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Behavioral Economics/Psychology and the Election of Donald Trump

The election of Trump was unexpected for most of us, until it happened--then dozens of explanations emerged. Following up on his The Undoing Project, Lewis made some pertinent observations. A major point (related to projects that Tversky and Kanheman worked on but did not complete), was the importance of certainty for people in an uncertain world (Lewis often talked about the stock market and explanations after the fact). Thus we have narratives why the election results happened (consider hindsight bias). People prefer overconfidence and Trump provided this continuously: exaggeration, complete fabrications and lies, it did not seem to matter. He "told it like it is" (no matter how far fetched or outright false). in Lewis terms, Trump preyed on weaknesses in human behavior, such as anchoring and he used framing effectively. People could anchor on Trump's perception of greatness ("make America great again" is a brilliant slogan, although meaningless); he could frame the immigration debate as a failure of government and his wall as the only solution. Honesty seems in short supply in Washington (relative honesty seems to run in cycles of corruption followed by reform), so Trump's hyperbole apparently can be viewed as "honest and refreshing." The problem is that he is a corruption instigator rather than a reformer. Plus he's on the wrong side on most issues that would benefit the working class: tax cuts, welfare cuts, reducing trade, consumer protections.

There seems to be several big losers, beginning with reasonably viable and effective institutions. Political scientist Francis Fukuyama focuses on political order which "includes a complex set of institutions that restrain and regularize the exercise of power through law and a system of checks and balances. ... delivery of basic services that people demand from their governments" and majority voting (Fukuyama, pp. 4-5). American government is increasingly viewed (especially on the right) as politically decaying, with increasing chaos and corruption. Important institutions are being attacked (e.g., recently the FBI and Justice Department) as being corrupt and partisan, although the attacks are not necessarily honest and certainly not non-partisan. Fukuyama describes political order as requiring the state (mainly administration systems by professional bureaucrats), rule of law, and accountability (he stressed democratic elections, I include audits and others means of oversight). We hope that our political order and institutions are strong enough to tolerate this aberration. The US did survive Nixon, Joe McCarthy, and Warren Harding.

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