Do people vote in their own material interests? I ask because of the decision last week by NS&I to cut interest rates to almost nothing.

In doing so, it is only bringing its rates into line with market rates. Which tells us two big things.

One is tha the pandemic has exacerbated a long-term downtrend in interest rates.

The second is that from the point of view of savers (let alone anybody else) the government is not borrowing enough. One reason for NS&I's decision is that it was raising more cash than the government needed - in part because the same pandemic that has raised government borrowing has also made forced savers of many of us and so raised the savings to pay for that borrowing.

From all this, savers should infer two things. One is that capitalism is serving them badly. Economists disagree upon exactly why rates have trended down. Some blame an ageing (pdf) population, others a savings glut or shortage of safe assets, whilst others blame a falling global rate of profit. What's more, low rates reflect lower trend growth, which itself might be due to not just lower profits but declining R&D efficiency, a fear that future innovations will make today's ones unprofitable, lower innovative possibilities, a general difficulty in monetizing the benefits of innovation, or simply an end of the things that caused growth in the first place. Whatever the explanation, the fact is that there are forces within capitalism that have clobbered savers.

Secondly, from this perspective, "fiscal discipline" and austerity is a menace. In depressing growth (or not raising it enough) it exacerbates the pressures for lower rates. Ten years of Tory government have thus added to savers' pain.

And who are these savers? Moderately wealthy retired people. That's who. It is these, therefore, that should be critical of capitalism and the Tory party.

Which, of course, most are not: instead they are the stereotypical Tory voter.

Hence my question: in supporting Tories, are older savers acting in their own material interests?

Possibly. The same low rates that destroy their incomes also push up house prices and help support shares.

But I'm not sure this is sufficient answer to my question. For one thing, unless you downsize (which many older people are loath to do) a higher house price is little use: equity release schemes are not great value. And even for landlords, years of weak growth have held down rents. And for another, many of the factors that lay behind lower interest rates have also weighed down share prices, such as secular stagnation and the falling rate of profit. Shareholders, more than most, should be alive to the shortcomings of capitalism.

So why aren't we seeing more discontent with capitalism and the Tories from older folk?

Part of the answer lies in a paper by David Leiser and Zeev Kril. They show that non-economists are terrible at making causal connections between economic phenomena*. They therefore just don't connect fiscal austerity and long-term trends within capitalism to the fact that they're incomes have disappeared.

In this, they are not helped by the media. The problem here is NOT that it has a rightist bias. Rather, it is that the news by definition under-reports slow-moving changes such as the downtrend in interest rates and the causes thereof. And the media's concern for human interest stories means it under-reports emergent phenomena which arise without any individual's intent. The media does not report social science.

Which creates a vacuum to be filled by something else, as described by Phil. Retired people, he says:

are dependent on impersonal forces beyond their control for prosperity or misfortune. This antagonises the general unease underpinning the pensioner position and turns them, politically speaking, into nervous wrecks. These anxieties and fears sublimate into lashing out against things exemplifying uncertainty and change, like young people, the socially liberal trajectory of popular culture, and people traditionally positioned as outside the mainstream and used as scapegoats: sexual minorities, travellers, and immigrants. The flip side of anxiety is a longing for surety, and what provides this better than the smack of firm government?

In this way, what should be an economic debate becomes a front in the culture war. During my adulthood the Tories have performed an amazing transformation. Whereas Thatcher could credibly appeal to voters' material self-interest, Johnson's Tories don't even try to do so. They have figured out - perhaps by accident - that the best response to capitalism's failures is not to talk about economics.

* This isn't to say they are irrational or stupid. I know nothing about plumbing, so why should I expect a plumber to know about economics?