The economic nationalism of right-wing populists

From Populism Newsletter #4, July 2021, pp. 7-8.

Valentina Ausserladscheider

Postdoctoral researcher, Department of Economic Sociology, University of Vienna

In the past decade, many countries across the globe witnessed increasing electoral support for right- wing populist parties and politicians, some of which entered government. This was the case in places as diverse as the US, Brazil, India, Austria, and Hungary to name but a few. Scholars and commentators focused their attention on explaining the electoral success and the expected governing outcomes. These accounts highlighted the nationalist core ideology of right-wing populists. This is assumed to lead to more restrictive immigration policies and, more broadly, threaten the foundations of liberal democracy. In contrast, right-wing populists’ economic policies have been argued to be irrelevant to their successful voter mobilisation. Even though their economic policy discourse significantly shifted to include ideas of economic nationalism such as trade tariffs, subsidies for domestic production and pride in the nation’s economy in recent years, scholars treated those ideas to be subordinate to their culturally exclusionary nationalism. Instead, I offer an alternative interpretation of right-wing populists’ economic agenda: i) I will suggest that the economic policy agenda of right-wing populist politicians is deeply intertwined with and thus highly relevant for their nationalist ideology, and ii) that their economic policymaking is best described as neoliberal economic nationalism, which helps construct an exclusionary nation.

In 2016, the world witnessed Donald Trump coming to power and the UK Independence Party (UKIP) playing a significant role in the referendum of the UK leaving the European Union. As a result, a long- standing explanation for the electoral success of right-wing populist parties has been called into question. For decades, scholars argued that socio- economic insecurities such as decreasing wages and living standards, pressure on domestic labour market due to globalisation, and the weakening of trade unions leads to citizens’ resentment that right-wing populists can mobilise in their favour. More recent accounts contend that rather than socio-economic insecurities, citizens’ fear losing their traditional and national identities in the face of rapid change of cultural values: progressive values such cosmopolitanism and multiculturalism have been on the rise since the ‘silent revolution’ from the early 1970s onward. In this context, right- wing populist politicians promised to protect these ‘threatened’ identities in a more exclusionary nation state that would be more restrictive against immigration, strengthen the state’s executive forces, and hinder the equalisation of LGBTQ+ and heterosexual couples before marriage law. Hence, the conservative and nationalist discourse of right- wing populist politicians is assumed to present the main reason for their electoral success.

Right-wing populists’ conservative and nationalist agenda has been emphasised not only by analysts of electoral dynamics, but also in the assessment of their governing outcomes. Studies have found that such governments introduce restrictive immigration policies and potentially pose a threat to the foundations of liberal democracies. Such studies show that policies that right populist parties in government put in place frequently challenge the idea that the power of the majority must be limited to safeguard individual rights and the division of power. This perspective highlights how populist politicians often equate the majority to ‘the people’, a unified whole with a general (political) will, to whom they would ‘give back the power’ when in office. Cases such as the Austrian Freedom Party, the Northern League in Italy, or the Swiss People´s Party posed as governing parties and exemplify such illiberal tendencies well. While their policies on immigration, their discourse on democratic rules, and their disregard for individualist liberal values have been thoroughly analysed, little has been said about their economic policymaking.

Recent cases such as Fidesz under Viktor Orbán in Hungary, or the Republican Party under Donald Trump in the US present many, if not all, of the above-named features. Yet, they also significantly shaped the economic trajectory of the respectively governed countries. Often their discourse presents elements of economic nationalism: an advocacy for trade tariffs, fostering domestic production, and a sense of pride in the nation´s economy. Donald Trump signed the ‘Buy American and Hire American Executive Order’ in April 2017 to put ‘American Workers First’. Similarly, Fidesz´s rise to power was accompanied by an economic nationalist agenda. Indeed, one of the few accounts that investigated populist economic policymaking has shown that those parties, which recently experienced electoral success systematically criticized market liberalism. Yet, Trump and Orbán simultaneously entertain supportive links to capital and big corporations and promote policies often associated with economic neoliberalism. Fidesz, for example, strongly deregulated labour markets and weakened trade unions in favour of foreign investment. This suggests that also right-wing populist politicians tend to support neoliberal policymaking despite its economic nationalist veneer.

The concept of the construction of a neoliberal exclusionary nation helps us understand this seemingly contradictory policy program, which holds important lessons to fully comprehend the electoral success and governing strategies of right- wing populist parties:

1. Culturally exclusionary sentiments are not the sole characteristic of right-wing populist parties. Their nationalist ideology is supported and legitimated through economic policies that suggest ‘to give back control’ to ‘the people’. This is well exemplified through right-wing populist discourse conflating anti- immigration sentiments with economic rationales. Where nationalist anti-immigration sentiments are often viewed as culturally rooted, right-wing populist policies advocate nativist welfare state protection against immigrants wrongly claimed as exploiting the social welfare system. Such welfare state policies, however, do not ensure a stronger welfare state.

Instead, welfare state spending is often cut down while becoming more exclusionary under right-wing populist governments. Unlike previous accounts that argued that economic policies in right-wing populist programs are merely adjunct to the culturally nativist core, I believe that this consideration raises the question in reverse: do culturally exclusionary values become a Trojan horse for neoliberal policymaking?

2. Policy outcomes of right-wing populists in government suggest on-going neoliberal policy dominance despite their economic nationalist discourse. This raises questions for both spheres of analysis: the electoral success and governmental participation of right-wing populists. Instead of considering such electoral dynamics as either culturally or economically rooted, the increasing dominance of economic nationalist ideas within right-wing populist discourse is instructive for prospective research to investigate the interlinkage between cultural and economic ideas as well as where and when the demand for economic nationalism arises. Relatedly, while exposing the illiberal and inconsistent policymaking of right-wing populist governments, cases such as Hungary and the US also illustrate the seemingly comfortable companionship of illiberal, nationalist, and authoritarian values with economically neoliberal policies. This begs the question not only of the compatibility between right-wing populism and democracy, but also of neoliberalism and democracy.