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European social democracy in the 21st century / Greg Chambers. - [Electronic ed.]. - London, 2000. - 19 Bl. =3D 70 Kb, T= ext . - (Working papers / Friedrich-Ebert-Stiftung, London Office ; 2000,1)
Electronic ed.: Bonn : FES Library, 2000

=A9 Friedrich-Ebert-Stiftung

=3D"CONTENTS"






[page-number of print ed.: 1= ]

Introduction

This paper draws upon presentations and discussions made at a semina= r entitled 'European Social Democracy in the 21st Century' in September 199= 9.=20

As its title suggests, the seminar was held with the purpose of addr= essing the future of European social democracy. Social democratic governme= nts currently dominate Europe's political map. However, social democracy a= cross the continent is grappling with major societal and economic changes. = All European societies are affected by globalisation and all Europe=92s so= cial democratic parties must strive to formulate compelling arguments regar= ding a clutch of interrelated issues. =20

After first providing a survey of the current national debates, this= paper goes on to assess some of the most vital of contemporary issues, und= er the headings =91Competitiveness and Employment=92, =91Inequality and Exc= lusion=92, and =91Democracy, Identity and Citizenship=92. =20

Now is an extremely apposite time for a pan-European debate between = social democrats. Dialogue is urgently required in order to ascertain wher= e, on the one hand, there is radical diversity between countries and points= of view, and where, on the other hand, European social democrats can learn= from each other and apply similar solutions to commensurable challenges. = The seminar upon which this paper draws undertook to explore this terrain b= y bringing together delegates from around Europe. The following text surve= ys the content of the seminar, and in so doing seeks to address whether or = not it is possible to detect the emerging outlines of a shared modern Europ= ean view of social democracy.


Current national debates

Certain differences between the various national contexts immediatel= y present themselves. For instance, some Italian observers argue that in t= heir country there simply is no national-level debate on the future of soci= al democracy. Such debate is reportedly taking place within small circles = that do not touch society at large. Furthermore, some commentators note th= at much of the rank and file of the Italian left has the impression that an= y Italian debate upon 21st century social democracy has more to = do with the future of individual politicians than with that of social democ= racy itself. =20

By contrast, in Britain and Germany talk of the =91Third Way=92 or <= i>=91Neue Mitte=92 certainly has provoked a debate upon the future of E= uropean social democracy. However, it is far from certain that this debate= will unfold along the same lines in the two countries. The co-signatories= of the recent Europe: The Third Way/Die Neue Mitte (Blair and Schro= eder) face markedly different domestic political situations. Indeed, domes= tic political concerns are currently threatening to blow the German Chancel= lor onto a course other than that plotted by the Blair-Schroeder manifesto.= Schroeder's SPD are stricken by electoral losses and the=20

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vote-winning Chancellor of a year ago now faces fierce resistance to= his project to re-fashion the German social state. The Blair-Schroeder pap= er provoked internal SPD discontent and Schroeder's planned austerity measu= res, including spending cuts of DM 31 billion next year, are proving popula= rly unpalatable. By contrast, Blair's Labour Party appears set fair for a = second term and internal Labour Party dissent over the Blair-Schroeder pape= r was notable by its absence. Blair has been dealt a more favourable histo= rical hand than his German counterpart, insofar as painful =96 some would s= ay brutal =96 structural economic reforms had already been made by Thatcher= in the 1980s. Further, Blair undertook tough party reforms, such as the r= ewriting of Clause 4, before Labour achieved office; the transition = to 'New Labour' had largely been negotiated while in opposition. In contra= st, one can not talk of a 'New SPD' in this manner; the bitter fight betwee= n modernisers and traditionalists is being waged now, while the party is in= government. =20

Opinion is divided over whether the Neue Mitte is part of Sch= roeder's problem or his solution. In some quarters the Blair-Schroeder pap= er is held to represent the end of social justice and to have precipitated = the SPD's current electoral woes. However, elsewhere one encounters the ar= gument that Schroeder's critics on the left have misunderstood the document= . This argument describes it not as a departure from the goal of social ju= stice, but rather as an expression of the contemporary need to renew social= democracy. Account must now be taken, so this argument runs, of the econo= mics of globalisation and the psychology of individualism. The state can t= herefore no longer be the sole motor of progress; new technologies and the = knowledge economy are held to dictate that the state must now play the more= facilitative role of enabling individual enterprise. As the Blair-Schroed= er manifesto puts it, the state must concentrate more on 'steering' than on= =91rowing'. Such thinking entails a new supply-side agenda for the left, = 'prudent' public finances and a reconstructed welfare state. According to = this stance, the Neue Mitte does not betray social justice, it recup= erates and renovates the concept for the modern era. However, if Schroeder= is to succeed in this project, the Neue Mitte must be defined with = greater clarity. At present the German government is struggling to work ou= t what its new mixture of demand and supply-side economics means in practic= e. To reverse Marx's dictum, theory must now be added to German praxis.=20

