Social Europe

politics, economy and employment & labour

  • Themes
    • Strategic autonomy
    • War in Ukraine
    • European digital sphere
    • Recovery and resilience
  • Publications
    • Books
    • Dossiers
    • Occasional Papers
    • Research Essays
    • Brexit Paper Series
  • Podcast
  • Videos
  • Newsletter

Radical-right populists and financialisation

Valerio Alfonso Bruno and Adriano Cozzolino 26th February 2019

Italy is the only western-European government where radical-right populists are the dominant power. But now they have found the limits to it.

radical-right populists

Valerio Bruno

The populist coalition in Italy, of the ‘five-stars movement’ (M5S) and the Lega, was recently the object of ironic media commentary, having produced a copy-pasted version of a decree—to rescue the Italian bank Carige, at risk of default—previously passed by the centre-left Gentiloni government in 2016, following European Union directives. Ironic because EU institutions and ‘mainstream’ Italian political parties have, since 2015, been the target of Lega and M5S propaganda, variously depicting them as technocratic or ‘political’ elites serving the logic of financial markets and deceiving the ‘people’.

Can populist forces tackle socio-economic inequalities, loosen up austerity policies and promote more stringent forms of financial regulation? In other words, can they fulfil the social segments of their electoral programmes?

radical-right populists

Adriano Cozzolino

The ambiguous role of the Italian executive on issues of finance and financialisation—a phenomenon which Nölke has defined as ‘an especially aggressive form of economic globalization’—can be regarded as paradigmatic of the approach of many radical-right and nationalist movements in developed economies. To borrow from Shakespeare, we may define the outcome as ‘much ado about nothing’.

On their side, of course, EU institutions dramatically failed, in the last decade, to defend social equality for European citizens from the destructive effects of globalisation by regulating it, or compensating it through a robust welfare state and job creation. Something similar can be said for ‘mainstream’ parties, with the entire social-democratic family particularly suffering from the perception of its close links with financial elites and institutions.


Our job is keeping you informed!


Subscribe to our free newsletter and stay up to date with the latest Social Europe content. We will never send you spam and you can unsubscribe anytime.

Sign up here

Radical-right populists and globalisation

Radical-right populist and nationalist parties have been particularly successful worldwide in being perceived as ‘closer to the people’, the core feature of every populist ideology. To do so, these parties mainly focus on local issues, prioritise ‘native’ citizens and opt for national or bilateral solutions over multilateral forms of governance. In this way populist parties present themselves as enemies of globalisation at the international level, and of the national establishment domestically, portraying themselves as eternal outsiders.

It is widely acknowledged that domestic political considerations regarding the costs of delocalisations, in terms of unemployment, together with xenophobia, played a crucial role in such groundbreaking political events as the ‘Brexit’ vote in the UK, the election of Donald Trump as US president and the electoral gains for radical-right populists in Austria, Germany and elsewhere in Europe. The point, though, is to what extent populist forces can really reverse, or even mitigate, structural processes such as financialisation. European populists seem eager, at least on paper, to fight the disruptive effects of economic globalisation, in particular in relation to renationalisation of some industrial sectors and a focus on social welfare. But, in government, are they actually developing policies to ‘shield’ citizens from the impacts of financialisation?

Broadly speaking, it appears that when financial themes (including the role of institutions and financial elites) are on the political agenda of ruling radical right parties, they are merely used strategically, in a rather vague and loose way, to keep electoral support, without clear or original policies being proposed. In other words, discussing global finance and financial markets is only useful during the prior ‘negative’ part of the populist politics—the propaganda about ‘broken promises’, strategic use of fear and frustration, the trivialisation of politics and the exploitation of identity

It is not an easy task for these rising political forces to tackle international finance: nation-states are inserted into an international environment which exerts stronger external constraints to maintain financial deregulation and a neoliberal agenda. The downgrading of Italy’s credit rating by Moody’s in October 2018 is symptomatic. The agency, assessing the planned policies of the ‘yellow-green’ coalition to loosen fiscal austerity and implement a citizens’ income (faced with rising poverty), downgraded Italy from Baa2 to Baa3, with important political repercussions—even before we get to the struggle between the government and the EU about the budget deficit.

