Figure 10.1 Top 0.1 percent Income Shares (%), 1820–2020
Source: “Global Income Inequality 1820–2020: The Persistence and Mutation of Extreme Inequality,” Lucas Chancel and Thomas Piketty (2021), July 5, 2021, wid.world/longrun.
The technological revolutions of the turn of the last two centuries created peculiarly modern forms of interconnectivity that produced peculiarly modern forms of social dislocation. They also engendered equally modern political responses. This chapter will look at how right-wing and left-wing formulations of who “the people” and “the nation” were developed, how economic nationalism became dominant, and lastly how each side of the political spectrum defined the international forces that were threatening the nation.
Table 10.1 Ideological Forms of Defensive Nationalism
| Left-Wing Defensive Nationalism | Right-Wing Defensive Nationalism | |
| Basis (“the people”) | Class-based | Nativist |
| Nemesis (“global enemy”) | International capital | Foreign penetration |
| Constituency | Predominantly urban based | Predominantly peripherally based |
| Orientation | Forward-looking, Progressive | Backward-looking, Retrogressive |
| Goals | Equality of opportunity | Restoration of traditional (religious) order |
| Rhetoric | Rights-based/Equity | Fear-based/Group Survival |
| Protection For | Economically disadvantaged and less privileged | Heartland “natives,” traditional family and patriarchy |
| Economic Policy Objectives | Checks on wealth accumulation Reduction of corporate power Unfair trade deals Protection of national jobs | Unfair trade practices Unchecked migration Unfair trade deals Protection of national jobs |
In the 1880s and 1890s, something new was brewing around the world. The rapid rise in immigration, coupled with economic distress and international terrorism, galvanized people in a whole new way. The period was to witness the materialization of an entirely new form of struggle. Across the advanced world, defensive nationalism took hold. This uniquely modern crusade became the dominant political movement of the era.
The irony was, as Polanyi underscores, that the anti-liberal response began as soon as the gold standard had been accepted as the international medium of exchange. Indeed, “the heyday of elite cultural globalization was before 1870. Nationalist cultural identities gained in importance in the latter decades of the nineteenth century.”1 On both sides of the Atlantic, nativist, populist, anti-international movements sprung up. Each side, however, followed a different trajectory. In Europe, defensive nationalism was spearheaded by the nobility and industrialists who were hit hardest by changes to agriculture and trade. By contrast, in the United States, with no history of feudalism, the impact of the economic changes was felt most severely by farmers, particularly grain farmers across the Midwest. They were the ones to mobilize and to define the populist understanding of the battle between “the people” and “the enemy.”
In the United States, the global panic of 1893 was the defining moment that ushered in this new form of political mobilization. The panic began when gold mining in the United States failed to keep up with supply, resulting in a run on gold. The “Great Depression” that followed was the worst financial crisis the United States had experienced hitherto (see Chapter 7). The situation eventually grew so bad that, “During the winter of 1893–94, charities were strained to the breaking point. Long lines appeared at the soup kitchens.”2
The misery experienced by the working classes prompted the first popular protest rally in Washington DC. The DC rally was the brainchild of Jacob S. Coxey, an Ohio businessman, aspiring politician, and astute publicist. Coxey, long interested in reform, had co-authored the “Good Roads Bill,” which he presented to Congress. The bill proposed a public roads program to aid the unemployed. After introducing his bill to Congress, Coxey looked for a way to drum up support for it. He alighted upon a novel promotional strategy. To make the scope of the problem of unemployment visible to the nation, Coxey organized “an army of laborers” to descend upon DC. On March 25, 1894, a great mass of unemployed workers, hobos, and tramps, from as far away as Oregon, began to make their way to the Capitol for what was announced to be a “petition in boots.”3
Although unemployed laborers formed the greater part of “Coxey’s army,” it was the farmers who came to form the central nexus of the American left-wing defensive nationalist movement. Farmers were hit especially hard by the drop in the gold supply because it occurred in tandem with falling farm prices. The fall in farm prices was quite sharp. From 1864 to 1896, “the price of farm products fell by over sixty percent”; farmers “felt the squeeze of falling prices and feared they might lose their independence.”4 Many farmers also had a heavy debt burden, which the currency crisis only magnified. To bolster agricultural prices, farmers advocated for a system of “bimetallism.” Their goal was to increase the availability of money by pegging silver to gold. The “free-silver” movement (as it came to be labeled) pitted farmers against “pro-gold” advocates. The latter included those who headed financial establishments in the Northeast, railroad barons, and large industrialists, all of whom benefited from the rise in trade and financing that the gold standard had facilitated.
In fact, this political battle has been immortalized in the childhood classic The Wizard of Oz based upon the first of a series of books written by L. Frank Baum.5 Although there is debate about whether the story was intentionally written as an allegory,6 all its components work to illustrate the free-silver movement of the period. The story begins in the heartland of the United States, Kansas. Its protagonist is Dorothy, an average, young farm-fed girl. In fact, the center of the free-silver movement was Kansas, and it was made up of farmers like Dorothy’s family and neighbors. The yellow brick road that Dorothy walks down symbolizes gold bullion, the contested national monetary standard. The “Wonderful Wizard of Oz” represents the federal government, which could decide by fiat (through wizardry) what metal, silver or gold, (oz. being the abbreviation for ounce) would be the center of the economy. In the original version, Dorothy’s slippers were not ruby but silver symbolic of midwestern farmers’ aspiration for a silver standard. Along the way, Dorothy encounters munchkins (the American population), a brainless scarecrow (farmers), a heartless tinman (industry), and a cowardly lion (politicians). Finally, the Wicked Witch in the story represents powerful individuals aligned against silver. Some have suggested that the character represents President Grover Cleveland, who worked hard to oppose the silver movement.7 However, another possible candidate for who the Wicked Witch signifies is J. P. Morgan.
