Economic liberalism and anti-euro agenda
The market radical economic policies of the AfD can be explained by its developmental history. It was established by critics of European Integration who advocated for economic liberalism. As discussed above, the AfD appeared in the aftermath of the Euro Crisis at the end of 2000s, but it can be traced back even further to the early 1990s, when the Maastricht Treaty was signed (Häusler and Roeser 2015: 28–41; Werner 2015: 19–33). With the signing of the treaty, a new kind of Euroscepticism emerged, which ultimately lead to the fruition of the AfD about 20 years later. The Maastricht Treaty opened up a new chapter of European integration, which began with the creation of the European Coal and Steel Community (ECSC) in 1952. The treaty represented a move beyond the existing alliance, which was limited in many ways to maintain peace and economic solidarity. The treaty called for the establishment of a unified political and monetary community and laid out the foundation for practical measures such as the establishment of the EU, the European Central Bank, and the single currency system. This attempt to develop and expand European integration, however, was met with intensification and expansion of Euroscepticism in many European countries. Many found dissatisfaction with restricted sovereignty and acceptance of multiculturalism, which were inevitable for advanced integration, and such sentiments gained considerable followings. One such trend was created by a group of right-wing economic liberals. Of course, not all economic liberals were against European Integration. One of the major driving forces of European Integration is economic liberalization, so naturally there were economic liberals supporting European Integration. Dieter Plehwe (2016) named this trend “transnational economic liberalism” and differentiated it from Eurosceptic economic liberalism that opposes European integration, which he named “right-wing liberalistic” or “national-liberalistic economic liberalism.” The two forces are essentially identical in terms of being anti-statist, but they have different perspectives on the proper role of the state in order for capitalism to function smoothly. Advocates of Eurosceptic economic liberalism who acknowledge the inherent role of the state worried that the Maastricht Treaty would prevent the establishment and execution of stable economic policies at the state level by limiting national sovereignty, and interfere with the smooth operation of the market due to an increase in unfair political interventions upon the economy. These forces existed on the periphery of European politics for a while, began to distinguish themselves in the mid-2000s, then gradually made their way into Europe’s mainstream institutional politics with the Eurozone crisis of 2008.
Germany was not an exception to this trend. After the Maastricht Treaty was signed, Euroscepticism spread among economists who were firmly rooted in liberal ideologies. Some used their specialty to criticize the plan for a European monetary community and expressed their skepticism about hasty European integration. For example, the anti-Maastricht Treaty declaration, which was signed by a total of 62 economics professors including Ohr and Schäfer (1992) in June 1992, listed the risks associated with the plan, such as an economic gap among member countries, the structural defects of monetary community, and the possible tarnishing of the economy by political agenda, and warned that the introduction of a single currency could trigger conflicts in Europe rather than encourage integration. A declaration of a similar nature was also announced in 1998, just before the introduction of the Euro. A total of 160 economics professors expressed their concerns about the flaws and hastiness of Euro introduction through a declaration (Kösters et al. 1998). The opposition movement against Maastricht Treaty also birthed new political parties. The Federation of Free Citizens (Bund für Bürger, BfB), formed in 1994 and inspired by the Liberal Party of Austria, is an example of such. The party was founded on pillars that consist of economic liberalism, heavy criticism of EU economic policy, and opposition to Eurocentrism, which would operate according to political consensus rather than the logic of the market and competition. Joachim Starbatty, former deputy leader of the BfB, was a representative of opposition to the Euro system whose criticism was backed by Ordoliberalism. Franz-Ulrich Willeke, an economics professor at the University of Heidelberg, was also a deputy leader of the BfB, and others such as Roland Vaubel and Willhelm Hankel, both economics professors, did not join the party but openly endorsed it. Karl Albrecht Schachtschneider, a jurist and a founding member of the BfB, was also a well-known anti-Europeanist. He, along with Starbatty, Hankel, and others, filed a constitutional appeal against The Amsterdam Treaty, which can be regarded as a follow-up measure to the Maastricht Treaty. BfB members and supporters, who stood at the forefront of opposition against the Euro system, would eventually become the key members of the AfD.
