1. Long-term decrease in real wages (i.e. loss of buying power, social status, etc.). Over time, it is inevitable that increased efficiencies, mass production and the search for cheaper labor and natural resources are exhausted — even as profit continues to be maximized at the same time — result in workers receiving less and less in real wages. And that is exactly what has happened in the U.S. since about 1972 — even as GDP and per capita productivity increased during that period, all that wealth went to the wealthiest owner-shareholders, and never “trickled down” to anyone else.
2. Loss of economic mobility. As income inequality expands, economic mobility decreases for the majority of a given population. So while they still are working just as hard (or even harder), the opportunities for advancement or even basic financial security evaporate.
3. Fewer jobs, and lower quality jobs. In order to fuel economic growth, the consumer base must expand as production costs shrink. This creates an ever-widening capture of cheap labor and resources, and an ever-enlarging global marketshare. Jobs must of necessity either be automated or exported away from affluent countries. Innovation can sometimes fill the job gap, but usually only for short periods.
4. A resulting frustration among formerly affluent populations. Factors 1–3 lead to increasing dissatisfaction and frustration among groups that had once held the most political, social and cultural capital. They become increasingly angry that the promise of economic freedoms and opportunities — and the cultural prestige — once afforded them has evaporated. But beyond that, there is real suffering as poverty begins to take root, and especially when yet another “false promise” in the form of increasing and inescapable debt adds fuel to resentments.
5. Xenophobic scapegoating and nationalistic romanticism. Someone has to pay for this loss of status, loss of affluence, and the snowball effect of failed promises. It could be anyone…and “big bad government” is a frequent target…but it is much easier and more concrete to scapegoat a powerless, vulnerable or “foreign” group than to rail agains more abstract institutions. Political scapegoating can, after all, backfire when half of the population is the group being targeted as scapegoats — they can rise up and exercise a dominant political will. But poor immigrants or helpless refugees fleeing violent oppression are much easier to villainize — especially when they are tarred and feathered as “attacking” a proud national heritage. It does not matter that that national heritage is being viewed through rose-colored distortions…only that it is being attacked by “Them.”
My 2 cents.
From Quora question: https://www.quora.com/How-is-fascism-created-from-capitalism-in-decline/answer/T-Collins-Logan
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