Anti-fascist economics? For sure! But what does that mean?

The following text was originally written in German and has been translated into English by the Exploring Economics team. You can find the original text here.

The day after Donald Trump was re-elected President of the USA, the economist Isabella Weber placed the buzzword anti-fascist economics on X:

— Isabella M. Weber (@IsabellaMWeber) November 6, 2024

The call for an anti-fascist economic policy has also circulated since then. For example, it has been taken up explicitly by the Left Party in Germany. The debate is a reaction to the fact that a large proportion of US Republican Party voters cited economic issues - particularly inflation - as an important reason for their voting decision. However, the connection between experiences of economic crisis and fascism is complex. There is a danger of underestimating the dramatic nature of the current situation if the focus is solely on economic aspects. Reason enough to take a closer look at the current debate.

What does Isabella Weber mean by anti-fascist economics?

Isabella Weber points out that the decision to vote for Donald Trump is rooted in the economic crises of recent years. In particular, inflation and the "cost of living crisis" were cited by many Americans as a central reason for voting for the Republican Party. Before this background, Isabella Weber's core argument is that politicians have taken the wrong approach to inflation, as she explains in an interview with the German newspaper taz. Weber's criticism of the Democratic Party is that it has underestimated the significance of the problem for the poorer sections of the population and, by raising interest rates, has relied on measures that have exacerbated the problem. Weber's argument is based on a particular understanding of price increases, for which she has coined the term profit inflation. According to this understanding, inflation is largely due to rising corporate profits, so that tools like price controls feature prominently in Weber’s policy proposals. More generally, however, Weber is concerned with a reorientation of economic policy. The aim is an economic policy that intervenes in the economy in the interests of the lower classes and involves the people concerned by decisions in policy-making. She also advocates economic disaster preparedness to counteract price shocks and other crises in a targeted way. The underlying hope is that an improvement in the economic situation and, in particular, social protection against risks would make the electorate less susceptible to fascist movements.

Is Isabella Weber the only economist with this idea?

The current debate follows a widespread theory among economists about the election of populist and far-right parties. According to this theory, growing social inequality, increasing social insecurity and a sense of loss of control are key motivators for voting for right-wing populist and extreme right-wing parties. These social problems and experiences of crisis are linked to processes of change such as globalisation and digitalisation, as well as crises such as the climate catastrophe and price shocks. Following the line of argumentation, it is argued that policymakers have been unable to cope with these changes, due to their attachment to neo-liberal economic policies that relied too much on markets and too little on the state. As a result, parts of the population have turned away from mainstream politics and towards populist parties. The solution, therefore, is a strong state that actively counteracts inequalities with instruments such as industrial and social policy or tax reforms, strengthens social security and proactively manages crises and processes of change.

Even if the individual positions differ significantly, this perspective has now produced a high degree of consensus in parts of the economic profession. This can be seen, for example, in the 'Berlin Summit Declaration' of the Forum New Economy, published at the 'Winning Back the People' conference in May 2024. Alongside Isabella Weber and other more left-leaning economists such as Thomas Piketty and Mariana Mazzucato, key voices from the profession's mainstream such as Angus Deaton and Olivier Blanchard support the declaration. In line with the analytical framework outlined above, the statement argues that the success of populist politics stems from anger, mistrust and the experience of loss of control. On this basis, an economic policy programme is developed with the aim of winning back the alienated sections of the population.

Didn't we have a similar debate after the last Trump election?

