Geopolitics

'The People v. Elites': An Existential Threat To Democracy

Failure to address spreading anger with economic inequalities, and to check its attendant demagoguery, may undermine the very functioning of liberal democracies.

Brazil President Jair Bolsonaro in Palácio da Alvorada
Roberto Saba

-Analysis-

BUENOS AIRES — The Bulgarian political analyst and intellectual Ivan Krastev states that in times when populism is gaining strength, the main political fight has ceased to be between Left and Right, or reformers and conservatives. The emerging, central and structural conflict is between elites increasingly distrustful of democracy, and discontented majorities espousing ever-more illiberal views, in the political sense of the term. To this he adds the presence of populist leaders of Right and Left who are riding the confrontation with moral attacks on a corrupt elite and an ostensible defense of the "real" people and its purity.

In similar terms, the Princeton University politics professor Jan-Werner Müller says these leaders have two common characteristics: anti-elitism and anti-pluralism, with the former being a necessary but insufficient precondition for any populist leader. The Colombian sociologist and expert in human rights law, César Rodríguez-Garavito, agrees with both and says opportunistic and self-interested populist leaders have been exploiting liberal democracies' evident weakness.

That weakness consists in part in professional, business and political elites winning a disproportionate amount of decision-making power, which has become detrimental to the interests of large or even majority sectors of the population. Increasing socio-economic inequality, and a growing sense among citizens that their representatives are distant and uninterested in their problems and concerns, have created the conditions favoring the rise of leaders who, keen to attach themselves to the discontented majority, point at the elites as those responsible for its unease.

Orban at the European Council in December — Photo: IsopixIsopix via ZUMA

Yet there is no uniform understanding of the notion of elite, or which groups constitute it. It varies depending on the national context. In the United States, President Donald J. Trump was provocative when he said he loved those who had not received a good education, taking a jab at the intellectuals and academics who criticize him from the liberal universities. He has also associated Wall Street bosses with the traditional political class, from which he seeks to differentiate himself and on whom he launches repeated verbal attacks.

There is no uniform understanding of the notion of elite, or which groups constitute it.

Britain's last prime minister, Theresa May, while campaigning for Brexit, blamed EU bureaucrats and their local allies, the elite, for the poverty and unemployment affecting so many Britons. Her comments of 2018 that "if you believe you are a citizen of the world, you are a citizen of nowhere," associate anti-popular elites with defenders of globalization, integration, international law and cosmopolitanism.

In Hungary, Prime Minister Victor Orban attacks and harasses academics who criticize him in classrooms, media and on networking sites. In that context he effectively expelled the liberal-leaning University of Central Europe, which moved its seat from Budapest to Vienna. Leaders like Vladimir Putin, Hugo Chávez, Nicolás Maduro and Orban himself have pointed at rights activists and especially those involved in areas like civil and reproductive rights, gender equality, the environment, or those financed by foreign donors and aid agencies as part of a global elite hostile to the national "majority." This tension was seen again with the former Brazilian president Dilma Rousseff in the case of the Belo Monte dam project in northern Brazil, and more recently in the conflict between current President Jair Bolsonaro and environmentalists abroad over deforestation. He too has voiced hostility to intellectuals.

Problems associated with economic inequality are part of the urgent agenda of modern democracies, and if the issue is not overcome, the system itself is threatened. Yet the panorama is complicated by the anti-elitist idea combined with anti-pluralism and xenophobic nationalism, which together forge a grave threat to democracy's survival.

*Roberto P. Saba is Professor of Human Rights at the universities of Buenos Aires and Palermo in Argentina.

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Economy

European Debt? The First Question For Merkel's Successor

Across southern Europe, all eyes are on the German elections, as they hope a change of government might bring about reforms to the EU Stability Pact.

Angela Merkel at a campaign event of CDU party, Stralsund, Sep 2021

Tobias Kaiser, Virginia Kirst, Martina Meister


-Analysis-

BERLIN — Finance Minister Olaf Scholz (SPD) is the front-runner, according to recent polls, to become Germany's next chancellor. Little wonder then that he's attracting attention not just within the country, but from neighbors across Europe who are watching and listening to his every word.

That was certainly the case this past weekend in Brdo, Slovenia, where the minister met with his European counterparts. And of particular interest for those in attendance is where Scholz stands on the issue of debt-rule reform for the eurozone, a subject that is expected to be hotly debated among EU members in the coming months.