Role of social welfare

In one way, the capacity of radical-right populists to counterbalance the damaging impacts of economic globalisation and financialisation is often underestimated—the role they envisage for social welfare. A growing number of scholars highlight their focus on providing protection to the most vulnerable citizens in periods of deep economic crisis and social frustration, such as the last decade.

Sheri Berman, for example, contends: ‘The origins of fascism lay in a promise to protect people. In the late 19th and early 20th centuries, a rush of globalization destroyed communities, professions and cultural norms while generating a wave of immigration. Right-wing nationalist movements promising to protect people from the pernicious influence of foreigners and markets arose, and frightened, disoriented and displaced people responded.’ Similarly, Mitchell Orenstein, in a brilliant and controversial article, recently affirmed that an important factor in the success of populism in eastern-European countries, such as Poland, was that it ‘cares for the poor, and supports families’.

The conundrum faced by populist forces in Europe is complex. On the one hand, many seem to lack the instruments to tackle international finance and financialisation, and so to put in place real alternatives for the national political economy. They gain support, however, not only because of their capacity to channel the frustration of elements of the middle classes towards external ‘threats’—such as immigrants or the financial markets—but also because of their deployment of social welfare, on which they differ from other political subjects, including EU institutions as well as mainstream parties.

So, the urgent question is: for how long will populist forces be able to use social-welfare measures to sustain their rise, while structurally incapable of tackling the systemic imbalances of the contemporary financial context in which they find themselves? Does their inability to form an effective Nationalist International mean that politics for them can never be a case of ‘as you like it’?


We need your support


Social Europe is an independent publisher and we believe in freely available content. For this model to be sustainable, however, we depend on the solidarity of our readers. Become a Social Europe member for less than 5 Euro per month and help us produce more articles, podcasts and videos. Thank you very much for your support!

Become a Social Europe Member

Valerio Alfonso Bruno and Adriano Cozzolino

Valerio Alfonso Bruno is a post-doctoral researcher at the University of Fribourg (Switzerland). His research focuses on post-2008 technocratic and financial elites and their relationship with the rise of populist movements in the European Union. Adriano Cozzolino has a PhD in international studies. He researches on the political economy of the European Union and the transformation of the nation-state in the neoliberal era.

You are here: Home / Politics / Radical-right populists and financialisation

Most Popular Posts

Russian soldiers' mothers,war,Ukraine The Ukraine war and Russian soldiers’ mothersJennifer Mathers and Natasha Danilova
IGU,documents,International Gas Union,lobby,lobbying,sustainable finance taxonomy,green gas,EU,COP ‘Gaslighting’ Europe on fossil fuelsFaye Holder
Schengen,Fortress Europe,Romania,Bulgaria Romania and Bulgaria stuck in EU’s second tierMagdalena Ulceluse
income inequality,inequality,Gini,1 per cent,elephant chart,elephant Global income inequality: time to revise the elephantBranko Milanovic
Orbán,Hungary,Russia,Putin,sanctions,European Union,EU,European Parliament,commission,funds,funding Time to confront Europe’s rogue state—HungaryStephen Pogány

Most Recent Posts

reality check,EU foreign policy,Russia Russia’s invasion of Ukraine—a reality check for the EUHeidi Mauer, Richard Whitman and Nicholas Wright
permanent EU investment fund,Recovery and Resilience Facility,public investment,RRF Towards a permanent EU investment fundPhilipp Heimberger and Andreas Lichtenberger
sustainability,SDGs,Finland Embedding sustainability in a government programmeJohanna Juselius
social dialogue,social partners Social dialogue must be at the heart of Europe’s futureClaes-Mikael Ståhl
Jacinda Ardern,women,leadership,New Zealand What it means when Jacinda Ardern calls timePeter Davis

Other Social Europe Publications

front cover scaled Towards a social-democratic century?
Cover e1655225066994 National recovery and resilience plans
Untitled design The transatlantic relationship
Women Corona e1631700896969 500 Women and the coronavirus crisis
sere12 1 RE No. 12: Why No Economic Democracy in Sweden?

ILO advertisement

Global Wage Report 2022-23: The impact of inflation and COVID-19 on wages and purchasing power

The International Labour Organization's Global Wage Report is a key reference on wages and wage inequality for the academic community and policy-makers around the world.

