Globalization – characterized by political and economic integration both among European Union (EU) member states and between the EU bloc and the world at large — has produced three observable domestic sociopolitical consequences in European states explored in this research. These include increased transnational immigration rates, the perceived loss of national/ cultural/ ethnic identity among the affected populations, and uneven distribution of economic benefits across social strata, which will be explored and measured in the literature review section of this study.

These three phenomena induced by globalization may have produced domestic political backlash from the populations affected by them. For whatever benefits globalization might confer, the process necessarily requires some concessions from nationalists who identify culturally and politically with the state and from the states themselves, which must surrender some degree of sovereign control over their economies and national borders. This research will examine whether “far-right” (defined herein) electoral success in France and Hungary from 1990-2020 is the result of popular domestic blowback against globalization and liberal ideology broadly. France and Hungary will serve as the case studies here, the results of which may be extrapolated and tested in the context of other European states in future studies.

The thesis tested in this research is that three factors (immigration to EU member states, perceived loss of national identity and sovereignty, and uneven distribution of economic benefits across social strata) resulted in increased electoral votes for “far-right” parties as a percentage of the total vote in France and Hungary from 1990-2020.

The section on globalization contains a trio of subsections: globalization’s effects on inequality, globalization’s potential to undermine national sovereignty, and the inherent conflict between protectionist policies and globalization. The section on effects of globalization on domestic politics and populations in France and Hungary is likewise comprised of three subsections: transnational immigration, perceived loss of national/cultural/ethnic identity, and uneven distribution of economic benefits across economic strata.

Globalization

The integration of the function of the state into broader governing bodies at the regional and global levels is termed is a key feature of globalization – otherwise known as “transnationalism.” The Geneva Centre for Security Policy summarizes globalization as “a process that encompasses the causes, course, and consequences of transnational and transcultural integration of human and non-human activities.” (Carminati, 2017) Since the 19980s, “one of the most striking features of the international economy… has been the proliferation and intensification of regional trading agreements around the world.” (Hanson, 1998, pg. 55) Beyond the regional level, so-called “mega-regional” trade agreements such as the Trans-Pacific Partnership (TPP) and Transatlantic Trade and Investment Partnership (TTIP), which encompass huge swathes of the global economy, .have also proliferated in the increasingly globalized economy. (Gonzalez, 2016)

Globalization has impacted most of the world, including European Union (EU) member states. The EU was a post-WWII project to integrate Western Europe – and, later, after the collapse of the Soviet Union in the early 1990s, Eastern Europe. Prior to the advent of the European Union, the states of Europe existed in a realist anarchy at the international level in which economic competition had historically led to war. Per interdependence theory, of the neoliberal school of thought, offered as an alternative to realist conflict, transnational institutions that facilitate trade have the capacity to enhance cooperation between states and reduce the likelihood of war as a result. (Jervis, 1999, p. 62)

The initial iteration of the EU was the supranational European Coal and Steel Community (ECSC), founded shortly after World War II which “pooled the coal and steel resources of six European countries: France, Germany, Italy, Belgium, the Netherlands, and Luxembourg (BENELUX)” (Carleton, 2023) in order to control the German steel and coal industries. The main motivation for the creation of the ECSC was to prevent another outbreak of war on the continent by constraining Germany. The next big change in European integration came with the 1985 Schengen Agreement, which abolished internal borders within the EU to allow the free flow of people and capital across member states. The Schengen Agreement included the original six members of the ECSC plus Denmark, Ireland, the UK, Greece, Portugal, and Spain. (Traynor, 2016)

In 2004, a major expansion of the EU welcomed member states from Eastern and Central Europe that had once been behind the Iron Curtain before the Soviet Union’s collapse in the early 1990s. With such a huge block of new members, some analysts called it the “big bang” of EU expansion. Europe had never achieved anything close to this level of political integration. The new EU members included Cyprus, Malta, Poland, Latvia, the Czech Republic, Estonia, Slovenia, Lithuania, Slovakia and Hungary. Along with this enlargement came concerns relevant to this research, such as “government responses to perceived cultural threats and anti-immigration sentiments in public opinion” (Sedelmeier, 2014, p. 2) among member states. These concerns over popular backlash to the EU’s rapid development would bear out in later conflicts between EU member states, particularly between Eastern European states such as Hungary and EU leadership in Brussels.

