LISBON, Portugal — On a warm evening when the croons of a fado singer in a dark bar where fingers slicked with oil glide between dishes of olives and wineglass stems echo down ancient limestone streets filled with late-night revelers from all over the world, it’s easy to forget that this ancient capital is in a political crisis.
Unlike in London, Amsterdam or Paris, Lisbon’s nearly 3,000-year evolution into a modern hub of cosmopolitan locals and international visitors came without a backlash in the form of far-right populists blaming foreigners and minorities for the problems in the city. Voters here had steered clear of politicians who harkened to the dictatorship that ruled Portugal from the Great Depression until the 1970s.
That is, until now. The wave of right-wing populism sweeping Europe’s democracies is finally crashing on the continent’s western edge, and keeping Portugal out of its undertow is going to be a “fight,” said Lisbon Mayor Carlos Moedas.
“We have seen the examples in countries like the U.S. and Brazil, where you go to the extreme and you break society. You really break society in two. And it’s very difficult to heal,” Moedas, 53, slender and bespectacled with thick but graying brown hair, said in a wide-ranging interview with HuffPost last month.
“So far, Portugal has been an example of moderation, but we now have to fight to keep that.”
Across this hilly city, where 1 out of every 4 Portuguese lives, are billboards for the first far-right party to go mainstream since the country returned to democracy less than 50 years ago. Called Chega — Portuguese for “enough” — the party is riding on a pledge to “cleanse” the nation of its political class. Its leader is a charismatic former sportscaster who rose to prominence by defying hate-speech fines to invoke racist “Gypsy” stereotypes against Portugal’s tiny Roma minority. After winning its first seat in Parliament in 2019, Chega won 12 out of 230 in the 2022 election.
Now the party looks poised to increase its seat count again in a snap election called in the wake of the country’s biggest corruption scandal in years. While the leader of the center-left Socialist Party wasn’t directly implicated, national prosecutors accused some of the highest-ranking officials in the government of corrupt deals with foreign energy companies, prompting Prime Minister António Costa to resign. Campaigning hard on an anti-establishment, anti-corruption message with three months left to go before the March 10 election, Chega — already in third place in public opinion polls — inched upward in the past four weeks.
All over the world, right-wingers have notched significant recent wins.
Argentina’s libertarian firebrand Javier Milei, who aligned himself with former U.S. President Donald Trump and ex-Brazilian leader Jair Bolsonaro, won the presidency last month with the most votes in the South American nation’s modern history.
Days later, a far-right party led by the Netherlands’ Geert Wilders won the largest bloc of seats in Parliament on a platform that vowed to end immigration and ban Muslims, who make up about 5% of the Dutch population, from practicing their religion. In Slovakia, Robert Fico — previously ousted from the premiership over his alleged connections to the assassination of an investigative journalist and his fiancee — returned to power in October by allying with the country’s far-right party.
French far-right leader Marine Le Pen, who came in second in the last two presidential elections and looks competitive in a third, arrived in Lisbon late last month to hold a press conference in support of Chega. It was the latest attempt by Europe’s populist faction to flex its presence in Portugal since Chega held a Lisbon summit in April that drew Bolsonaro himself.
Moedas is a member of the center-right Social Democratic Party, the second-largest bloc in Parliament and the traditional opposition to the center-left Socialists. But he said both parties in the center are struggling to compete with extremists whose inflammatory rhetoric travels further across social networks, where algorithms favor the outrageous over more measured or practical discourse. Even those on Portugal’s far-left lament that Chega’s rise is uniquely fueled by the ability of members to use “hate speech to mobilize their followers.”
Portugal’s economic revival after its 2011 debt crisis was impressive enough that pundits coined the term “sardine capitalism,” as a model for balancing the fiscal discipline expected by fellow euro users like Germany with the generous welfare state Portuguese voters demand. Portugal remained Western Europe’s poorest nation, where 1 in 5 reported being unable to afford heating bills in the winter in a poll taken before energy prices surged in recent years. Still, annual surveys showed more optimists than pessimists about the direction of the economy.
