Al­though the aim of the ne­olib­eral ap­proach is to main­tain price stability and limit price hikes, the fact that this isn’t seen in any de­vel­op­ing econ­omy proves the rea­son for the far-right’s rise and its pop­u­lar­ity is not as sim­ple as it seems

Daily Sabah (Turkey) - - Opinion - AH­MET AKYILDIZ* * Ph.D. re­searcher in the Pri­vate Com­pany Eco­nomic Re­search Depart­ment MENA at Swiss Busi­ness School

The ex­ter­nal debt level of emerg­ing economies has reached its high­est level in his­tory and ac­cord­ing to global con­sult­ing gi­ant McKin­sey, the in­crease in the ex­ter­nal debt bur­den of emerg­ing mar­kets, es­pe­cially in South Amer­ica and Asia, is a pre­cur­sor of a global eco­nomic bub­ble. As the trade war starts to trig­ger in­fla­tion, it would not be wrong to say that 2019 won’t be a very bright year for many coun­tries, in­clud­ing China.

With new In­ter­na­tional Mone­tary Fund (IMF) agree­ments be­ing signed one af­ter the other, new political em­bar­goes and mil­i­tary ten­sions grow­ing ev­ery day, we con­tinue to sound the death knell for do­mes­tic man­u­fac­tur­ers world­wide. The res­cue pack­ages of­fered ev­ery time – which al­legedly con­tain lib­eral and in­no­va­tive ap­proaches – bring noth­ing but pri­va­ti­za­tion and bud­get cuts. Mean­while, the frag­ile economies, which had to en­trust their doors to in­ter­na­tional gi­ants be­cause of the heavy terms in their con­tracts while try­ing to main­tain their na­tion-state sta­tus, have also de­clared war on U.S. Pres­i­dent Don­ald Trump and his poli­cies.

The so­ci­eties di­vided due to political and eco­nomic ri­valry are hav­ing a hard time be­cause of the in­de­ci­sive­ness their gov­ern­ments have shown in eco­nomic man­age­ment ev­ery year. We wit­nessed the first ex­am­ple of this in Ar­gentina this year. In a pe­riod when the cur­rent Ar­gen­tine gov­ern­ment came to power with pledges of pro­tect­ing do­mes­tic pro­duc­ers and im­prov­ing un­em­ploy­ment fig­ures, the sign­ing of one of the worst IMF deals in his­tory led the peo­ple of Ar­gentina pour­ing into the streets.

De­spite the ris­ing right-wing movements and fas­cism in the world, it is very dif­fi­cult to pre­dict the ex­tent of dis­ap­point­ment of the peo­ple who think that lib­eral and more left-lean­ing poli­cies should be sup­ported. They feel that they have been prej­u­diced against fas­cist par­ties, who chose to pur­sue pro­tec­tive and harsh poli­cies, and have started to ques­tion their choices. The worst and scari­est part is per­haps this. The im- pact of the eco­nomic and political de­ci­sions taken by gov­ern­ments on so­ci­eties’ de­ter­mi­na­tions of the fu­ture are not an­a­lyzed in any way. Those who have tried to stay lib­eral and find a happy medium through­out their lives are now shift­ing to­wards far-right doc­trines with fears of un­em­ploy­ment and anx­i­ety about the fu­ture. This sit­u­a­tion should also be ex­am­ined so­ci­o­log­i­cally, be­yond elec­tions. If we can­not pre­vent those peo­ple push­ing to make fas­cist and rad­i­cal choices over fears of refugees, wars and in­come in­equal­ity, we will yearn for par­lia­men­tary democ­ra­cies.

The fact that right-wing and left-wing politi­cians do not ful­fill the prom­ises they made be­fore elec­tions but in­stead make the de­mands of global com­pa­nies their pri­or­ity is one of the main sources of the prob­lem; es­pe­cially for emerg­ing economies, which have been ex­posed to a se­ries of hard­ships rang­ing from cus­toms ex­emp­tion to ex­tra tax­a­tion due to the pro­tec­tion­ist poli­cies im­ple­mented by the United States, have be­come much more frag­ile. We have seen how the fas­cist right, which ac­cuses the gov­ern­ment of in­ac­tion as soon as its fiscal poli­cies start to come un­der scru­tiny, has risen in re­cent years, es­pe­cially in Europe. Ev­ery coun­try from Greece to Ger­many has seen a rise in the num­ber of seats, 25 per­cent, demon­strat­ing that the mo­men­tum of the fas­cist right is not slow­ing. In par­tic­u­lar, par­ties that em­ploy harsh rhetoric against refugees and fo­cus on youth un­em­ploy­ment and se­cu­rity con­cerns seem to be gain­ing value and con­sol­i­dat­ing their place.