If the SPD is to win public acceptance in Germany, it must win the d= ebate at a national level, yet European-level discussions are also crucial = in order to determine which practices from abroad can be most fruitfully ad= apted to the German context. Rigorous debate about the future of European = social democracy is thus a pressing requirement for the formulation of a co= herent Neue Mitte that is a successful modern approach built on clea= r values and with policies and ideas appropriate to the new millennium. Su= ch debate is also necessary for the future credibility of Blair's Third Way= , since =96 despite Blair's dominance of Parliament and the opinion polls = =96 New Labour is frequently criticised as lacking both clarity and radical= content. Centre-left voices in the media argue that for all the British g= overnment's welcome initiatives, such as the Working Families' Tax Credit, = its policies do not yet match Blair's grand rhetoric of a 'constant revolut= ion'. Furthermore, New Labour is not entirely immune=20

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to internal rank and file dissatisfaction. Disquiet has been expres= sed by those who feel New Labour is disregarding the traditional redistribu= tive left-wing agenda, and many of Labour's 'core' supporters have 'stayed = at home' in recent elections. There are therefore key similarities as well= as differences between the political landscapes confronting Blair and Schr= oeder. Like Schroeder, Blair must inject the rhetoric of Third Way with ra= dical content and, like Schroeder, he must address the arguments of those w= ho charge him with betraying the left. A pan-European debate upon the best= ways to reconcile social justice and modernity is thus valuable for Britai= n and Germany alike.=20

The debate over European social democracy in the 21st cen= tury clearly extends beyond considerations of the Third Way. Indeed, Jospi= n has explicitly distanced his French socialists from the Third Way, which = is described as having moved too far in the direction of the US model. Tal= k is of building a 'new alliance' (between the middle classes and the ex= clus), but not of following the Third Way. Furthermore, French sociali= sts were undeniably piqued by the Blair-Schroeder manifesto. It was publis= hed on 8th June 1999, just four days before the European Parliam= ent Elections. This timing was felt to be at best inopportune and at worst= a betrayal, since its liberal calls for a smaller state and less rigid lab= our laws were held to contradict the joint declaration of the European Soci= alist Parties, signed in March. The joint declaration, and not the Blair-S= chroeder paper, was designed to be the common platform upon which Europe=92= s socialists fought their election campaigns. Furthermore, following the e= lection results, the French socialists have been able to argue that they ar= e correct to oppose the Third Way, for Jospin=92s PS was alone among Europe= =92s governing centre-left parties in securing a positive electoral return.= Viewing the mire the SPD now finds itself in, some French socialists have= concluded that it was an error of the Germans to present the highly libera= l Blair-Schroeder manifesto just before an election.

Jospin=92s supporters seek to differentiate themselves from the Thir= d Way by presenting the French path as one along which traditional socialis= t values can more comfortably move. However, perhaps surprisingly, the vie= ws of Blair and Jospin do have much in common. Both the British and French= governments place a premium upon encouraging people back to work, and both= strongly voice their =91pro-business=92 credentials. The two governments = share a conviction that a transition must be made from industrial society t= o a service society based on knowledge. Like Blair, the French PS declares= that society must be re-configured to accommodate the information age and = globalisation. Furthermore, the two governments concur that, in order to e= ncourage this transformation, today's social democrats must nurture entrepr= eneurialism and champion social investment in training and education. One = can therefore detect broad agreement over what the big issues, or key quest= ions, facing today=92s social democrats are. The cross-Channel differences= arise because the two governments seem to be generating different answers = to these questions. Of the two premiers, Jospin appears the less enamoured= with market economics, and the more confident in direct state activity. T= he French socialists talk more openly of redistributive state benefits as a= necessary component of 'social health', and they are more overtly=20

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concerned to stress that flexibility can bring undesirable job preca= riousness as well as economic dynamism.