John Pierpont Morgan was arguably the person who best exemplified the “pro-gold” camp. Morgan was the richest man in the world. During the Great Depression, while the rest of the country suffered, Morgan’s companies thrived. Although he came from a wealthy banking family, J. P. Morgan made his spectacular fortune in railroads. Yet, Morgan did not build railroads; he took over or consolidated failing railroads under his control. These hostile takeovers even came to be referred to as “Morganization” (reputedly also the original inspiration for the game Monopoly).8 In 1901, Morgan switched his focus to steel, forming US Steel—the first billion-dollar corporation in the world.9 Public resentment grew against the railroad magnate, especially among farmers who were heavily affected by Morgan’s monopolistic control of rail freight prices. J. P. Morgan became the symbol of all that was wrong with American politics, the quintessential “Wicked Witch.” The magnitude of opprobrium felt toward the great railroad magnate is palpable even a century later. A contemporary wrote: “No other system of taxation has borne as heavily on the people as those extortions and inequalities of railroad charges which caused the granger outburst in the West, and the recent uprising in New York.”10
Thus, the battle over gold versus bimetallism produced a self-identified populist movement, particularly in the West, where farmers blamed the greed of eastern bankers and industrialists for the depressed state of the economy. The American populist parties of the 1890s drew their largest followings from the central farmland states of Omaha and Kansas. The cardinal goal of the movement, summed up in the Omaha Chapter of the People’s Party platform, was “to restore the government of the Republic to the hands of ‘the plain people,’” “the urban workman,” and “pauperized labor” who were “denied the right to organize for self-protection.”11 A critical figure at the time was Mary Elizabeth Lease, a riveting orator who helped found the Kansas People’s Party. Lease was also politically savvy. By organizing a slate of populist candidates to run for the Kansas legislative election, her Kansas People’s Party won control of the legislature with ninety-one seats. The success of the populists in Kansas boosted other populist movements across the country.
Whereas the People’s Parties were strong in the Midwest and to a lesser extent in the South, in the East it was labor unionists and socialists who gained left-wing populist support. One individual who gathered a significant following was a radical reformer who ran for mayor of New York in 1896, Henry George. George had developed a unique economic theory, which came to be known as “Georgism.” The central tenet of Georgism was that the root of all economic crises was inflated property values. The logic was that as property values rise, they inevitably produce irresponsible speculative bubbles, which inevitably burst. Hence, private property is the source of economic dislocations. George’s solution was to effectively eliminate private property by placing a high tax on it and at the same to cease taxing labor. George published his theory in an eloquently written book Progress and Poverty (1879).12 The book, with its scathing critiques of the extreme greed of the idle wealthy, gained popularity and Georgism briefly took hold as a political movement in the East.
But it was William Jennings Bryan who became the standard bearer of the burgeoning left-wing defensive nationalist movement. A congressman from Nebraska from 1890 until 1895, Bryan was considered the national leader of the Free Silver Movement. Bryan’s superior oratory skills had unexpectedly won him the Democratic nomination for the presidency in 1896. At the Democratic Convention, Bryan made a stirring speech in defense of the free-silver platform. Later dubbed the “Cross of Gold Speech,” Bryan galvanized the auditorium with his famous closing words: “You shall not press down upon the brow of labor this crown of thorns, you shall not crucify mankind upon a cross of gold.” So rousing was the speech that the next day the Atlanta Constitution reported that “Deafening cheers rent the air and articles of every description were thrown high above the surging sea of humanity.”13
In Europe, the emergence of defensive nationalist movements followed a very different trajectory. In the late nineteenth century, international anarchist and communist movements formed the core of European left-wing, anti-liberal movements. Their goal was to defeat global capitalism by uniting workers across what they regarded as artificial national boundaries. But after the turn of the century, they too had become nationalist.
In 1864, the Communist International was established at a meeting in London attended by labor leaders and radical nationalists from France, Italy, Germany, and London. The most famous delegate in attendance was Karl Marx who represented Germany. The Comintern, as it came to be known, held three important conferences. Over time, however, founding members of the Comintern came to support nationalist policies. Indeed, “the tension between national sentiment and internationalist aspiration was never resolved in socialist theory or practice and was to haunt all three Internationals.”14 This is illustrated by Vladimir Lenin’s political transformation. Lenin had vehemently argued that “democracy and nationalism were little more than deceptions used by the bourgeoisie to divert the working class from revolution.”15 However, facing the stark circumstances in which the Soviet Union found itself at the tail end of World War I, Lenin was compelled to place national interests and state economic development ahead of international revolution. In 1917, he instituted what he labeled “War Communism”; in reality, it was economic nationalism. The policy agenda focused on industrializing the Soviet economy and advancing the languishing Soviet State. Thus, even at the center of the international communist movement, defensive nationalism took hold.
Although left-wing defensive nationalism evolved more slowly in Europe than in the United States, strong right-wing defensive nationalist movements developed very early on. These right-wing defensive nationalist movements were led by members of the elite classes: the nobility, as well as members of the bourgeoisie and industrialists hurt by open trade policies. They spoke to the same fears of globalization and threats to “the nation” as their left-wing counterparts, but they used very different idioms. For conservative nationalists, “the nation” that was under attack was not the average worker or laborer being crushed by the actions of powerful railroad magnates. “The people” were those who lived in the rural “heartland” and made up the heart and soul of the nation: the volk.
