‘Erratic’ is the typical label the mass media attaches to the far-right’s economic project. The Guardian has called Giorgia Meloni a “shapeshifter”, the Dutch news call the Party for Freedom “inconsistent” and Adam Tooze warns of “sane washing” Donald Trump’s economic policy programme.  

There is a similar lack of clarity on the far-right economic project in the academic literature. Scholars have, so far, mostly focused on the demand side of the far-right project (voters’ interests) and have paid much less attention to the actual policies the far right offers (supply side). At the same time, the literature which has focused on voter interests has been evenly split into two opposing camps. One argues that the far-right project amounts to insurgency against neoliberalism, globalisation and technocracy. The other contends that it is a project which emerged out of neoliberalism and consolidates it. 

Scholars who studied fascist and nazi movements of the 1920s and 1930s during and after the war, including from the Frankfurt School, did not only seek to understand why the demos had become seduced by these movements. They also attempted to trace the architecture of the fascist state and map its policy strategies carefully. Although it is too early to map out the far-right’s full state project, a systematic account of its economic strategies might help us discern the contours of such a map.

To research the economic policy of the far right in the early 21st century, I set up a database which explores the economic-policy goals of the far right in eight advanced market economies (US, UK, Switzerland, Germany, Austria, Netherlands, France, and Italy). I systematically gathered statements far-right parties made over the past twenty years to see if certain goals (e.g., financial regulation or deregulation) are presented consistently over time and whether those goals are also pursued in legislative initiatives (i.e., did the parties not just “say” they supported those initiatives but actually tried to implemented them). The database places a particular focus on the realm of finance because of its critical relevance in contemporary economies and because vote shares for the far right increased considerably since the Global Financial Crisis. 

The economic project of the far right is not comparable to the regimes of the post-war era.

One of the main features of the far-right’s economic project that comes into view is that it defies the classical interventionism/neoliberalism dichotomy that is currently applied in analyses. The economic project of the far right is a different project altogether, not comparable to the regimes of the post-war era. On the one hand, while parties seek to take control over the economy, state planning is not focused on universal benefits for societal groups—on the contrary, the economic/financial benefits for the average population are limited. Far-right parties, for instance, do not consistently pursue significant regulation of financial markets to prevent crises, do not offer relief for debtors or caps on variable interest rates in legislative initiatives, despite consistently high levels of support of these policies among voters in Western societies. Instead, planning is geared towards increases of competitiveness in the global economy through a range of different measures some of which obey market principles and others that do not.

As our available conceptual frameworks are proving deficient for making sense of far-right’s economic project, it might be helpful to look at how scholars tackled the economic project of the 1920s/1930s’ fascist states. To be clear, I do not equate the far right with fascisms a priori, because such labelling might pre-empt a critical analysis, but draw on the conceptual framework developed in the analysis of early 20th century fascism as a heuristic device for articulating the differential specifica of the current day far-right’s stance on the political economy. 

Most analysts of that period start by highlighting the economic context in which the fascist project emerged. Karl Polanyi details in The Great Transformation that fascism became one possible answer to the deadlock between democracy and capitalism that threw western societies into a grave social crisis at the early 20th century. When democratic demands of government intervention clashed with business demands for lower costs of production, liberalised (financial) capital withheld productive investment. This “investor strike” limited the prospects for economic growth and fed into an economic slump that in turn fostered declining voter support for establishment parties. 

Giovanni Arrighi adds that the investor strike triggered distributive struggles over global productive resources—as productivity diminished, domestic economies had to expand their absolute share of global economic rents if they wanted to retain or expand their living standards. Economic nationalism thrived under such conditions. Moreover, given the persistent conflict between capital and democracy, fascists increasingly appeared to be the only political agents who could save capitalism, or as Clara Mattei put it: only Mussolini could restore the capital order in Italy. 

Financialisation and the rise of shareholder value have turned our previously bank-based financial systems into fast-paced and asset-price focused financial machines with a growing shadow banking sector. The resulting decline in the pie of economic productive capital has curtailed the potential for economic growth

There is some evidence that an investor strike did contribute to the rise of the contemporary far-right movements as well. Our economies have gone through a revolutionary transformation since the 1980s. Capital mobility has reached almost perfect levels (comparable to those in the 1910s and 1920s). Financialisation and the rise of shareholder value have turned our previously bank-based financial systems into fast-paced and asset-price focused financial machines with a growing shadow banking sector. The resulting decline in the pie of economic productive capital has curtailed the potential for economic growth which has teetered at 2%. Under these conditions, establishment parties had to implement austerity even while domestic economies grappled with the aftermaths of the Global Financial Crisis and the COVID-19 Crisis. 