Although the debate has gained momentum with Trump's election victory, which was shocking for many in Europe, the discussion is by no means new, nor is it being led solely by Isabella Weber and the signatories of the Berlin Summit Declaration. There was already a similar debate on the left in the context of the first Trump election in 2016, led, for example, by the Marxist-feminist sociologist Nancy Fraser. At the time, Trump's strong showing in the traditional strongholds of the labour movement in the US was the starting point of the debate. Similar patterns could be seen in other countries - for example in France, where the Front National was particularly strong in areas where the French Communist Party had previously been successful. The argument then was that the mainstream parties of the political left had moved away from questions of distribution and class struggle towards questions of recognition and representation. This was accompanied by an orientation towards the academically educated middle and upper classes and integration into neo-liberalism. Despite all the social upheavals, the political left supported this and even played a leading role in its implementation in the Clinton administration, New Labour in Britain and the red-green government in Germany. This was understood to have created a situation in which the working class has turned away from left-wing parties and towards right-wing parties. Accordingly, in this reading, the election of Trump indicated that the protest against experiences of economic crisis and suffering was no longer being articulated on the left, but on the right. There was therefore a need to turn away from neoliberalism.

Hasn't much changed since then - keyword Bidenomics?

Yes and no. In fact, a lot has changed. Radical free-market policies have lost ground - not only among economists. There have also been changes in economic policy that have been discussed under the heading of a paradigm shift. These changes have been particularly pronounced in the recently voted out Biden/Harris administration, for which the buzzword Bidenomics has taken hold. A number of factors have played a role, most notably geopolitical competition from China. But it was also an attempt to learn from past mistakes and win back workers for the Democratic Party. The change of course was not only reflected in large-scale industrial policy initiatives such as the Inflation Reduction Act, the CHIPS Act or initiatives to regulate the digital industry. It was also expressed in a new relationship with the labour movement, even if it did not translate into the concrete changes that were hoped for. In the fight against inflation, however, instead of, for example, introducing price controls as Isabella Weber had called for, there was a more orthodox neoliberal response of raising interest rates. Overall, therefore, Bidenomics has had only a moderately positive impact on the working class. Investments in infrastructure development and climate protection seem to have primarily benefited the capital side, not least because of resistance from political opponents to more far-reaching measures.

What is the difference between Bidenomics and Isabella Weber's anti-fascist economics?

This question is difficult to answer, because the debate on anti-fascist economics is still very new and so far the boundary between the two approaches seems to be blurred. The progress made by Bidenomics is acknowledged, and strategic orientations such as the project of a green industrial transformation are upheld. However, it is argued that they have not gone far enough. In particular, it is argued that Bidenomics has not sufficiently taken into account or successfully addressed the interests and experiences of the poorer sections of the population. The aim is therefore to further develop economic policy in the interests of the working classes. To this end, it proposes not only an expansion of the policy toolbox to include instruments such as price controls and a greater focus on social security and the social cushioning of crises and change. It is also about changing the relationship between politics and the lower classes. In particular, the focus on expanding participation in the workplace as well as crisis management and transformation processes appear to be a key difference. It is hoped that this will contribute to removing the social basis of fascism, which is seen in social insecurity and political alienation.

Where does the debate about antifascist economics fall short?

As important as it is to shed light on the socio-economic underpinnings of fascism, it would be wrong to conclude from the election result alone that Republican voters actually want left-wing policies and just need to be met where they stand. Instead, it is important to understand the character of fascist politics and the specific approach to economics that underlies it. Only then can the gravity of the current situation be fully understood.

Problem 1: The Economy is not simply the Economy, stupid!

The first point that is essential here is that subjects' experiences of economic crises cannot be separated from the social context through which they are shaped. How subjects react to crises depends on which social discourses they are exposed to and how crises are interpreted there. This is where the boom in fascist propaganda comes into play, which has been shaping public discourse for years, especially in social media, and continues to grow in importance. Apocalypticism and doomsday narratives play a central role in fascist propaganda. These narratives constantly and dramatically warn of the death of people and nation, painting a picture of the impending destruction of culture and family. These doom prophecies are gaining drama by virtue of the fact that they attribute the guilt for these developments to political opponents, minorities or other imaginary enemies. It is not only phenomena such as climate change, the coronavirus pandemic or migration that are perceived in the context of these conspiratorial world views. Economic phenomena such as inflation, natural gas production or one's own social situation are also processed through these ideologies. Anger and frustration with Kamala Harris or the Democrats are not direct effects of the economic situation. They are shaped and intensified by fascist propaganda. They are therefore also effects of the election campaign and an expression of the strength of the fascist movement, which has succeeded in politicising the economic situation from the right.

