One hundred years ago, Austro-Hungarian economist Karl Polanyi witnessed the collapse of liberal democracies and the rise of fascism in Europe – a development which he famously analyzed in The Great Transformation. Following the onset of the Great Depression in 1929, economic liberalism was on the defensive. The widespread belief that laissez-faire capitalism and the prevailing property relations were without alternative had crumbled after the experience of far-reaching state interventions during World War I. Moreover, the assertiveness of a revolutionary workers’ movement, including its vision of democratic control over production via workers’ councils and the tools of economic planning left the propertied classes in distress. However, not socialist but fascist ideas eventually gained the upper hand in the 1930s in different parts of Europe. Commenting on these developments, Karl Polanyi remarked in 1944[i]:  

 “Planning and control are being attacked as a denial of freedom […]. Yet the victory of fascism was made practically unavoidable by the liberals’ obstruction of any reform involving planning, regulation, or control” – Karl Polanyi 1944, p. 265 

In her acclaimed 2022 book The Capital Order[ii], Clara Mattei shows how austerity served as a key tool for enabling this broader regime change. In the 1920s, austerity was imposed by democratic means in the UK, Germany, and Austria, creating socioeconomic conditions that ten years later were conducive to the rise of fascism. In Italy, however, it was only under fascist rule from 1922 onwards that the austerity agenda of economic liberalism could be implemented. These historical examples reveal a troubling pattern: A hundred years ago, sacrificing democracy and civic liberties to uphold economic orthodoxy seemed justifiable to important parts of the liberal elites. Today, similar anti-democratic dynamics can be observed, which raises urgent questions: Will today’s liberal elites once again forsake political equality and individual freedoms? And will they, once again, open the door to authoritarian, reactionary, and anti-democratic far-right movements?