The process of the integration of Europe into a supranational political body (in the form of the EU) and the process of globalization are distinct phenomena. However, in Europe, the expansion of the EU is paramount to the process of globalization because former lent the mechanisms needed for the latter, as “the EU developed a policy of regulated globalism in part because the union had to put in place regulatory frameworks for the governance of European integration, meaning that these frameworks offered themselves as templates when interdependence gathered pace at the global level.” (Youngs & Ulgen, 2022) So, since its inception, the EU has been outward-facing in its orientation, which has put it at the forefront of globalization. Per the KOF Globalisation Index, the top three most globalized countries in the world – the Netherlands, Belgium, and Switzerland — are located in Europe (although Switzerland is not a member of the EU). (Swiss Economic Institute, 2021)

Despite its dubious record of achieving stated aims, globalization is normatively attractive to adherents of liberal ideology such as the European Liberal Forum who prize internationally-oriented policies to reduce inequality and promote human welfare: “Over the course of the development of the EU, we have stressed how important cooperation and coordination among its Member States is to defending and enhancing the freedom and prosperity of their citizens.” (European Liberal Forum, 2014, p.3) The European Union has been described by some analysts as “a bulwark of the liberal international order” (de Paiva Pires, 2022) because of its emphasis on transnational governance.

Accordingly, “liberal political parties and organisations throughout Europe traditionally have a strong pro-European profile,” (European Liberal Forum, 2014, p.3) meaning they support greater political integration of the continent. Attenuating the destabilizing effects of inequality, according to liberal doctrine, produces stability and promotes prosperity and peace; Rodrik cites the importance of “social policies to address inequality and exclusion,” concluding that nations that implement these policies will fare enjoy greater economic and social benefits than those that do not (Rodrik, 2013, p. 447). Globalization is one such development “propagated by the international development agencies [that] focuses on the shift in thinking which occurred in the 1980s… known as the ‘Washington Consensus.'” (Gore, 2001, p. 318), which encouraged national governments to open up trade with the outside world and to liberalize capital accounts to enable free movement of capital as a means to achieving mutual prosperity among states.

Globalization has been a dominant and major international phenomenon following the political and economic devastation wreaked by World War II: “Since the Second World War, globalization has been underpinned by a liberal international order, a rules-based system structured around the principles of economic interdependence, democracy, human rights and multilateralism.” (Money, 1997) Neoliberalism, a branch of the liberal school of thought that gained popularity among Western political elites and policymakers in the late 20^th century, “postulates that the reduction of state interventions in economic and social activities and the deregulation of labor and financial markets… have liberated the enormous potential of capitalism to create an unprecedented era of social well-being in the world’s population.” (Navarro, 2007) Coinciding with the rapid increase in globalization beginning in the 1980s, “one of the most marked changes in the sociopolitical landscape of European societies since the 1980s has been the rapid and widespread adoption of neoliberal policies across the continent.” (Mijs, et al., 2016, p. 1)

Although globalization is largely favored among elite policymakers and academics, especially in the West where liberalism is arguably ideologically hegemonic, it does have its detractors. According to one critique, for instance, “neoliberal globalization is comprised of four processes: accumulation by dispossession; de-regulation; privatization; and an upward re-distribution of wealth” that, taken together, create numerous sociopolitical dilemmas such as “rising global inequality” and “threats to identity,” (Gandesha, 2018) both of which will be explored here.

Because “European governments and the EU collectively played important roles in shaping globalization… over many decades, the EU was a powerful force in extending international trade,” (Youngs & Ulgen, 2022) Europe is regarded as one of the foremost supranational organizations driving the phenomenon forward. As such, its member states have been among the first and most heavily affected by some of the (largely unintended) consequences of globalization, such as its effects on inequality, its diminishing impacts on national sovereignty, and strain on certain domestic industries within member states, explored now.

