Five factors driving Europe’s populism

Populism within politics has been on the increase in recent years. Alan Shipman looks at the reasons behind this.

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GDJ on pixabay.com under Creative Commons license.

Although they thrive on grievances that are specific to each country and region, populists’ manifestoes contain some common themes. Europeans have been especially driven towards new protest movements by three trends in the international economy and internal demography that they can’t do much about, combined with two features of the EU that set it up as a multilateral scapegoat.

1. Globalisation and changing technology

Barriers to the international movement of goods, people and money have been falling away for decades, as governments pursue free international trade and financial-market deregulation in the belief this will make their countries better-off, and the world more harmonious. Beginning as a scheme for free trade and free movement within a small core of North European states, the EU progressively enlarged to 28 members and opened itself to trade with other regions , shedding its ’fortress Europe’ economic reputation.

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Pixel2013 on pixabay.com under Creative-Commons license.

Critics claim this exposure has plunged the EU and other ‘rich’ economies into a premature de-industrialisation , as companies move production to lower-cost countries. Internationalisation of trade in services means that ‘white collar’ professional jobs are also disappearing overseas, and globalisation tends to leave incomes more unequally distributed even when it raises them overall. Low-cost competition forces the remaining European producers into rapid automation, which still stifles job creation and shifts distribution from wages into profits .

The threat of relocation also gives multinationals unprecedented power over national governments, forcing them to cut taxes and regulations, resulting in erosion of the traditional European welfare state. ‘Globalism’ is an especially emotive target for populists because it suggests the erosion of national sovereignty , allowing its sponsors to be painted as unpatriotic and conspiring with a global elite. Public anger can then be directed at ‘enemies within’, who stand accused of gaining from open borders while everyone else loses out.

2. Shrinking populations and economic pressure for immigration

Europeans are gradually dying out. Women in the EU now give birth to 1.6 children on average , well below the 2.1 needed to maintain the current population size without net immigration. Numerous studies suggest that recent immigration has boosted European economies , by averting skill shortages, lowering costs, expanding demand and paying more tax than they claim in benefits.

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Jeff Djevdet under Creative Commons BY 4.0 license.

But immigration sparks fears — about competition for scarce jobs, and erosion of traditional ‘culture’ — which appear fulfilled when accelerated arrivals cause temporary absorption problems, as in Europe in 2015–16. The recent influx reflected a unique confluence of conflicts and environmental disasters in North Africa, South Asia and the Middle East, and has already subsided. But populists can play up and prolong such fears, especially when they can point to fast population growth in regions bordering Europe — with fertility rates still (for example) 2.5 in Morocco and Uzbekistan, 2.7 in Algeria and Kazakhstan, 3.3 in the ‘Arab World’ and 4.5 in Afghanistan. If they acknowledge a need for more people, they insist these can be ‘home-grown’ via social incentives like childcare subsidy and extra maternity leave.

3. The generation game, with older people winning

Low fertility and birth rates, combined with increased longevity due to generally better health, mean European societies are ageing as they shrink. While populist leaders are often younger than those of mainstream parties, they have proved skilful at targeting the ‘grey’ vote along with that of disaffected youth.

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Geralt on pixabay.com under Creative-Commons license.

Older voters are becoming more numerous and are more likely to exercise their vote than their children and grandchildren. They tend to be more conservative , remaining sceptical towards new technology, new cultural traits and any breakaway from traditional attitudes to sex and marriage. This makes them more likely to swing behind populist parties , to defend ways of working and living that they fear are under threat. The Brexit referendum (and polls on a possible sequel) confirm the extent to which the older generation may reject the more cosmopolitan and Europhile preferences of the younger — even if most do so with the interests of their children and grandchildren in mind.

4. The Eurozone: austerity and stagnation

The EU’s resilience against globalisation, and recovery from the 2008 Global Financial Crisis, may have been fatally compromised by its adoption of a single currency. The Euro, launched in 1999 and now used by 19 EU members, was meant to boost prosperity , by removing exchange-rate uncertainties and giving the EU a ‘reserve currency’ to rival the US dollar. But critics say it removes vital policy options . Eurozone rules prevent member governments from combating recession by running wider budget deficits, or by letting their currency depreciate to deliver an export boost. The zone’s one-size-fits-all interest rate and exchange rate benefits Germany , and any partners that can match its traditionally low inflation, while holding back investment, job creation and welfare spending everywhere else.

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Stux on pixabay.com under Creative-Commons license.

Whereas the US responded to the post-2008 global downturn with a ‘stimulus plan’, which has already restored its pre-crisis income and employment levels, the Eurozone stayed much longer in recession and is still struggling to recover . In Italy, whose economy has not grown significantly since the 1990s, the populist government elected in 2018 proposed to kick-start recovery with an expansionary budget, and was ordered to make deep cuts to stay within EU rules . The alternative — holding down wages. prices and welfare spending till the economy becomes more ‘competitive’ — is what devastated Greece and chased the previous mainstream parties out of Rome.

5. Rule by ‘Brussels’

The Eurozone gifts populists an especially powerful stick with which to beat elites, because it was designed by a handful of Eurocrats and may have adversely affected millions. They can add it to a long list of grand ‘expert’ plans that don’t work well for ordinary people, and of internationalist projects that take power from national governments. Europe is a collection of small states with long histories of either fighting their way out of big empires or proudly preserving sovereignty against them. This makes it easy to liken the EU to a new imperial power , ruling a continent by decree and turning members into ‘vassal states’.

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By Fill on pixababy.com under Creative-Commons license.

The European Parliament, Brussels.

The advantages of blaming the EU grow as populists ascend from a regional to a national power base. If they enter government, especially in uneasy coalition with mainstream parties, populists often find their popularity ebbing. It can be hard to deliver on key promises, and harder still to blame this on people in the power when you’ve been sitting in cabinet with them. European populists can now trace their troubles to ‘Brussels’ — deflecting blame away from their national elite, towards unelected European Commissioners whose technocratic rules have tied their hands. It may prove a more persuasive excuse than that of Donald Trump’s administration, which has to blame any failures on a Congress that includes his own Republican party), or an obstructive ‘deep state’ which may just be the revered US Constitution.

Populist attitudes are likely to persist, shifting to new protest parties of the present ones disappoint, as the European Dream continues to suffer nocturnal disturbance. Much of the EU is still struggling with high unemployment, stagnant incomes, more poverty and less social-service provision more than a decade after the Global Financial Crisis. The additional strains on social provision caused by ageing populations, rising care costs and job displacement by new technology will go on, potentially pitching young and old into an intergenerational battle over pension funding — if the challenge of cheap imports (especially from China) and of rapid immigration now subsides.

The UK’s difficult experience on the path out of the EU has forced other populists and nationalists to back away from Frexit, Quitaly and the other triumphal walkouts they were previously planning. But this has hardened their resolve to fight the system from within. The 27 new EU Commissioners , many stepping up from a career in mainstream politics, can expect to remain under fire from their old domestic foes.

Alan Shipman is a Lecturer in Economics at The Open University.

This article was previously published on OpenLearn in January 2020 and can be viewed here.

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