Introduction

Chapter 5 examines the roots of populism, the dangers it presents to democracy and how the COVID-19 pandemic has introduced new dynamics to the situation with both promises and dark warnings. Four decades of neoliberalism has not only spawned economic and financial crisis but also political crisis. It is manifested in the ascendance of populism verging on ethnonationalist regimes, which can descend into fascism in the worst scenario. Populists in power have exploited the pandemic crisis to grab more power. At the same time, populist governments have not performed well in coping with the crisis. This chapter also looks at how the pandemic can affect the fortune of populism and democracy, as well as the sense of solidarity among nations.

The rise of populism and ethno-nationalism today is in many ways a redux of what happened in Europe during the interwar years in the early twentieth century. Polanyi saw the rise of fascism, the economic depression, and the two world wars as the crisis and breakdown of the self-regulating market and capitalism. Under capitalism, societies are constantly confronted with the basic tension between forces of marketization and the counterforces of social protection. As the market relentlessly expands its reach and search for profit, it generates contradictions in society and imposes enormous hardships on people. This naturally engenders counter-movements, seeking protection from the ravages of market, demanding political and social rights. This produces a clash between market values and political values of democracy. When these two forces are equally balanced, political stability prevails. But when market forces become excessive, they result in extreme inequities and crisis. The inability to find a solution to the crisis, and a stalemate between these two forces, presents opportunities for alternative narratives and “solutions”. This unstable situation is often exploited by political demagogues and charlatans to rise to power. Italy and Germany, during the period between the two world wars, represented such a moment. Defeated after the First World War, humiliated psychologically and impoverished with the heavy burden of war reparations, the lives of ordinary people were made worse by hyperinflation.