One of the first writers to connect national revival with protecting the “heartland” was a French aristocrat, Arthur de Gobineau. Gobineau’s theories were related to a larger movement developing across Europe at the time, especially in the arts, Romanticism. The Romantics were on a “quest for authenticity,” which they expressed through the “spiritual and artistic identification with the local and national way of life in the countryside.” The fascination with the peasantry came from the idea that “the local and national way of life in the countryside” represented “the ‘incorruptible’ nation.” Unlike urbane civilization, “Nature” was “the true source of life, dignity and sanctity.” As Anthony Smith explains, “this turn towards rural labour [betokened] a deeper self-identification with the peasantry” and a “general expansion of national sentiment,” which identified “ ‘the land and its people’ as emblems of national authenticity.” Thus, the Romantic movement was characterized by a “turning away from the sophisticated but often corrosive lifestyles of the city,” to embrace “the deeper, more permanent, sacred truths of human life, which could be appreciated and embodied most faithfully in the simple life, the labour and the customs of ‘the people,’ the rural poor.”16
Gobineau built on this romantic tradition, combining notions of racial purity with the peasantry. In his treatise, “Essai sur l’inégalité des races humaines” (“Essay on the Inequality of Human Races”) published between 1853 and 1855, Gobineau idealized agrarian society and disparaged the modern city as a giant cesspool of unrooted people undermining the purity of the French nation. By the latter part of the century, Gobineau’s ideas had become increasingly popularized. In Wilhelmine, Germany, Gobineau’s theories found fertile ground. Indeed, Gobineau’s essay was translated into German in 1874, where a Gobineau Society was set up to propagate his ideas.17 Soon after, the early German nationalist Konstatin Frantz published a political treatise in 1879, Der Untergang der alten Parteien und die Parteien der Zukunft, in which he directly echoed Gobineau’s themes:
What does the peasant care whether they have the same laws a day’s journey from his village as at his home? But he must desire all the more to keep to his traditional law with which all the habits of his life are entwined. Similarly, what does the petty burgher, whose business transactions do not extend beyond his immediate neighbourhood, care? So that exactly those elements who form the stable basis of a nation, not only have no interest in a general and uniform civil code, they are decidedly harmed by being required to fit themselves into the new legal provisions. Only the mobile section of the population is at all interested in it, i.e., those who have no fixed abode, or who travel frequently, or whose business activities result in far-flung connections. Hence it is at merchants and manufacturers and most to fall pure speculators, that opportunity will henceforth smile: to start form one point and everywhere set up business, everywhere speculate in land and buy up estates, because the legal forms and conditions of such transactions are everywhere the same. So it is for the purpose of providing elbow-room for this mobile element that we have shaken the solid foundations.18
More generally, among conservative German circles, agriculture was exalted “as a symbol of the fatherland and a nursery of national strength and energy.”19 Conservatives declared that the contempt for the peasants of the land was the chief cause of the moral, material, and intellectual decline of Germany. In a publication of the day, the Konservative Korrespondenz, it was proclaimed that the rural population “forms an irreplaceable basis not only for our German army but for the entire national power of the Volk.”20 These ideas were later propagated by Hitler, who described his fight for Germany as a defense of the German peasantry against the urban centers: “When I fight for the future of Germany peasantry against the urban, I must fight for German soil and I must fight for the German peasant. He renews us, he gives us the people in the cities, he has been the everlasting source for millenniums, and his existence must be secured.”21
Such sentiments were in no way restricted to Germany. Across Europe, and to a lesser extent the United States, national public figures were promoting extreme nationalism. These late nineteenth-century romantic nationalists exalted “the nation and tradition . . . as the sole moral creative forces, the only ones able to prevent decadence.”22 The reactionary movement was typified by the writings of several intellectuals of the day, from George Sorel, the revolutionary syndicalist in France; to Enrico Corradini, the Italian novelist, essayist, journalist, and political figure. The new breed of conservative intellectuals embraced an ideology that combined myth and nationalism with anti-liberalism. However, there were also differences among them. For proto-fascist thinkers like Sorel and Corradini, the volk were not the peasantry. Their brand of anti-democratic, racialized nationalism was blended with Marxism and anarchism. They believed the heart of the nation lay with the working proletariat. Thus, Sorel advocated “anarcho-syndicalism” and Corradini “national-syndicalism,” both revolutionary philosophies that held that the workers should combine forces to overturn the liberal-capitalist, democratic, state through industrial unionism, or syndicalism. Many of these nationalists were also heavily influenced by Social Darwinism and “appropriated biological language,” which they “applied to politics and all human relations.”23 For example, Alfredo Rocco, a conservative Italian nationalist, saw history as “a perpetual, quasi-Darwinian struggle among nations, with each nation understood as a distinct biological organism.”24
These ideologies were, thus, the precursors to fascism that would be adopted a few decades later. The revolutionary mobilization of the masses and the quasi-mystical exaltation of the nation would then fully be actualized under the strict guidance of an authoritarian leader.
As in the preceding century, job displacement and economic insecurity led to the defensive nationalist movements of the twenty-first century. There had been a series of financial panics in the 1990s, mostly felt in Latin America and Asia. But it was not until the financial crisis of 2008 that the precariousness of global financial speculation hit Europe and the United States directly. After 2008, a series of Eurosceptic and populist movements gained large followings.
As in the earlier period, the core of the late twentieth-century left-wing movements were internationally organized. One of the more consequential leftist crusades was the “global justice movement” that emerged in the 1990s. It had developed largely in response to the increasing power the World Trade Organization (WTO) was exercising on states’ domestic affairs. The WTO had obligated governments around the globe to eliminate protective regulations and tariffs. In Polanyian terms, it was a process of dis-embedding the market from measures established under the Bretton Woods framework.25 In practical terms, it meant that laborers, farmers, and Indigenous people had no one to protect them from plundering multinational corporations that were swooping in to extract labor and resources. In response, activists in the Global North joined in solidarity with activists in the Global South to force the WTO and its state sponsors to respect national trade unions, environmental laws, and Indigenous rights.
