Economic collapse shattered Germany in the 1930s, allowing fascism to rise from the wreckage. Amid national humiliation and mass unemployment, Hitler exploited the public fear, redirected economic rage toward scapegoats like the Jews and communists and aligned with industrial elites to solidify power. This wasn’t merely a political shift — it was capitalism in crisis, reborn as a violent, exclusionary system that commodified human life through eugenics and social Darwinism.
Today, similar dynamics are emerging, not through war, but through capitalism’s failure to deliver shared prosperity. Rising inequality, stagnant wages and economic uncertainty have bred resentment and political disillusionment across democracies. In 2024, The New York Times found that many former Democrats supported Trump out of economic stagnation, immigration fears and a hunger for bold leadership. What once led to fascism in Germany is now driving support in our own country.
Although capitalism and democracy are seen as twin pillars of modern freedom, history shows their relationship is far more complicated— and dangerous. When capitalism is left unchecked, it hollows out the very democratic principles it once seemed to support, fostering inequality, social fragmentation and creating fertile ground for authoritarianism. This isn’t just happening in the United States, though. From Germany’s rising far-right to Denmark’s nationalist policies, the link between economic hierarchy and democratic erosion is playing out on a global scale.
Capitalism, at its core, is an economic system centered on private property ownership, market competition and limited government intervention. While its forms vary globally, its unchecked expansion consistently concentrates wealth and deepens inequality. But inequality doesn’t erode democracy— what follows matters more. As prosperity becomes more inaccessible, anger, fear and resentment grow, especially among those who feel left behind or excluded. These emotions don’t just passively weaken democracy; they actively fuel the rise of leaders who promise strength, restoration and scapegoats. Calls to “restore order” rarely arise from low voter turnout; they emerge from governments that are fearful of losing control over a disillusioned, destabilized public. This is the soil in which authoritarianism grows, and it is being cultivated across the globe.
In the United States, capitalist structures have been manipulated for political gain, widening inequality and weakening democratic norms. Trump’s tweet on April 9, 2025 — saying “THIS IS A GREAT TIME TO BUY!!! DJT”— triggered a 3,000-point surge in the stock market, exposing how easily financial systems can be weaponized for spectacle rather than stability. This wasn’t economic policy; it was market manipulation through branding. It reinforced the dominance of the wealthy elites while deepening the divide between those who benefit from the system and those left behind by it. In the aftermath, deep racial and class wealth gaps were exposed, undermining key democratic pillars: the rule of law was weakened through insider manipulation, economic disillusionment will distort free and fair elections, freedom of expression was weaponized through populist rhetoric and transparency in government deteriorated. This hollowing out of democracy by elite-driven economic systems is not unique to the United States — it is a global phenomenon.
Following WWII, Germany rebuilt several strong democratic institutions, most notably through the establishment of The Basic Law (1949), which protected personal freedoms and outlined the principles of democracy, the rule of law and social democracy. However, these protections have not been immune to the forces of capitalism. The debt brake of 2009, intended to enforce fiscal discipline, severely restricted Germany’s ability to invest in public infrastructure and social services. By limiting the government’s ability to respond to citizens’ needs, the debt brake deepened economic stagnation, eroded public trust in Germany’s democratic institutions and fueled support for extremist parties like the Alternative for Germany (AfD). Simultaneously, a pattern of grand coalitions between major political parties has blurred the lines of political choice, further disillusioning voters and weakening Germany’s democratic pluralism.
Denmark, too, has shifted from its historically egalitarian model. Known for its strong welfare state and high institutional trust, Denmark began neoliberal reforms in the early 2000s that prioritized market efficiency over collective welfare. Welfare cuts tightened eligibility for assistance and reduced social protections, eroding the safety net and increasing economic inequality. Welfare systems became conditional and moralized, distinguishing between the “deserving” and “undeserving” poor, compromising core democratic values of human rights, freedom and dignity.
Across the globe, the rise of capitalism has consistently eroded democratic principles. As wealth concentrates and public insecurity deepens, economic disillusionment breeds fear and resentment. Political leaders exploit these fears not by addressing their causes, but by redirecting public anger through xenophobia. Immigrants, racial minorities, and the poor are framed as threats to national security. They are scapegoated to justify reactionary policies and authoritarian control. Thus, xenophobia is not a passive byproduct of inequality, it’s a political strategy — the same one that fueled the rise of Nazi Germany. And it’s happening again.
In the United States, the reactionary forces of capital show their disregard for human rights in the aggressive detention and deportation of immigrant workers by ICE. In Germany, AfD’s growing popularity reflects a platform of xenophobia and anti- Muslim sentiments, paralleled by a surge in hate crimes that threatens Germany’s social cohesion and democratic values. In Denmark, leadership has pushed for stringent immigration policies and nationalist rhetoric, culminating in the infamous “ghetto laws” that allows the state to be able to demolish apartment blocks in areas where at least half the residents have a “non western background.”
These are not isolated incidents. They are symptoms of a global system that values capital over people. Left unchecked, capitalism will continue to undermine democracy and fuel authoritarianism around the world. But this trajectory is not inevitable. We must rise to resist this erosion and reclaim the promise of democracy.
We must dismantle the systems that prioritize profit over people. We must demand economic justice through wealth redistribution, strict corporate regulation and public investment in healthcare, education and housing — not just in financial markets. We must measure national success by human flourishing, not stock market surges and empty economic statistics.
To defend democracy against the encroaching shadows of authoritarianism and xenophobia, we must do more than resist, we must reimagine. We must reshape our economies — and our futures— for the people.
“In its identification of the Party with the State, in its Gleichschaltung of independent bodies, in its transformation of a minority doctrine into a national orthodoxy, in the violence of its methods and the unlimited power of the police, the Hitlerite régime surely has more in common with Bolshevik Russia than with the daydreams of the counter-revolutionaries. Right and Left, or Fascist pseudo-Right and Communist pseudo-Left, can be said to meet one another in totalitarianism.”
Raymond Aron, The Opium of the Intellectuals (1957)
So we are meant to believe that this author has experienced an overnight conversion to full-blown anti-capitalism and preaching social revolution? Sure. Nothing to see here.