It should be noted that the ris­ing right in Europe in the 70s and 80s and the far-right in the 2000s and to­day dif­fer from each other at cer­tain points. The cur­rent sit­u­a­tion of G8 coun­tries, which at the time did not com­pro­mise on their aura of unity against Rus­sia, should be ex­am­ined thor­oughly. In France, politi­cian Marine Le Pen’s anti-Semitic, Is­lam­o­pho­bic and anti-im­mi­gra­tion rhetoric has re­ceived se­ri­ous sup­port. Ac­cord­ing to the find­ings of a study in­ves­ti­gat­ing the pro­files of peo­ple who voted for right-wing pop­ulist par­ties in EU mem­ber states be­tween 2008 and 2018, the per­cent­age of peo­ple sup­port­ing far-right par­ties in Italy was 8 per­cent in 2008, while this reached 50 per­cent in 2018. The same rate rose from 32 per­cent to 51 per­cent in Poland, 13 per­cent to 27 per­cent in France, 10 per­cent to 21 per­cent in Ger­many, 17 per­cent to 54 per­cent in Greece and from 43 per­cent to 65 per­cent in Hun­gary. In other words, be­tween the years 2019 and 2025 non­con­formist, anti-EU and anti-NATO stances will con­tinue to gain ground.

Fas­cist par­ties have gained an ad­van­tage here by an­a­lyz­ing the elec­toral be­hav­ior of peo­ple aged 18-35. It is not dif­fi­cult to fore­see the end of ar­chaic ne­olib­eral movements that ig­nore eco­nomic trou­bles and dis­miss un­em­ploy­ment. In a pe­riod where the Brexit de­ci­sion can be taken swiftly and the idea of a Euro­pean Army can be said right to a U.S. pres­i­dent’s face, cling­ing to tra­di­tions and not ac­cept­ing change will ensure noth­ing but fail­ure.

Cen­ter-right and non-sec­u­lar left par­ties should set aside the prof­its of neo­con­ser­va­tive com­pa­nies and fo­cus on be­ing a so­cial state. If the op­po­site hap­pens, par­lia­ments will only con­sist of fas­cists thriv­ing on chaos and ten­sion and mi­nor­ity par­ties that sup­port only green economies and prom­ises to keep the de­fense bud­get to a bare min­i­mum while ar­gu­ing that bor­ders don’t ex­ist. Since this part­ner­ship will last only a short time, fig­ur­ing a way out of this chaos will be as bur­den­some as Brexit talks for world economies.

The rhetoric of un­fair pri­va­ti­za­tions used by fas­cist right and left par­ties, as well as se­ri­ous re­stric­tions on em­ployee rights, long work­ing hours and late re­tire­ment de­ci­sions, all come back as votes for such par­ties. The let­downs of the Euro­pean left, who dis­credit the right’s eco­nomic poli­cies and then im­ple­ment those same prac­tices when they come to power, also af­fect the choices of Gen­er­a­tion Y in elec­tions.


It should not be for­got­ten that these movements, which started with the as­ser­tion that pub­lic aid in some sec­tors could en­hance pro­duc­tiv­ity as long as it doesn’t ham­per in­ter­na­tional com­pe­ti­tion, which was also voiced by No­bel lau­re­ate econ­o­mist Paul Krug­man in the 1990s, have grown mainly due to the ef­fects of in­come in­equal­ity. At the cen­ter of the prob­lem, not an­a­lyz­ing the so­cial changes ex­pe­ri­enced dur­ing the down­siz­ing of na­tion-states that took lib­er­al­ism as their ex­am­ple is to turn a blind eye to the mid­dle and lower in­come groups be­com­ing un­em­ployed when it comes to in­ter­ests of the cap­i­tal.

The fact that sup­port poli­cies do not al­lo­cate suf­fi­cient funds for agri­cul­ture, as is the case with Brazil and Ar­gentina, and com­pany res­cue pack­ages are laid as a bur­den on the peo­ple’s backs via taxes cause this vi­cious cy­cle to be­come more chronic. Al­though the aim of the ne­olib­eral ap­proach is to main­tain price stability and limit price hikes, the fact that this isn’t seen in the G8 or any de­vel­op­ing econ­omy proves the rea­son for the far-right’s rise and its rank in peo­ple’s votes is not as sim­ple as it seems. The “work cul­ture” the West claims to be so hu­man­is­tic is pre­par­ing its own end by dis­re­gard­ing eco­nomic in­sta­bil­ity and the value of hu­man life. This could mean the end of ne­olib­eral economies.

Pro­test­ers with signs bear­ing the faces of Pres­i­dent Don­ald Trump and IMF Manag­ing Direc­tor Chris­tine La­garde march against the G20 sum­mit be­ing held in Buenos Aires, Ar­gentina, Nov. 30.

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