This eighth edition of the report, The Impact of inflation and COVID-19 on wages and purchasing power, examines the evolution of real wages, giving a unique picture of wage trends globally and by region. The report includes evidence on how wages have evolved through the COVID-19 crisis as well as how the current inflationary context is biting into real wage growth in most regions of the world. The report shows that for the first time in the 21st century real wage growth has fallen to negative values while, at the same time, the gap between real productivity growth and real wage growth continues to widen.

The report analysis the evolution of the real total wage bill from 2019 to 2022 to show how its different components—employment, nominal wages and inflation—have changed during the COVID-19 crisis and, more recently, during the cost-of-living crisis. The decomposition of the total wage bill, and its evolution, is shown for all wage employees and distinguishes between women and men. The report also looks at changes in wage inequality and the gender pay gap to reveal how COVID-19 may have contributed to increasing income inequality in different regions of the world. Together, the empirical evidence in the report becomes the backbone of a policy discussion that could play a key role in a human-centred recovery from the different ongoing crises.


DOWNLOAD HERE

ETUI advertisement

The EU recovery strategy: a blueprint for a more Social Europe or a house of cards?

This new ETUI paper explores the European Union recovery strategy, with a focus on its potentially transformative aspects vis-à-vis European integration and its implications for the social dimension of the EU’s socio-economic governance. In particular, it reflects on whether the agreed measures provide sufficient safeguards against the spectre of austerity and whether these constitute steps away from treating social and labour policies as mere ‘variables’ of economic growth.


DOWNLOAD HERE

Eurofound advertisement

Eurofound webinar: Making telework work for everyone

Since 2020 more European workers and managers have enjoyed greater flexibility and autonomy in work and are reporting their preference for hybrid working. Also driven by technological developments and structural changes in employment, organisations are now integrating telework more permanently into their workplace.

To reflect on these shifts, on 6 December Eurofound researchers Oscar Vargas and John Hurley explored the challenges and opportunities of the surge in telework, as well as the overall growth of telework and teleworkable jobs in the EU and what this means for workers, managers, companies and policymakers.


WATCH THE WEBINAR HERE

Foundation for European Progressive Studies Advertisement

The winter issue of the Progressive Post magazine from FEPS is out!

The sequence of recent catastrophes has thrust new words into our vocabulary—'polycrisis', for example, even 'permacrisis'. These challenges have multiple origins, reinforce each other and cannot be tackled individually. But could they also be opportunities for the EU?

This issue offers compelling analyses on the European health union, multilateralism and international co-operation, the state of the union, political alternatives to the narrative imposed by the right and much more!


DOWNLOAD HERE

Hans Böckler Stiftung Advertisement

The macroeconomic effects of re-applying the EU fiscal rules

Against the background of the European Commission's reform plans for the Stability and Growth Pact (SGP), this policy brief uses the macroeconometric multi-country model NiGEM to simulate the macroeconomic implications of the most relevant reform options from 2024 onwards. Next to a return to the existing and unreformed rules, the most prominent options include an expenditure rule linked to a debt anchor.

Our results for the euro area and its four biggest economies—France, Italy, Germany and Spain—indicate that returning to the rules of the SGP would lead to severe cuts in public spending, particularly if the SGP rules were interpreted as in the past. A more flexible interpretation would only somewhat ease the fiscal-adjustment burden. An expenditure rule along the lines of the European Fiscal Board would, however, not necessarily alleviate that burden in and of itself.

Our simulations show great care must be taken to specify the expenditure rule, such that fiscal consolidation is achieved in a growth-friendly way. Raising the debt ceiling to 90 per cent of gross domestic product and applying less demanding fiscal adjustments, as proposed by the IMK, would go a long way.


DOWNLOAD HERE

About Social Europe

Our Mission

Article Submission

Membership

Advertisements

Legal Disclosure

Privacy Policy

Copyright

Social Europe ISSN 2628-7641

Social Europe Archives

Search Social Europe

Themes Archive

Politics Archive

Economy Archive

Society Archive

Ecology Archive

Follow us

RSS Feed

Follow us on Facebook

Follow us on Twitter

Follow us on LinkedIn

Follow us on YouTube