But the global justice movement was surprisingly short-lived. Even before the global economic crisis in 2008, the movement had begun to wane. Arguably, the apex of the global justice movement was the protests held during the 1999 round of WTO negotiations in Seattle. Fifty thousand protestors took to the streets. The “Battle in Seattle” united a diverse collection of civil-society actors: “Environmentalists clad in turtle costumes marched alongside Teamsters, black-clad anarchists alongside the Raging Grannies.”26 The Seattle protests also brought the WTO to the attention of the general public. In fact, after Seattle there was “a wave of other mass protests at meetings of multilateral economic organizations—including the International Monetary Fund (IMF), the World Bank, the World Economic Forum, and the G20—at different sites around the world.”27 And yet, at the next series of WTO negotiations held in Doha in 2001, protests were comparatively anemic. States and civil society groups had already begun focusing on their specific interests. In general, by the early 2000s, internationalism was on the way out, setting the stage for the national populism that was to emerge. The final spur was the 2008 economic crisis. After the global economic crisis had hit, incipient anti-liberal, anti-globalization movements began to develop both in Europe and the United States.
In the United States, the first social protest movements that emerged in the wake of the 2008 economic crisis were not expressly organized against globalization; but they were forerunners to the defensive nationalist movements that came into being a few years later. Anger came to a pitch when, rather than prosecute the top banking executives behind the financial crisis, the United States government bailed out the banks and allowed the company heads to resume control of the same corporate banking conglomerations that had so spectacularly failed under their watch. To add insult to injury, while the country was reeling from the fall-out of the crisis and thousands of Americans were losing their homes, it was reported that these CEOs gave themselves large bonuses a year after their banks failed. Their bonuses had effectively been paid for with taxpayer money, that is through government bail-out funds. This had taken things too far. People took to the streets.
In 2011, the “Occupy-Wall-Street” movement took shape. Its goal was to target the established elite and international finance. Several demonstrators set up camp in Wall Street’s Zuccotti Park, which they renamed Liberty Plaza (emulating the successful Egyptian occupation of Tahrir Square that had brought down Hosni Mubarak’s government earlier that year). The right also began to mobilize. After the 2008 election of the first African American President, Barack Obama, closely followed by major Republican losses in both houses, a new crop of organizers led an insurgent “Tea Party” movement (so named to connect their movement with the protests on tea taxes that had set off the American Revolution). Like the left-wing Occupy movement, the Tea Party was angered by Wall Street and the political elite’s complicit support of these powerful financiers. But reactions on the right included something else in addition: racial animus. Many were galvanized by the false notion that Obama was not an American citizen. The “Birther” movement was indeed central to the Tea Party. At Tea Party protests, it was not uncommon to find protestors carrying placards with racist depictions of the president.
Four years later, during the lead-up to the 2016 presidential election, the scales had fully tipped. Public sentiment had had time to stew and all the themes that had emerged with the Occupy and Tea Party movements came to a head. A palpable disgust with the political establishment had combined with the fear that globalization had run amuck. Populism ran so high that two outsider candidates had unparalleled success: each representing different polls of the defensive nationalist fervor that was beginning to take hold globally. On the left was Bernie Sanders, a long-established socialist who campaigned on the Democratic ticket against the corrupt party establishment, corporate greed, and for returning the power to the people. On the right, the man who had been a central propagator of the myth of “birtherism” and who had little support within the Republican Party establishment, Donald Trump, who proclaimed it was time to “drain the swamp” in Washington, DC.
In Europe, the process was different but parallel. Right-wing nativist parties had been on the upswing since the 1990s. In 1994, Hagtvet described “the spectre of nationalism, re-emerging and attended by a flurry of right-wing extremist behaviour” across Europe.28 But that proved to be just the beginning. After the 2008 global economic crisis, a large number of populist politicians across Europe were able to expand their base, and in some cases form new parties. In this way, “Parties that were inexistent or largely unknown prior to 2008 were propelled into the political mainstream.”29 In less than two decades, European support for both far-right and far-left parties more than doubled, from 15 percent to in 1992 to almost 35 percent, after 2015.30 Many of the far-leaning parties were later labeled “Eurosceptic” parties because their supporters were galvanized by their opposition to the Eurozone.
