Recorded on June 3, 2019
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In this episode of Uncommon Knowledge, Peter Robinson is joined by author and columnist Douglas Murray to discuss his new book The Madness of Crowds: Race, Gender and Identity. Murray examines the most divisive issues today, including sexuality, gender, and technology, and how new culture wars are playing out everywhere in the name of social justice, identity politics, and intersectionality. Is European culture and society in a death spiral caused by immigration and assimilation? Robinson and Murray also discuss the roles that Brexit and the rise of populism in European politics play in writing immigration laws across the European Union.
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BERLIN—To win voters lost to an anti-globalization backlash, Europe’s mainstream parties are going back to the 1970s.
In Germany, the U.K, Denmark, France and Spain, these parties are aiming to reverse decades of pro-market policy and promising greater state control of business and the economy, more welfare benefits, bigger pensions and higher taxes for corporations and the wealthy. Some have discussed nationalizations and expropriations.
It could add up to the biggest shift in economic policy on the continent in decades.
In Germany, Europe’s biggest economy, the government has increased social spending in a bid to stop the exodus of voters to antiestablishment, populist and special-interest parties. Reacting to pressure on both ends of the political spectrum, it passed the largest-ever budget last year.
“The zeitgeist of globalization and liberalization is over,” said Ralf Stegner, vice chairman of the 130-year-old Social Democratic Party, the junior partner in Chancellor Angela Merkel’s government coalition. “The state needs to become much more involved in key areas such as work, pensions and health care.”
The policies mark the end of an era in Europe that started four decades ago, with the ascent of former British Prime Minister Margaret Thatcher and her U.S. ally, President Ronald Reagan.
After Thatcher abolished capital controls in 1979 and began selling off state companies in the 1980s, other European governments followed suit, embracing supply-side policies, deregulation, market liberalization and tax cuts. Revenues from privatization among European Union member states rose from $13 billion in 1990 to $87 billion in 2005, according to Privatization Barometer, a database run by consultancy KPMG Advisory S.p.A.
Today, concerns about growing inequality, stagnating wages, immigration, the debt crisis and China’s rising power have fueled the recent political shift. European businesses and governments also worry about potential changes in U.S. policy, amid looming threats of trade sanctions.Smaller State Governments across Europe retreated from many economic sectors and sold state companies starting inthe 1980s.Privatization proceeds in EU countriesSource: Privatization Barometer reports00.billion1980’85’90’952000’05’10’150102030405060708090$100
This erosion of the old technocratic consensus about how to run an economy, even in countries where populists aren’t getting any closer to power, could be one the most lasting consequences of the recent antiestablishment surge.
Even in countries where populist parties are already in government, such as Poland, those parties have shifted their focus from nationalist and anti-immigration rhetoric to championing generous welfare policies and state aid.Bigger BenefitsGermany’s government has increased socialspending in a bid to win over voters. Germany’s government spendingSource: Germany’s Federal Ministry of FinanceNotes: Data through 2017 are actual; 2018 and 2019are targets. €1=$1.14.billionSocial and welfare benefitsOther spending2012’13’14’15’16’17’18’19050100150200250300350€400
Germany’s SPD has embraced additional welfare spending, paid for by tax revenues, to combat a retreat of voters so rapid it threatens to turn the once-dominant force in German politics into a niche player. The party is now pushing for policies such as unconditional pension for people who have worked for a certain period but didn’t make sufficient contributions into the pension pot.
In the U.K., Jeremy Corbyn, leader of the opposition Labor Party, has proposed renationalizing railways, public utilities, the postal service and the Royal Bank of Scotland ,the country’s second-biggest lender. It’s effectively a reversal of the privatization spree initiated by Ms. Thatcher. The party is also toying with policies such as universal basic income for all and a four-day working week for public-sector employees.
Labor has been polling ahead of the ruling Conservatives in opinion surveys for most of the past two years.
The re-nationalization plan would cost around $210 billion, according to an estimate by New York-based consulting firm S&P Global. Labor has said it would issue treasury bonds to finance nationalizations. Thames Water, the U.K.’s largest water company, added a clause to its bond to make sure holders are repaid immediately should it be nationalized.
