{"id":63373,"date":"2026-09-21T18:09:50","date_gmt":"2026-09-21T08:09:50","guid":{"rendered":"https:\/\/billmitchell.org\/blog\/?p=63373"},"modified":"2026-09-21T18:09:50","modified_gmt":"2026-09-21T08:09:50","slug":"the-failure-of-neoliberalism-and-the-progressive-failure-to-articulate-that-has-engendered-the-rise-of-the-far-right","status":"publish","type":"post","link":"https:\/\/billmitchell.org\/blog\/?p=63373","title":{"rendered":"The failure of neoliberalism and the progressive failure to articulate that has engendered the rise of the far Right"},"content":{"rendered":"

On Sunday (September 20, 2026), the two state elections in Germany confirmed a trend that has been unfolding for some years in fact – the polarisation of politics in nations, and, in particular the legitimisation of far Right politicians espousing views that are not inconsistent with the views of the National Socialists in Germany in the 1930s. Those views were considered the anathema of acceptable in the post WW2 period but now are garnering increased support again. Chancellor Merz called the outcome “a disaster” with the far Right Alternative for Deutschland (AfD) recording the most votes in the – 2026 Mecklenburg-Vorpommern state election<\/a>. The other interesting result was recorded in the – 2026 Berlin state election<\/a> – where a Left candidate triumphed echoing the sort of momentum that Zohran Mamdani achieved in the New York in the November 4, 2025 city elections. These results are indicative of the trends that the failure of neoliberalism has engendered. I trace this theme in this blog post.
\n<\/p>\n

In the weekend’s state elections, the historically dominant Christian Democratic Union (CDU) recorded its “worst in any state election … since 1949” (Source<\/a>).<\/p>\n

The AfDs win in Mecklenburg-Vorpommern followed it taking second place in the – 2026 Saxony-Anhalt state election<\/a> – on September 6, 2026.<\/p>\n

Both states are in the North East part of Germany that was formerly part of the German Democratic Republic.<\/p>\n

But the interesting result from my perspective was the result from the – 2026 Berlin state election<\/a> – where a Left candidate increased her seats from 20 to 38 (winning the largest number) and outshone the far Right Alternative for Deutschland (AfD) candidate who came placed third (with the mainstream CDU second but dramatically shedding 24 of their previous 52 seats).<\/p>\n

The Die Linke lead candidate – Elif Eralp<\/a> – is from a Turkish background (her parent’s were trade unionists) and fought hard on issues like “the expropriation of housing properties owned by large companies”.<\/p>\n

Her views are at the opposite end of the spectrum from those advocated by AfD.<\/p>\n

There are several examples of this sort of polarisation occurring in elections around the world.<\/p>\n

While the mainstream media focuses more on the emergence of the far Right parties as legitimate contenders for power, which is unsurprising given how toxic the views expressed by these parties are, the dominance of the Left candidates in large city elections is a sign of hope for the a progressive future … perhaps.<\/p>\n

The reality is that the mainstream political parties on the right and left – that mostly try to hug the centre somewhere have been in terminal decline for years and are products of their own lack of innovation and vision.<\/p>\n

I have had a particular interest in the way the traditional progressive parties – such as the Labour parties, the Socialists, or the Democrats (in the US) – have squandered their political capital by trying to mimic the conservative parties on macroeconomic policy.<\/p>\n

Our 2017 book – Reclaiming the State: A Progressive Vision of Sovereignty for a Post-Neoliberal World<\/a> (Pluto Books, September 2017) – traced this decline (as did many of my blog posts that served as the raw material for the book).<\/p>\n

See the category – Reclaim the State<\/a> – if you want to trace back through those blog posts.<\/p>\n

The essence of my thesis is that the mainstream progressive parties started to lose their way in the first half of the 1970s when they conceded the macroeconomic debate about the capacity of currency-issuing governments to the conservatives who were espousing the ‘household budget’ fiction and demanding that governments run fiscal surpluses through privatisation, outsourcing, and purges on expenditure on welfare, education, health, and public transport (etc).<\/p>\n