Opposition to European Integration, which somewhat subsided after the introduction of the Euro, was re-ignited by the Euro Crisis in Germany (Handelsblatt 2012). Germany, which feared that the financial crisis of southern European countries could potentially lead to the collapse of the Eurozone and wreak economic havoc across Europe, agreed to establish the European Financial Stability Facility (EFSF) and provide funding for countries in crisis, including Greece. There was an outpouring of criticism of bailout and the Euro system from institutional political entities, especially the ruling party, the CDU/CSU, and even from the coalition partner, FDP. In April 2011, the Small and Medium-Sized Business Association of the CDU/CSU (Mittelstands- und Wirtschaftsvereinigung der CDU/CSU), one of the influential lower branches of the CDU/CSU, announced a resolution declaring its averse position on the establishment of the European Stability Mechanism (ESM) that was being discussed. The Liberal Awakening (Liberaler Aufbruch), which is a faction of the FDP with a marked tendency toward economic liberalism, gave harsh criticism of the excessive government intervention in the Euro Crisis. In May 2012, ten members of the Federal Parliament belonging to the CDU/CSU and the FDP jointly organized the Alliance Against the ESM (Allianz gegen den ESM). Such movements of opposition, however, did not resonate well within the existing political party system.
On the other hand, movements against bailouts and the Euro system outside institutional politics were not negligible. Economic liberal economists and business leaders who were critical of European integration began to organize against European integration once more. The Ifo Institute for Economic Research, one of the largest economic research institutes in Germany with a representative Euro critic Hans-Werner Sinn as its director, released the Bogenberg Declaration in October 2011, and directed fundamental criticism at the Euro system for bringing about the Euro Crisis. Hans-Olaf Henkel, former IBM executive and president of the Federation of German Industries and of Leibniz Association, openly endorsed the Liberal Awakening of the FDP and the Free Voters (Freie Wähler), and played a pivotal role in connecting politics, business, and academia using his involvement with think tanks such as the Initiative New Social Market Economy, the Mont Pelerin Society, and the Hayek Society. One must not forget Lucke, who birthed the Alliance for Citizens’ Will (Bündnis Bürgerwille) movement and later went on to become the first co-chair of AfD. After successfully organizing hundreds of like-minded economists through the announcement of the Hamburg Appeal (Hamburger Appell) in 2005 and the Plenum of Economists (Plenum der Ökonomen) in 2010, Lucke established the Alliance for Citizens’ Will in 2011 and rallied not only scholars, politicians, and activists who opposed bailout but also the general public. In the following year, he led the organization of Electoral Alternatives 2013 (Wahlalternative 2013) with Alexander Gauland and Konrad Adam who were disappointed by the CDU’s response to the Euro Crisis and defected from the party. Together, they attempted to place opposing bailout, abandonment of the single Euro, and freedom to withdraw from the Eurozone on the map as key agendas for a series of elections that were going to be held in 2013. Initially, the Electoral Alternatives 2013 started as a nonpartisan political group, and was meant to tackle the election in cooperation with the anti-Euro-oriented Free Voters. However, after witnessing the disappointing vote share (1.1%) of the Free Voters in the Niedersachsen State Parliament election, which was exacerbated by his tensions with the party leader Hubert Aiwanger, Lucke switched strategy to form a political party. The AfD was the product of this decision (Bebnowski 2015: 19–31; Häusler and Roeser 2015: 65–78; Oppelland 2017).
In its early stage, the AfD was led by the economic liberal faction centered on Lucke. Lucke was a co-representative of the party, along with Adam and Petry, but in practice led the party on his own using his large vote share in the party representative election and publicity to legitimize his authority. Of the seven members of the AfD elected in the 2014 European Parliament election, five members identified themselves as part of the economic liberal faction – Lucke, Starbatty, and Henkel were all among them. It was only natural for their radical tendency to be translated into their policy. Furthermore, numerous economists who were involved in the party must have exerted a significant amount of influence on its economic policies. Economist Starbatty was the representative of the academic advisory committee of the party, and economist Vaubel, a member of the academic advisory committee under the German Ministry of Economics, was also part of the committee. According to Bebnowski and Förster (2014: 14–18), this economic liberal faction was strongly rooted in ordoliberalism. The ordoliberal standpoint recognizes the role of the state, but holds that it should only exist for the market and not against it, and that the dissolution of the Eurozone was a rightful measure that could free the market from the reigns of politics. Furthermore, ordoliberals believe that in order for the principle of competition to work smoothly, market results should be left entirely to the individuals, and all artificial attempts to correct this under the name of social justice ruled out. Since the AfD was based on such ideals, its economic policies were adjusted to accommodate basic trends such as market liberalism, laissez faire and minimal state intervention philosophies, and anti-interventionism. These principles take form in more specific policies such as passive labor market intervention, reduction of social insurance expenditure, tax rate reduction, and tax repeal. Where the ideals of another faction within the party came in contact with radical market ideology, as it will be discussed below, the agenda of the economic liberal faction was converted into policies without much hindrance.
