Bezos, Musk, and Branson Should Boost Democracy on Earth, Not Flee to Space – Barron’s

About the author: John Austin is director of the Michigan Economic Center and a nonresident senior fellow at the Chicago Council on Global Affairs and the Brookings Institution.

The three billionaire space-exploration amigos Richard Branson, Jeff Bezos, and Elon Musk are getting some critical reactions to their uber-expensive space flight projects.

While some lament the vanity, others point to the lack of scientific merit. But the criticism hasnt yet mined the vein of deepest irony, as well as the looming danger that makes their space games such a distraction from our most fundamental challenges. As they race to space, back on earth the global economic system created by democratic regimes that allowed them to get rich in the first place is under assault from without and within. And these winners in globalization arent doing much to preserve it, but instead funding their own ego-driven projects.

The threat from without comes as China uses its corrupting, dependency-building Belt and Road development initiative, surveillance state, restrictions on free speech, and attacks on democratic institutions and norms as tools to replace the open, rules-based, economic and trade regime organized by the U.S. and its democratic allies, with its own closed model of authoritarian politics and economic development.

The threat to democracy from within comes from our failure to diminish yawning geographic economic disparities and opportunity gaps. Gaps individuals like our space billionaires have too often exacerbated, what with their own wealth-hoarding, alleged nonpayment of taxes, and resistance to providing decent pay, working conditions and bargaining power for their employees. These wealth differentials are politically dangerous as the gap grows between thriving global city regions and struggling communities in heartland regions of our democraciesenabling anti-democratic populism that poses an imminent challenge to the stability of our political order here and abroad .

Unless wealthy elites in Europe and North America, including these space cowboys who have profited so enormously from the West-led international capitalist system, put their money and influence to work to reduce wealth inequalities at homeand partner to strengthen the economies and polities of democracies abroadthey may soon witness the death of the goose that has laid their golden eggs.

These billionaires were made because of the West and democracies principles for organizing the world economy: freedom to innovate and create businesses with disruptive new ideas and technologies; to have these ideas and technology protected by laws and patents; to benefit from a very light touch of state regulation and control; to take advantage of a relatively free and mobile market for labor; as well as the unencumbered free flow of goods and information across the globe. These are all tenets of the post-World War II liberal trade and political order constructed purposefully by the U.S. and our democratic partners.

All of these conditions are imperiled by the rise of authoritarian anti-democratic leaders and models like Chinas, which empowers corrupt leaders, actively dismantles democratic institutions, throws up barriers to the free flow of ideas, people and trade in favor of self-service and obeisance to autocrats and hollow nationalist sentiments.

In their 2012 book Why Nations Fail, economists Daron Acemoglu and James Robinson argue that even prosperous civilizations can fail when exploitive elites keep grabbing the spoils for themselves versus redistributing wealth in the form of opportunity-building investments like education and infrastructure, which benefit all and build a healthy middle class. They also argue that when you combine rotten regimes, exploitative elites and self-serving institutions, it is a national recipe for disaster.

Unfortunately, that is what we have seen recently in the U.S., and even among once strong and West-leaning allies like Turkey, Hungary, Poland and Brazil. Support for parties with disturbing anti-democratic tendencies has grown and become alarmingly high even in democratic stalwarts like Germany with its Alternative for Germany right-wing party, and in France with Marine Le Pens nationalist movement.

The tragi-comic race to space among billionaire business elites is not really that funny. These elites could use their outsized influence on our culture, our politics, and their big bucks to fight for democracy and capitalism. Look at what Bill Gates, with a similarly sized ego and pocketbook has accomplished in the arena of global health.

And we know what we need to do to help democracies win.

Yes, we must work together as allies, as President Biden has been urging, to focus on winning the strategic competition with China for global political and economic high ground..

But a major priority lies at hometo attack the root causes of anti-democratic populism with a people and place-focused economic development policy within our own democracies. These moguls and other global business leaders should be at the front of the parade seeking a minimum corporate international tax, a hike in the tax rates for millionaires and billionaires, and expansive national investments in education, child care, infrastructure and clean energy and higher education, akin to those proposed by Biden here in the U.S.

Closing gaps in wealth and opportunity also need to have an important focus, with particular attention to the once mighty older industrial regions of our Western democracies.As I have written before, these are the geopolitically significant places where many residents feel ignored or, even worse, looked down upon and patronized. As we learned at a recent trans-Atlantic symposium on populism and place, this, coupled with economic anxiety, concern about losing ones place in a changing world and perceptions that their communities are in decline, leads proud residents of industrial regions to embrace messages of nativism, nationalism, isolationism and economic nostalgia that are peddled by right-wing populist leaders. These movements encourage anti-democratic behaviors, such as distrust of institutions, the press and a breakdown in support for the civil rights of others. This nurtures the fierce political polarization that is undermining Western democracies.

These anti-elite and anti-democratic populist sentiments will not change until their root causes are addressed:the real and perceived decline of once-thriving industrial communities. There is good evidence demonstrating that when older industrial communities continue to decline, residents are receptive to the polarizing messages of populists and nativists. At the same time, accumulating evidence suggests that when older industrial communities secure new economic footing, anxiety and fear among their inhabitants give way to optimism and hope for the future.

After World War II, Western government and business leaders worked hand-in-glove to invest in and rebuild economies, many broken by war, in part to fend off communist movements and the then seeming appeal of the since-discredited Soviet economic and political model.International-minded business leaders supported political leaders in building the open, rules-based, international economic and trade regime that brought decades of relative peace and more prosperity for more people around that world than ever before. It is this regime that made it possible for Branson, Bezos, and Musk to innovate and fly.

Our democracies could use their help on the ground.

Guest commentaries like this one are written by authors outside the Barrons and MarketWatch newsroom. They reflect the perspective and opinions of the authors. Submit commentary proposals and other feedback toideas@barrons.com.

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Bezos, Musk, and Branson Should Boost Democracy on Earth, Not Flee to Space - Barron's