Brazil shows how the elite responds when forced to choose between fascism and the left

The victory of the far-right Jair Bolsonaro demonstrates how quickly the centre can evaporate. 

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Once you’ve heard the words “Jair Bolsonaro, president of Brazil” you have to prepare yourself to hear, in the future, “Marine Le Pen, president of France”. We already have a far-right Italian deputy prime minister, Matteo Salvini, but Bolsonaro’s victory also signals that Salvini could one day rule without the restraint of a coalition partner. The Brazilian president’s victory was, in short, the first case study in how a financial elite responds when faced with a choice between fascism and the left.

The left, in Brazil’s case, was no longer the radical left. The Workers’ Party (PT) had a proud history of representing the poor, but had accustomed itself to running a corrupt and corporate form of state capitalism. So when Bolsonaro and his army of online trolls speak of saving Brazil from the fate of Venezuela, they are distorting reality. But that will not stop the president trying to jail the PT’s leaders, destroying trade union power and suppressing left-wing protest. This, however, is not the reason the Brazilian middle class supported Bolsonaro.

Across the world, the neoliberal economic project is under stress. Though elites everywhere wish to continue with the bonanza of free central bank money, low taxation and the destruction of welfare states, they understand that consent for this cannot be maintained. Beginning with the Greek crisis in 2015, then Brexit in 2016 and the victory of Donald Trump thereafter, we’ve seen a series of attempts to reorder the neoliberal world by force.

The Greek crisis was, in fact, a power grab by Germany, whose finance minister claimed the right to expel a fellow member of the Eurozone, and enforce neoliberal economics on a population that had voted to reject them. Lest we forget, the same tabloids that now spew fear against Germany’s migrant communities, first otherised the “lazy” and dark-skinned Greeks.

Brexit was a power grab by a section of the elite - almost wholly detached from domestic British business - on behalf of hedge fund owners and investment bankers. What Boris Johnson and his crew wanted - and still may get - is to pitch the UK into a perpetual whirlwind of deregulation and privatisation - under the guise of trade deals - for the benefit of speculative finance.

Trump’s project is even bigger: to dismantle the multilateral, rules-based system that holds the world together, and instead reorganise the Americas and Europe as tributary economies to the US corporations.

So Bolsonaro's victory is both a reflection and a reinforcement of what the national elites of major developed countries have done: mobilising the xenophobia and petty grievances of the middle class in a project to empower the state, removing obstacles to the greater exploitation of the poor, and reneging on obligations to halt climate change and protect the planet.

In Brazil’s case this project takes an a proto-fascist form because it has to: the urban poor are well-organised and so are the landless peasants; the labour movement and progressive social movements are strong.  Meanwhile, whatever social benefits the Workers’ Party delivered under former presidents Lula and Dilma Roussef, it never delivered security from crime, or from corrupt and violent policing, and never tackled the bribery endemic in Brazil's system of large, state-backed corporations. Until 2014, the Workers Party’ may have run Brazil as a successful emerging capitalist economy, but the overhead costs are now being paid.

Brazil's economy collapsed after 2014 because its economic model no longer fitted its position within the globalised economy. The price of its key exports - sugar and iron ore - halved after 2010. As debt spiralled, governments were forced to tighten austerity. Meanwhile, the Brazilian real slumped: one real would have bought you 64 US cents in 2011; three years later it would command just 25 cents, and remains at 27 cents today.

Economies that are heavily reliant on raw material exports can survive such a slump in the terms of trade, but not economies like Brazil, committed to public ownership of the oil industry, provision of social benefits to the poor, and with generous pension system for former state employees. Unemployment topped 13 per cent last year. Debt, which was just 51 per cent of GDP five years ago, stands at 75 per cent and rising. The Workers Party, just like its liberal centrist and social democratic equivalents in Europe, lost the battle for a coherent narrative.

Now Bolsonaro will crack open Brazil’s relatively closed domestic economy like a piñata, showering global finance with opportunities to privatise the country’s businesses and exploit its natural resources. He will suppress wages by attacking organised labour and slash welfare payments to the poor. His programme is so clearly one of upward redistribution that his opponent, the Workers’ Party Fernando Haddad, won in 98 per cent of the country’s poorest districts.

If Hannah Arendt’s description of fascism - an alliance of elite and mob - applies to Brazil, it is an alliance of the global financial elite with the “mob” of middle class people enraged at the enduring social power of the poor. Bolsonaro will align Brazil firmly with Trump’s design for an American world disorder. His supporters have wasted no time in taking to the streets, firing guns and torching offices to intimidate minorities and the left.

And that’s how fascism happens. There is, in all modern societies, a seething reactionary consciousness that remains unexpressed behind the politeness and performativity demanded by globalised technocratic norms. Arendt said that what the mob and the elite needed was “access to history”. That is what figures like Trump and Bolsonaro provide. The ability to roll back social liberalism, welfarism and the rule of law whose progress had seemed as certain as the arrow of time in the decades when the free market model worked.

We are living through a period where one crack in the system generates another. Bolsonaro could have won without Trump, but it would have been harder; Trump could have won without Brexit, but he modelled his entire campaign on Brexit, and dabbled with Russian influence in the same way as the Brexiteers.

So where’s next? The most fragile political economy is Europe. In Western Europe, the far right has been contained so far by proportional representation systems, and by the refusal of traditional conservative parties to entertain coalitions with authoritarian nationalists. In Eastern Europe, it is authoritarian conservatism that holds the whip hand.

Meanwhile, the political centre has begun to fight authoritarian nationalism with a combination of courage (as in the case of Guy Verhofstadt's Alliance of Liberals and Democrats for Europe) and ineptitude (as in the case of the German SPD). For now, the political room for authoritarianism is constrained by the European conventions on human rights and the structure of the EU itself.

However, the forces of instability are rising. Italy’s clash with Brussels over the Budget; the intolerance of the Spanish state for Catalan nationalism; the violence in Chemnitz, and the refusal of the German security services to take it seriously; the shaky coalition in Berlin. Above all, we are in a period where assuaging xenophobia does not seem to abate it. The far-right forces corralled in parliamentary quarantine - from the Hague to Stockholm to Berlin – are still capable of generating anger and legitimising racism, and the American money flowing into stoking that will only help them.

The left, weak as it may be in many countries, at least knows what it wants to do. It wants to tax the rich, spend money on the poor, curb the excesses of globalisation and protect minorities. It is - despite honourable exceptions - the liberal centre that is bereft of a coherent strategy and narrative. Brazil shows how quickly the centre can evaporate.

Fascism, historically, was only ever beaten by an alliance of the centre and the left. The task is to place that kind of alliance on the agenda: to muffle the cacophony of recrimination between left and centrist political activists and fight what has become the main enemy: the racist man with a gun who wants to cleanse society of all that annoys him.

Paul Mason is a New Statesman contributing writer, author and film-maker. As economics editor at Newsnight, then Channel 4 News he covered the global financial crisis, the Arab Spring, the Occupy movement and the Gaza war. His bestselling book Postcapitalism has been translated into 16 languages. His play Why It’s Kicking Off Everywhere was televised on BBC Two in 2017. 

This article first appeared in the 02 November 2018 issue of the New Statesman, The Great War’s long shadow