These twenty-first-century defensive nationalist movements were mobilized by similar kinds of rhetoric as their nineteenth-century counterparts. On the left, “the people” were identified primarily as the average worker who had become a pawn in the hands of the wealthy. For example, Alexis Tsipras, the leader of the “Coalition of the Radical Left” party (Syriza), won the Greek Prime Ministership in a major upset in 2012 by declaring: “On one side there are workers and a majority of people and on the other are global capitalists, bankers, profiteers on stock exchanges, the big funds. It’s a war between peoples and capitalism.”31 Similarly, Jeremy Corbyn, the socialist who had upset the apple cart in Britain by becoming the leader of the Labour Party in 2015, galvanized the left by campaigning to protect the average man: “Pensioners anxious about health and social care, public servants trying to keep services together. Low and middle earners, self-employed and employed, facing insecurity and squeezed living standards.”32 In the United States, Bernie Sanders, also a socialist running on a major party ticket, emphasized that the body politic was made up of diverse working people and celebrated that diversity during his 2016 presidential campaign:
our diversity is one of our greatest strengths. Yes, we become stronger when black and whites, Latino, Asian American, Native American, when all of us stand together. Yes, we become stronger when men and women, young and old, gay and straight, native-born and immigrant fight together to create the kind of country we all know we can become.33
The rhetoric used by those on the right also paralleled the earlier defensive nationalist movements. As their nineteenth-century counterparts, they too defined the “nation” in terms of “the heartland,” or the volk. However, the volk of today are more likely to be portrayed as the people who live on the periphery of cosmopolitan urban centers (rather than as rural farmers or the “proletariat” per se), particularly people who live in areas that have fared the worst from international trade competition. On both sides of the Atlantic, these peripheral regions had suffered from a “decline in manufacturing employment [that] initiated the deterioration of social and economic conditions . . . exacerbating inequalities between depressed rural areas and small cities and towns, on the one hand, and thriving cities, on the other.”34 In small towns and rural communities across Europe and the United States, a bitterness took hold against urban areas, where finance and the new service industries benefited most from globalization. Those living in the areas blighted by deindustrialization became especially ripe for political mobilization. As Voss explains, “the likelihood for a rise of rightwing populism depends on the relative number of marginalised working-class voters as a result of widened labour market segregation, their mobilising capacity, and above all the generalisability of their experience of socioeconomic decline.”35
Politicians who were willingly to use divisive language and hate to drum up support quickly recognized they could profit from the situation. New political entrepreneurs emerged who conjured up all kinds of dangers posed by invading hordes of immigrants to the “true” citizenry, the volk. Britain’s right-wing white-supremacist party, The National Front, pronounced on their home page that “National Front represents the indigenous peoples of the United Kingdom,”36 by which they meant white, Anglo-Saxons. In a 2016 interview, Frauke Petry, a co-chair of the racist and xenophobic right-wing party, Alternative for Germany (AfD), openly called for revaluing the term “völkisch.” Treating such a term neutrally was seen by most Germans as outrageous. The adjective had no active meaning apart from the late nineteenth-century movement that was “chauvinistically nationalist, anti-democratic, authoritarian, anti-Semitic, militaristic and racist.”37 This claim was therefore shocking to the larger society in Germany, where for half a century people had taken great pains to condemn Nazism. In a 2010 speech, Geert Wilders, the leader of the radical-right Party for Freedom (PVV) in the Netherlands, contrasted the liberal establishment’s support of Islamic migration with the needs of the true Dutch, “What this cabinet was especially good at was ramping up mass immigration, the support of Islamisation and hollowing out the Dutch character of the Netherlands.”38 Similar pronouncements were made by nativist leaders across Europe, from Italy, France, Hungary, and Spain, as well as others.
Less directly, but with equal force, Trump in his inauguration speech at the 2015 Republican Convention invoked the plight of the volk when he spoke of “the forgotten men and women of our country”; the “wounded American families [who] have been alone.” These “forgotten country-men” Trump described as “the laid-off factory workers, and the communities crushed by our horrible and unfair trade deals . . . People who work hard but no longer have a voice.” Trump contrasted the “forgotten Americans” victimized by globalizing forces, with inner-city populations. The latter he portrayed as willfully idle, the “58% of African American youth are not employed. 2 million more Latinos are in poverty today than when the [Barak Obama] took his oath of office less than eight years ago. Another 14 million people have left the workforce entirely.”39 In other words, Trump made clear who the true American volk were, as well as who they were threatened by.
In general, nativist rhetoric became more commonplace during the 2010s. Extreme ideologies no longer had to hide in dark, faraway corners. The small, isolated far-right factions of the 1990s had grown in numbers, gained in political strength, and were now able to come out in full daylight and be accepted into the mainstream.
The rediscovery of national society was as much a state process as it was a civil society movement. As Polanyi observed, one of the first manifestations of the “double movement” was protectionist policies. In both periods, protectionism materialized just when international integration and the new global economy were beginning to emerge. In fact, they came in tandem.
It did not take long to recognize that global liberalism posed a threat to industry, farmers, and workers. Almost as soon as international trade had been liberalized, anti-trade tariffs, particularly of grain, were instituted across Europe in the late 1870s and 1880s.40 By 1890, even the United States had adopted stringent protectionist policies.
In Europe, open trade was especially harmful to the interests of the landed nobility and large industrialists who were powerful enough to pressure their governments to enact legislative protections. Two of the first countries to erect trade barriers had actually been early adopters of the new free-trade agreements: Germany and Italy. As early as 1851, the Piedmontese government in Italy began to lower tariffs and liberalize their trade policies. By 1863 the kingdom had even signed a free-trade agreement with France.41 Similarly, in the early 1870s, Otto von Bismarck established the new German Reich “on free trade principles and low tariffs.”42
However, the “grain invasion” from the United States provoked a reversion to protectionism. As Rodrik explains:
The transport revolutions and tariffs resulted in an influx of grains from the New World and sharply lower prices. Everywhere on the Continent agricultural interests clamored for protection, often making common cause with industrialists who were reeling under competition from the more advanced British producers (and increasingly from American exporters too) onward.43
By 1878 and 1879, Italy and Germany, respectively, adopted tariffs to protect their landed nobility and industrialists. In Germany, the flood of American wheat on the global market hastened the end of the “golden age of German agriculture, which began in the 1830s.”44 “Stagnating production, high costs, and declining prices produced an agrarian crisis in Germany of serious proportions.”45 The junkers, Germany’s landed elite and the industrialists began to clamor for something to be done. Bismark, who had never been ideologically committed to open trade, reversed himself. Germany abandoned free trade and introduced tariffs on grain, pig iron, and livestock.46 Thus, by the end of the seventies, “the chancellor Otto von Bismarck shifted to an authoritarian and protectionist domestic policy, which was heralded by the Anti-Socialist Law of 1878 and the tariff act of 1879.”47
The Italian government faced similar forms of destabilization as wheat prices dropped. In the 1880s, tariffs were dramatically increased on grain. So devoted were they to these protectionist policies that by 1913 the Italian government was levying a “roughly 40% ad valorem tariff on wheat.”48 In fact, comparable protectionist responses to laissez-faire trade were embraced across Europe. France and Sweden reimposed tariffs in the 1880s; Russia increased grain protections in 1877 and again in the mid-1880s; and Austria-Hungary and Spain adopted protectionist policies in the 1870s and 1880s.49 “Of the major Western European powers, only Britain adhered to free trade principles.”50,51
In the United States, “economic nationalism [also] prevailed.”52 In the initial period after the Civil War, the United States had fully embraced the new laissez-faire ideology. Successive governments looked beyond the home market to export the country’s growing agricultural and manufacturing surpluses. However, as the deleterious effects of international capitalism became more pronounced, pressure mounted for the government to institute tariff reforms. After a decade of debates, “economic nationalism visibly manifested itself in 1890 with the passage of the highly protective McKinley Tariff.”53 The McKinley Tariff was “the era’s highest tariff.”54 The Act mandated that tariffs be placed on most imports, some as high as 49.5 percent. The passage of the Act “sent political–economic shockwaves throughout the globe, from England to Australia, and sparked corresponding global demands for protectionist retaliation.”55 Even in Britain, the center of the “liberal creed,” “the McKinley Tariff’s policies helped to call into question Britain’s liberal, free trade, global empire by drumming up support for an imperial, protectionist, preferential Greater Britain.”56
A similar process evolved in the twentieth century. Almost as soon as globalization began, protectionism emerged. Economic interdependence and expanding financial speculation left national economies vulnerable. These processes caused major economic crises, from the oil shocks of the 1970s to the nearly ruinous financial crisis of 2008. Facing increased political pressure, even the most dogmatic supporters of free trade adopted protectionist policies.
