For voters battered by globalization, pro-Europeans must deliver growth – and jobs

Emmanuel Macron’s decisive defeat of Marine Le Pen in the French presidential runoff was a major victory for liberal Europe. But it was a battle, not a war. The idea that one in three French citizens would vote for the National Front’s Le Pen was inconceivable only a few years ago.

Commentators have affixed the “populist” label to the wave of demagogic politics sweeping Europe. But, beyond the common raucous style, what do these movements share? After all, Spain’s Podemos and Greece’s Syriza are of the left. France’s National Front, the Netherlands’ Party for Freedom and Germany’s Alternative für Deutschland (AfD) are of the right. Beppe Grillo, of Italy’s Five Star Movement, says he is neither.

And yet, common themes run through all of them: economic nationalism, social protection, anti-Europeanism, anti-globalization and hostility not just to the political establishment but to politics itself.

Learning from the past

To understand what this might mean for the evolution of European politics, consider the history of fascism. Benito Mussolini, the founder of Italian fascism in 1919, started as a revolutionary socialist. In Germany, the word Nazi was, we should recall, short for National Socialist -German Workers’ Party.

Initially, fascism was a nationalist, anti–capitalist movement. Later it confined its attack to liberal capitalism, especially “international finance.” And this soon shaded into anti-Semitism – what the German social democrat August Bebel famously called “the socialism of fools” – finally collapsing with the defeat of Germany in 1945.

The social base of interwar fascism made it reasonable to see it as a party of the right. At the time, the working class dependably supported parties of the left. The only political space left for fascism was the petite bourgeoisie: shopkeepers, small businesspeople and low-level civil servants.

Today, the social basis of left-wing politics has vanished.  The classic working class has disappeared and trade unions are shadows of their former selves. This means that left-wing populists are inevitably compelled to compete with right-wing populists for the support of exactly the same groups that turned to fascism between the wars: young unemployed males, the “small man” who feels threatened by the “oligarchy” of bankers, global supply chains, corrupt politicians, remote European Union bureaucrats, and “fat cats” of all kinds. The same supporters, the same enemies.

How much space exists for populism’s further growth, and which variety – socialist or fascist – will attract the available votes?

A plague on both

Part of the answer was provided by former U.S. President Bill Clinton’s 1992 campaign: “It’s the economy, stupid.” The EU has been the slowest of the world’s economic centers to recover from the post-2008 slump. In France, unemployment is 10%, with youth unemployment around 24%, and 34% in Italy – creating fertile recruiting ground for the extremes of left and right.

Though Macron is by no means an obsessive fiscal hawk, he wants to narrow the French deficit from 3.4% to 3% of GDP, the Eurozone standard, cutting up to 120,000 civil service jobs. Yet he also wants to boost the economy with a €50 billion stimulus package and extend the welfare state.

Macron needs growth, and he is relying largely on supply-side reforms – cutting corporate taxes, expanding free trade – to deliver it. If he fails, he gives Le Pen the perfect target for the 2022 presidential campaign.

In the French runoff, one particularly illuminating Twitter hashtag was #NiPatronNiPatrie (“Neither Boss Nor Country”), reflecting dissatisfaction with the choice between neoliberalism and nationalism. The task of the left is to direct attention to the truly problematic aspects of global economic integration – financialization, the prioritization of capital over labor, of creditor over debtor, of patron over ouvrier– without lapsing into reactionary politics.

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Professor Emeritus of Political Economy at Warwick University and a fellow of the British Academy in history and economics, is a member of the British House of Lords. The author of a three-volume biography of John Maynard Keynes, he began his political career in the Labour party, became the Conservative Party’s spokesman for Treasury affairs in the House of Lords, and was eventually forced out of the Conservative Party for his opposition to NATO’s intervention in Kosovo in 1999.