It is therefore apparent that, although Jospinisme and Blairism are = not synonyms, there are significant areas of overlap. To expand upon the l= atter, one should note that Jospin=92s programme of privatisation has proce= eded more speedily than those of his centre-right predecessors, and that th= e new French budget freezes public spending in real terms. In addition, Jo= spin has recently stated that the government can no longer =91administer=92= the economy, and one of the reasons French employment has recently been bo= osted is that France is generating more short-term and part-time work in se= rvice and high-tech industries. Workers in these jobs do not receive the s= ame level of benefits and protection as those in full-time work; precarious= flexibility would appear to be creeping into the French model after all. = It can therefore be argued that although Jospin talks to the left, he acts = to the centre in a manner in some ways comparable to Blair. The similariti= es between Blair, Schroeder and Jospin suggest that upon certain key issues= a European social democratic consensus is indeed forming, and forming itse= lf in opposition to traditional social democratic Keynesian macro-economics= . The following sections will indicate whether such similarities warrant t= alk of a new European social democratic mainstream.


Competitiveness and Employment:=20
What sort of European social model(s) for the 21st century?<= /font>

Today's European social democrats face the conundrum of how to const= ruct social models that both preserve social cohesion and also prevent jobs= leeching away to more =91competitive=92 models. This section discusses wh= ether or not European social democrats' responses to this riddle are conver= ging.=20

1. Unfit for the 21st Century: A negative consensus

Current European social democratic governments appear in broad agree= ment that traditional European social models are inadequate for the 21= st century. In its classic incarnation, the European model includes = full (male) employment, generous redistributive social security from cradle= to grave, and Keynesian demand management. Such features are commonly dee= med out of step with today's social and economic realities. For example, t= raditional conceptions of full employment are felt to be outmoded, for they= do not include working women, and traditional social models are considered= incompatible with an internationalised economy as well as unable to bear t= he strain of ageing populations. It can therefore be said that European so= cial democrats face a similar set of constraints, and that they are converg= ing upon the realisation that traditional European social models must be ra= dically overhauled.=20

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This can be termed a rearview mirror consensus since it is largely d= efined by a rejection of the past. However, a certain amount of agreement = also textures the debate on which current models to steer clear of in the f= uture. European social democrats appear united in their desire to avoid th= e US model in its unadulterated neo-liberal form. However, it should be re= cognised that, whereas some European social democrats refer to a pan-Europe= an social democratic rejection of the US social model, other social = democrats drop the use of the definite article and refer to US models in th= e plural, some of which are deemed acceptable. For example, some draw atte= ntion to the fact that the American Robert Reich argues for a social model = that both prioritises education as the fulcrum of economic growth and indiv= idual opportunity, and also stresses the need for public spending plus a mo= re direct redistribution from rich to poor. Such thinking provides a provo= cative counter-balance to those on the centre-left who seem to use a vocabu= lary of equal educational opportunity in place of, rather than adjacent to,= one of fiscal redistribution. The particular US model envisaged by Reich = is thus clearly of value to the European left. This has led some European = social democrats to argue that certain models conceptualised by Amer= icans have utility for European policy makers, and to disagree with those E= uropeans that talk in terms of a common refusal of the US model. =20

It therefore appears that not all European social democrats even agr= ee on what their common enemies are. However, one must distinguish substan= tial differences from terminological ones since, although not all European = social democrats seek to oppose a unitary =91US social model=92, one can in= deed talk of a common rejection of pure Reaganomics. Debate between Europe= =92s social democrats must therefore occur at the basic but crucial level o= f definition. Terminological ambiguity such as that attached to the phrase= 'US social model' is inevitable in any discourse, but it is all the more l= ikely in one conducted between Europe's social democrats, hailing as they d= o from diverse cultural, linguistic and historical backgrounds. One of the= vital functions of an ongoing pan-European debate between social democrats= will therefore be its capacity to reveal where, on the one hand, disagreem= ents boil down to the hard substance, and where, on the other, they turn up= on definitional ambiguities. In this given instance, one can detect substa= ntial agreement beneath the surface disagreement. European social democrat= s agree that the model built under Reagan bought economic dynamism at too h= igh a human price =96 witness the US=92s highly uneven distribution of inco= me and wealth, the existence of a working poor, chronic homelessness, and i= nadequate health care provisions for the poor.=20

Today=92s European social democrats can therefore be seen to share b= oth a rejection of the more brutal aspects of the US model and a common rec= ognition that there is no going back to the classical European model. Howe= ver, although one can talk of these two positions as defining a mainstream = contemporary European social democratic stance, it must be recognised that = this is a consensus on what to reject. It is a negative consensus, rather = than a positive agreement concerning which policies should be adopted. The= following subsections outline various national efforts to address the twin= issues of economic=20

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competitiveness and social cohesion, and they consider whether or no= t these efforts gesture towards a positive consensus over the desirable Eur= opean social model for the 21st century.