The idea that global financial markets had become more powerful than sovereign states and that the macroeconomic policy choices of those states had to be friendly to the large financial speculators was propagated by the conservatives and swallowed in total by the progressive political forces.<\/p>\n

We can trace a series of linked tipping points – British Labour PM Callaghan at Blackpool in September 1976, French Socialist President Fran\u00e7ois Mitterrand and his finance minister Jacques Delors in their ‘turn to austerity’ in 1983, the Labour governments of New Zealand and Australia in the 1980s, etc – as examples of formerly progressive voices beginning to act in the same way as the conservatives.<\/p>\n

Of course, the thesis in the 2017 book was that the neoliberal forces knew all along that the ‘state’ had not withered away and still retained ultimate power through its legislative and regulative capacities.<\/p>\n

To accomplish the dominance of the neoliberal programme, those capacities had to be reconfigured to favour the elites of capital who saw neoliberalism as the way to overturn the decades of social democratic outcomes that followed WW2.<\/p>\n

So the state was reconfigured to become an agent of capital rather than a mediator in the capital-labour conflict, a role it had played in that social democratic period.<\/p>\n

One of my current projects, which will appear in book form sometime down the track, is examining the contradictions of neoliberal ideology and the consequences of those contradictions.<\/p>\n

In the early years (1970s and 1980s), advocates of what we now refer to as neoliberalism were vanguards for what they referred to as the ‘free market’ pathway to prosperity.<\/p>\n

In Australia, it was marketed as ‘economic rationalism’ and the promoters put in front of the cameras by the elites driving the show were mainstream economists who crept out of the academy where they had infested the minds of their students with neoclassical assertions that optimality is achieved if all market exchanges are conducted freely between consumer and supplier.<\/p>\n

The idea of perfect competition where no transactor can overly influence the exchange and that price would clear markets to equilibrate supply (unit costs) with demand (consumer preferences) and thus generate the least-cost allocation of resources that delivered the most satisfaction was central to the free market lobby.<\/p>\n

Of course, it was just a ruse to attack government and trade unions – characterising their activities as ‘market imperfections’ which could be reduced to improve welfare outcomes.<\/p>\n

Economist after economist would be quoted in the press or appear on national broadcasting platforms extolling the virtues of the ‘free market’ and extrapoloting that concept to a broader notion of individual freedom – freedom of movement, freedom of choice – and utility maximisation for individuals and profit maximisation for producers.<\/p>\n

What could go wrong?<\/p>\n

Answer: Everything.<\/p>\n

The reality is that is was an elaborate front for corporate elites to gain a greater share of national income – reducing the capacity of labour to enjoy real wages growth and reducing the activities of governments aimed at redistribution and inclusive outcomes for all.<\/p>\n

There are no ‘free markets’.<\/p>\n

Prices are continually fixed.<\/p>\n

Suppliers manipulate choice through advertising.<\/p>\n

All economic exchanges are mediated within legal frameworks created and regulated by the state.<\/p>\n

The last point explains why the neoliberals had to work through<\/strong> the state and use its legislative and regulative power to further their own ends.<\/p>\n

Global capital did not see the state ‘wither away’ as the Left was conned into believing.<\/p>\n

The state was just coopted by global capital to make it easier for the latter to extract national income away from labour and welfare ends.<\/p>\n

The other reality is that far from advancing gains in general welfare, the neoliberal era has done exactly the opposite.<\/p>\n

1. Income and wealth inequality has increased whereas in the social democratic period inequality was narrowed.<\/p>\n

2. The consequences of deregulation, privatisation, outsourcing and all the other elements of the reconfiguration of the state has been instrumental in eroding the rights of workers, eroding their capacity to gain real wages growth, and undermining the delivery of policies that target the most disadvantaged.<\/p>\n

