Investors have been watching Europe anxiously, and the first round of voting in the French Presidential Election yesterday did little to offer reassurance. The incumbent Sarkozy did not manage to come first in the first round, and came second to the socialist François Hollande who took 28.63% of the vote. Historically the second round of voting is a formality, as the momentum of the first round results take hold. However there is a chance that Sarkozy might be able to capitalize on supporters of Front National whose leader, Marine Le Pen, took close to 20% of the vote. The economic situation in France, and Europe more broadly, is prompting the rise of socialism and nationalism, something that European conservatvies must learn to address if Europe is to overcome its current economic situation.
Understandably, investors are worried about what a socialist French economy would mean for Europe, and the markets have reacted. However, it is not only the threat of government expansion that is worrying investors. The strong performance by the nationalists under Le Pen’s leadership have led some to worry about what influence the anti-euro and anti-European Union rhetoric could have. While it is unlikely that Le Pen will have much of a political influence, Sarkozy will need to address far-right concerns if he is to defeat Hollande, who has the support of the communists who took a little over 10% of the vote.
The strong performance from Le Pen’s Front National is perhaps an indication of how much more pronounced nationalism is becoming in Europe. Parties like the Freedom Party in the Netherlands have proven to be increasingly influential, with Geert Wilders leaving budget negotiations prompting an unscheduled election. It is these sorts of successes that could encourage Len Pen’s supporters to not support Sarkozy, a man many of them consider a traitor. A socialist victory could collapse Sarkozy’s UMP, allowing for Len Pen’s supporters to wield more influence over whatever right-wing coalition emerges.
What should worry conservatives is that Europe seems to be experiencing a rise of socialism in major economies, and that this rise is accompanied by the rise of far right nationalism that many times offers collective and centralized economic policies. Were an election held today UK’s Labour Party would do well, and perhaps even establish an outright majority in the House of Commons. Data also indicates an increase in support for the policies of the British National Party, although support for their polices does drop slightly when the BNP is mentioned explicitly in surveys.
Both of these trends, socialism and nationalism, will spell economic disaster for Europe. While the euro should probably be dismantled, to do so through xenophobic, protectionist, and discriminatory policies would be incalculably dangerous. Likewise, Hollande’s socialism will encourage government spending and the nationalization of industries.
Much of the resurgence of these unpleasant trends has to do with conservatives’ lack of effective communication. That conservatives have allowed for the current economic crisis to be portrayed as a crisis of capitalism is a shame. Over regulation, bailouts, and government collusion allowed for and encouraged the situation we have now.
Europe and the U.S. have very different histories with socialism and nationalism. Nonetheless, the refuge that people feel in socialism and nationalism does not stop at America’s borders. Americans are not immune to the attitudes and fears of Europeans, and should take note of what is happening in France.