Globalization vs inequality

The evidence of globalization’s neutralizing effects on poverty and wealth inequality is mixed and nuanced. It does, importantly, bear out globalization’s neutralizing effect on inequality in certain contexts but, upon further examination, this claim is misleading when applied generally. Branko Milanovic, in “Global Income Inequality in Numbers,” parsed global inequality by applying three separate formulas to analyze global inequality numbers – “Inequality 1,” “Inequality 2,” and “Inequality 3.” Inequality 1 measures inequality between states without regard to population. Inequality 2 factors population into the otherwise same equation as Inequality 1, weighing countries with higher populations more heavily. Inequality 3, finally, the most data-intensive, uses an individual-level approach to measuring inequality without breaking the data up by nationality. (Milanovic, 2013, p. 417)

Milanovic then charts measurements of the three concepts, respectively, across time to determine whether, and to what extent, if any, inequality has declined using each metric. He found that, while Concepts 1 and 2 have declined precipitously since 1990, the same cannot be said of Inequality 3, which has remained more or less unchanged in the past several decades.

To summarize the relevancy of Milanovic’s findings to this research, globalization has produced reductions in inequality between nations, as promised. But an individual-level analysis of wealth inequality, as indicated in Concept 3 in the above illustration, shows that inequality between the ultra-wealthy and the ultra-poor regardless of nationality has remained elevated since the advent of globalization in the 1980s. 

Analysts often point to reductions in Inequality 1 and 2, on the heels of massive economic development in developing countries like India and China, as globalization success stories – and arguably deservedly so. Indeed, developing low and middle-income countries have, on average, economically benefitted significantly from globalization by many estimates, as “a government committed to economic diversification and capable of energizing its private sector can spur growth rates that would have been unthinkable in a world untouched by globalization.” (Rodrik, 2011)

As a result of the inflow of foreign investment and reduced trade barriers facilitated by globalization, worldwide “between 1990 and 2015… some 900 million people entered the $10-per-day middle class and another one billion people escaped dire poverty of just $2 a day or less.” (Birdsall, 2017, p. 130) Taking these numbers alone, it would appear that globalization is a boon for reduced inequality.

However, those bullish assessments of globalization’s economic benefits frequently neglect to mention that globalization has produced no such decrease in Inequality 3 – the kind that, again, measures individual inequality levels across the board, in both developed and developing countries. Since the 1990s, “the larger (and still far richer) middle class in the West has declined in size, and the prevailing mood among many of its members is one of anxiety and pessimism about their future prospects including those of their children,” (Birdsall, 2017, p. 131) indicating negligible benefits for the middle and working classes of developed countries, many of which are located in Europe.

This reality comes with electoral consequences for the states that champion pro-globalization, pro-liberalization economic policies. Although they might not necessarily begrudge the gains of the middle and working classes in other states, humans are not by nature altruistic. If the economic gains enjoyed by developing countries conferred by globalization are perceived to come at the expense of the electorates in developed countries such as Europe, far be it for the average European member of the middle or working class, whose life has not materially improved due to globalization based on Milanovic’s Inequality 3 model, to celebrate the relative gains of the working classes in India or China with the same level of enthusiasm.

Austerity – the practice of attempting to reduce national debts through tax hikes or spending cuts or a combination thereof, often under coercion from international creditors –

“lead[s] to sharp reductions in welfare spending, cancellation of school building programs, severe reductions in local government funding, increased VAT and tax levels, the abolition of governing bodies and reduced spending on public services.” (McMahon, 2017)

Austerity is increasingly relevant as a political issue, as by some estimates, “by 2023, 85% of the world’s population will live in the grip of austerity measures.” (Abed, 2022)

There are many potential domestic causes of austerity, including the collapse of internal tax revenues and national debt accumulation. (Maldowitz, 2014). However, globalization arguably plays a role in spurring austerity policy in developed countries, as evidenced by the international global financial crisis of 2007-2008 that “changed the post-war observation that sovereign debt burdens were largely the concern of emerging market countries. As government balances deteriorated, public debt-to-GDP ratios in advanced countries surpassed those of emerging markets, rising to levels not seen since World War II.” (Bosner-Neal, 2015, p. 545)

As Martell notes, “austerity has a lot to do with globalization… in terms of the global nature of the financial crisis.” (Martell, 2014, p. 12) In other words, national economies that are interconnected through globalization to other economies suffer the negative consequences of foreign economic downturns, in turn driving a need for political solutions that are often presented as austerity measures.