Indeed, the investor strike played a critical role in the declining vote shares for establishment parties and the rise of far right-parties in the past twenty years, as Jonathan Hopkin and Mark Blyth have demonstrated. However, what has received less attention is the question how the far right aims to resolve the conflict; or to put it differently: how does it plan to save capitalism? We may, again, turn to authors who explored the fascist project of the 1920s/1930s. What those scholars found is that the specific project fascism offered in the moment of an emergent investor strike is one of State Authoritarian Capitalism—the term was introduced by Max Horkheimer, but others have offered similar conceptualisations. 

What were the key characteristics of State Authoritarian Capitalism? The first and most fundamental principle of this regime was that while fascists were involved in considerable planning of the economy, they did not challenge capital and property rights. Instead, planning was focused on taking bureaucratic control over the process of capital accumulation and enabling the extraction of rents to revitalise capitalism. If one follows this definition of the fascist economic project, it immediately becomes apparent that the state was neither categorically laissez-faire nor interventionist. Instead, it was extractivist. Second, to resolve the deadlock between capitalism and democracy, fascists truncated the power of democratic institutions. Thus, while fascists planned, they dismissed redistribution or the protection of workers’ rights. Instead, and third, they preserved elite control and nurtured close relationships with loyal businesses. This was not only beneficial for capitalism, but fascists directly benefitted from such alliances. Mussolini, for instance, consolidated the dictatorial state through funds made available through the revitalisation of Italian capitalism. 

Not unlike the fascists, far-right parties now seek to establish control over capital accumulation, but they do not intend to use this control to support workers’ demands in domestic economies. Most of those parties have, despite voter majorities supporting financial transaction taxes and strict regulation of international financial markets, openly rejected both (e.g., the German AfD, the Dutch PVV, UKIP and the Swiss SVP). While some have criticised liberalised financial markets publicly, proposals to tame them were among the first to be abandoned when the parties took public office. Donald Trump twice campaigned on closing a carried interest tax loophole benefitting private equity and the wealthy but has not implemented this. And while Giorgia Meloni publicly advocated for improved financial regulation and taxes on bank windfall profits, those proposals were dropped when financial markets panicked. 

While far-right parties appear to have no genuine interest in regulating financial capital, they intend to use elements of state planning to facilitate the national accumulation of capital. Critically, there are differences in how state planning is envisioned/implemented among those parties. Some focus on shielding domestic financial markets from international finance—and then guiding credit or equity and debt investments into productive areas of the economy, while others seek to actively remove the last bits of financial regulation to support powerful domestic financial actors. This difference appears to be the result of a particular facet of the contemporary investor strike: asset manager capitalism. Ben Braun has used the term ‘asset manager capitalism’ to conceptualise the increasing dominance of institutional capital pools including mutual funds, hedge funds, private equity and venture capital funds in our global financial system. Emerging around the 1990s, these financial capital pools made productive areas of the economy increasingly accessible to financial investment. Venture capital firms, for instance, nurture start-up companies and private equity opens companies, housing and infrastructure to institutional investment. Private equity and M&A focus on short-term financial returns and financial engineering—companies are bought to extract value via cost-cutting, asset sales, dividends and layoffs—rather than productive investment. As a result, capital is diverted from productive uses like R&D, investments in new technology and the workforce. 

Besides diminishing productive investment, asset manager capitalism has produced visible winners and losers in the struggle over world productive economic resources. Global asset and wealth management business is concentrated in specific jurisdictions (US, UK and Switzerland) extracting rents from others (e.g., France, Italy and Greece, Germany, the Netherlands and Austria). Voters and far-right politicians in “loser economies” may feel like they relinquished control over domestic firms which are being sold out to foreigners. 

These parties seek to enhance private equity’s, hedge fund’s, and venture capital fund’s capacity to invest abroad while incentivising the repatriation of profits to headquarter economies.

Nevertheless, economic nationalism appears to thrive in both winner and loser economies but in different ways. To expand their share of global economic resources, winners have opted for an aggressive expansion of financial agents’ room to extract rents abroad via policies of economic liberalisation. This is apparent in the financial programmes of US, UK and Swiss far-right parties. These parties seek to enhance private equity’s, hedge fund’s, and venture capital fund’s capacity to invest abroad while incentivising the repatriation of profits to headquarter economies. Donald Trump, for instance, implemented bills which facilitated takeovers and acquisitions while enabling bank investment in hedge and private equity funds. The administration then implemented a territorial tax system which facilitates the repatriation of those profits private equity firms earned abroad. 

Losers, on the other hand, have developed convincing plans to curb the ability of those exact private equity firms to buy out domestic companies. Marine Le Pen, for instance, seeks to use an Economic Security Authority to protect emerging sectors and defend French economic diversity. Shielding domestic economies is also represented in ideas of the Austrian Freedom Party and the Alternative for Germany. The former, for instance, pursues policies which make it harder for “foreign investors [to] go on a shopping spree of [domestic] stock corporations”. 