During the postwar era, laissez-faire economics was largely considered a discredited theory of bygone years. After the terrible market crash of 1929, the dominant economic model was that of the prominent British economist John Maynard Keynes. Keynes had argued that markets were not perfectly self-adjusting and that, therefore, governments had to invest in the economy to ensure full employment and to buffer society from inevitable market downturns. But the global economic recession in the 1970s eroded trust in government’s ability to repair the economy. Keynesianism lost favor in many circles. A new liberal ideology, neo-liberalism, that had been on the periphery of the academic world gathered an increasing number of adherents. The followers of this new brand of liberalism held an even more stringent conception of free-market liberalism. Laissez-faire capitalism was deemed to be inextricably linked to political freedom and economic individualism. This strain of liberalism was exemplified by the writings of staunch anti-communists, such as Josef Hayek’s treatise on economic theory, The Road to Serfdom;57 and Ayn Rand’s novel, Atlas Shrugged.58
Thus, by the late 1980s a new liberal economic order had come into being. For the second time in history, there was a broad consensus in favor of freer trade. Using arguments that strongly echoed Herbert Spencer’s in the nineteenth century (see Chapter 3), the proponents of the new economic theory depicted globalization “as a spontaneous and agentless economic process, propelled by the ingenuity of markets and the magic of the invisible hand.”59 International integration of markets for goods and capital was promoted as an end in itself. The United States was “the primary driver of neoliberal economic order restructuring the economy globally.”60 With the political and economic might of America and to a lesser extent the European Union, “Domestic economic management was to become subservient to international trade and finance rather than the other way around.”61 By the 1990s, the WTO had reintroduced “a significant expansion in supranational authority.”62
Yet, just as global finance was beginning to overshadow domestic agendas, several countries instituted protectionist tariffs. In fact, “the ‘deep integration’ bargain reflected in WTO treaties came into question almost as soon as the ink was dry.”63 It became rapidly apparent to those involved in major exporting industries—from automobiles to steel and rubber to machinery—that they were facing much more competition in both international and domestic markets. Almost as quickly as free-trade treaties had been agreed upon, both labor and capital “switched to protectionism.” Thus, along with the “enthusiasm toward a deepening of international economic integration,” there developed the fear “that economic integration had gone quite far enough.”64
Hence, during the 1980s, “the GATT regime underwent a metamorphosis which cannot be simply understood as an evolution of the regime within the embedded liberal normative texture.”65 As Rodrik explains, “GATT’s purpose was never to maximize free trade. It was to achieve the maximum amount of trade compatible with different nations doing their own thing.”66 The upshot was twofold. On the one hand, weak, developing countries were forced to radically liberalize their struggling economies. They were directed to eliminate any and all labor and environmental protections, open themselves to foreign direct investment, sell off government owned industries (including public utilities) to private owners, and even roll back government-funded education and healthcare. On the other hand, governments in the advanced nations hypocritically evaded opening their own markets and built bulwarks against facing risks from international competition.67
America, the country that perhaps more than any other pushed for developing countries to open their markets, was among those that fought the hardest to protect its steel, textiles, footwear, and clothing producers.68 This protectionist posture even seeped into popular culture. As early as 1975, the American International Ladies Garment Workers Union (ILGU) launched a television campaign that resuscitated the old union jingle “Look for the Union Label” to promote the purchasing of products made by American union workers rather than cheaper goods made overseas. Competition from Japanese automobile manufacturers, who were producing cheaper, fuel-efficient cars, brought into being a new phase of Japan bashing. American politicians vilified Japanese manufactures and exhorted Americans to buy products made in the United States. Anti-Japanese sentiment reached such a pitch that in 1983 two white auto workers who mistook a young man out celebrating his birthday, Vincent Chin, for being Japanese, savagely beat him to death. When the attackers pled guilty to Chin’s murder, the judge only sentenced them to serve three years’ probation and ordered them to pay a $3,000 fine. They were given no jail time. This incident proved to be a portend of the nativism that was to be widely embraced a few decades later.