Globalization opened up new economic vulnerabilities to instability in the global banking system that previously did not exist, as “even countries that have benefited from globalization in the past… are vulnerable… globalization increases vulnerability through a variety of channels, including trade and financial liberalization.”  (United Nations, 1999, p.1)

As a result of the 2007-2008 economic crash and its aftermath, austerity policies were instituted across Europe: “either of their own volition or at the behest of the international financial institutions, [national governments in Europe] adopted stringent austerity policies in response to the financial crisis.” (McKee, et al., 2012)

Austerity is recognized to hit working-classes and middle classes, which depend more heavily on the public welfare system, the hardest:

“austerity measures aimed at curtailing public debt have impacted tremendously on the living standards of the middle class. Even in some of Europe’s most stable economies, the middle class is struggling.” (Ulbrich, 2015)

Specifically in the context of the EU, “austerity policies have expanded inequalities and undermined rights… Disparities in income have widened, the poorest getting poorer as welfare support declines and incomes are cut, while the rich continue accumulating income and wealth.” (Martell, 2014, p. 15) Some analysts have issued even starker warnings on the detrimental impacts of austerity on inequality and poverty in Europe: “austerity measures are weakening the mechanisms that combat inequality. Income is being increasingly unequally distributed; rising for the richest and falling for the poorest.” (OxFam, 2013a, p.11)  

Does globalization undermine national sovereignty?

People move more freely across national borders in a globalized state as well. In addition to trade liberalization and capital flows, globalization is characterized “by transnational movements of people in search of better lives and employment opportunities elsewhere.” (Cholewinski, 2005) Globalization has resulted in the increased freedom of movement of workers and tourists alike without regard for national borders: “The unprecedented volume and speed of human mobility are perhaps the most conspicuous manifestations of the present era of globalization…. the phenomenon’s main driving force is the global expansion of capitalism and the free-market system.” (Knobler, et al., 2006)

Increased freedom of movement is most evident in the case of the European Union, given the previously outlined, unprecedented transnational Schengen Area, joining together dozens of European states in a free movement zone with no internal migration controls. One of the “fundamental principles” of EU membership is the “free movement of workers… enshrined in Article 45 of the Treaty on the Functioning of the European Union and developed by EU secondary legislation and the Case law of the Court of Justice.” (European Commission, n.d.) Under these provisions, EU citizens (which include every citizen of every EU member state) “are entitled to look for a job in another EU country, work there without needing a work permit, stay there even after employment has finished, [and] enjoy equal treatment with nationals in access to employment, working conditions and all other social and tax advantages.” (European Commission, n.d.) This has important implications for domestic workers that will be explored further in a later section of this research.

Global capital, along with post-nuclear geopolitics, environmental danger, and identity politics, is considered by some analysts to be one of the four principle threats to the state in the modern era. (Mann, 1997, p. 472) Globalization, which “has forced states into increasing competition for hi-tech industrial advantage” (Manchester Business School, 2017) in the global marketplace, weakens the position of the state. It exerts less and less influence over economic activities within its borders: “If globalization, in part, involves the emergence of supra national [sic] authorities because of new transnational problems resulting from growing trade, foreign investment, financial market interdependence and rapid technological change within a globalizing economy, then it seems only too natural that this process too will lead to supra national authorities eventually acquiring more jurisdictional power and nation states declining.” (Whalley, 1999, p. 1) This incursion of supranational authorities into areas of economic activity traditionally exclusively under the jurisdiction of states is a generally-held consensus, although some scholars like Mann point to the state’s continued social existence and the disparate impacts of globalization on various states as evidence that they maintain their primacy in the present era. (Mann, 1997, p. 472)

Protectionism vs globalization

Globalization stands in stark contrast to trade protectionism, which “protects domestic industries from unfair foreign competition… [using] tariffs, subsidies, quotas, and currency manipulation.” (Amadeo, 2022) Globalization is at odds with protectionist policies, as the latter are overwhelmingly favored by populist leaders who have “often used nationalism to justify protectionist policies that favor select domestic lobbies and have been at the forefront of trends in deglobalization.” (Ciravegna & Michailova, 2022, p. 175) There is debate regarding the extent of deglobalization and whether it exists as a phenomenon, but what is indisputable, as documented in an upcoming section on “far-right” politics and parties, globalization has increasingly become a highly relevant political issue in national politics in Europe.