3. The hollowing out of the state has directly benefited the wealthy elites.<\/p>\n

4. Initially, it was hard to detect the shifts but as public infrastructure degraded, health systems frayed, education outcomes became more unequal and social safety nets disappeared, citizens started to feel the crunch.<\/p>\n

5. Further, the accompanying ‘free trade’ myth, saw wide scale deindustrialisation of regions where communities depended on local manufacturing capacities.<\/p>\n

For example, in Newcastle (where I mostly live) the old steel industry collapsed and the major employment opportunities became low-paid, precarious work in the service sector – shop assistants etc.<\/p>\n

6. Job insecurity increased and wages growth stagnated while the corporate CEOs and their hangers on recorded record remunerations.<\/p>\n

7. Enviroment degradation carried on at a pace and a whole industry of denial was erected to diffuse the obvious issue that our planet was becoming inhospitable to human existence because of our own activities and approaching a state of peril.<\/p>\n

I could articulate more dimensions of what neoliberalism has resulted in despite the early promises of a nirvana for all.<\/p>\n

The other important point is that the mainstream political parties on the right and left were seen as being enablers of neoliberalism.<\/p>\n

The elites of capital, through political funding, lobbying, etc were able to capture these political voices and turn them into advocates for the neoliberal agenda.<\/p>\n

In particular, the formerly progressive parties tried to become more neoliberal than the conservatives.<\/p>\n

Whereas the latter was the more consistent camp for these ideas, the fact that the progressive forces surrendered the macroeconomic debate and became more vehement about pursuing fiscal surpluses and reducing public debt and imposing austerity on communities, meant they were seen by their natural constituency – the working class – as traitors.<\/p>\n

The upshot is that these mainstream political parties were increasingly seen as being ‘out-of-touch’.<\/p>\n

The progressive parties, who should have become the voice for those impacted negatively by the neoliberal outcomes, ceded that role to more extreme right wing forces and instead were seen as being facilitators of the woe that neoliberalism has inflicted on workers.<\/p>\n

I recall being in Madrid one year when fiscal austerity was pushing up the national unemployment rate and creating increasing harshness for the workers.<\/p>\n

There was a massive street march in Seville (I think from memory) demanding jobs and reductions in unemployment.<\/p>\n

I asked the audience that I was presenting to who they thought was organising the march.<\/p>\n

The consensus was it was the Socialist Party (the traditional progressive force).<\/p>\n

The reality was that it was the new right forces in Spain that organised the march and were giving voice to the angst of mass unemployment and fiscal austerity.<\/p>\n

The mainstream political forces had ceded that role to these extremist elements.<\/p>\n

The German state elections yesterday now indicate what the consequences of that sort of abandonment by progressive forces has led to.<\/p>\n

The emergence of the far Right is no accident.<\/p>\n

The mainstream media (Fox etc) that promote neoliberalism has been able to deflect the attention of citizens away from an understanding of the direct causality between the neoliberal agenda and the negative outcomes.<\/p>\n

The way they have done this is to deploy a classical divide-and-conquer strategy that has been the tool of trade for capitalism since industrialisation emerged.<\/p>\n

It is now a highly refined exercise that involves vilifying vulnerable groups in society and casting them as the ’cause’ of the woes.<\/p>\n

The economic anxieties that neoliberalism has generated are directed towards scapegoats – migrants, refugees, minorities, left-wing workers (Trump’s ‘Marxists’).<\/p>\n

In Australia, for example, there is a housing crisis caused directly by state governments walking away from their traditional role to supply ‘social housing’ for disadvantaged citizens as they pursued what they claimed was essential fiscal rectitude.<\/p>\n

The religious connotations of rectitude were exploited by the neoliberals to further broader the appeal of the ideology.<\/p>\n

While the cause of the housing crisis is obvious to anyone who studies the situation, the mainstream media and the aspiring right wing politicians has characterised it in Australia as undeserving migrants coming here and taking our homes from us.<\/p>\n

