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Globalization And Its Discontents
Published on Monday, November 27, 2000 in the San Francisco Bay Guardian
Globalization And Its Discontents
Far Right Backlash Against The European Union
by Martin A. Lee
Germans have deutsche marks, the French have francs, and Italians have the lira. But not for long. These national currencies will begin to disappear next year, as the new "euro" replaces them in the pockets of 300 million Europeans from Dublin to Berlin.

Denmark, however, has decided to buck the trend and keep its krone. In September, the Danes voted in a referendum to reject the euro. It was the only country in the 15-member European Union (E.U.) that put the matter to a vote, as required by the Danish constitution, and it was defeated by a large margin.

Opinion polls suggest that if such a vote were held in Germany or elsewhere within the E.U., the result would be similar to the Danish referendum, which was about much more than just the single continental currency. For many Danes, it touched on the question of sovereignty. By snubbing the euro, they felt they were protecting their national identity and culture.

Europeans are understandably worried about the economic implications of the euro, which has lost about a quarter of its value against the dollar since it was launched 22 months ago. Others simply dislike the idea of being dictated to by Brussels, where the E.U. is headquartered in Belgium. Concerned that Europe is integrating too much and way too fast, they are put off by what they see as the antidemocratic nature of a European superstate meddling in the internal affairs of its members and making decisions on all kinds of issues – from major antitrust cases to seemingly petty matters such as the appropriate size and shape of cucumbers.

While hostility to the European Union is widespread in many countries, opposition to the euro has been led not by mainstream politicians but by right-wing extremists such as Pia Kjaersgaard, head of the ultranationalist Danish Peoples Party, which emerged as the big winner of the recent referendum on the euro.

Campaigning against the single currency, radical right-wing populist movements with openly fascist roots have made significant inroads into mainstream politics in Western Europe, where today there are 50 million poor, 18 million unemployed, and 3 million homeless. Such conditions are ripe for exploitation by ultra-right-wing demagogues. They have gotten a lot of mileage out of exploiting justifiable qualms about the European Monetary Union, which, in essence, "is part of the attempt to adapt European capitalism to the needs of an increasingly global era," as scholar Mark Mazower explains.

Riding the crest of a populist backlash against globalization, the far right Freedom Party, led by Jorg Haider, muscled its way into Austria's national governing coalition after it won 27 percent of the vote last year. A haven for neofascists and holocaust-deniers, Haider's party had previously agitated against Austria joining the E.U. by "using theories of worldwide conspiracies connected with barely concealed anti-Semitic arguments," according to the Vienna-based Documentation Center for the Austrian Resistance.

Haider's antagonism toward the European Union provoked outrage among Austria's E.U. partners, which imposed unprecedented diplomatic sanctions against Vienna when the Freedom Party joined the government in February. Nine months later, the boycott was lifted after a panel of "wise men" determined that such measures had become counterproductive by encouraging just the kind of xenophobic and anti-European sentiment they were designed to punish.

Haider gloated at the E.U.'s tactical blunder and threatened to obstruct plans to incorporate several new members from Eastern Europe into the organization. Warning of an influx of desperate job seekers from the east, he denounced the E.U. as "immoral and decadent" and called its enlargement proposals "a declaration of war against all working and upstanding people." Adept at playing upon economic insecurities, the Freedom Party has touched a raw nerve by scapegoating immigrants and foreigners for every social problem imaginable.

The failed sanctions against Austria stoked anti-E.U. feelings in other countries, where far-right opportunists have decried Brussels' attempt to bully a small nation over the right to decide which political parties, however controversial, should participate in the government. This issue was exploited by the neofascist Vlaams Blok party, which outpolled all rivals with 33 percent of the vote in Antwerp, Belgium's second largest city, in October.

Coupling their anti-immigrant tirades with pointed criticisms of the E.U., right-wing extremist parties also have gained 15 percent or more nationwide in France, Italy, Switzerland, and Norway. While this percentage may seem inconsequential in terms of the U.S. two-party system, it can carry great weight in parliamentary balloting and determine the political makeup of the government. Even when they lose elections, neofascists are like a toxic chemical in the water supply of the political landscape, polluting public discourse and pressuring establishment parties to adopt extremist positions to fend off challenges from the hard right.

Supporters of the European Union have long argued that economic integration is a crucial step toward a harmonious political union, which, they hope, will prevent the revival of a ruthless and aggressive nationalism that has ravaged the continent in the past. But just the opposite seems to be happening. As economic globalization has accelerated in the post-cold war era, producing definite categories of winners and losers, so has the momentum of neofascist and right-wing extremist organizations.

What went wrong? How did the development of an antinationalist, pan-European alliance envisioned in the wake of World War II veer off course?

The single European currency was the brainchild of Robert Mundell, a Canadian-born economist, who first promoted the idea in 1970. Last year he won the Nobel Prize in economics for a lifetime of work that earned him the moniker "father of the euro." A radical free marketeer who also could be considered "the father of Reaganomics," Mundell maintains that governments must not intervene in the economic lives of their citizens either to assist or restrain them. His supply-side theories served as the ideological basis for President Reagan's assault on the U.S. welfare system (or what passed for it).

Mundell advocated a single currency for Europe that would, in his words, "put monetary policy beyond the reach of politicians." In effect, this meant that full participation in the European Monetary Union, as stipulated by the 1989 Maastricht Treaty, would significantly curtail the ability of national governments to regulate their economies and redress high unemployment by adjusting their own currency valuations and interest rates.

The introduction of the euro, and the globalization of financial markets in general, have required painful budgetary retrenchment by member states, which, for better or worse, were forced to relinquish their authority on important fiscal matters to unelected and unaccountable central bankers. Moreover, by usurping some of the traditional prerogatives of the nation-state, the E.U. has called into question democratic notions of political power and representation.

Although free markets are supposed to guarantee maximum efficiency, instead they have magnified severe inequalities and hastened the breakdown of social structures, resulting in widespread instability, impoverishment, mass migration, and ethnic strife. At the same time, the waning power of the nation-state has triggered a harsh ultranationalist reaction, as evidenced by the surge of support for mass-based far-right parties in Western Europe.

Disenchantment with the conventional political spectrum is further reinforced by the failure of erstwhile left-of-center social democratic parties to offer an alternative agenda to rigid E.U. policy nostrums, which are "leading to a concentration of wealth and power that is undermining democracy," as Nicholas Hilyard, formerly of The Ecologist, has warned. This, in turn, has strengthened the hand of neofascists and other right-wing extremists who have successfully tapped into widespread resentment against remote and unresponsive state governments.

If anything, the process of European integration is likely to foster the continued growth of radical right-wing parties. Burgeoning ultranationalist movements are collateral damage inflicted by unfettered globalization, which breeds the very monstrosities that it purports to oppose. And the extreme right provides an alibi for globalization while revolting against it.

The menace of Jorg Haider and like-minded demagogues in other countries should not be underestimated. But the "Haiderization" of Western Europe, as some have referred to the growing influence of the far right, may not be a threat to democracy as much as a consequence of its lack.

Martin A. Lee is the author of The Beast Reawakens, a book about neofascism.


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