How populism will end: A Game of Thrones Approach

Wed 15 May 2019

Game of Thrones is finally ending, with some great lessons about human excesses.

After almost 75 hours of watching the world’s most successful show, plus another 20 reading the books, I now find myself not too keen on watching the final episode. I feel that there’s no walking back on the damage done from showrunners Weiss and Benioff. My sentiment is shared by many. The producers are slated to run “Star Wars”, but criticism on that choice has been mounting.  I will not reveal details, not to avoid spoilers but mostly out of respect for the uninitiated.

Rather, to explain my feelings, I will go back to the first season, where it all began. In the seventh episode the show’s movie star and central character, Shawn Bean, is unexpectedly killed off. Cinephiles should not be too surprised as Bean is one of the actors most often killed in movies. But audiences were nevertheless shocked. That became the promise, and premise, for the franchise’s success thereafter: to relentlessly deliver shocks. Murder, rape, betrayal, torture, mutilation, patricide, child abuse, alcoholism, necromancy, all in necessarily increasing doses as episodes came and went. One needs stronger and stronger shocks to remain attentive after all.

“The blood dimmed tide is loose, and everywhere the ceremony of innocence is drowned” (Yates)

Take for example Arya Stark,  a 15 (if that) year old girl, who can kill 100 men with efficiency and ruthlessness that would make Vlad the Impaler (the real-life Dracula) nauseous. Yet, according to data from the US Social Security Administration, “Arya” was the 119th most popular girl’s name in 2018 in the US, with 2,545 babies named after her. Joffrey Baratheon’s, the child-king character, created such an aversion that the actor, the very talented Jackie Gleeson, decided to quit acting altogether. The climax was the penultimate episode, a tale of unfettered and unjustified destruction wrought by the show’s iconic female heroine who broke bad quicker than most characters on Peaky Blinders. The result: The viewers’ bloodlust was finally satiated to the point where that episode is now the lowest rated one in the series history.

The show was made, and I believe ultimately destroyed, by the one same factor: the audience’s insatiable lust for shock. But that audience is not just defined by one show. They are also consumers, citizens and voters. That same person that cannot wait for next week’s surprise (“will we get another patricide? Or will it be just boring old child abuse this week? Oh, I hope we get a bit more mutilation”) is the same person that will flip the channel once Ramin Djawadi’s awesome ending credit songs drop and watch a political debate. Will that voter now turn on the critical functions of their brain, judging a candidate by their merits, their approach to the economy, projecting the outcome of their plans onto their own lives and the lives of their children? Or will voters simply wait for the next shock to be delivered? When they go to the polls, will they reward policies, or will they vote for the person who put on the best show?

That isn’t to say that voters are stupid. Quite the opposite. We are the most informed generation and very mindful of the impact of our choices. But many are also mindful that their choices are not ultimately impacting their lives, that the system has somehow failed them. Why would people feel that their choices do not matter? Maybe because real income-related purchasing power in most developed markets has stagnated over the last 20 years. Maybe it’s because huge global debt levels have been crippling growth for over 15 years. Maybe it’s because after 5 years work, young people can still ill-afford a house and are forced to share apartments, still hamstrung by student debt they can’t hope to repay. Maybe it’s because of 10 years of money-printing policies which exacerbate inequalities, improving incomes for the top earners and disempowering the marginal consumers. Maybe, it’s because of the economic decline of the west as the east now becomes a more prominent purveyor of global growth. Or maybe, it’s because for the first time in history, the west has not experienced a major war in over two generations.

Whatever the case, animal spirits seem unleashed, and partisanship is rampant. This chart from the PEW research centre, is indicative of a trend now observed across the world.

The west was already in decline. 10 years of serious QE-related asset misallocation exacerbate the situation.   Sometimes, it seems is not enough for politicians to go to the extremes any more, they are now required to stay there and not consider cooperation. Brexit is a great example of that. Politicians need an identity that will resonate with particular groups, and then shout at the top of their lungs and make unreasonable assertions to grab the spotlight from other candidates who do the same, or see their appeal lost to fire-breathing dragons on HBO. Populism can be a symptom of the boredom and despair that comes with lack of self-actualisation incentives, not necessarily a root cause.

Thus, people find themselves in need of a shock, so that the brain can switch on the pleasure and entertainment centres. The ancient Romans knew that very well, which is why they invented blood sports and the arena. To quench the human need for shock.

In ancient Rome, and Greece, often democratic excesses were followed by a period of autocracy. Our need to be shocked is not perpetual, but rather as cyclical as markets and economies. And will end like every market cycle ends, or how Game of Thrones ended. When the excesses of populism will be too hard to stomach. But since we are probably still away from that place, investors should continue to expect politically-induced volatility to continue for the foreseeable future.