In France, President Emmanuel Macron reacted to weeks of violent street protests by abolishing plans to increase fuel prices and announcing measures to boost the incomes of low earners. The estimated cost of the spending is more than €10 billion ($11 billion). In a symbolic concession to the antiestablishment yellow-vest movement, Mr. Macron declared he would shut down the university École Nationale d’Administration, his own alma mater, because it instigated elitism.
Mr. Macron reversed a decision to eliminate 200,000 civil-service jobs and announced a tax increase for companies that overly rely on short-term contracts, which his government blames for creating an underclass of workers. In addition, monthly pensions of less than €2,000 have been pegged to the rate of inflation.
He also embraced the idea of holding referendums on certain policy issues, a key demand of populist leaders. The first major referendum will decide whether the sale of the state’s majority stake in the company that runs Paris’s airports should go ahead as planned.
Denmark’s Social Democrats, who had been out of government since 2015, won a general election on June 5 following a policy makeover that included going further left on economic policy, while sharply turning right on immigration. They pledged to increase public spending and taxes for companies and the wealthy, and to enable early retirement by rolling back some recent pension changes. Their far-right rivals the People’s Party suffered a major loss in the election.
The reaction from European economists is decidedly mixed.
Some have greeted the shift as a welcome correction to years of pro-business and free-trade policies they think have dug deep rifts in Western societies.
“The lesson from Germany is: Strong growth and a generous social welfare system alone are insufficient to satisfy voters. Globalization and technological change are putting pressure on many people,” said Marcel Fratzscher, head of the German Institute for Economic Research, a Berlin-based think tank. “Europe’s social welfare state needs a fundamental overhaul as it has to focus on empowering people and on stopping the market abuse of firms and lobby groups.”
Others are concerned Europe is deviating from proven economic recipes just as growth is wobbling, or that the policies are outdated.
“We are indeed seeing a kind of return to the pre-Thatcherite approach, but it is doubtful that policies from the era of closed markets and capital controls could work in a globalized world. A vision of the past can’t be implemented in the present,” said Branko Milanovic, a New York-based Serbian-American economist who studies income distribution and inequality.
In Germany, despite a decade of robust economic growth and near full employment, almost four million working people receive welfare benefits to supplement their income. Around one-quarter of all employees work in the low-wage sector, according to government statistics and research by Mr. Fratzscher’s group.Low Wages Increased competition put downward pressure on wages, while shrinking unemployment benefits increased incentives for Germans to take lower paying jobs. Share of German workers who are low paid*Source: German Institute for Economic Research*Those who make less than two-thirds of the country’s median earnings%1996’982000’02’04’06’08’10’12’14’1614161820222426
Subsidies to Germany’s mandatory pay-as-you-go pension scheme almost reached the €100 billion mark for the first time in 2018. Earlier this year, Ms. Merkel’s government adopted a new industrial strategy that centers on protecting German companies from foreign competition, including by enabling the government to buy stakes in businesses to shield them from foreign acquisition.
Peter Altmaier, economics minister and author of the industry strategy, said it was designed in part to address the anxieties of Germans who have been drawn to far-left and far-right parties in recent years.
Germany’s SPD, the junior partner in Germany’s government coalition, is now debating whether large real-estate investors should be expropriated as a way to stabilize rents. In Berlin, where they preside over the local government, the SPD announced a freeze on rent prices. The head of its youth wing recently called for car maker BMW to be nationalized, earning grass-roots plaudits and some support from SPD ministers and mayors.
The SPD scored its worst result ever at last month’s European Union election. Polling around 12% to 14%, it is a shadow of its 1998 self, when it gathered 41% of the vote.
The environment-focused, center-left Greens more than doubled their votes between the country’s last general election in September 2017 and the EU election. It is now polling at around 26%. At least two polls since early June showed the Greens had become Germany’s most popular party for the first time since its creation in the 1980s—ahead of Ms. Merkel’s Christian Democratic Union.
