With the rise of anti-immigrant right-wing extremist parties, we are getting comparisons to the 1930’s and comments that depression spawns fascism. This is true, but not the whole truth. The bigger picture is that two things seem to bring down governments – any governments – more than any other. One is losing a war. The other is economic crisis.
There is at least some evidence that democracies survive losing wars better than non-democratic governments. The U.S. government remained stable throughout the darkest days of the Civil War, and the Confederate government (which was democratic so far as white people went) also help up to the very end. Napoleon III, by contrast, was overthrown when he lost the Franco-Prussian War. Russia’s abortive revolution of 1905 came in response to losing the Russo-Japanese war. WWI brought down the monarchies of Russia, Germany and Austria, while the democratic governments of France and Belgium held up even when all seemed lost. The French Fourth Republic fell when it lost the war in Algeria, but gave way to the Fifth Republic. Military dictatorships in Pakistan and Argentina also collapsed when they lost wars. On the other hand, the dictator most likely to survive losing a war is the harshest and most brutal one, Saddam Hussein, for instance. Stalin also held onto power even when the Germans invaded and all seemed lost. And the Nazi government went down fighting. Why the harshest dictators should survive best is clear enough. They brutally crush all opposition. Why democracies might hold up better is not clear. Maybe one it is because in a democracy, the people have the option of throwing out the scoundrels who lost the war without violent revolution. A lost war, after all, is a sunk cost. It is too late to go back and win, and the newly elected government will not be responsible for losing.
Economic crises are a different matter. Economic crises can continue for years without improvement. Voting out the scoundrels who started it does little good if the next government can’t improve things. Sometimes this leads to desperate measures and revolution. This isn’t altogether bad. It applies to democratic and dictatorial governments alike.
Clearly the Great Depression was a disaster for democracy. Hitler was merely the most (in)famous of many right-wing dictators to come to power in its wake. True fascism was limited to Germany and Italy, but Austria established Austrofascism, Hungary trended in that direction, and democracies fell and fascist movements arose across eastern and southern Europe.
The process was reversed in Latin America in the 1980’s, where one military dictatorship after another gave way to democratic reformers under the pressure of an economic crisis. Well do I remember those days, and newspapers that commented that just as an economic crisis undermined democracy in Europe in the 1930’s, it was undermining dictatorship in Latin America in the 1980’s. The Asian crisis of the 1990’s brought down the Suharto dictatorship in Indonesia.
And now we have come full circle, with yet another economic crisis in Europe, the rise of right-wing extremists (as well as the far left in Greece). The rise of extremists in Europe is not just a desperate reaction to declining economic conditions. It is also a response to a general consensus in favor of self-destructive policies -- fiscal austerity, monetary policy set by Germany to German needs, and calls for "internal devaluation." These policies harming Europe, but they are they have the universal support of "respectable" opinion everywhere. Only extremists, especially semi-fascists, are willing to rebel against German-dictated terms and even consider leaving the euro. Let this be a lesson. If "respectable" authorities persist in policies that undermine European economies, people will look elsewhere for a way out.