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The fringe also rises

Friday, October 26, 2012

Extremist parties in Europe aren't big enough to win elections yet, but they may now have enough clout to break up the euro zone

ERIC REGULY

Entrepreneurs like to reinvent themselves and Frank Stronach is one who does it with trademark oddball flair. At age 80, the auto parts magnate who created Canada's Magna International and, later, a horse racing empire, is launching an Austrian political party that aims to yank his beloved homeland out of the euro.

In Stronach's value calculus, the costs of sticking with the 17-country euro zone now outweigh the benefits of staying put. To wit: If the zone's bailout fund for sovereign debt, the €500-billion European Stability Mechanism (ESM), were to unleash its full force on some clapped-out economy like Spain's, Austrian taxpayers would be on the hook for about €20 billion. Recent polls suggest that Stronach's party (which had no name as of early October) would nail 10% of the vote if elections were held today.

Stronach's party is not unique in Europe. Parties on the radical right and the radical left, though more of the former, are gaining votes. Some are becoming so popular that they can kill governments and swing elections. As the European Union and centrist politicians preach the virtues of political and economic integration, fringe parties are preaching the opposite.

In April in the Netherlands, Geert Wilders's anti-immigrant, anti-Muslim and euro-skeptic Party for Freedom (PVV) brought down the government over disagreements on austerity-related budget cuts. In France, Marine Le Pen's Front National, the nationalist, euro-phobic party founded by her anti-Semitic father, Jean-Marie Le Pen, took 18% of the vote in the first round of the spring presidential election that sent Nicolas Sarkozy packing. It was the party's best showing ever. In Greece, the neo-Nazi Golden Dawn party, which advocates defaulting on the country's debt and exiting the euro zone (not to mention stringing land mines along the borders to discourage illegal immigrants), took 7% of the vote.

Some left-wing populist parties are taking off, too. Greece's Coalition of the Radical Left, known as Syriza, used its anti-austerity stance to become the main opposition party in elections earlier this year.

It would be wrong to credit - or blame - the recession, sovereign bailouts and job-killing austerity measures since 2008 for all the success of the extreme parties. In various guises, many of those parties have been around for a long time. Some of them, including the Front National, enjoyed impressive showings during economic boom times. Nor is a failing economy always an incubator for extremism. Spain, with an unemployment rate of 25%, has no radical parties to speak of.

Drawing parallels among the parties isn't easy, either. Many are anti-immigrant but surprisingly liberal in other areas - Wilders's party supports gay rights and gender equality. Syriza is not anti-euro, but thinks Greece should default because its debt load is unsustainable. In Italy, the soaring Five Star movement of accountant-turned-comedian Beppe Grillo seems neither left- nor right-wing. He runs on an anti-corruption platform with a strong dash of euro wariness, calling the common currency "an ever-tightening noose."

But if Europe's double-dip recession and the relentless austerity programs did not produce the extreme parties, they are helping to propel them to mainstream status. That's because the attitudes toward the European Union (or simply "Brussels,'' to give the ogre an address) have changed radically.

For most of its existence, the EU was merely an annoyance for many governments, businesses and voters. The rule that all teddy bears made for children under age 3 had to be washable was one of them. An effort to write common standards for bank capital was more serious, though still nothing to go to war over. Then Brussels, with the ample support of Germany, the euro zone's paymaster, got into the austerity game. If countries were to be bailed out, they had to crunch spending, fire civil servants, sell state companies, slice open social safety nets and gut pensions.

As a result, annoyance with Brussels has turned into outright resentment and sometimes rage. Mass protests, some violent, have crippled Athens, Madrid and other cities. Fringe parties that had been anchored by their anti-immigration, anti-Muslim or economic nationalism policies suddenly had a new rallying cry: Death to austerity. The populist backlash is also pushing centrist parties off balance, killing the careers of pro-austerity politicians (Sarkozy, for instance) and pouring fuel on the fire of nationalist movements.

Voting for an extremist party does not necessarily mean you're a racist, fascist, Muslim hater or anti-Semite (though it often does); it is just as likely a protest vote against a new economic model that, in the eyes of millions, means a decade or longer on the dole. Frank Stronach, like all smart entrepreneurs, is tapping in to pent-up demand for a useful new product. To him, that product can't be bought in euros.

Eric Reguly is an award-winning columnist with The Globe and Mail. He is now based in Rome, and can be reached at ereguly@globeandmail.com