Austerity And Fascism

A while ago, I argued, in the context of Greece’s imploding economy, that a key economic policy benchmark should be not encouraging fascism:

When you read about the political mess that Greece has became, the press for austerity–led by Germany–is bizarre. If there is one nation that should understand the political consequences of unpayable public debt denominated in a foreign currency, it would be Germany (Got Versailles Treaty?)…

Admittedly, maybe the austerity push should have been reconsidered after the reigning coalition appointed “The Hammer” as the Interior Minister. You might be wondering, “Why is he called the Hammer?” Because he used to beat his political opponents with a fucking hammer. Although he would, on occasion, use an ax handle: quite the generalist, the Hammer is.

So let’s forget about inflation targeting, debt-to-GDP ratios, and the like. I propose a new metric: if your policies enable fascists then you’re doing it wrong.

Which brings us to this very good post about Brexit (boldface mine):

I’ve been struggling to write this post ever since last Friday. There are too many things to say. This morning, however, all I want to say is this. The Leave campaign was fought and won, largely on the back of fears about immigration. People worried about immigration come from all sections of British society – including those who are more recent immigrants to this isle themselves. Not all of these views deserve to be called racist or even xenophobic, although they are often summarily dismissed as such. People are worried that there are not enough jobs to go round, not enough houses, not sufficient capacity in the NHS and other services. The country is ‘full-up’. Sharp practices on the part of some employers have meant that it is sometimes true that British people have lost out to cheaper workers from elsewhere. Unions that could show both groups that they lose out from this arrangement, and help fight a common cause against exploitation, are missing. A lack of ready access to any facts concerning immigration, jobs, and the economy, makes it difficult for people to assess the situation. Then, of course, there are the views that count as racism.

For some people, even if they’re well-off, racism and bigotry are organizing principles. All can be ‘explained’ based on the ‘otherness’ (inferiority, moral degeneracy, unfairness) of various groups. But scarcity makes good people mean.

Regarding scarcity, while natural resources can be limiting, in most cases, the state of being ‘full-up’ is due to an absence of spending–that is, a simple lack of currency. Currency issuers, which include both the UK and the U.S. federal government, can’t run out of money. While our economic betters seem more concerned about the horrifying specter of three or four percent inflation rates, there are more serious things to worry about–like xenophobia and bigotry, which flourish in a climate where people (mis)perceive that there isn’t enough to go around.

There is a solution here, and it’s not ‘moderate’ calls for balanced budgets. Put people to work fixing all of the broken shit. Deficits are far preferable to authoritarianism and bigotry.

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4 Responses to Austerity And Fascism

  1. chrisj says:

    Minor aside, but one of the annoying things about people who insist there’s not sufficient capacity in the NHS is that immigrants are a much higher proportion of NHS staff than NHS patients. But since the “Leave” campaign was fought from the standpoint that facts are bad (and the remain campaign was at best rubbish), somehow the benefits of immigration[1] went unmentioned.

    [1] which, for avoidance of doubt, are many, and stretch far beyond “they have useful skills” or “the contribute far more to the economy than they take”, although both of those are true…

  2. Thanks for this blog post regarding austerity and fascism; I really enjoyed it and am definitely recommending this blog to my friends and family. I’m a 15 year old with a blog on finance and economics at, and would really appreciate it if you could read and comment on some of my articles, and perhaps follow, reblog and share some of my posts on social media. Thanks again for this fantastic post.

  3. Mark Centz says:

    The Hammer as cognomen- Charles Martel and Molotov. Can’t think of any figures who were nicknamed The Nail.

  4. rwv says:

    ‘The nation’ of Germany is not taking these decisions, nor is Germany run for the people.

    Politicians are corporate lackeys. When did capital ever have problems with fascism before?

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