These days doomsayers dominate, with a vast majority of Portuguese adults telling pollsters in September that the economy has gotten worse since 2022. The sardine has entered what Bloomberg recently described as “choppy waters.”
Economic growth, which had outpaced other European economies after the COVID-19 pandemic, has begun to slow and factories are producing less. Inflation is slowing, but the cost of living in Portugal rose more over the past year than the continental average in every category of the official statistics. That squeeze comes with an extra pinch on workers whose wages are below average for a rich country, where half of workers earned less than €1,000 per month and the average salary had barely increased by 5% over the past two decades. That’s now hardly enough for a month’s rent in Lisbon.
As 90% of Portuguese adults will tell you, housing costs are spiraling out of control.
The Socialist government’s solution is to stop encouraging rich foreigners to buy up all the apartments by repealing special tax breaks and “golden visas” for real estate investors. The policy changes have done little so far to mute demand, with 65% of new sales going to foreign buyers.
Those foreign buyers bring wealth to the city, Moedas said, and the incentives to lure them to Portugal made Lisbon competitive with larger cities in Spain like Barcelona and Madrid. To the Social Democrat, housing is a problem of supply, not demand. His administration is spending hundreds of millions of euros from the European Union on building and renovating apartments with subsidized rent. At present, the mayor said, the city completes as many as 40 new or upgraded units every two weeks.
Its €560 million ($600 million) grant went at first to building apartments for very low-income residents paying as little as €10 per month. But Moedas said the city was now focused on units that would rent for between €200 and €300 per month to teachers, nurses and other professionals priced out of the Lisbon housing market.
“You can have a wonderful city of innovation but if there’s no social network and social welfare for people, you create friction and you create problems.”
It’s an example not only of what’s possible when pragmatists in rival parties work together, Moedas said, but also of the kind of social policy that can really materially help people and make populists’ burn-it-all-down message less potent.
“We’re building municipal housing for those middle-class jobs,” he said. “For the last 20 or 30 years, there was never this level of investment.”
But Portugal is still not building homes fast enough to keep up with demand. The number of permits granted for construction of new housing in 2022 was 15,207, roughly enough for one home per every two new households forming each year in the country, according to a September 2023 research note from the Spain-based bank Caixa. The cost of construction materials, meanwhile, climbed by nearly 10%. Home prices are on track to rise an additional 9% next year. Rents in Lisbon are soaring so high that the city surpassed Singapore for the top spot on a list of real estate markets seeing the steepest jump in rental costs.
Moedas said his administration was working on digitalizing the permitting process, which he criticized as “too slow and too bureaucratic,” and setting up another program where the city will give a free plot of land to a group of individuals looking to build a cooperatively owned apartment building. But he also said the city offsets high prices by offering services like free public transportation for students and the elderly.
“You have to invest more in social policies than in everything else because the city depends on people living with dignity. If they don’t live with dignity, then the city doesn’t work,” he said. “You can have a wonderful city of innovation but if there’s no social network and social welfare for people, you create friction and you create problems.”
Established by the Phoenicians centuries before the founding of Rome, Lisbon emerged from centuries of rule by Muslim and Catholic theocrats to become the seat of a globe-spanning empire controlling key ports and territories along the trade routes of South America, Africa and Asia. Like Germany and Italy, Portugal lost its nascent democracy to a fascist dictatorship during the Great Depression. Since Portugal stayed neutral in World War II, the regime, which went on to wage its own brutal wars against colonial subjects vying for independence, held on to power until the 1970s. It wasn’t until the end of that decade, as the colonies split off into sovereign nations, that Lisbon held its first truly open elections.
Today the city is a tourist hot spot beloved for its music and food in an LGBTQ-friendly country renowned for its lawmakers’ boldly humane approach to social problems, such as a 2001 law that decriminalized all drug consumption and led to a drop in addiction-related illnesses.
“That’s the easy thing,” he said.
Giving fair consideration to opposing ideas and taking time to “hear both sides and listen to different views, and come up with policies for concrete problems,” on the other hand?
Moedas paused. “The tough part is being a moderate politician,” he said.
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