The Glasgow-born barrister, an expert in human rights law, said the world is witnessing an "erosion of the rule of law" as a result of the "politics of the hard man".
She said that Brexit was a "dishonest" hard right project to take apart the fundamentals which create a decent society, disguised in a flag.
Baroness Kennedy, who is appearing at the Festival of Politics at the Scottish Parliament this evening, said: "The country is going through a crisis of English nationalism, because that is what all this Brexit stuff is about. There's a desperate thrashing around to have a sense of what that means and it's expressing itself in a very divisive form of politics - these are dark times."
Asked where she thought the crisis stemmed from, she said: "It's the economic model we've been living with. In the 1980s economics was reshaped and as far as I'm concerned this was a long game for the hard right.
"Neo-liberal economics took hold inside politics, and inside the banks, including the World Bank, the IMF, the ECB - the whole system. The model is about small state, low taxation and a limited welfare state, basically reducing all the things that are so important, I think, to a decent society."
She added: "Of course they couldn't go as far as they wanted because we were in the EU which has meant a strong regulatory framework to maintain high standards in relation to medicines, chemicals, environment and workers rights and so many other things.
"But the alt and hard right want total de-regulation. This is what this Brexit project is and it's a form of politics we should be anxious about because it's really not going to play out well for most ordinary folk.
"It's all about driving down the areas of life which are fundamental to a decent society. And the problem is it's been wrapped in a flag which is so dishonest - saying it's about delivering power to people, that "we're there for you", when they are absolutely not. We just need to follow the money.
"It's not just nationally of course - a lot of my work is international and we're seeing an erosion of the rule of law all over the world. Look at Trump in the US, Orban in Hungary, look at Poland and the mess in Italy. It's the politics of the hard man. And Boris Johnson is attempting the same, though he's just a pale imitation of Trump.
"Dominic Cummings is another one who hates institutions and wants to tear everything down, who believe from the ashes we can re-grow things. Well no, too many people get crushed in that."
She said that the judges in Scotland and at the Supreme Court had put "a shot across the bows" of the Prime Minister with their recent judgements on the unlawful prorogation of the House of Commons, and by reserving judgement on whether they would force him to ask for an Article 50 extension if there was no deal with the EU, believing he had made a commitment to abiding by the law.
"They're reminded him we live in a parliamentary democracy," she said. "That law is made by Parliament and that he is obliged to obey the law as much as the next guy.
"One of the things we know happens with populist government - and there is a trajectory, we've seen it play out in Hungary - is that the first thing they do is close down critics in the media. Unfortunately a lot of the media is very pro-Brexit and seems to be excited by chaos theory - the idea we should rip everything down and see what happens.
"Then they go after the lawyers, and the judges... they want to control the justiciary. They don't like the rule of law - which is far more than law and order. It means that any ordinary citizen is able to challenge decisions made by those who have power over their lives. So we're seeing attacks on lawyers and judges and on the parliamentary processes and next will be the tearing down of other institutions."
Praising John Bercow for his handling of Brexit in the Commons and his "commitment to backbenchers", she also said Scotland's First Minister, Nicola Sturgeon had proved an "adept politician" in her handling of Brexit.
"She has been one of the most significant voices in the UK. Whatever your feelings are about independence, Scotland's voice has been in there, even if not enough notice has been taken of it and of Scotland wanting to stay in the EU. There's been no shortage of hearing from her."
Kennedy was one of Scottish devolution's most ardent supporters. She was involved in the creation of think tank Charter 88 in the 1980s "which was really about saying, after many years of Thatcherism, we have to look at our constitutional arrangements".
"There was a great deal of unhappiness in Scotland around the poll tax and the sense that Scotland was never high on the agenda when it came to things being decided in Westminster and I was a firm believer in devolution," she said.
"I was very much involved in speaking to the Labour leadership at the time, to Gordon Brown and John Smith, and then in the run up to the 97 election, saying this is the agenda you should be making yours. I seriously believe that decisions should be made as close to the people affected by them as is possible.
"The Scottish Parliament has had its fair share of bedding down but I think it's been a success story, I really do."
According to Kennedy, it's been important for women to have someone like Nicola Sturgeon speak out about Brexit, though she said she has watched as "Tory boys" have co-opted women in their party to support anti-women policies.
"Look at Priti Patel, her politics couldn't be further from mine, I want to put my head in my hands when I hear her talking. But this whole thing [Brexit] is mainly about men - there's a machismo about it. They don't seem to give a toss to what's going to happen to Ireland and the possibility of tearing up the Good Friday Agreement. They don't care what happens in Scotland and I'm not sure they give any consideration at all to how folk live their lives and how other people experience life.
"To consider no deal is catastrophic. They're prepared to do it of course because they and their friends will make a ton of money out of this. All of us who don't "play the markets" it's inconceivable to us that that is their attitude, but it is. And of course lots of people in business and the financial sector know how bad it will be, but they won't speak out because they might need the support of these people after. Self interest always comes first."
She said she believed Jeremy Corbyn's policies of redistribution were "coming back at speed", and while she did not believe in closing private schools, she did believe they shouldn't have charitable status. She added that an "open border" policy on immigration was "crazy" and that the subject of immigration was being badly handled by Labour.
However she said: "The old third way of Tony Blair is dead and gone and we're dealing with a whole different set of circumstances."
"They were too craven to the neo-liberal economic model, all that trickle down nonsense. Not that I'm happy with all that's happening in Labour now, but at least we're back to having conversations about redistribution.
"There's a real polarisation in society, small differences are being magnified, and people seem to want to find someone to loathe. So arguments around gender for instance, are magnified, and there's a rise in Islamophobia, anti-Semitism, racism, homophobia.. but it's really all about the malaise which stems from the unfairness of society. We've created a very angry society and we have to look at where that comes from and have to find a better balance economically."