Essays on Backlash Against Policy Reform

Abstract

What prompts political backlash against policy reform that promises broad public benefits? This dissertation explores this theme across three papers, spanning education and financial policy. Each suggests such policies may be opposed by unexpected coalitions that include less well-off constituencies. The first chapter, "Boundary Defense: Evidence from a Referendum Against Reform", outlines a theory to explain why policies that reinforce unequal opportunity persist in democracies and applies it to the case of early-age sorting across schools in Germany. The theory suggests middle-class families mobilize to defend these ``opportunity boundaries" against reform when they lack alternative strategies to secure their status in light of uncertainty. In the German context, I argue early-age sorting across stratified schools is such an opportunity boundary that excludes immigrants and that status uncertain German families defend it against reform. To test this, I introduce a 2010 referendum which blocked a reform to early-age sorting across schools in Hamburg and collect data from precinct-level votes, city-district demographics, election studies, and archival sources. Results show referendum support was highest in lower-income places and specific precincts with less access to academic schools and higher shares of immigrant children, among parents of school-age children without academic educations, and predicts future support for politicians who took positions against the reform. I suggest this theory also applies to different boundaries in both education and other fields, and that policies which reduce middle-class uncertainty can equalize opportunity better than technocratic reforms given boundary defense. The second chapter, "Boundary Defense in the United States", applies the theory of boundary defense to understand the political persistence of racial segregation across places in the U.S.. In this context, I explore why integration within school districts has succeeded politically while "Metropolitan Integration" between urban and suburban school districts has failed. In the case of integration within districts, a relatively broad group of families have private alternatives to urban public schools, whether in the form of access to private schools or homeownership in suburban school districts. These Secure Insiders" are willing to support integration \emph{within} urban school districts. In coalitions with racial minority beneficiaries of integration, these constituencies successfully support reform despite the opposition of less secure marginal insiders" in urban areas who do not have these alternatives. However, in the case of Metropolitan integration across school districts, many suburban households are threatened by greater uncertainty about their children's assignment to quality public schools. This larger set of ``marginal insider" households oppose integration across school districts and outweigh suburban households with private alternatives to secure opportunity, leading it to fail politically. I test this argument by examining the case of Massachusetts and find supporting evidence from both local elections in Boston and state-level legislative votes. Further evidence from the federal level suggests that Northern suburban Congressional representatives opposed busing when their constituents were most threatened by federal-level court orders that would mandate metropolitan integration. The third chapter, "Local Dependence: Evidence from the Rollback of Dodd-Frank" examines bank regulation in the United States. A number of important US banks secured looser risk oversight when Congress rolled back the Dodd-Frank Act in 2018. Existing theories suggest that large US banks wield instrumental power to secure deregulation, but this rollback benefited smaller banks. I explain this with a theory of local dependence, arguing that geographically concentrated and represented firms use local disinvestment threats to influence policy. I hypothesize that local dependence on banks predicts representatives' votes for the rollback, and test this by linking district-level local dependence on banks, banks' instrumental influence, and roll-call votes. Results show that credible local threats to small banks' lending and regional banks' high-risk lending predicts rollback support, while instrumental influence only does when it accompanies prospective threats to local headquarters employment at regional banks. Qualitative evidence provides further support. To conclude, I outline directions for future research, interpret these American results in comparative perspective, and suggest implications for the politics of international risk regulation. Taken together, the results suggest that technocratic reformers in democracies across policy domains and country contexts may better achieve their aims by understanding and anticipating potential sources of democratic backlash.