It is an easy sell to those forced to pay sky rocket rents and live in sub-standard accommodation, while the landlords exploit highly favourable tax breaks to record massive profits.<\/p>\n

The former ‘Australian Dream’ – home ownership is rapidly vanishing for the younger generations and it is easy to divert the blame onto Muslims, Asians, etc who come here to make a new life.<\/p>\n

Those narratives are global and played a prominent role in the German state elections.<\/p>\n

Meanwhile, capital has pressured governments to alter Visa rules etc to facilitate the entry of migrants because they will take low pay and work in precarious jobs.<\/p>\n

As an aside, the construction sector has many migrants working on short-term visas – to ‘fills the skills gap’ as the campaign goes – and the results are that the downward pressure on wages and conditions are not only eroding the prosperity of local workers but also becoming part of the inferior developments in the city areas that are being evidenced now.<\/p>\n

The mainstream media on the one hand berate the migrants but are owned or facilitated by the same forces that demand the government maintain a continuing supply of low paid labour.<\/p>\n

For the ordinary citizen the message that the migrants are the problem resonates and they see the direct consequences in their work places as wages are bid down.<\/p>\n

They fail to see the common force facilitating the whole thing – which isn’t the migrant workers and their families.<\/p>\n

To reinforce the message, the far Right political class propagates an exclusionary concept of nationalism – mimicking the National Socialists of Germany in the 1930s – that seems to promise a protective environment for citizens (excluding of course the newcomer migrants).<\/p>\n

In Australia in the 1990s, the far Right One Nation party singled out Asians – ‘we were about to be overrun’ by them.<\/p>\n

Now, in keeping with the times, it is Muslims that are to blame for eroding out national culture.<\/p>\n

The only solution they advocate is to close borders and deport people, which, of course, doesn’t do anything to stop the neoliberal onslaught that is the cause of the anxieties.<\/p>\n

Further, identity politics is part of this divide-and-conquer strategy which the far Right leaders have falling prey of.<\/p>\n

Citizens who are feeling culturally and economically abandoned by the mainstream parties – they correctly see these parties as being the facilitators of neoliberalism – are attracted to the ideas of the far Right that criticise the mainstream parties for pursuing approaches aimed at inclusion.<\/p>\n

So we get the transgender push back – ‘competitive sport is apparently being overrun by men masquerading as women’ and all that.<\/p>\n

We get the allegations of wokeness – One Nation politicians are now referring to the Labor party (which is in government) as the ‘Uni Party’ – leveraging the long-standing attacks by conservative politicians on academics.<\/p>\n

The conservative hatred of universities and the academics who work in them stems from their desire to eliminate debate and eschew knowledge that got in the way of their corporate enablers’ aspirations to extract more national income.<\/p>\n

The far Right politicians have leveraged that constant attack on the woke academics and constantly denigrate research activities and the findings of knowledge that follow.<\/p>\n

So they become coopted by the fossil fuel industry against climate change; the anti-vax interests, etc.<\/p>\n

The voters are lured by these ‘wedge tactics’ and think the way forward is to accept the far Right ideas – because, after all, the mainstream political voices have abandoned them.<\/p>\n

Conclusion<\/h2>\n

The irony in all of this, which I am now researching is that the calls for ‘individual freedom’ which characterised the rise of neoliberalism and the messaging that captured political support for the reconfiguration of the state has manifest in an increasingly ‘fascist’ politics.<\/p>\n

The far Right now want to suppress the freedom of the press and freedom of movement.<\/p>\n

They want to scrap national broadcasters and significantly cut university research budgets and academic employment.<\/p>\n

Increasingly, we are heading into authoritarianism – which is the product of a failed neoliberalism and moreover, the failure of progressive political forces to voice the anxieties that the neoliberal failure has generated.<\/p>\n

It is a massive clusterf*ck.<\/p>\n

That is enough for today!<\/p>\n

(c) Copyright 2026 William Mitchell. All Rights Reserved. <\/p>\n","protected":false},"excerpt":{"rendered":"

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