National Conservatism, anti-immigration, and anti-refugee agenda
The final destination of the Eurosceptic economic liberalistic forces, which emerged in the opposition to the Maastricht Treaty at the beginning of 1990s and flourished during the Euro Crisis at the end of 2000s, was the AfD, but the party was not for themselves only. The national conservatives, who have been with the AfD since the Electoral Alternatives 2013 at the latest, took up a significant portion of the party membership (Bebnowski 2015; Häusler and Roeser 2015: 13–27; Werner 2015: 51–60). Gauland and Adam led the Electoral Alternatives 2013 with Lucke, but they were national conservatives and their ideologies differed from his. Petry is also classified as a national conservative. Even though she left the party shortly after the 2017 Federal Parliament election as a result of power and line struggles, she has served as the face of the AfD since Lucke. Beatrix von Storch, who is a member of the European Parliament, as well as co-deputy leader, is also worth mentioning. As the head of the Civil Coalition (Zivile Koalition) that claims to be the German version of the Tea Party, and has been cooperating with economic liberals since the Alliance for Citizens’ Will, she still represents the retrospective, Christian conservatism in the party. Marcus Pretzell, a member of the European Parliament, and Björn Höcke of Thuringia are other symbolic figures of the far right and key forces in national conservatism.
Economic liberal forces and national conservative forces could coexist despite their differences, and this can be attributed to the political environment at the time of their union. First, the Euro Crisis and bailout provided a point of political contact for the two groups. Both of them fiercely opposed the existing form of European Integration and financially supporting countries in financial crisis. From the standpoint of Eurosceptic economic liberalism, bailout was deemed an uneconomical and irrational measure whose practical implication was outweighed by its cost, and regarded as a byproduct of political decisions against market logic. It was moreover seen as an invasion of private property by the state in that the bailout used taxpayers’ money to support other countries. The European Integration that would violate national sovereignty and national identity is something difficult for national conservatives to accept. They also assured that bailout measures for Eurozone countries in crisis would never benefit Germany. Second, both forces shared the need for a new party. There was no political party that represented the Eurosceptic economic liberals among the existing political parties. The existing parties maintained essentially the same position with regard to bailout, since they did not deny the need for the Eurozone or financial support itself (Lees 2008; Wimmel 2012). Dissatisfaction with the existing party system was not new to the national conservatives. Some of them, such as Gauland, served as critics in the CDU. They feared the prospect of “socialdemocratization of the CDU” under Merkel and contended that the party should be more nationalistic, statist, Christian, and traditional. The organization Civil Coalition represented such trends outside institutional politics. Third, the economic liberal faction and national conservative faction had strategic need for each other. For the former, the latter could complement their insufficient popularity, while for the latter, the former could hide their radical tendency, lest they become labeled as right-wing extremists (Korsch 2014; Plehwe 2014; Häusler and Roeser 2015: 16–22).Footnote 3
This is not to say that there existed no ideological point of contact between economic liberalism and national conservatism. As Bebnowski and Förster (2014: 19-24) correctly pointed out, the logic of economic competition, which underlies Eurosceptic economic liberalism, complements the national pride of national conservatives, embodied in the idea that Germany rose as the winner from market competition because it had superior economic capabilities. Economic liberals believe that Germany’s economic success is rooted in the innate superiority of the Germans, that they were diligent and productive, unlike the citizens of the southern European countries that were suffering from crisis, and were pre-conditioned for linking economic superiority to cultural and national superiority. Hierarchical ranking based on superiority and social Darwinian struggle for survival underpin the perceptual basis of not only the harsh economic liberals but also rigorous national conservatives. Economic liberalism does not necessarily clash with what is culturally conservative in practice – Lucke is a good example of this. Although liberal-minded in regard to economics, he is a devout Protestant and stubbornly conservative on matters such as multiculturalism and homosexuality (Korsch 2014: 7–8; Bebnowski 2015: 19–22; 2016).
