Endgame for the Centre Left?
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Endgame for the Centre Left?

The Retreat of Social Democracy Across Europe

Patrick Diamond

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Endgame for the Centre Left?

The Retreat of Social Democracy Across Europe

Patrick Diamond

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About This Book

After a period of electoral dominance, centre-left parties in western Europe have suffered a dramatic erosion of support; the vote share enjoyed by social democrats is at its lowest ever level. Social democracy stands at a point of great promise, but also peril. This book explores these themes and argues that to write off centre-left politics now would be a great mistake. It counters the idea that social democratic values have been rejected by voters. The ideal of solidarity and the need to forge bonds of connection in a volatile, interdependent world is as compelling as it always was. At the same time, the centre left clearly faces difficulties: ‘the forward march of labour’ has been abruptly halted while declining trust in politics adds to the problem of constructing viable electoral coalitions. The UK’s decision to vote to leave the European Union is symptomatic of societies throughout Europe that are irreparably divided between voters who embrace economic change and openness, and those who are opposed to it. Social democracy has to find new ways to build bridges between ‘open’ and ‘closed’ communities by updating public institutions and policies, just as socialist parties did in the immediate aftermath of the second world war.

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Year
2016
ISBN
9781786602831
Social democracy: a crisis of ideas?
The argument of this book is that the centre left is losing elections since it has patently lacked a distinctive, compelling project for the future. Social democrats have become increasingly defensive, both intellectually and politically, as they see the political landscape around them changing in ways that are hardly propitious for the left. In Europe and the United States, the rise of new populist forces on both left and right appears to be dragging politics in ever more radical directions, ‘hollowing out’ the political territory on which social democratic parties once stood. The rise of left and right populism has made the politics of western democracies more ‘noisy’, but this turmoil often disguises the fact that the majority of voters still yearn for competent, stable and broadly progressive government. In this environment, the centre left has to re-discover the courage of its convictions while setting out a new vision.
Social democracy and the third way
The debate about ideas on the centre left often begins with discussion of third way social democracy, the now infamous effort to modernise social democracy during the 1990s. An increasingly fashionable argument since the 1960s and 1970s has been that ideas no longer matter in politics: we have entered an age of technocracy and rationalism signalling ‘the end of ideology’. To some extent, this view underpinned the development of the third way. The third way’s core proposition was that ‘what matters is what works’; the practicality of policy and the results it generated mattered more than the ideological content of that policy. It was argued that social democrats had to break out of the conventional boundaries that traditionally separated left and right. Supporters of the third way insisted that this was a necessary act of ‘revisionism’, updating social democracy for changing times; but the third way’s opponents countered that centre-left parties were being shorn of their ideological convictions. This was more resonant in the aftermath of the financial crisis in 2008–9, when centre-left parties were held to be culpable for inadequate regulatory oversight of financial markets while tolerating huge rises in economic inequality.
It is striking that in the late 1990s there was a wave of enthusiasm about the revival of progressive parties in US and European politics; however, this was accompanied by much debate, and perhaps even confusion, about whether electoral success would be translated into more profound social change (White, 1999). Rather than furthering progressive commitments to egalitarian reform, social justice, political freedom, and the extension of democratic governance, the perception was that many third way governments merely tinkered with an established Conservative settlement initiated by Ronald Reagan and Margaret Thatcher in the early 1980s (Gamble, 2010). In the US, Clinton’s New Democrats confounded the hopes of many progressive liberals by appearing to pander to a conservative agenda in order to secure re-election (Weir, 1999). In countries such as Britain and Germany, Tony Blair and Gerhard Schröder were regarded as the agents of a pro-market reform agenda under the guise of ‘modernising’ social democracy.
It can be legitimately argued that the core project of third way politics was a genuine response not only to the shattering of the post-1945 Keynesian settlement, but to structural changes that have occurred since the demise of the postwar social contract in the late 1970s. In the economy, dramatic changes were underway as a result of the internationalisation of capital markets and the expansion of world trade; the rise of information and communications technologies; the emergence of a ‘knowledge-driven economy’; and the shift from manufacturing to services that heralded a ‘post-industrial economy’ in the west (Callaghan, 2009). These economic forces interacted with important social changes, notably the fragmentation of traditional class structures; changes in the position of women reflected in growing labour force participation; demographic changes such as population ageing and the acceleration of labour migration; the apparent breakdown of traditional family structures; as well as an alarming decline of trust in democracy and government (Esping-Andersen, 2009).
