Time for better stories

Psychologists and philosophers increasingly agree that what we expect to happen will shape both our experience and how we respond to that experience. If you expect things to go badly, you’ll likely interpret things that way. Even if things don’t go as badly as expected, you’ll likely see the more positive outcome as a stroke of luck, a fluke or maybe just getting away with things. Just as importantly, if you expect things to go badly, then you’ll respond in a certain way. You’ll be overly defensive or you’ll bury your head in the sand to ignore things. The game changing point of this is that you cannot always control what you experience in life, but you can control your expectations and, not least by shaping those expectations, you can help make better responses to whatever is thrown at you.

The age of the negative Nelly

That research around expectation and experience came back to me when I was reading an Economist article about the pessimism afflicting the globe affecting economics, politics and even demographics. It would appear that we are living in an age of negativity, certainly across the rich world. As Ezra Klein discussed on a recent podcast though, it is not entirely clear that we have a genuine reason to be so negative. Which is not me (or Klein) saying that we have nothing to worry about: geopolitical conflict, the climate crisis, the economic impacts of AI are all genuine concerns. Rather, what I am suggesting is that we are being a negative Nelly on some issues with no basis to be so.

One of the things that Klein discusses with two economist guests is the issue of affordability, which was also a cover story for The Economist in their first issue of 2026. Across both pieces, there is plenty of evidence that incomes have for the most part kept pace with inflation and unemployment hasn’t significantly spiked. There are real issues though, such as the problem of asset inequality rather than income inequality, which affect affordability. Alongside the underlying issues though, there is also the psychological issue of expectations. People think they should be able to afford more, whether that is through their incomes being higher or costs being lower. Where do these expectations come from though?

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Populist protection

I think I agree with various analyses I’ve seen that what is happening is around the kernels of truth behind affordability, you have politicians and the media spinning the issue to suit the spreading populist agenda1. So rather than tackling some tough questions like what to do with inequalities between wealth (assets, not incomes), you get the affordability crisis blamed on migrants or foreign countries freeloading, or whatever right-wing trope you can imagine. This leads to two issues: firstly electoral success of populists with all the problems that brings, and secondly taking the wrong policy steps to tackle the actual underlying issues.

Take the USA for example. A populist campaigns on affordability and gets elected. That populist introduces sweeping tariffs which, by design, make prices higher. One year into office and prices have not gone down. At all. There have been some promises of re-shoring, but they haven’t done anything about affordability. Meanwhile, tax cuts have disproportionately benefited people who are least exposed to any cost of living challenges. Strip out investment related to AI and economic growth figures for the past year would look pretty bleak too.

We need to tell better stories

The negativity and pessimism has been in no small part fuelled by populists telling stories which have cut through with voters. They’ve been more convincing at explaining the causes of voters problems, albeit incorrectly, and their policy solutions have been more appealing too. That isn’t because their stories have been superior though. It’s because it feels like they’re the only ones with a story to tell. I refer back to my piece a week or so back about Keir Starmer in the UK. He has no story to tell because he things everything is fundamentally ok and just needs better management. Even if that were so, its not a winning story.

Pessimism has now become the expectation - the collective expectation - which will influence how we experience the world and respond to it. Liberals, centrists and the left need to tell a positive story, because it is stories which can shape our collective expectations differently. We need to talk about how green energy can create jobs and tackle the climate crisis, but not through tinkering around the edge but through the largest investment of the 21st century, on a scale of FDR’s New Deal or the postwar reconstruction of Europe. We need to explain how we can safely and sustainably harness the power of AI to improve our lives and not just replace our jobs. We need to provide incentives and support to encourage entrepreneurs to innovate and to push small businesses to break out into the big time, and along the way to solve problems, create jobs, and grow the economy.

There are real problems in the world but a totally underwhelming blend of managerialism and risk-aversion has stopped anybody but the populists to really try to rise to the challenge of telling a brave and bold story of what could come next. Yes, those stories will have to tell people the truth about the challenges we face. That isn’t going to be comfortable listening, especially when we have to tackle the genuine underling causes rather than the populist tropes. But once we open up about the challenges, then we can talk about what comes after we’ve tackled the challenges. We give people reasons to be optimistic, especially the great many people who never buy into the populism anyway and so are left with not only the doom and gloom but also a sense that nobody is doing anything meaningful about it. We need better stories and that means we need to become better storytellers. That way we can shape make our collective expectations more optimistic. Optimism creates a positive feedback loop. A positive feedback loop just needs that first input, and that is just one story that somebody needs to tell.