The AfD established itself as the anti-Euro party, groomed by the political climate of the Euro Crisis and bailout. However, it was not a single-issue party that paraded only an anti-Euro agenda. Although it did not emphasize these features as heavily in its early stage, the party was anti-immigration and anti-refugee from the beginning (Häusler 2015: 2–3). After joining with national conservative forces, it began to actively address the issue of immigration and refugees that economic liberals focused little on. Within the national conservative framework, an ethnic group sharing homogeneous, “German” traits living together as a nation-state is the most desirable. Such ideals stem from engrossment with national identity and national sovereignty. Family is considered to be a basic unit of society that reproduces traditional values and “German” characteristics. Europeanization driven by the EU is a threat against national identity and national sovereignty, and homosexuality and gender equality, which disrupt traditional family structure, are issues that the national conservatives of the AfD say they can never accept. This is coupled with their strong opposition to immigration and refugees. Outsiders who are not “German,” especially the Muslims who are seen as unable to assimilate into the Christian culture that shapes the backbone of traditional German society, are sources of fear for national conservatives who want to maintain the German national identity and traditional image of family (Bebnowski 2015: 5–11). Petry’s absurd statement during an interview with a local daily newspaper suggesting that firearms can be used in the case of emergency when unregistered refugees are attempting to illegally enter Germany (Mannheimer Morgen 2016), and parochial slogans with messages such as “not multi-culture but German culture centered (Deutsche Leitkultur)” (AfD 2016a: 47) and “Islam is not a part of Germany” (Ibid. 49), should come as little surprise when the basic doctrine of the party is rooted in such extreme exclusivity.
Along with changes in circumstances within and outside the party, the AfD’s anti-Euro platform has been gradually marginalized while their anti-immigration and anti-refugee agenda gains prominence. The national conservative faction’s victory in the internal power and line struggle against the economic liberal faction brought about conclusive results. Conflicts between the two formerly dominant factions have been gradually surfacing following the 2014 State Parliament election. The encouraging election results in the former East Germany areas of Sachsen, Brandenburg, and Thuringia boosted Petry’s stance within the party because she represents Sachsen and former East Germany, while also threatening Lucke, who once held overwhelming status in the party. The conflict between the two factions escalated further as far-right extremists were systematically flown in under the connivance of national conservatives from the former East Germany area and dominated the party. The outbreak of the conflict revealed differences in the positions of the two factions on right wing extremism, and added more fuel to the conflict. While the economic liberal faction was concerned about the far-right, radical, and xenophobic nature of the Patriotic Europeans Against the Islamization of the West (Patriotische Europäer gegen die Islamisierung des Abendlandes, PEGIDA) and wanted to distance themselves from it, the national conservative faction wanted to expand their support base in the former East Germany area and insisted on strengthening solidarity with PEGIDA. The tedious conflict ended when Lucke left the party with over 2000 economic liberals, including Starbatty and Henkel, immediately following his overwhelming defeat to Petry at the national convention held in Essen in July 2015. Even though the national conservative faction maintained the party’s anti-Euro agenda, the party’s shift toward an anti-immigration and anti-refugee agenda was inevitable (Häusler 2015).
From the outside, a series of immigration and refugee-related happenings lead to a change of social atmosphere, and further empowered the AfD’s anti-immigration and anti-refugee agenda. German society, which was relatively generous to immigrants and refugees, even following the decision to accept Syrian refugees in August 2015, turned rapidly sour after a series of tragedies, including the terrors of November 2015 in Paris, Brussels in March 2016, Nice in July, the group sexual assault in Cologne in December 2015, the train axe terror in Würzburg in July 2016, the random shooting in Munich, the Ansbach bomb terror, the assault with deadly weapon in Reutlingen, and the truck attack in Berlin in December. When the other political parties were essentially not opposed to the Merkel government’s open immigration and refugee policies, the AfD’s obvious opposition had considerable appeal not only for voters who were already hostile to foreigners but also for ordinary voters who were concerned that the government’s immigration and refugee policies might be “naive” (Hambauer and Mays 2017).