Today’s Fascism: Parallels with the 1930s in the North and South

On the 18 May this year I joined a podcast hosted by The International Karl Polanyi Society at the University of Vienna to discuss “Global Finance and Fascism: Yesterday and Today” with Bruno De Conti, Professor at the University of Campinas (Unicamp, Brazil). The session was hosted by Andreas Novy. In preparing for the discussion I went back to Charles P. Kindleberger’s The World in Depression 1929-39 - a well-thumbed book I have had on my shelves for decades.

The parallels were almost too numerous to pack into this discussion - but I did try. Stock market booms, inflation, austerity, central bank independence, the bankruptcy of mainstream economics - and the absence of international political leadership in a time of global crisis, are just some of those parallels.

One of the most interesting aspects of the conversation was Professor De Conti’s reflection on parallels from the perspective of countries of the South. In particular we discuss decisions to drop out of the gold standard system by President Roosevelt in 1933 on the one hand, and also apparently, by Brazilian President Getúlio Vargas of Brazil - and the impact of capital controls in stabilising first, the US economy, and then after the Bretton Woods conference in 1945 the global economy - leading to the ‘golden age’ of 1945-1971. [I was keen to stress the difference between the nationalism and fascism of many societies in both the South and North seeking ‘protection’ from market forces - and the inter-nationalism of for example, of President Roosevelt’s policies for public, democratic authority over global markets.]

We bring this all up-to-date by noting that today both high and low income economies live within a new deflationary standard: the US dollar standard. This leads us to discuss dollar hegemony and the determination to de-dollarize by many countries of the South. More recently, as Professor De Conti points out, the European Union and the ECB have begun making strenuous efforts to detach EU economies from dependence on the US dollar and on “Cryptocrats” like President Trump, by reforming the international payments system.

We end by discussing the relevance of Karl Polanyi’s work. Namely that the rise of fascism in the 1930s can be explained by societies demanding protection from the utopian project of government by private, global markets.

As Polanyi argued, de-regulated markets “could not exist for any length of time without annihilating the human and natural substance of society”…and so “inevitably society took measures to protect itself..and in doing so “impaired the self-regulation of the market, disorganized industrial life, and thus endangered society in yet another way.” 1

Today, as Professor De Conti argued in a recent paper,2 we are witness to a global “earthquake” endangering societies worldwide as they turn to political ’strongmen’ for protection from globalised markets in money, energy and food.