The Great Fear

 The years of the Biden presidency have in many ways been a tale of a widening gulf between public perceptions and reality. People are outraged about the state of the economy—yet, the economy has only grown in recent years; the much-dreaded recession never materialized; and, by comparison with what most other countries have been through since the pandemic, our economy has been the envy of the world. 

Likewise with crime. The national statistics on crime show that rates of victimization have fallen since the pandemic. Yet, Americans are more afraid of crime than ever. So too with immigration. Federal Reserve officials and countless economic reports have shown that increased immigration and asylum-seeking saved the U.S. economy and helped slow inflation over the past year. Yet Americans are outraged about it. 

Such an enormous disconnect between perceptions and reality can only be likened to a sort of collective hallucination. In order to understand it, we are well served by looking into similar incidents from the past. History sheds light on the circumstances that give rise to shared delusions and the panics they engender. In particular, I've been learning a great deal from reading Georges Lefebvre's classic study on The Great Fear. 

This 1932 book about a French Revolutionary–era mass panic holds up a kind of "distant mirror" to our own epoch. In describing the economic and social situation in France on the eve of the "Great Fear"—in which towns all over France suddenly and almost-simultaneously became convinced that they were under attack from a non-existent army of "brigands"—Lefebvre paints a curiously familiar portrait. 

Lefebvre begins by showing how the panic had its origins in the dread of rising prices. He begins with an evocative quote from the 19th century historian Taine about how "the people" are like a man walking through a flood that has already risen to his chin. A slight stumble—or a slight increase of depth below his feet or of the height of the water—will drown him. So it is with rising prices. 

In other words, if people are already living hand-to-mouth, barely scraping by with each paycheck, then a slight increase in prices—even if it is seemingly offset by other positive economic news, from the perspective of the relatively well-heeled—is enough to soak the poor. This is why the relatively impoverished dread high prices more than anyone else—and why other, more positive statistics matter to them less. 

Once the price of bread in pre-revolutionary France started to rise, the populace began to panic about crime. Rumors about vagrants coming to steal or damage their corn crop, or about "brigands" intent on extorting what little savings the peasants retained, began to spread throughout the countryside. The peasants were more likely than others to face such crime in reality, and had the most to lose from it. 

At this stage, politicians intervened. The revolutionary government and the propagandists of the Third Estate, in Lefebvre's telling, had a genuine fear that emigré aristocrats who had fled the new regime would return to stage a coup d'état. This gave rise to rumors of the alleged "aristocrats' plot"—which, in the countryside, assumed the form of the notion that the emigrés would return at the head of invading troops. 

The partially-justified fears of "vagrants" and "brigands," some of whom did exist and were known to be a danger to peasants' crops, combined with fears of the aristocrats bringing in a foreign army to spread terror among the peasantry. These are the forces that aligned to ignite the "Great Fear." Peasants who had seen a few innocuous beggars inflated them into an invading army, and the rumors metastasized from there. 

You can probably already tell where I'm going with this—but tell me honestly that this does not evoke what we have experienced the last few years. First, it helps us understand the riddle of the public's reaction to high prices. For years, people have been resenting high prices, even as the rest of the economy was outperforming expectations and year-over-year inflation statistics were starting to stabilize. 

Taine's image of the man up to his chin in water helps explain what is happening here. People who live paycheck-to-paycheck cannot afford even the slightest increment in price rises. If the prices go up even a small amount, it makes little difference if they then stabilize a year later. The poor are already sunk. They need prices to come down, not just for the growth rate of prices to become more manageable. 

And this sense of economic scarcity provides the psychological preconditions for a host of other related fears. If people are already afraid about whether they will be able to feed themselves, then they will dread crime even more than they did before—they will fear someone coming to take what little they have. Likewise with immigration. If they already have a sense of scarcity, they will dread migrants coming in who will need to eat in turn. 

This creates an interlocking galaxy of scarcity-based fears that cynical politicians can easily exploit. Finding this rich vein and mining it through demagoguery has been the key to Trump's sinister success. Note how persistently he keeps working the same basic ideas that we saw in the Great Fear: the notion of an "invasion" of foreigners, the dread of retail theft and property crime, the hatred of high prices. 

The fact that Trump's rhetoric is divorced from reality does not matter. In real terms, Trump's policies of keeping tax rates low, running high deficits, and increasing tariffs will only increase prices still more. In the real world, immigration has helped stabilize prices and contributed to economic growth that benefits everyone. In the real world, crime rates are falling. There is no "invasion" of violent foreigners. 

None of this makes a difference, because Trump has tapped into the psychic vein that feeds all of these fears. The one real-world situation he has identified and managed to exploit is that many working class Americans are actually experiencing grave scarcity from high prices. And, just as we saw in the "Great Fear," it is always easy to link this scarcity to related fears of crime and the appearance of outsiders. 

Likewise, just as there were actually some real "brigands" terrorizing the peasants in pre-revolutionary France, there are also some real incidents of mass retail theft and property crime in the U.S. today. No matter what the overall statistics show, one can always find high-salience one-off examples of such problems. If they are particularly disturbing to people, then the cognitive "availability bias" will do the rest. 

In other words, people will think crime is more prevalent than it is, and will associate it with immigrants, even if you can only find one or two incidents in the whole country that actually serve as examples of such a phenomenon. You don't have to prove it with statistics. You just have to give people a few illustrations that stick in their minds. Then the fear does the rest—moving from one sense of scarcity to another like a contagion.

Trump even has his own version of the fictitious "aristocrats' plot." Recall that he is not only telling people (falsely) that immigrants bring higher crime rates. He is also telling the public that Democrats are deliberately introducing more immigrants in a plan to destabilize the United States. Joe Biden here serves the same role as the fictitious emigrés—people are led to imagine him riding in at the head of an invading host. 

Take the example of a mass panic that has spread on the right in recent weeks as the result of a cleverly-staged disinformation campaign. Right-wing operatives at a MAGA-aligned think tank claimed to "discover" a document at a migrant aid center that purports to urge asylum-seekers to vote for Biden. The document shows all the signs of being a doctored scam—but it toys ingeniously with the same emotional cues as the "aristocrats' plot." 

It is astounding how well Trump is able to tap into these psychologically potent themes, seemingly by instinct. He tells people—based on nothing, invented out of whole cloth—that Biden is emptying mental hospitals and prisons of their inhabitants in order to bring them to the United States. The same notion took root during the Great Fear—Lefebvre writes that "prison breaks" often played a major role in the rumors. 

How does one arrest the collective delusions of a Great Fear of this sort? It is hard to do so, but Lefebvre provides some guidance. He points out that where influential people had the courage to cast doubt on the rumors, the panic often died out. But doing so required guts. People do not take kindly to having their cherished convicions doubted—no matter how much the evidence and common sense are against them. 

The solution also has to lie in improving the underlying economic conditions that give rise to the sense of scarcity in the first place. Politicians have to take steps to make prices more affordable. Yet here, they are often trapped between a rock and a hard place. For the same policies (such as increasing transfer payments) that make high prices easier to live with, will often result in driving them still higher...