Twenty years ago, the German Greens co-wrote with the SPD the country’s last big tax cuts and a deeply unpopular overhaul of labor-market legislation. Today, the party is toying with an unconditional universal income and seizing real estate from commercial landlords as a way to stop rent increases.
The far-right Alternative for Germany, known as AfD, lost ground in last month’s EU election, and is now polling around 13%.
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The AfD has campaigned on immigration in recent elections. Party leaders recently consulted with Steven K. Bannon, President Trump’s former chief strategist and now an adviser to nationalist and populist parties in Europe. In a meeting in Berlin on May 13, he advised the leaders to tone down their anti-Islam fervor, purge radical members, and refocus their message from identity politics to economics.
“The real message is the economy,” Mr. Bannon said in an interview. “Populists need to talk to the workers.”
Jörg Meuthen, the AfD co-chair who met Mr. Bannon, said he agreed, but questioned the timing of the message. He said Germany’s economy—with record low unemployment and slowing but still positive growth—remained too healthy for an immediate policy shift.
“When the recession kicks in and people start worrying about their jobs, then we can roll out economic campaigns and show our competence. Populists must look at what is affecting people emotionally, and at the moment that is migration and the climate,” Mr. Meuthen said.Globalization BacklashProtest parties focused on denouncing the economic, cultural and security impact of globalization have drawn more attention across Europe.Populist party poll performance in selected countries Source: NomuraNote: Weighted averages of national polls.%GermanyFranceSpainU.K.2015’16’17’18’19051015202530
In Spain, Pedro Sanchez, acting premier and leader of the Socialist Party, won the national and the EU elections this year after sharply raising the minimum wage and announcing a boost in social benefits and corporate taxes.
Mr. Sanchez’s bet on wooing working-class voters lost to protest parties paid off, said Daniel Diaz Fuentes, professor of economics at the Spanish university of Cantabria. Mr. Fuentes said that the rise of populism could trigger a re-nationalization wave.
“I think that the state will become a much more active entrepreneurial actor via venture capital and involvement in investment via the banking system,” Mr. Fuentes said.Two TrajectoriesThe income of low earners has decreased since 1980, while that of top earners has grown.Income shares of the top 10% in European regions*%NorthernWesternSouthernEastern1980’902000’102022242628303234Income shares of the bottom 50% in European regions*Source: Thomas Blanchet, Lucas Chancel and Amory Gethin, World Inequality Database*Population-weighted country averages%NorthernWesternSouthernEastern1980’902000’102022242628303234
Wolfgang Schmidt, deputy German finance minister and one of the strategists behind the SPD’s new approach, said the success of socialists in Spain, Britain and Denmark, in elections and opinion polls, shows that voters have turned against economic orthodoxy.
“As a society, we need to stop looking down on people. Anxiety about the future of work is driving voters to populists. People read about automation and self-driving cars and they ask themselves what will happen to their jobs in the near future,” he said.
Many European politicians and economists say the swing away from markets and back to the state misses the point of many voters’ anxiety, which is rooted in politics or culture. An annual poll about the fears of Germans conducted by the R+V Versicherung AG insurance group found that nine of respondents’ top 10 fears focused on politics, security and health. Economic concerns dominated between 2004 and 2015.
Paul Ziemiak, the second most senior official in Ms. Merkel’s conservative party, opposes what he says is an SPD-driven spending spree. “These policies have never made any country successful. Countries that have [tried them] have ultimately failed—politically, but also economically,” he said.
Protectionism would destroy a German economy built on exports and cross-border supply chains, said Clemens Fuest, an economist and adviser to the German government. Ambitious redistribution programs such as pension increases, early retirement or a universal income would collapse as soon as tax revenues fall in the slowdown. Companies were privatized 30 years ago because the state is generally bad at managing businesses, he said.
“Established parties are taking over the populists’ agenda to show voters that they have heard their message,” Mr. Fuest said. “But they are making big promises that cannot be kept.”
From Australia to Europe, the signs are multiplying that conservative populism is on the rise.
