Trump's anti-establishment cards: Do not follow suit

Institutions matter for prosperity. When they fail, they should be reformed and not taken apart

- NARAYAN RAMACHANDRAN

If there is one thing other than personal loyalty common to US President-elect Donald Trump's cabinet choices, it is that they are all anti-establishment.

It is indeed ironic that this wave comes in the year that the Nobel Prize for Economics was awarded to a trio of professors whose life's work has been on the importance of institutions. The winners of the 2024 Sveriges Riksbank Prize in Economic Sciences in memory of Alfred Nobel were Daron Acemoglu and Simon Johnson of the Massachusetts Institute of Technology and James A. Robinson of the University of Chicago for studies on how institutions are formed and affect prosperity.

Their research traced economic disparities back to colonialism and demonstrated that societies with strong and inclusive institutions are more prosperous, while countries with exploitative institutions are unable to grow consistently.

While their approach does indeed hold appeal in demonstrating how developing economies can prosper, it appears that in many 'post-modern' economies of the West, such as those of the US and Europe, institutions have degenerated into a complex construct of rules and do not function for the betterment of the greater good.

In a recent article, Daron Acemoglu says that "American democracy has long promised four things: shared prosperity, a voice for the citizenry, expertise-driven governance, and effective public services. But US democracy—like democracy in other wealthy (and even middle-income) countries—has failed to fulfill these aspirations."