2. Competitivess and Employment: Some national perspectiv= es

Both commonalities and divergences emerge when one analyses the mean= s by which different European social democrats have undertaken to solve the= puzzle of combining competitiveness with cohesion. Some key features of t= hese attempts are mapped below.=20

Making Work Pay

Some French commentators argue that, in order to side step US-style = social ruptures, a maxim for 21st century social democrat employ= ment policies could be 'no working poor'. Such a maxim could be given cont= ent by statutory guarantees of a =91decent=92 minimum wage, and by policies= to 'make work pay', such as the Working Families' Tax Credit recently intr= oduced in Britain. Some French observers envisage that minimum wage levels= might in the future be determined at an EU level. Such an eventuality wou= ld herald a truly pan-European social democratic employment policy. Howeve= r, for the present moment such a co-ordinated supranational policy appears = untenable. Divergence between national economic performances ensures that = the level at which a wage becomes meaningful, or decent, will vary across t= he EU=92s member states. Nonetheless, =91make work pay=92 could still beco= me a creed common to all European social democrats, even were the means to = realising this aim left in the hands of national governments.

Flexibility and Competitiveness

It should be noted that measures such as statutory minimum wages ris= k building rigidities into the job market, thereby entailing a loss of comp= etitiveness and risking higher unemployment. The precept of =91no working = poor=92 must therefore be accompanied by policies that promote the flexibil= ity required in order to boost competitiveness and maintain high levels of = employment.

The Dutch =91polder model=92 has been notable for its success= vis-=E0-vis competitiveness and job creation. The basic units of t= his model are drawn from the Dutch tradition of co-operative governance. T= he dominant mode of interest-group representation in Holland =96 consociati= onalism =96 is inherently consensual, and neo-corporatist institutions for = socio-economic decision-making are deeply rooted. These underlying conditi= ons of Dutch politics and society were prerequisites for the understanding = between trade unions, employers and the state in 1982 regarding the limitat= ion of wage increases (the Agreement of Wassenaar). Some Dutch observers p= osit that since 1982 the consistent adoption of wage moderation has injecte= d dynamism into the economy and created jobs. Significantly, some commenta= tors also argue that the co-operative manner in which these decisions to re= strain wages were reached through keeping social partners in dialogue wit= h each other =96 was able to

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safeguard social cohesion. Co-operation is also manifest at the le= vel of Dutch party politics. For 80 years Holland's coalition governments = have been working along broadly similar lines. Dutch politics has therefor= e been marked by pragmatism and a narrowing gap between parties on the left= and right. However, it has been argued that these are specific national c= haracteristics and that the Dutch model is not widely exportable. It is ce= rtainly unlikely that one could successfully transplant the Dutch model int= o countries that periodically experience major shifts in government, and wh= ere neo-corporatist institutional channels of communication between respons= ible social partners are not already embedded.=20

Another feature that has enabled the Dutch model to successfully gen= erate employment has been the fact that it embraces the creation of part-ti= me jobs. Until the late 1970's, the proportion of women in the Dutch labou= r market was very low. In the last 20 years, however, the number of women = entering the labour market has risen rapidly. This development has brought= about a sharp rise in the number of part-time jobs. Nonetheless, although= the Dutch model has been a successful job machine, it has not been able to= prevent inequality in income and wealth from rising. It might therefore b= e argued that Dutch collective bargaining is a supply-side corporatism that= draws a veil of social cohesion across measures that in fact increase soci= al divisions. It is not, therefore, a magic formula that dissolves all ten= sion between competitiveness and cohesion.=20