Sometimes political revolutions occur right before our eyes without us quite realizing it. I think that’s what’s been happening over the last few weeks around the world, and the message is clear: The populist “New Right” isn’t going away anytime soon, and the rise of the “New Left” is exaggerated.
Start with Australia, where Prime Minister Scott Morrison won a surprising victory last week. Before the election, polls had almost uniformly indicated that his Liberal-National Coalition would have to step down, but voters were of another mind. With their support of Morrison, an evangelical Christian who has expressed support for President Donald Trump, Australians also showed a relative lack of interest in doing more about climate change. And this result is no fluke of low turnout: Due to compulsory voting, most Australians do turn out for elections.
Or how about the U.K.? The evidence is mounting that the Brexit Party will do very well in this week’s European Parliament elections. Right now that party, which did not exist until recently, is in the lead in national polls with an estimated 34% support. The Tories, the current ruling party, are at only 12%. So the hard Brexit option does not seem to be going away, and the right wing of British politics seems to be moving away from the center.
As for the European Parliament as a whole, by some estimates after this week’s election 35% of the chamber will be filled by anti-establishment parties, albeit of a diverse nature. You have to wonder at what margins the EU will become unworkable or lose legitimacy altogether.
Meanwhile in the U.S., polls show Joe Biden as the presumptive front-runner for the Democratic presidential nomination. He is one of the party’s more conservative candidates, and maybe some primary voters value his electability and familiarity over the more left-wing ideas of Bernie Sanders and Elizabeth Warren. That’s one sign the “hard left” is not in ascendancy in the U.S. Biden’s strategy of running against Trump is another. It’s hard to say how effective that will prove, but it is likely to result in an election about the ideas and policies of Trump, not those of Democratic intellectuals.
Meanwhile, the U.S. economy has remained strong, and Trump’s chances of re-election have been rising in the prediction markets.
One scarcely noticed factor in all of this has been the rising perception of China as a threat to Western interests. The American public is very aware that the U.S. is now in a trade war with China, a conflict that is likely to provoke an increase in nationalism. That is a sentiment that has not historically been very helpful to left-wing movements. China has been one of Trump’s signature causes for years, and he seems to be delighting in having it on center stage.
The Democratic Party is not well-positioned to make China a core issue. Democrats have been criticizing Trump’s tariffs for a while now, and it may be hard for them to adjust their message from “Tariffs Are Bad” to “Tariffs Are Bad But China Tariffs Are OK.” Their lukewarm support for free trade agreements — especially the Trans Pacific Partnership, which could have served as a kind of alternative China trade policy — also complicates matters. The net result is that Republicans will probably be able to use the China issue to their advantage for years to come.
Elsewhere, the world’s largest democracy just wrapped up a lengthy election. The results in India aren’t yet known, but exit polls show that Prime Minister Narendra Modi’s ruling coalition — and his philosophy of Hindu nationalism — will continue to be a major influence.
In all of this ferment, I am myself rooting for a resurgence of centrist cosmopolitanism. But I try to be honest about how my ideas are doing in the world. And in the last few weeks, I’ve seen a lot of evidence that a new political era truly is upon us.
He’s crisscrossing Europe because he believes it’s a bellwether for the United States. The scary thing is he could be right.
MILAN — Italy is a political laboratory. During the Cold War, the question was whether the United States could keep the Communists from power. Then Italy produced Silvio Berlusconi and scandal-ridden showman politics long before the United States elected Donald Trump. Now, on the eve of European Parliament elections likely to result in a rightist lurch, it has an anti-immigrant, populist government whose strongman, Matteo Salvini, known to his followers as “the Captain,” is the Continent’s most seductive exponent of the new illiberalism.
Steve Bannon, Trump’s former chief strategist, has been close to Salvini for a while. That’s no surprise. Bannon is the foremost theorist and propagator of the global nationalist, anti-establishment backlash. He’s Trotsky to the Populist International. He sensed the disease eating at Western democracies — a globalized elite’s abandonment of the working class and the hinterland — before anyone. He spurred a revolt to make the invisible citizen visible and to save Western manufacturing jobs from what he calls the Chinese “totalitarian economic hegemon.”
