Monday, 2 December 2013

The New Fascism - a comment on economic nationalism


I had a wry smile about Friedrich List. Here's the opening of his wikipedia entry:

Georg Friedrich List (August 6, 1789 – November 30, 1846) was a leading 19th-century German-American economist who developed the "National System" or what some would call today the National System of Innovation. He was a forefather of the German historical school of economics, and considered the original European unity theorist whose ideas were the basis for the European Economic Community.

Now one of the important things about Italian Fascism was the way in which it drew on List (and others) to provide the economic arguments supporting protectionist, centrally-directed economic policies. The central argument - familiar to development economists weaned on import-substitution - is that tariffs are needed to protect nascent industries. Moreover that the cost of this protection to consumers is an acceptable investment in the collective future of the nation.

This isn't to say that List was a Fascist but it is to point out that his economics provides an important rationale for nationalism since it is founded on both the idea of the nation state (not merely the idea of nationhood) and also the belief that nations, as collective identities, compete. You'll be familiar with this idea's associated rhetoric - "global race", "the only way Britain can win", "British jobs for British workers". Such language is appealing and populist, indeed it harks back to an age of one-sided "free trade", ever higher tariff barriers and protectionism.

A further, and essential, element of Fascist economics is the idea that only investment directed by the state - as the embodiment of nation - is good investment. Other investment - by big business especially - represents a drag away from the vital agenda of national development and progress.

This view persists today - here from an article in the FT:

...especially in an economic environment where the only productive use of capital is increasingly through government spending.

Private investment is anti-social, indeed it represents:

...the pursuit of personal gain over the common good in a nefarious and unproductive way for society.

Since the writer here isn't proposing a Stalinist command economy, the only conclusion is that she believes that the state, as the mirror of society's needs, must direct investment in the economy. And, just as was the case with Italian Fascism's drawing on List, a core policy is the rejection of consumption today in order that the state of the future may thrive. Today this policy is couched in terms of 'climate change', 'well-being', 'sustainability' and 'equality' rather than 'industrialisation', 'competitiveness' and 'national power' but it is otherwise indistinguishable.

Moreover, like fascism, these ideas are anti-democratic (or in modern parlance post-democratic):

Party government was formally suspended in Italy on 18 November 2011. On that day, less than a week after Silvio Berlusconi’s resignation, a new government led by the former European commissioner Mario Monti received the support of the Chamber of Deputies, with only the regionalist-populist Lega Nord (Northern League) voting against it. By an overwhelming majority, all but one of Italy’s parliamentary parties approved a government that contained not a single party representative or elected parliamentarian.

And this returns me to my wry smile about List:

...the original European unity theorist whose ideas were the basis for the European Economic Community

Leaving aside the admirable desire to avoid war, the European project was founded on the idea of state-directed, protectionist economics. The entire programme is the antithesis of laissez faire and the political imperative is both anti-democratic - as we have seen with the response to the Euro crisis - and anti-enterprise. Or rather against enterprise that falls outside the 'plan', does not confirm to the 'agenda' and lacks the endorsement of collective technocratic leadership.

Today we tend to characterise fascism as ignorance, jackboots and racism but the core economic ideas remain - nations, regions or cities competing, the state directing economic investment and the belief that technical expertise is better than democratic leadership. Above all there is this view that we have, as a nation (or in the EU's case 'group of nations') a 'common purpose', a greater mission than our personal, selfish interest. And that this purpose requires sacrifice - higher taxes, lower incomes, reduced choice - for the greater good of the nation.

This is the New Fascism.


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