Protectionism is anathema to liberalism. As Amadi notes, “a major contradiction of liberalism is ‘protectionism,’ which is the process of imposing trade restrictions such as tariffs to boost domestic industry.” (Amadi, 2020, p. 6) Under liberal theory, economic decisions are best left to the individual consumer outside of state influence to sort through cost, quality, etc. and make the most rational, self-interested decision possible. No preference is granted to domestically produced goods vs imported ones. The state does not intervene to favor domestic production over the import of foreign goods. Each nation unit produces the goods (and, increasingly in developed countries, the services) it is best suited to produce, based on its geographic location and human and natural resources. Adam Smith, one of the original purveyors of free trade, argued that if imported goods are cheaper than domestically produced ones, then importation makes good economic sense. (Smith, 1776, p.36) The EU has led the way in combating protectionism within its borders when it “implemented a program to create the world’s largest single market and embarked on creating a common currency.” (Hanson, 1998, p. 55)

Effects of globalization on domestic politics and populations in France and Hungary

Explored here are three potential effects of globalization on France and Hungary:

Transnational immigration 

Defined as “a process of movement and settlement across international borders in which individuals maintain or build multiple networks of connection to their country of origin while at the same time settling in a new country,” (Upegui-Hernandez, 2014, p. 2) transnational immigration is a consequence of globalization in highly globalized states. Academics disagree on its merits, but the fact is not disputed that globalization has been a boon for transnational immigration. Analysts note that “increased migration is one of the most visible and significant aspects of globalization.” (Tacoli & Okali, 2001, p.1)

Talani cites increasing interconnectivity between states, “resulting in more people than ever before choosing to live and work in other countries,” (Talani, 2022) as a result of globalization. Economic mandates factor heavily into the increase in transnational migration in globalized states. Demand for unskilled labor by developed economies, such as many of those in the European Union, drives transnational migration: “The global reorganisation of labour markets has an important impact on migration. In the North, demand is high for semiskilled and unskilled workers, such as cleaners and housemaids, and for seasonal agricultural workers.” (Tacoli & Okali, 2001, p. 2)

Central to the question of transnational immigration from a political perspective is whether any entity can truly control the phenomenon. And, if so, who or what is in control: “It is quite possible… that the forces unleashed by globalisation escape governance as they are structural necessities… and therefore the urge to migrate cannot be stopped by political entities,” (Talani, 2022) Essentially, it appears as if no one is steering the ship – no one or no thing is truly in control, including state authorities in charge of policing international borders. Perceived lack of control resulting from an influx of foreign migrants may aid “far-right” political parties because “sensing a lack of control tends to have a reinforcing effect on voters with nativist attitudes in support of [radical right populist parties].” (Heinisch & Jansesberger, 2022, p. 1) The connection between transnational immigration and the proliferation of populist, “far-right” parties and ideologies in Europe is explored in further detail in an upcoming section.

Perceived loss of national/cultural/ethnic identity

How does globalization impact national identity, if at all, from the perspective of the domestic voting public? In popular perception – if not also in reality — national identity is at odds with the phenomenon of globalization in fundamental ways: “Nationalists and religious traditionalists fear that globalization will undermine cultural and other norms.” (Friedan, et al. 2017, p. 16) Often, perhaps out of social convention and discretion, the exact theoretical mechanism through which the culture will be “undermined” is not explicitly stated, but it is understood to be caused by an influx of immigrants who will introduce their own cultures and norms which will then spread throughout the population at large. According to the “clash of civilizations” theory, pioneered by Samuel Huntington, states are “differentiated from each other by history, language, culture, tradition and, most important, religion.” (Huntington, 1996, p. 282) The differences serve to stoke distrust, resentment, and hostility between cultures. He warns that “the interactions among peoples of different civilizations enhance the civilization-consciousness of people that, in turn, invigorates differences and animosities stretching or thought to stretch back deep into history.” (Huntington, 1996, p. 282) Peoples tend to be protective of their own cultural heritages, which necessarily excludes others. Culturally-based conflicts spill over into the political sphere.