In fact, many of the changes represented ‘opportunities’ as much as ‘threats’ for left parties; notably they instigated an unfinished feminisation process within social democracy which brought concerns about gender equality to the forefront of politics: there was no process of inexorable structural decline. The prediction that social democratic parties were doomed to defeat because of changes in the class structure proved to be exaggerated. Nonetheless, such developments made it harder to build a stable, cross-class alliance to match the power of organised labour in the 1950s and 1960s, the halcyon days of the postwar welfare state (Cronin, Ross & Schoch, 2010). The constraints imposed by globalisation, increasing welfare dependency, and declining faith in government appeared to circumscribe what social democratic parties were able to achieve in office. Indeed, the shift towards more dynamic and volatile ‘issues-based’ politics combined with the growing importance of perceived governmental competence and performance have created a febrile environment for governing parties of all ideological complexions (Stoker, 2006).
The third way was a concerted attempt to rethink social democratic politics in the wake of the Thatcher-Reagan hegemony, alongside the apparent dominance of ‘neoliberal’ ideas in advanced capitalist democracies. Numerous critics have sought to subject the third way to extensive critique since the mid-1990s. For instance, academics such as Chris Pierson (2001) insist that the third way had overstated the impact of economic and social change especially that associated with globalisation. In a similar vein, Ashley Lavelle (2008) argues that the third way entailed an unnecessary degree of accommodation with neoliberalism. The terrain of a distinctive left political economy centred on market intervention was prematurely abandoned. Marcus Ryner (2010), benefiting from the hindsight afforded by the 2008–9 financial crash, avers that New Labour’s model of social democracy meant a ‘Faustian’ bargain with market liberalism. The legacy was growing income inequality and an economy dangerously unbalanced by financialisation. Finally, the Swedish political scientist Jenny Andersson (2009) observes that third way social democracy entailed an emphasis on the rise of the ‘knowledge-driven economy’, which justified a new compromise between the private sector, workers and the state unified by the goal of widening access to human capital. Andersson concludes that the third way assimilates all forms of human potential and the public good under the rubric of economic growth and higher productivity, aiding the remorseless process of commodification in capitalist societies.
Other important structural changes in the ‘Anglo-Saxon’ economies were also downplayed or ignored by the third way. These included the substantial increase in earnings and income inequality in many western countries; the growing concentration of wealth among the richest one per cent of the population; the growth of relative poverty (especially child poverty); persistently high rates of economic inactivity among the unskilled (especially in the UK and some continental European states); as well as the emergence of excluded minorities economically and geographically isolated from the economic and social mainstream. The third way confronted a core paradox: economic and social change was generating new demands for progressive intervention by the state; at the same time, these very forces were eroding and undermining citizen’s trust in government, which manifested itself in declining election turnouts and growing disillusionment with the political process. Social democracy struggled to reconcile its aspirational rhetoric centred on social justice and the equal worth of all with the economic and political realities imposed by governing a liberal capitalist economy.
Moreover, the third way implicitly assumed that social democratic parties would converge around a single model of centre-left governance; but there have always been strikingly divergent national pathways within social democracy: there are distinctive models of British, French, German and Nordic centre-left politics. More recently, the British model has accepted globalisation and flexibility in capital and labour markets tempered by ameliorative government intervention. The German centre left has undertaken liberalising reforms since the late 1990s, but preserved the corporatist model of tripartite cooperation between employers, trade unions and the state. Similarly, the Nordic social democratic parties have remained open to globalisation and free trade, but have embedded the traditional pillars of the Scandinavian model such as collective wage bargaining and a relatively high density of trade union membership. Finally, the socialists in France have accepted some reforms of the state’s role in the economy, but the French left remains committed to achieving a high level of social protection through government regulation and intervention. This point underlines that there have always been ‘multiple third ways’ for social democracy in Europe.
Neither are the various criticisms of the third way always convincing: for example, Ben Clift and Jim Tomlinson (2007) have taken issue with the claim that UK centre-left modernisation in the late 1990s meant the abandonment of postwar Keynesian social democracy. For one, previous British social democratic governments in the 1940s and the 1960s had never been avowedly Keynesian: they were committed to nationalisation, more interested in economic planning, and rather distrustful of Keynesian theories which sought to defend the legitimacy of the liberal market economy. New Labour did not abandon demand-management but combined it with supply-side policies; the pursuit of ‘credibility’ was intended to create more space for fiscal activism as public spending grew markedly as a share of GDP after 1998–9; indeed, the Blair-Brown governments were fundamentally committed to the quintessentially Keynesian goal of full employment (Clift & Tomlinson, 2007: 66–69).
