Only by taxing the rich can Johnson become more than a plutocratic populist

W hat is the difference between former US president Donald Trump and current British prime minister Boris Johnson? Both men are skilful practitioners of plutocratic populism, but “Britain Trump”, as the president himself called his British ally, might yet prove the more successful.

Trump was a super-spreader of this Anglo-Saxon variant of populism. He promised to help the poor but actually helped the rich. His actions were inseparable from the interests of his own businesses, party donors and a wider oligarchy. True, the US economy did well until the Covid pandemic hit, but there was no substantial economic or social “levelling up”. And then many, especially poorer, Americans died as a result of his culpable mishandling of the pandemic. Trump did not “deliver”, in the way that verb is generally used by commentators, and yet more than 70 million Americans still voted for him at the last election.

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Why? Because we use the word “delivery” too narrowly. Support for populism is a cultural as much as an economic phenomenon. Trump did deliver culturally and, so to speak, psychologically. He gave Americans who had felt ignored and disrespected the feeling that he was on their side, and even “one of them” – the blue-collar millionaire taking up the white man’s burden. The emotional politics of identity trumped the rational politics of social and economic interest. He appealed to the 90% while in practice promoting the interests of the 1%.

Trump was only denied a second term because of the unity of a single-party opposition behind Joe Biden, whose “hardscrabble from Scranton” life story and down-home style also appealed to a part of Trump’s electorate. President Biden now has four years to prove that actually giving people decent healthcare, education, social security and job prospects will prevail over the very real emotional power of nationalist, populist narratives. He has made a magnificent start. If he can get enough of his current $6tn (£4.2tn) proposals for post-Covid recovery, infrastructure and welfare spending through Congress, there will be echoes of Franklin D Roosevelt’s New Deal.

Although Biden comes from a part of the Democratic party that itself became too close to financial interests, he has recognised that the rich must do more to pay for this transformation. That applies especially to the super-rich, who have done disproportionately well out of four decades of financialised globalisation: the share of private wealth held by the top 0.1% in the US tripled from 7% in the late 1970s to about 20% in 2019. Hence his pathbreaking proposal that capital gains should be taxed at the same rate as income.

The British government was rumoured to be contemplating a similar capital gains tax hike in the last budget, but nothing happened. After its recent electoral victories, the Johnson government faces the choice of continuing with plutocratic populism or going beyond it. The scandal around the luxurious refurbishment of Johnson’s flat in Downing Street, the extraordinary access enjoyed by Brexit-supporting billionaire James Dyson and the now collapsed Greensill Capital, and the planning permission row surrounding the communities secretary, Robert Jenrick, all speak of a Trump-like intertwining of government, party and plutocratic interests.

At the same time, Johnson has delivered psychologically and culturally to a significant swathe of England in much the same way that Trump did in the US, although with a better sense of humour. Brexit may have happened, but the identity politics of Brexit remain a potent force.

To be fair, in stark contrast to Trump, the Johnson government has also delivered an impressive vaccine rollout, which is one of the biggest explanations of its success in the local elections last week and a key byelection in the former Labour stronghold of Hartlepool. Meanwhile, the negative economic consequences of Brexit have been driven off the front page by the pandemic, and can be rhetorically concealed behind the impact of Covid.

“Is he lucky?” The question Napoleon is supposed to have asked about one of his generals can be answered in Johnson’s case with “so far, yes”. Whereas Biden’s personal skills as a great conciliator and the United States’ seemingly unshakeable two-party system provided an united opposition to defeat Trump, Johnson has the good fortune to face a trebly divided opposition. Keir Starmer has so far failed to do with Labour what Biden managed with the Democrats – bringing together left and centre, young, university-educated urban cosmopolitans and more traditional working-class voters.

The left-liberal side of politics in England is anyway divided between Labour, Liberal Democrats and Greens. And then, in the increasingly disunited United Kingdom, it is also divided geographically between England, Wales, Scotland and Northern Ireland. True, in the recent elections the incumbent Labour administration in Wales also benefited from the “vaccine bounce”; but a far greater cost to Labour is the electoral success of the SNP in Scotland, from where many Labour MPs have been traditionally returned to Westminster.

At the local level, Conservative politicians like Tees Valley mayor, Ben Houchen, are delivering real investments to previously neglected parts of the country that voted for Brexit. In public policy, as in private life, Johnson seems quite happy to spend as if there is no tomorrow. Yet at some point the bills have to be paid, for investment in neglected northern towns as for Lulu Lytle golden wallpaper in his Downing Street flat. If you add what is needed for nationwide “levelling up” to the already huge costs for sustaining the economy through the Covid emergency, plus future bills for the NHS, ambitious green targets, lifelong education and all the other good things just promised in the Queen’s speech, then it is crystal clear that you need more tax revenues to spend on this scale. Regressive taxation, hitting the poor more than the rich, is the opposite of “levelling up”. So the question then becomes: are you prepared to take on the plutocratic interests with which you are so closely linked in order to pay for it? That is what Trump ducked, but Biden is taking on.

So how about that capital gains tax hike in the next budget? Or a wealth tax, which Martin Sandbu of the Financial Times intriguingly suggests is fairer than a capital gains tax. Or a land tax. As Labour’s new shadow chancellor, Rachel Reeves, argued a few years ago, “the hardest way to make money in this country is to go to work; the easiest way is to own capital, particularly housing”.

If the Conservatives don’t go beyond the confidence trick of plutocratic pluralism, there is just a chance that an electoral alliance of Labour, Liberal Democrats, Greens and – if Scotland does not vote for independence in a coming referendum – Scottish nationalists could find a narrow, Bidenesque path to electoral victory in 2023 or 2024. If, however, the Conservatives do go beyond it, adding economic substance to cultural appeal, then political change may be hard to achieve before the second half of the 2020s.

• Timothy Garton Ash is a Guardian columnist