Now Bannon is crisscrossing Europe ahead of the elections, held Thursday through next Sunday. He’s in Berlin one day, Paris the next. As he explained during several recent conversations and a meeting in New York, he believes that “Europe is six months to a year ahead of the United States on everything.” As with Brexit’s foreshadowing of Trump’s election, a victory for the right in Europe “will energize our base for 2020.” The notion of Wisconsin galvanized by Brussels may seem far-fetched, but then so did a President Trump.
Polls indicate that Salvini’s League party, transformed from a northern secessionist movement into the national face of the xenophobic right, will get over 30 percent of the Italian vote, up from 6.2 percent in 2014. Anti-immigrant and Euroskeptic parties look set to make the greatest gains, taking as many as 35 percent of the seats in Parliament, which influences European Union policy for more than a half-billion people. In France, Marine Le Pen’s nationalists are running neck-and-neck with President Emmanuel Macron’s pro-Europe party. In Britain, Nigel Farage’s new Brexit Party has leapt ahead of the center-right and center-left.
Salvini, whose party formed a government a year ago with the out-with-the-old-order Five Star Movement, is a central figure in this shift. The coalition buried mainstream parties. He is, Bannon told me, “the most important guy on the stage right now — he’s charismatic, plain-spoken, and he understands the machinery of government. His rallies are as intense as Trump’s. Italy is the center of politics — a country that has embraced nationalism against globalism, shattered the stereotypes, blown past the old paradigm of left and right.”
For all the upheaval, I found Italy intact, still tempering transactional modernity with humanity, still finding in beauty consolation for dysfunction. The new right has learned from the past. It does not disappear people. It does not do mass militarization. It’s subtler.
- It scapegoats migrants,
- instills fear,
- glorifies an illusory past (what the Polish sociologist Zygmunt Bauman called “retrotopia”),
- exalts machismo,
- mocks do-gooder liberalism and
- turns the angry drumbeat of social media into its hypnotic minute-by-minute mass rally.
Salvini, the suave savior, is everywhere other than in his interior minister’s office at Rome’s Viminale Palace. He’s out at rallies or at the local cafe in his trademark blue “Italia” sweatshirt. He’s at village fairs and conventions. He’s posting on Facebook up to 30 times a day to his 3.7 million followers, more than any other European politician. (Macron has 2.6 million followers.) He’s burnishing the profile of the tough young pol (he’s 46) who
- keeps migrants out,
- loosens gun laws,
- brandishes a sniper rifle and
- winks at Fascism —
all leavened with Mr.-Nice-Guy images of him sipping espresso or a Barolo.
His domination of the headlines is relentless. When, during my visit, a woman was gang raped near Viterbo, his call for “chemical castration” of the perpetrators led the news cycle for 24 hours. Like Trump, he’s a master of saying the unsayable to drown out the rest.
“I find Salvini repugnant, but he seems to have an incredible grip on society,” Nathalie Tocci, the director of Italy’s Institute of International Relations, told me. No wonder then that the European far-right has chosen Milan for its big pre-election rally, bringing together Salvini, Le Pen, Jörg Meuthen of the Alternative for Germany party and many other rightist figures.
A nationalist tide is still rising. “We need to mobilize,” Bannon told me. “This is not an era of persuasion, it’s an era of mobilization. People now move in tribes. Persuasion is highly overrated.”
Bannon gives the impression of a man trying vainly to keep up with the intergalactic speed of his thoughts. Ideas cascade. He offered me a snap dissection of American politics: blue-collar families were suckers: their sons and daughters went off to die in unwon wars; their equity evaporated with the 2008 meltdown, destroyed by “financial weapons of mass destruction”; their jobs migrated to China. All that was needed was somebody to adopt a new vernacular, say to heck with all that, and promise to stop “unlimited illegal immigration” and restore American greatness. His name was Trump. The rest is history.
In Europe, Bannon said, the backlash brew included several of these same factors. The “centralized government of Europe” and its austerity measures, uncontrolled immigration and the sense of people in the provinces that they were “disposable” produced the Salvini phenomenon and its look-alikes across the Continent.