During both these periods, the dominant economic power of the day, Britain in the nineteenth century and the United States in the twentieth, promoted a liberal economic agenda that maximized gains to the wealthy. As a consequence, in both periods of modern globalization, inequality grew sharply. Increasing inequities fueled growing defensive nationalist movements. Left- and right-wing defensive nationalists charged that the painful restructuring of the economy was guided by nefarious global financial forces working in cahoots with corrupt domestic elites. However, each side characterized these global players differently. For leftists, the sinister global force was high finance, industry, and billionaire capitalists; for the nativists, the malevolent power was particular ethnic groups, especially those associated with finance or opposing nations.
The nineteenth century infamously came to be known as the age of the “Robber Barons.” Indeed, wealth concentration spiked between 1870 and 1900 (see Figure 10.1). While an increasing number of workers were forced into punishing factory jobs and miserable slums. the great captains of industry, like Carnegie and Rockefeller, and their financiers, such as the Rothschilds in London, the Périere brothers in France, and J. P. Morgan in the United States, accumulated spectacular fortunes. Henry George, the popular economist of the day, described the duality of the age:
the tendency of what we call material progress is in nowise to improve the condition of the lowest class in the essentials of healthy, happy human life. Nay, more, that it is still further to depress the condition of the lowest class . . . between top and bottom. It is as though an immense wedge were being forced, not underneath society, but through society. Those who are above the point of separation are elevated, but those who are below are crushed down.69
In reaction, left-wing defensive nationalist movements of the era emphasized the predatory nature of international capitalism. Mary Elizabeth Lease, who helped organize the Kansas People’s Party, the first populist party in the United States, declared that “Wall Street owns the country. It is no longer a government of the people, by the people, and for the people, but a government of Wall Street, by Wall Street, and for Wall Street. The great common people of this country are slaves, and monopoly is the master.”70 Similarly, the Omaha Platform of the People’s Party argued that railroad magnates and great industrialists were the enemies of the people, whose ability to steal the “fruits of the toil of millions” had bred “two great classes—tramps and millionaires.”71 William Jennings Bryan in his celebrated Cross of Gold Speech proclaimed, “What we need is an Andrew Jackson to stand, as Jackson stood, against the encroachments of organized wealth.”72 He described the populists as in a battle waged between “the idle holders of idle capital” and “the struggling masses, who produce the wealth and pay the taxes of the country.”73 A few decades later, Teddy Roosevelt, adopting some of the positions outlined by the populist parties, made a speech on “New Nationalism” in 1910. The speech centered on the need to free government “from the sinister influence or control of special interests” and to overcome the “unfair money-getting [that] has tended to create a small class of enormously wealthy and economically powerful men, whose chief object is to hold and increase their power.”74
Figure 10.1 Top 0.1 percent Income Shares (%), 1820–2020
Source: “Global Income Inequality 1820–2020: The Persistence and Mutation of Extreme Inequality,” Lucas Chancel and Thomas Piketty (2021), July 5, 2021, wid.world/longrun.
In contrast, right-wing defensive nationalism defined the problem in terms of outsider ethnic groups. In the late nineteenth century, this manifest as a deep-seated anti-Semitism that took hold of Europe. Jews became the embodiment of every evil associated with modernity, especially the modern economy in which wealth in money had superseded wealth based on land ownership. Jews had long been viewed “contemptuously as the personification of the money-grubbing bourgeois, petty, cowardly, selfish, and materialistic,” but as nationalism gained prominence, anti-Semitism became “infused with the more traditional nationalist criticism that Jews were prime exponents of internationalism. Because Jews were scattered throughout the world and supposedly gave primary allegiance to their religion which transcended individual nation-states, they could never be considered loyal citizens of a single state.”75
This intensified fear of the threat the Jewish populations posed to European nations manifested in hundreds of pamphlets, newspaper articles, books, and treatises all weighing in on the “Jewish Question.” The Jewish Question was a debate over how to handle these rootless strangers threatening Europe. People debated about whether the Jewish population should be resettled, deported, or assimilated. The Jewish Question became a hallmark of the politics of the age and reflected in literary circles. In the 1850s, the great German composer Richard Wagner carped that “According to the present constitution of this world, the Jew in truth is already more than emancipate: he rules, and will rule, so long as Money remains the power before which all our doings and our dealings lose their force.”76 A couple of decades later, Houston Stewart Chamberlain, the British proto-fascist living in Germany, warned that the ultimate aim of the Jew was to create a situation where “there would be in Europe only a single people of pure race, the Jews, all the rest would be a herd of pseudo-Hebraic mestizos, a people beyond all doubt degenerate physically, mentally and morally.”77
These reactionary, racialized sentiments propelled right-wing defensive nationalist movements. In France, the “Antisemitic League of France” (Ligue antisémitique de France) was founded in 1889. The league soon modified its name to National Antisemitic League of France (Ligue nationale antisémitique de France), clearly indicating its nationalist aspirations. The league spread anti-Semitic propaganda as well as diatribes against Masons and Communists (international organizations that it was believed the Jews were running). They became particularly active during the Dreyfus Affair. In Germany, the Alldeutscher Verband (Pan-German Party) formed in 1891. Along with its opposition to liberalism and social democracy, the party assailed “Jewish capitalism.”
Such anti-Semitic diatribes stand in contrast to left-wing movements that focused on the evils of the capitalist class. William Jennings Bryan actually took pains to underscore that “We are not attacking a race, we are attacking greed and avarice, which know neither race nor religion. I do not know of any class of our people who, by reason of their history, can better sympathize with the struggling masses in this campaign than can the Hebrew race.”78 And yet, these right/left-wing distinctions are not hard and fast. Some American populists also blended anti-Semitism with their attacks on global capital. “Several prominent Populist authors named the House of Rothschild as the reason for agrarian misery. Still others told of scheming, devious, inbred, commercial Jews. Mary E. Lease labeled President Grover Cleveland ‘the agent of Jewish bankers and British gold.’”79
In the second period of modern globalization, wealth concentration and inequality returned to levels not seen since the late nineteenth century.80 Neo-liberal policies were at the heart of the change. The policies championed in the 1980s were designed to remove any regulatory framework that could hinder business. They also worked to undermine the social welfare systems that had been put in place in most countries following World War II. One of the central effects of the neo-liberal turn was a dramatic upsurge in wealth inequality across the advanced economies, and most particularly in the United States.
