(DETAILED VERSION) THE THIRD ROAD TO SERFDOM: AUTHORITARIAN NATIONALISM

Preface:  Building on a Review of Smith, Helmut Walser. Germany: A Nation in Its Time, Before, During, and After Nationalism, 1500-2000. New York: Liveright Publishing, 2020, 591 pp.   This Review was stirred by a recent vacation trip, a Danube River Cruise from Amsterdam with stops in several German towns and cities along the way to Vienna. The stop in Nuremberg --- the place where the Authoritarian Radical Nationalism of 1933-1945 in Germany was born, nourished, and died in the Nuremberg Trials was especially informative, but also unsettling.  I read the Smith (2020) book during the trip: Along with what I observed along the way, the book was a real eye opener as to the downsides of Authoritarian Nationalism, especially the Radical version that went into play in 1933-1945 Germany. So, why have so many places already installed, and others to include even the United States are on the move to, Authoritarian Nationalism? Read on.

Earlier blogs built on the original use of the notion of The Road to Serfdom by Hayek (1944), the First Road (see  https://www.metaeconomics.info/post/the-two-roads-to-serfdom ).  It was about going too far toward the pure communism (extreme socialism) end of the political economic spectrum.  The other blog pointed out that going too far toward the pure capitalism end of the political economic spectrum assures the Second Road, suggesting The Two Roads to Serfdom, as in the notion of an unfettered laissez-faire capitalism being the Second Road, demonstrated in The Neoliberal Order 1970-2008 ( https://www.metaeconomics.info/post/the-two-roads-from-mont-pelerin ).  It crashed in 2008, and became a major contributor to the US now moving toward an Authoritarian Nationalism as started in the 2016 Election, and is now a push in full play after the 2024 Election. The interim step may be what Levitsky and Way (2010) refer to as a Competitive Authoritarianism, but, nevertheless, the clear push is in the direction of Authoritarian Nationalism.

Also, keep in mind the road away from serfdom, as made clear by the trilogy in McCloskey (2006, 2010, 2016, summarized in McCloskey and Carden 2022; see the Review in Lynne 2025 ) is paved by liberty and freedom, dignity and opportunity accorded to ordinary people. Hierarchy in vertical power rule of men systems does not work. Only the horizontal power rule of law systems work, like the one put into play in the 1787 US Constitution. Serf income of $3/capita/day for centuries increased by orders magnitude, like to $224/capita/day in the United States in 2024, before the 2024 Election with the GDP now declining back toward serfdom, once again.

Economic failure in Germany after WWI drove the move away from Democracy in the 1920s toward Authoritarian Nationalism starting in the early 1930s. Economic failure in the US in 2008, along with cultural (and religious) fears of too rapid change, similarly gave fertile ground for building Authoritarian (Vertical Power Rule of Men) Nationalism styled systems.   And, unfortunately, while gone in Germany, it is back in other forms of it to include contemporary Competitive Authoritarian Nationalism in Hungary and Authoritarian Nationalism in Russia, but also with variants of it in a number of places, including in Argentina, Brazil, Turkey, China,  and the list is growing, now even including the United States.

Nationalism is made even worse if integrated with Market (and, as is now the situation in the US, integrated with Religious) Fundamentalism imposed on people.  With a hierarchical, authoritarian imposition of both Market & Religious Fundamentalism, one is operating on the way to an Authoritarian Nationalism which assuredly gives the Third Road, as in The Third Road to Serfdom. So, overall, there are at least Three Roads to Serfdom --- extreme socialism, extreme capitalism, and extreme authoritarian nationalism, the latter built around market and religious fundamentalism --- all of said roads must be avoided unless Serfdom (and 1500s era Medieval Festivals) is the goal.

Conservative Manifesto Claims a Virtue for Nationalism

The book by Hazony (2018, 2025) --- see Review at  https://www.metaeconomics.info/post/the-virtue-or-not-of-nationalism  ---   has become a kind of Conservative Manifesto used widely in framing the conversation about the rising vertical power rule of men Competitive Authoritarian and Authoritarian Nationalism systems emerging in many places across the Spaceship Earth.  Said move to Nationalism is akin to moving back toward a 1500s Patrimony in structure,  as documented in Hanson and Kopstein (2024)  --- see Review at  https://www.metaeconomics.info/post/the-assault-on-the-deep-state  .  Hanson and Kopstein (2024) point to Putin-Russia as the first return to such a political system since World War II, likening same to the old Patrimonial Vertical Power Systems of the 1500s. 

Yet, the building and protection of the National State run by loyalists at the top is viewed as virtuous on the ground that Hazony (2018, 2025) claims that a “… world based on independent national states ... (is) the best political order  … (and the need to) … reject the imperialism that is now so much in fashion.”  Perhaps.  The problem is, way too many of said systems have or are evolving into forms of Competitive Authoritarianism on the way to Authoritarian (Vertical Power) Nationalism, sometimes with Radical elements. 