“In Macron’s vision of a United States of Europe, Italy is South Carolina to France’s North Carolina,” Bannon told me. “But Italy wants to be Italy. It does not want to be South Carolina. The European Union has to be a union of nations.”
The fact is Italy is Italy, unmistakably so, with its high unemployment, stagnation, archaic public administration and chasm between the prosperous north (which Salvini’s League once wanted to turn into a secessionist state called Padania) and the southern Mezzogiorno. Salvini’s coalition has done nothing to solve these problems even as it has
- demonized immigrants,
- attacked an independent judiciary and
- extolled an “Italians first” nation.
A federal Europe remains a chimera, even if the euro crisis revealed the need for budgetary integration. Bannon’s vision of Brussels bureaucrats devouring national identity for breakfast is largely a straw-man argument, useful for making the European Union the focus of all 21st-century angst.
The union has delivered peace and stability. It’s the great miracle of the second half of the 20th century; no miracle ever marketed itself so badly. It has also suffered from ideological exhaustion, remoteness, division and the failure to agree on an effective shared immigration policy — opening the way for Salvini’s salvos to hit home in a country that is the first stop for many African migrants.
Salvini grew up in Milan in a middle-class family, dropped out of university, joined the League in its early days in the 1990s and was shaped by years working at Radio Padania where he would listen to Italians’ gripes. “What he heard was complaints about immigrants, Europe, the rich,” Emanuele Fiano, a center-left parliamentarian, told me. “He’s run with that and is now borderline dangerous.”
The danger is not exit from the European Union — the government has come to its senses over that — or some Fascist reincarnation. It’s what Fabrizio Barca, a former minister for territorial cohesion, called the “Orbanization of the country,” in a reference to Viktor Orban, the right-wing Hungarian leader. In other words, insidious domination through the evisceration of independent checks and balances, leading Salvini to the kind of stranglehold on power enjoyed by Orban (with a pat on the back from Trump) or by Vladimir Putin. “The European Union has been ineffective against Orban,” Barca noted. Worse, it has been feckless.
Another threat, as in Trump’s United States, is of moral collapse. “I am not a Fascist but. …” is a phrase increasingly heard in Italy, with some positive judgment on Mussolini to round off the sentence. Salvini, in the judgment of Claudio Gatti, whose book “The Demons of Salvini” was just published in Italian, is “post-Fascist” — he refines many of its methods for a 21st-century audience.
Barca told me the abandonment of rural areas — the closing of small hospitals, marginal train lines, high schools — lay behind Salvini’s rise. Almost 65 percent of Italian land and perhaps 25 percent of its population have been affected by these cuts. “Rural areas and the peripheries, the places where people feel like nobody, are home to the League and Five Star,” he said. To the people there, Salvini declares: I will defend you. He does not offer a dream. He offers protection — mainly against the concocted threat of migrants, whose numbers were in fact plummeting before he took office because of an agreement reached with Libya.
The great task before the parties of the center-left and center-right that will most likely be battered in this election is to reconnect. They must restore a sense of recognition to the forgotten of globalization. Pedro Sánchez, the socialist Spanish prime minister, just won an important electoral victory after pushing through a 22 percent rise in the minimum wage, the largest in Spain in 40 years. There’s a lesson there. The nationalist backlash is powerful, but pro-European liberal sentiment is still stronger. If European elections feel more important, it’s also because European identity is growing.
As for the curiously prescient Italian political laboratory, Bannon is investing in it. He’s established an “Academy for the Judeo-Christian West” in a 13th-century monastery outside Rome. Its courses, he told me, will include “history, aesthetics and just plain instruction in how to get stuff done, including facing up to pressure, mock TV interviews with someone from CNN or The Guardian ripping your face off.”
Bannon described himself as an admirer of George Soros — “his methods, not his ideology” — and the way Soros had built up “cadres” throughout Europe. The monastery is the nationalist response to Soros’s liberalism. There’s a war of ideas going on in Italy and the United States. To shun the fight is to lose it. I am firmly in the liberal camp, but to win it helps to know and strive to understand one’s adversary.