By the 2010s, wealth concentration, measured as the ratio of private wealth to national income, returned “to the high values observed in the late-nineteenth century, which were as high as 600–700%”81 (see Figure 10.2). Like the Robber Barons who preceded them, most of this wealth was amassed by the new captains of industry—founders of today’s tech giants. Indeed, according to Forbes Magazine’s 2021 rankings, eight of today’s top ten richest people were owners of mega-tech companies—Jeff Bezos, Bill Gates, Mark Zuckerberg, Larry Elson, Steve Ballmer, Elon Musk, Larry Page, and Sergey Brin.82
Figure 10.2 Top 1 percent Income Shares (%), 1820–2020
Source: “Global income inequality 1820–2020: The Persistence and Mutation of Extreme Inequality,” Lucas Chancel and Thomas Piketty (2021), July 5, 2021, wid.world/longrun.
Twenty-first-century formulations of left-wing defensive nationalism echoed those of the earlier American populists. Like their earlier counterparts, leftists put the blame for economic dysfunctions on powerful corporate concerns and global finance. Bernie Sanders in a 2016 speech declared, “Our trade deals were written by large multinational corporations for multinational corporations. Trade is a good thing. But we need a trade policy that works for working families, not just large corporations.”83 A centerpiece of Jeremy Corbyn’s Labour Party manifesto, issued in November 2019, was ending the “tax and cheat” culture of multinational corporations: “Huge multinational companies often act as if the rules we all live by don’t apply to them. They use loopholes to claim they don’t owe tax and cynically push their workers to the limit.”84 The socialist candidate in the French 2012 presidential election put it most succinctly, “Mon véritable adversaire, c’est le monde de la finance.”85
For the left, nefarious global capitalism was also associated with particular individuals who control inordinate amounts of wealth and corporate power. Just as J. P. Morgan came to symbolize ill-gotten gain for leftists during the fin de siècle, Jeremy Corbyn declared that “the system is rigged for the rich. So thanks for making that clear, Mr Murdoch.”86 In his General Election campaign speech on May 9, 2017, Corbyn focused on the fact that “In the last year, Britain’s 1,000 richest people have seen their wealth rise by 14 per cent to £658 billion—that’s nearly six times the budget of our NHS.”87 In the same vein, Bernie Sanders in a 2016 speech declared that “it is not acceptable, and it is not sustainable that the top 1/10th of 1 percent now owns almost as much wealth as the bottom 90 percent. Or that the top 1 percent in recent years has earned 85 percent of all new income. That is unacceptable. That must change.”88
For those on the right, however, like late nineteenth-century defensive nationalists, the global enemy was neither global capital, nor industry, nor wealthy individuals but specific ethno-national groups who menace the nation. The enemy was embodied in an opposing national/cultural group. Victor Orbán, the Hungarian prime minister since 2010 and former president of the conservative party Fidesz, spread “imagery of powerful Jewish financiers scheming to control the world.”89 In Italy, Elio Lannutti, a Five Star senator, “suggested on twitter in January [2019] that Jews controlled the world banking system, and quoted the anti-Semitic ‘Protocols of the Elders of Zion.’ ”90 Yet, cultural classifications of the global enemy also manifested more subtlety. The far-right leader of Hungary, Gabor explained that the Hungarian nativist party, “The Movement for a Better Hungary” (Jobbik), opposed global capitalism, “and its three main representatives—the USA, the EU and Israel—from the pedestal of universal human values.”91 And whereas Sanders and Corbyn saw multinational corporations as the malign international influence undermining the economy and working people, President Trump presented China as the nemesis hurting Americans, whether through “their devastating currency manipulation,”92 or their pernicious spread of the Coronavirus.93
However, just as a century ago, these left/right distinctions do not always hold. For example, anti-Semitism has been on the rise with left-wing defensive nationalist leaders as well. An infamous example is Gerard Filoche, a member of France’s Socialist Party national bureau, who was expelled from the party in 2017 for tweeting an image with anti-Semitic overtones.94
The paralellels between the two periods are striking. In both eras, economic, demographic, and political changes ushered in a period of national populist fervor, which expressed itself on both ends of the political spectrum.
In the late nineteenth century, leftist-populist parties in America responded to radical displacements by rallying honest farmers and workers, “the people,” to fight against the machinations of heartless bankers and industrialists who were privileging international finance over the national economy. In Europe, the dislocations caused by modernity produced an extreme form of nativism. Fear and hatred was targeted primarily against ethnic-others who were believed to have invaded and polluted the “heartland” and who it was feared were poised to overtake it.
In the twenty-first century, the problems caused by globalization once againg engendered a national populist backlash. On the left, national populists oppose the established system, be it establishment parties or international organizations, which are seen to be nothing more than the mouth pieces of the wealthy and multinational corporations. On the right, the fear of changing times has merged with a nativist fear of white genocide and the danger of immigrant hordes.
Thus, in both periods, people threatened by social and economic displacements seemed to have spontaneously moved in parallel directions. In the United States and Europe, citizens on both the right and the left banned together to shield their ways of life from the ravages the liberal order had set into motion. It could be said that national societies rediscovered themselves in their opposition to globalization. Across the developed world, economic nationalism took center stage.
Yet, along with economic nationalism, the rhetoric of defensive nationalism pushed some on the right closer and closer towards fascism. In both eras, the emergence of proto-fascist movements began to menace the very nations they were striving to save.