Hazony (2018, 2025) discounts the dangers of Nationalism, even claiming that 1933-1945 Nationalism in Germany was not Nationalism at all, but rather was about Empire Building as in the Third Reich notion.  Smith (2020) disagrees, arguing Germany started as a Democracy in the 1920s, moved toward an Authoritarian Nationalism in the late-1920s to early-1930s, but went to the extreme in an Authoritarian Radical Nationalism by 1945. And, as a forewarning here, based in DIT analysis, unless a National State can keep it within bounds, a turn to an Authoritarian Radical Nationalism akin to that which emerged in Germany is a danger lurking in the background of any move toward Nationalism. 

Key Questions About Nationalism

The important question becomes:  Can one realize the virtues of  Nationalism --- as in people feeling in unity with the other, on common ground --- while still retaining the essential features of a horizonal rule of law “ism” such as framed by the 1787 US Constitution, the US Democracy, and avoid moving to a vertical power rule of men Authoritarian Nationalism?  Is it possible to build a Virtuous Nationalism?  It seems the answer can be “yes” assuming the Democracy --- something akin to the Republic put in place by the 1787 US Constitution --- can also be maintained while doing so.

Lessons from the German Experience Need to be Studied, Heeded, and Not Repeated

Lessons from history are key in working to find an answer to said question, especially the lessons from what went awry in Germany. Starting on rather innocuous grounds of just building a German National State as was evolving in the 1920s,  during which time Germany was still a Democracy, a Nation about which citizens could join in prideful community in mutual loyalty, the process went awry.  It led to an Authoritarian Radical Nationalism that eventually had to be put down by Anti-Fascism (Britain, France, Australia, Canada, US among others, the ANTIFA of the allies) forces in World War II.  That is, the Nationalism in Germany (as well as Italy and Japan) had also taken the Fascist path.  Said path saw only the “us” as part of the Nation with the “them” to be neutralized, and in the case of certain groups, the Radical frame led to genocide.  The allies led by the US were Anti-Fascist, Anti-Radical Authoritarianism and focused on bringing Democracy back into play in Germany.

Conservative Manifesto Claims It is About Building Mutual Loyalty

The Hazony (2018, 2025) claim for bringing Nationalism back into play is all based on loyalty --- actually, mutual loyalty. And, it could in theory work:  Using DIT, it is all about the mutual loyalty to each other and to the Nation as held in the shared other-interest widely shared, not just within the “us” but also with the “them.”  Hazony (2025, p. 100) says:  “Let us consider this alternative political order. I have said that under empire the loyalty of the individual is supposed to be directed toward humanity as a whole; whereas in an anarchical order, it is devoted to the politically independent family or clan. Here, what is proposed is an order in which loyalty is turned toward an institution that sits precisely at the conceptual midpoint between these others: the national state…. (wherein a) .. nation is a number of tribes with a shared heritage, usually including a common language or religious traditions, and a past history of joining together against common enemies—that permit tribes so united to understand themselves as a community distinct from other such communities that are their neighbors. By a national state, I mean a nation whose disparate tribes have come together under a single standing government, independent of all other governments.”  The question is, and Hazony never addresses it:  Is said National State a horizontal power rule of law Democracy like in the Republic formed by the  US Constitution or a vertical power rule of men Autocracy?

Tracing the Building Toward Nationalism in Germany

Smith (2020) traces the history of Nationalism in Germany, an area of Europe which started out as just a kind of federation of loosely connected tribes and territories in the 1500s toward a Nationalism in the 1920s.  Unfortunately, it moved onward to an Authoritarian Radical Nationalism during 1933-1945.  Smith (2020) also traces what happened next, as Germany (actually, the ANTIFA Allies did it) throttled back Radical Nationalism after WWII, with the hope and intention it would never return again. Yet, some of it has returned in the 2020s, in the form of a political party called the Alternative for Germany (AfD) which has roots in the National Socialist Party --- the “us” vs “them” party of the 1930s-1945.  The US also has some close, uncanny overlap with said kind of framing as represented in parts of the MAGA Party. 

The following turns to Smith (2020) to help make sense of what a reasoned Democracy-based Nationalism might look like in contrast to an Authoritarian Nationalism, thus avoiding The Third Road to Serfdom.   The attention here is put to what happened in Germany both during 1933-1945, and then after 1945 to the present time.

Guidelines for the Review

A kind of organizing principle here:   The Smith (2020) book has a difficult style, as in telling the reader what the reader will be told, then telling the reader, and then repeating parts of it, sometimes adding other ideas that were not in the previous sections.   The following is a bit convoluted because of it, as every iteration tends to weave a somewhat different version of it.   A review cannot fix a badly written book.

Parts I-III of Smith (2020), left out of the following, address the evolution from a loosely knit federation of German areas in about 1500 addressed in THE NATION BEFORE NATIONALISM through THE COPERNICAN TURN to THE AGE OF NATIONALISM.  Part IV points to THE NATIONALIST AGE, followed by Part V AFTER NATIONALISM.  The book finishes with an EPILOGUE, which points to what has been ongoing in Germany in recent years. The Review is finished with the METAECONOMIC POSTCRIPT ON NATIONALISM. Nationalism can work as long as the Constitutional Democracy is preserved: The tilt toward Authoritarian Nationalism is dangerous, and ensures The Third Road to Serfdom.