In-group/out-group identity forming is a foundational element of sociology, predicated on the distinction between members of a social group and the amorphous, excluded “other.” Per Tajfel, et al. (1979), social groups confer identity and, with it, a sense of pride. The world is then dichotomized between “us” and “them.” Through this process, the differences between the in-group and out-group are amplified along with similarities among members of the in-group. Nationalism is, by definition, exclusive, since “the most messianic nationalists do not dream of a day when all the members of the human race will join their nation in the way that it was possible, in certain epochs, for, say, Christians to dream of a wholly Christian planet.” (Anderson, 1993, p. 7) That is to say, nationalist ideology – specifically, “exclusive nationalism” as defined in the following paragraph — does not allow for the same kind of assimilation into the native culture that liberal states have traditionally advocated for because it rejects new members from the out-group out of hand.

In particular, the variety of nationalism driven by an aversion to the influences of the outside world and peoples and manifest in “far-right” politics is called “exclusive nationalism” because it emphasizes in-group/out-group dynamics: “many newly ascendant nationalisms legitimate internal racial, religious, and ethnic hierarchies among citizens of their own countries…. it is not nationalism per se, but exclusionary nationalisms (also called ethnic or essentialist nationalisms) that are problematic for outcomes such as democracy.” (Mylonas & Tudor, 2021, p. 111) Because there is no interest among certain factions of the population in mingling with the outside world – and indeed, such mingling is viewed not just as undesirable but as an inherent threat — there is nothing to be gained socio-politically from globalization in the same theoretical way that it might benefit the economy, and everything to be lost in that regard.

Uneven distribution of economic benefits across social strata 

The previous two effects of globalization touch on the issue of the threat to national identity. The final effect of globalization explored here is economic in nature. Specifically, globalization may exacerbate class divides by conferring disproportionate economic growth to the higher echelons of the socioeconomic ladder. As alluded to previously, globalization has disparate impacts across economic strata, tending to benefit upper-income brackets more so than the working and middle classes: “neo-liberal development aids the rich more than the poor, or at their expense… reproducing a linear rather than a relational conception of development’s co-ordinates of poverty and wealth.” (McMichael, 2012, p. 78) Various fleshed-out theories, such as trade theory, predict this dichotomy: “Trade theory tells us that the group… most likely to lose from globalization, or at best to gain less than everyone else, is labor.” (Deardoff & Stern, 2001, p. 6)

The lower economic classes, particularly low-skilled workers and the less-educated who benefit least from globalization, and the political parties that represent them, have taken note: “With growing economic inequality, low-skilled workers in the developed countries are turning increasingly against trade and immigration-feeding nationalist parties across Europe and North America.” (Friedan, et al. 2017, p. 16) Deardoff and Stern note “Growing opposition to globalization by organized labor… Because labor has lower income than those with income from other sources, and because trade lowers the relative wage, it tends to make the poor relatively poorer.” (Deardoff & Stern, 2001, p. 6) The working class – again, concentrated particularly in manufacturing and other unskilled labor-intensive economic activities — struggle with trade liberalization via globalization: “illiterate and other poorly trained workers in developing countries, designated as ‘NO-EDs/’ do not have even the minimal skills to benefit from unskilled labor-intensive exports. NO-EDs therefore may not have experienced the wage pull [from liberalization] that more educated but still unskilled compatriots might have enjoyed.” (Baker, 2005, p. 318)

Furthermore, globalization may not reduce inequality within states, despite popular perception to the contrary. Depending on the type of globalization, it may worsen inequality, as evidenced in Milanovic’s breakdown of three types of inequality explored in a previous section. To briefly rehash the results of his study, he found that, when the measure of inequality is conducted on an individual level independent of nationality, global inequality has remained the same since the 1980s. (Milanovic, 2013, p. 418)

In Heimberger’s meta-analysis of the effect of globalization on inequality, he refined the variables used to distinguish between the effects of trade globalization versus the effects of financial globalization on inequality, and concluded that “globalisation has, on average, a small-to-medium-sized effect of increasing income inequality. Trade globalisation has influenced income inequality to a lesser extent than financial globalization.” (Heimberger, 2020) Europe has become increasingly highly financially globalized: “after 1987 most of the [European] countries liberated their capital account[s]… [and] progressed significantly into financial globalization.” (García, 2012)