France, which holds its own elections early next year, has already made its position clear. "When it comes to the Stability and Growth Pact, we need new rules," said Bruno Le Maire, France's minister of the economy and finance, at the meeting in Slovenia. "We need simpler rules that take the economic reality into account. That is what France will be arguing for in the coming weeks."

The economic reality for eurozone countries is an average national debt of 100% of GDP. Only Luxemburg is currently meeting the two central requirements of the Maastricht Treaty: That national debt must be less than 60% of GDP and the deficit should be no more than 3%. For the moment, these rules have been set aside due to the coronavirus crisis, but next year national leaders must decide how to go forward and whether the rules should be reinstated in 2023.

Europe's north-south divide lives on

The debate looks set to be intense. Fiscally conservative countries, above all Austria and the Netherlands, are against relaxing the rules as they recently made very clear in a joint position paper on the subject. In contrast, southern European countries that are dealing with high levels of national debt believe that now is the moment to relax the rules.

Those governments are calling for countries to be given more freedom over their levels of national debt so that the economy, which is recovering remarkably quickly thanks to coronavirus spending and the European Central Bank's relaxation of its fiscal policy, can continue to grow.

Despite its clear stance on the issue, Paris hasn't yet gone on the offensive.

The rules must be "adapted to fit the new reality," said Spanish Finance Minister Nadia Calviño in Brdo. She says the eurozone needs "new rules that work." Her Belgian counterpart agreed. The national debts in both countries currently stand at over 100% of GDP. The same is true of France, Italy, Portugal, Greece and Cyprus.

Officials there will be keeping a close eye on the German elections — and the subsequent coalition negotiations. Along with France, Germany still sets the tone in the EU, and Berlin's stance on the brewing conflict will depend largely on what the coalition government looks like.

A key question is which party Germany's next finance minister comes from. In their election campaign, the Greens have called for the debt rules to be revised so that in the future they support rather than hinder public investment. The FDP, however, wants to reinstate the Maastricht Treaty rules exactly as they were and ensure they are more strictly enforced than before.

This demand is unlikely to gain traction at the EU level because too many countries would still be breaking the rules for years to come. There is already a consensus that they should be reformed; what is still at stake is how far these reforms should go.

Mario Draghi on stage in Bologna

Prime Minister Mario Draghi at an event in Bologna, Italy — Photo: Brancolini/ROPI/ZUMA

Time for Draghi to step up?

Despite its clear stance on the issue, Paris hasn't yet gone on the offensive. That having been said, starting in January, France will take over the presidency of the EU Council for a period that will coincide with its presidential election campaign. And it's likely that Macron's main rival, right-wing populist Marine Le Pen, will put the reforms front and center, especially since she has long argued against Germany and in favor of more freedom.

Rome is putting its faith in the negotiating skills of Prime Minister Mario Draghi, a former head of the European Central Bank. Draghi is a respected EU finance expert at the debating table and can be of great service to Italy precisely at a moment when Merkel's departure may see Germany represented by a politician with less experience at these kinds of drawn-out summits, where discussions go on long into the night.

The Stability and Growth pact may survive unscathed.

Regardless of how heated the debates turn out to be, the Stability and Growth Pact may well survive the conflict unscathed, as its symbolic value may make revising the agreement itself practically impossible. Instead, the aim will be to rewrite the rules that govern how the Pact should be interpreted: regulations, in other words, about how the deficit and national debt should be calculated.

One possible change would be to allow future borrowing for environmental investments to be discounted. France is not alone in calling for that. European Commissioner for Economy Paolo Gentiloni has also added his voice.

The European Commission is assuming that the debate may drag on for some time. The rules — set aside during the pandemic — are supposed to come into force again at the start of 2023.

The Commission is already preparing for the possibility that they could be reactivated without any reforms. They are investigating how the flexibility that has already been built into the debt laws could be used to ensure that a large swathe of eurozone countries don't automatically find themselves contravening them, representatives explained.

The Commission will present its recommendations for reforms, which will serve as a basis for the countries' negotiations, in December. By that point, the results of the German elections will be known, as well as possibly the coalition negotiations. And we might have a clearer idea of how intense the fight over Europe's debt rules could become — and whether the hopes of the southern countries could become reality.

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