If global financial markets are not the space where Continental European far-right parties envision extracting rents, what strategies do they pursue to save domestic capitalism? The German AfD and the Austrian Freedom Party plan to erect a type of capital-market cycle intended to channel domestic savings into a newly incentivised capital market—ETFs and funds which, in turn, are supposed to invest in domestic companies—so that “our German firms are no longer in the hands of American investment companies or Saudi oil billionaires, but in the hands of the German people.” The National Rally, the Greek Solution and the Brothers of Italy seek to control bank credit and cycle it into domestic industry through state investment banks or sovereign wealth funds. In the programmes of the Continental European far-right parties then we see a significant departure from the previous neoliberal regime in which the public purse had been largely hijacked by private investors and monetary and fiscal capacity was used to support financial markets (through polices like Quantitative Easing). At least in Continental Europe, the far right intends to take control of private credit and curtail the power of international financial actors to earn profit in those economies. However, to reiterate, even in Continental European economies this is not a project which resists private property per se. Specific domestic capital interests will benefit from state control over credit allocation (e.g., the real estate and industrial sectors). 

There is also some evidence for the second feature of State Authoritarian Capitalism—the far right’s seeking to truncate the power of democratic institutions. While supporting the expansion of welfare spending in their programmes, these parties also seek to reimplement the gold standard (i.e. backing the national currency with gold reserves, thereby limiting the government’s ability to alter the value of the currency) which will critically hamper their ability to expand government spending –the gold standard restricts the amount of money a government can issue. Furthermore, the parties have criticised bailout programmes implemented during the Global Financial Crisis and COVID-19 as irresponsible and inhibiting market forces. They also tend to object to strong roles for trade unions and do not support workers’ participation in industry/finance. For example, the Alternative for Germany (AfD) does not support co-determination in German corporate governance despite its rhetoric of “re-democratising” Germany and supporting the hardworking segments of society. Likewise, benefits for workers are set to be curtailed under the current Trump administration. It, for instance, plans to privatise Freddie Mac and Fannie Mae, the two state-backed institutions which have played a critical role in the extension of mortgage finance to lower and middle incomes. Privatisation would restrict lending and raise mortgage rates for those income groups while distributing higher returns towards shareholders.

Finally, there is also some evidence of the far right’s attempt to build an economic bloc with loyal economic groups to aid both the economy and to enable the consolidation of state control. One striking example is Meloni’s attempt to gain control over the Italian banking sector. She intends to build a new financial centre to limit the power of the existing one—which she considers overly dependent on international financial capital. For instance, the Brothers of Italy  criticise that UniCredit accepts domestic deposits and invests them abroad instead of domestically. To prevent the future transfer of rents abroad, Meloni is building an alliance with the Italian billionaire Francesco Gaetano Caltagirone who owns stakes in several Italian banks. Through this alliance she intends to establish state control over banks to ensure that the new financial centre invests into Italian companies. At the same time, the alliance is supposed to resolve the state’s sovereign debt crisis by mandating the newly state-dependent banks to buy Italian sovereign bonds. Italy has one of the highest debt-to-GDP ratios in the world which puts the fiscal sphere under considerable pressures from international financial markets. Bond investors, international institutions and credit rating agencies constantly monitor fiscal decisions and bond yields rise if the fiscal deficit increases—making the service of debt more expensive. If domestic banks would buy domestic sovereign bonds, this would enable the government to expand spending without facing the pressures of international bond markets.

This blogpost offers an initial attempt to conceptualise the far-right economic project, while focusing on the realm of finance. Scholars have either likened far-right economic policies to post-war embedded liberalism (i.e., more interventionism) or neoliberalism (i.e., less interventionism). However, the reality is more complex: while these parties seek to return to state planning, they do not pursue a genuine redistributive/regulatory agenda (at least not in the realm of finance). The data, which I have gathered, indicates that the far right has responded to a type of investor strike, but that this response has differed considerably between economies. While we see a continuation of the neoliberal approach to deregulate financial markets in the US, the UK and Switzerland, many Continental European far-right parties intend to shield domestic financial markets from the activities of international financial institutions and guide credit and investments into specific industries. This latter approach clearly constitutes a significant departure from the neoliberal practices we have observed over the past forty years. 

Inga Rademacher is a lecturer in International Political Economy at City St. George’s University of London and a researcher on varieties of neoliberalism and the critical juncture in the fiscal, monetary and financial spheres in advanced market economies in the 1980s. Inga is currently working on a book manuscript entitled “Finance and the Far Right”. Her work on central banks has been discussed in blogs including Phenomenal World and Adam Tooze’s Chartbooks.