Problem 2: Manifest Interests in fascism

However, fascism cannot be attributed to manipulation and disinformation alone. People join the fascist movement because they believe in it, feel comfortable with it, or see it as best serving their interests. However irrational these forms of crisis reaction and processing may be, at least temporarily, they can be functional for coping with experiences of social change and crisis. They can be a way of passing on responsibility and suppressing the need for social and personal change. Instead of having to work on oneself and on a different society because climate change or progress in gender relations imply change, the past and the status quo are glorified. Anger and frustration can be transferred to the supposedly guilty, which also makes it possible to act out sadistic impulses and improve one's psychological status.

But the advantages of supporting the fascist movement are not just psychological. In fact, Trumpism is based on a relatively coherent political-economic project. It responds to developments such as the rise of the People's Republic of China and the worsening ecological catastrophe with an economic nationalist and authoritarian programme. As expressed in the slogan 'America First', the programme is based on putting national interests first without compromise. Whether it is climate protection or international law, democracy or the protection of minorities, everything is subordinated to national interests and the accumulation of capital. Of course, the main beneficiaries are those factions of capital that are committed to the Trump project - such as fossil fuel capital. There are also clear losers, such as people without secure residence status or recipients of social benefits, and it is quite possible that protectionist policies will lead to further price increases. Nevertheless, an economic nationalist turn may well be in the immediate, short-term interests of broad sections of the population. This is not only the case where jobs are created in industry or where the value of land increases through the extraction of raw materials. It is also the case where Trumpism defends the global power position of the US and thus the imperialist and ecologically unsustainable lifestyle of the US population.

For anti-fascist economics, what are the implications of these objections?

In principle, both objections boil down to the fact that anti-fascist economics is an uphill struggle, not a sure-fire success. Fascism is not only more deeply rooted than the interpretation of it as a misguided social protest would suggest - it is also more dangerous. Nevertheless, it is worth fighting and focusing on economic issues and the working classes. This can be done within the framework of an anti-fascist economic policy at state level, where investment can and should be made in social security and the reduction of inequality. Isabella Weber's proposals offer important starting points. Such a policy program can help prevent further groups from being radicalised to the right. It may also be possible to win back some groups of voters or to activate non-voters. However, it should not be hoped that convinced supporters of the fascist movement will turn away from it for this reason alone. There is also a danger of aligning with fascist policies in the attempt to regain supporters - as is seen, for example, in migration policy.

In addition to a policy of economic and social security and the extension of participation, social struggles must therefore be organised and carried out in order to push back the fascist movement. Focusing on social issues and investing in grassroots work also makes sense here. Campaigns such as 'Deutsche Wohnen und Co. Enteignen' (a campaign to expropriate large real estate groups in Berlin) or the successes of the Communist Party of Austria show that left-wing politics can be successful and capable of winning a majority beyond the academic milieu. It is therefore good that the German Left Party (Die Linke) or the 'Zeit für was Neues' initiative, which emerged from the youth party of the German Green Party, are developing in this direction. Nevertheless, there is still a need for education, information and media work - however difficult this may be in times where social media is dominated by the fascist movement and where the public is moving ever further to the right.

Economic education has a special role to play here. It can identify the contradictions and class conflicts that still exist in fascist society, despite nationalist ideology claiming they do not. It can also raise awareness of global inequalities and the ecological destructiveness of the capitalist economy, and help ensure that social crises are not personalised and interpreted in terms of conspiracy ideology. In conjunction with critical economic research, it can also point to visions of a better society that go beyond the prevention of economic disasters and the stabilisation of the crisis-ridden normality of capitalism.