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Why Did the Working Class Abandon the Left? With Nobel Economist Daron Acemoglu

Liberal democracy was once a radical force. It challenged monarchies, expanded political rights and, at its most successful, helped deliver rising wages and shared prosperity. So how did it become associated with an establishment that growing numbers of voters have turned against? In this episode, r

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Episode Summary

Executive Summary: Darren S. A. Moglu argues that liberal democracy rose by building broad coalitions and delivering shared prosperity in the industrial era, but has faltered in the post-industrial age as automation, globalization, inequality, and elite drift split its support base. He proposes "working class liberalism"—a renewed, forward-looking liberalism that re-centers workers, resists top-down social engineering, and confronts AI, immigration, and cultural division through broader democratic compromise.

Main Topics: Liberalism’s rise as a radical and successful political project: The discussion reframes liberalism as once-radical opposition to monarchies and autocracy, later becoming the establishment ideology that enabled democracy, rights expansion, and social reform. Coalitions and shared prosperity in the industrial era: Moglu explains that liberal democracy worked when it had broad coalitions spanning labor, middle classes, farmers, and business, and when industrial firms needed workers and thus shared gains through wage growth. The shift to post-industrial politics and the left’s demographic reversal: The conversation highlights how the center-left lost working-class support while gaining college-educated, urban, globalized voters, contributing to inequality, cultural drift, and weakened legitimacy. Technology, automation, and globalization: Digital technologies and offshoring are presented as key forces that increased demand for educated labor while weakening the link between business growth and broad-based prosperity through automation. Unresolved liberal dilemmas: inclusion, intolerance, education: Moglu criticizes social contractarian views and argues liberalism never fully solved how to include excluded groups, manage intolerance, or balance pluralism with civic education. A new governing philosophy: working class liberalism: He proposes a renewed liberalism centered on workers, community, free speech, practical compromise, and restraint from technocratic or top-down social engineering. AI and the urgency of political reform: AI is treated as a looming test: if it automates too many jobs before a new settlement is built, shared prosperity and liberal democracy could deteriorate further.

Key Arguments: Liberalism succeeded historically because it was broad enough to build coalitions across class lines and because industrial capitalism required labor, which pushed wages upward. The political left abandoned its working-class base as post-industrial society elevated college-educated professionals and shifted parties toward identity and cultural politics. Automation and globalization do not deterministically produce political outcomes, but they do reshape labor markets and weaken the old link between growth and shared prosperity. Liberalism struggled when it became the philosophy of power because it avoided hard questions in opposition and failed to adapt to new social and economic conditions. Social contractarian theories are too neat for complex political dilemmas; liberalism should instead be understood as an ongoing framework requiring compromise and consensus-building. A better future depends on "working class liberalism," which re-centers workers, respects pluralism, strengthens communities, and avoids top-down imposition. AI could either deepen job loss or be redirected toward "pro-worker AI"; current priorities are insufficiently aligned with labor-friendly outcomes. Immigration and cultural issues must be debated openly rather than managed solely by technocrats, because ignoring them pushes working-class voters toward the right.

Data Points: Time since prior conversation: 3 years - Moglu says little job loss has been observed since he and Carl Miller last spoke about AI and jobs. Predicted job loss by some tech voices: 60% of entry-level jobs - He rejects the accelerated timeline predicted by some in tech for AI-driven labor displacement. Historical period: 19th century - Liberalism is described as a radical force against monarchies and absolutist rule. Historical period: Mid- to late 1970s onward - He identifies this as the broad era when post-war liberal democracy began weakening due to the post-industrial transition. Historical periods referenced: 1980s, 1990s, 2000s - He cites office automation, robotics, and offshoring as drivers of labor displacement across these decades. Date: August 20 - The book was noted as being out in the UK since August 20th. Time horizon: Next two years - Moglu says no positive AI or democracy reforms should be expected in the U.S. under Trump during this period.

Pivotal Quotes: "Technology never, and I really mean never, comes with a preprogrammed social impact." — Darren S. A. Moglu: He explains that technology’s effects depend on political choices, institutions, and how society directs innovation. "We need a new governing philosophy." — Darren S. A. Moglu: He argues that simply defeating Trump or changing leaders is insufficient without rebuilding liberalism’s coalition and agenda. "I call this working class liberalism." — Darren S. A. Moglu: He names his proposed renewal of liberal democracy centered on workers, community, and shared prosperity.

Implications: The episode argues that liberal democracy’s survival depends on rebuilding class-based coalitions, reshaping AI toward labor-friendly ends, and addressing cultural and immigration conflicts through democratic compromise rather than technocratic management.

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