What is populism?

What Does populism Mean

Populism is a term that is not part of the dictionary of the Royal Spanish Academy (RAE) but that, nevertheless, is very frequently used in the Spanish language.

It is a political concept that makes it possible to refer to movements that reject traditional political parties and that show, either in actual practice or in speeches, combative against the ruling classes.
Populism appeals to the people to build their power , understanding the people as the lower social classes and without economic or political privileges. It usually bases its structure on the constant denunciation of the evils that the privileged classes embody. Populist leaders, therefore, present themselves as redeemers of the humble.

The term populism has a pejorative sense , since it refers to political measures that do not seek the welfare or progress of a country , but rather try to gain the acceptance of the voters regardless of the consequences. For example: "Sanctioning US companies is a decision of populism, which has dire consequences from an economic point of view" , "Left-wing populism has scared off investment and plunged the population into poverty" , "Who we accused of populism are those who for years enjoyed immense profits at the expense of the poverty of the rest of society ” .
When the notion of populism is used in a positive way, these movements are classified as proposals that seek to build power based on popular participation and social inclusion.
From success to adjustment
It is known that populist groups do not form a homogeneous group, but show certain notable differences in political and economic matters . On the other hand, they have many points in common that oppose them to those who do not participate in their ideology, which is based mainly on the forced promotion of consumption and distribution. In the 1970s and 1980s, there was no regional populist experience that did not go through four distinct phases : initial success , imbalances , their acceleration , and, finally, adjustment .
In the first one, the procedure does not matter, since everything seems to work . Increases employment and real wages, the effect of inflation seems to fade and fiscal and monetary policies are expansionary such a revival. These are historical moments in which a country believes it has found the economic model that really works for its people, the revolution that everyone was waiting for and that will change their quality of life forever.

But all this has its consequences. It is after this initial stage that imbalances appear: the inflation rate increases more strongly, debts grow, the well-known external bottlenecks appear (the export volume decreases or stagnates but the import volume increases) and the fall in international reserves. Faced with this situation, the government's actions usually revolve around controlling prices and changes, which leads to repressed inflation , among other evils.
Then, in the acceleration of imbalances, the fiscal deficit and the necessary monetary issue for its financing grow violently , the lack of foreign exchange increases despite controlling the changes (with the consequent devaluation of the currency), the fall in the demand for money, inflation volatility worsens and real wages lower, to cite some of the dire consequences of the previous phase.
Finally, the adjustment tries to rearm the country, as if it were a great puzzle. It is worth mentioning that this process takes a few years and each step is the result of decisions made coldly, knowing the risks they carry. Today's world makes the duration and impact of each of the phases vary from what the history of a few decades ago teaches us, but the final picture is always the same.

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