Radical risks

The rise of the Tea Party in the USA and some previously fringe parties in Europe is an inevitable by-product of mistakes in the policies of deregulated finance and the European single currency. The mainstream parties are losing ground because they lack a description of what has gone wrong and a clear pathway out. This does not mean that every alternative will be better. We’re entering dangerous territory.

The National Front and Jean-Luc Mélenchon in France currently have the support of almost 30% between them, in pre-election opinion polls. For all their antagonism, these two forces have similar policies: anti-European Union, heavily interventionist in economics, and with a tendency to protectionism. In power, they would probably resemble Juan Domingo Perón in Argentina, or Hugo Chávez in Venezuela: nationalist, opportunistic and seeking to buy short-term support of interest groups.

Our view is that the left-right orientation in politics has failed; we do not need more extreme versions of the same. The big failed idea on the left is that you can generate greater economic equality through laws and taxes. In the real economic world, you can only build greater equality by developing strong businesses, either cooperatives or other forms of participative organization. This is a feature of the more equal societies, such as Germany, Japan and Scandinavian countries. It is no coincidence that the demagogues find it harder to gain support there.

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