Moreover, for all the intellectual critiques of the third way, the prolonged attempt to ‘modernise’ social democracy was a serious effort to rejuvenate centre-left ideas. The economic crisis and the imposition of austerity in the wake of the great recession have underlined that ideas matter in politics. Ideas create ‘cognitive frameworks’ which are the precondition for political and policy action, as Mark Blyth (2011) has pointed out. It is ideas that enable social democratic parties to forge new coalitions for change, breaking down the influence of vested interests. As John Maynard Keynes famously remarked, ‘The ideas of economists and political philosophers, both when they are right and when they are wrong are more powerful than is commonly understood. Indeed, the world is ruled by little else’.1
In revising the third way since the 1990s, social democrats in Europe have developed three distinctive frameworks of ideas that are briefly reviewed in the chapter below: first, the turn towards ‘communitarianism’ associated with Blue Labour in Britain; second, the reassertion of a nascent version of cosmopolitan liberalism; and finally, the call for a renewed attack on economic inequality on the left.
The Communitarian Turn: ‘Making Sense of Blue Labour’
Communitarianism is a plural political ideology with roots both on left and right. The set of ideas known as Blue Labour have dominated internal debate within the British Labour party since its devastating 2010 defeat, among the worst the party has suffered since 1918. Similarly, in the Netherlands and Germany there has been a growing interest in communitarian ideas among social democrats, partly in reaction to heightened concerns about the long-term impact of migration on solidarity and community.
Election defeats have triggered an inevitable period of soul-searching, the most tangible product of which has been the Blue Labour prospectus. This occurred in the absence of any serious intellectual contribution either from the organised left or the remnants of New Labour. Exponents of Blue Labour expressed their ideas in the language of ‘love, community, neighbourliness, fraternity, relationships and the common good’. This was unusual in British politics, while leading Blue Labour exponents made a series of controversial claims. Maurice Glasman, widely viewed as Blue Labour’s leading intellectual voice, argued that the Labour governments had been dishonest about their intensions in liberalising immigration policy and accepting free movement of labour, as they feared a backlash from voters. Glasman was appointed to the House of Lords in 2011 by Ed Miliband, then Labour leader; his views have been taken seriously by the British media and the political class.
Blue Labour did not just provide a critique of immigration policy, but entailed a commitment to reclaiming past traditions, including respect for working-class life and the values of solidarity and collectivism that once animated the British left. The prefix ‘blue’ indicates a residual sympathy towards conservatism as a philosophy, not to be confused with the British Conservative party, which remains avowedly free market; it speaks to an appetite in the country to protect, safeguard, and improve the vital aspects of our common life, in particular England’s language, culture and institutions (Rutherford, 2010). Blue Labour embodies several important strands in the Labour tradition. It is a complex amalgam of distinctive ideological and intellectual tendencies which shares certain similarities with earlier phases of Labour party thought, namely the ethical socialism of Ramsay MacDonald and RH Tawney; the commitment of Clement Attlee’s Labour to a democratic ‘common culture’ in the postwar years; the pragmatic labourism of Harold Wilson and James Callaghan in the 1960s and 1970s; alongside the distinctive communitarianism and ethical socialism of the Blair years prior to 1997 (Rutherford, 2010).
Blue Labour involves an array of diverse and distinct positions. For example, Glasman is a strong exponent of the politics of virtue and the common good rooted in the social teaching of faith communities. Others emphasise the importance of Labour rediscovering its commitment to a democratic ‘common life’. The cultural theorist Jonathan Rutherford (2010) draws attention to the importance of rooting politics in everyday lived experience, particularly the parochialism of England, English culture and English identity. However, what unifies Blue Labour is its resistance to the commodification of human beings through markets, which allegedly strips life of all that is intrinsically valuable, echoing the early writings of Karl Marx and Georg Wilhelm Friedrich Hegel. Their most inspirational theorist is Karl Polanyi who has shaped the thinking of Glasman in particular, by examining the impact of capitalist markets on 17th and 18th century England. The process of commodification has been intensified in the 21st century by New Labour’s commitment to a ‘dynamic knowledge-based economy’ driven by globalisation. Unlike other anti-capitalist movements, Blue Labour sees capitalism as a problem not of class exploitation or structural inequality, but primarily of commodification and the unruly forces of capital (Glasman, 2010). The aim of left politics ought to be to resist the forces of marketisation that transform individual citizens into commodities.
In policy terms, Blue Labour embraces ‘stakeholder’ economics, redirecting British capitalism from its Anglo-American orientation towards northern European models...

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