In Britain, New Labour appears to be responding to the cohesion-comp= etitiveness conundrum by leaving the deregulative Anglo-Saxon model it inhe= rited from the Tories largely intact. Care has been taken to ensure that n= ew employment policies do not interfere with competitiveness. For instance= , Britain's minimum wage was deliberately set low (=A33.60), and lower stil= l (=A33.00) for 18- to 21-year olds. A Blairite social model includes the = following features: an emphasis on the triangle of individual responsibilit= y, participation in the labour market and education; tight budgetary polici= es; supply-side economic policies, and opposition to a passive welfare stat= e that hands out overblown and unwieldy benefits.=20

Some in the French PS label Blairites as 'Third Way partisans' who a= re overly dependent on the Anglo-Saxon model. Whereas in Britain the reali= sation that flexibility denied can mean jobs lost manifests itself as a rel= uctance to temper the Anglo-Saxon model's deregulated flexibility, in Franc= e greater effort is expended on distinguishing good forms of flexibility fr= om the bad. A distinction is drawn between internal flexibility, which is = deemed desirable, and external flexibility, which is not. French observers= have suggested that internal flexibility comprises measures designed to bo= ost citizens' lifestyle flexibility, such as the re-organisation and reduct= ion of hours spent working and more flexible opening hours for shops and pu= blic services. This type of flexibility, it is argued, accommodates the re= aring of children, lifelong learning, sabbatical periods, and so forth. In= contradistinction, negative, external flexibility is held to encompass fac= ets like fragile part-time jobs, short-term contracts and sub-minimum wage = jobs for the young or unskilled. This is the kind of flexibility held to c= haracterise the Anglo-Saxon model and to produce a working poor. In an effo= rt to highlight the Anglo-Saxon model=92s deficiencies, some on the French = centre-left argue that the creation of jobs is a necessary but not sufficie= nt criterion of a social

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democratic programme; social democrats must create not just jobs, b= ut jobs that are worth doing. =20

As evidence that the PS has backed this rhetoric with action, one ca= n point to Jospin=92s announcement on 26th September 1999 that c= ompanies with a large proportion of 'precarious' jobs on their payroll will= be forced to pay a higher rate of unemployment insurance. However, such a= step appears to cut against Jospin=92s previous declaration that governmen= ts should no longer seek to administer the economy. This does indeed repre= sent a tension within French employment policy, and it suggests that within= the Jospin government itself different =96 and not necessarily mutually co= mpatible =96 responses are being offered to the competitiveness-cohesion c= onundrum.

The reduction of working hours

It is far from clear that internal flexibility promotes economic com= petitiveness effectively, and there is widespread agreement that prohibitin= g external flexibility does cut against economic dynamism and is thus likel= y to cause unemployment. Rather than follow the Anglo-Saxon model, the Fre= nch PS's response to this appears to be an attempt to outflank unemployment= by means of reducing the number of hours that people work.=20

The French government's 35-hour week proposals are designed to creat= e jobs, foster good bargaining conditions in firms in order to promote inte= rnal flexibility, and to help fashion a new social model that re-assesses t= he comparative values of working time and leisure. This policy has generate= d significant interest among Europe's social democrats. This is largely be= cause it is Jospin's biggest departure from liberal economic orthodoxy, and= the policy that most clearly distinguishes him from the Blairite Third Way= . It should be noted that in practice the French proposals are relatively = modest: they entail a reduction from 39 hours to 35. However, the concept = of reducing working time does have profound social and philosophical ramifi= cations. The intention is to translate economic progress into social and c= ultural gain through providing citizens increased leisure time. The presen= ce of the latter objective suggests an intriguing divergence between the Fr= ench and British governments' conceptions of the good life. New Labour has= introduced a minimum wage and a Working Families' Tax Credit, together wit= h Welfare-to-Work schemes that are designed to encourage people into employ= ment. All of these policies turn upon the project of 'making work pay' and= are informed by the notion that labour liberates the individual and benefi= ts society. Similar thinking also marks Jospin's increases in the minimum = wage and his scheme to create jobs for young people. =20

However, the presence of the 35-hour week signifies that Jospin's go= vernment also draws upon an alternative conception of the good life =96 one= that does not measure value solely in terms of the individual's freedom to labour, but also in terms of his/her freedom from labour. B= oth quality of work and quality of life outside of work matter. If the 35-= hour week proves capable both of creating jobs and also of freeing time (an= d thereby also expanding cultural and social space), it will be a truly rad= ical response to the competitiveness-cohesion=20

[page-number of print ed.: 9= ]

conundrum. Indeed, some on the French centre-left believe that work= ing time reduction has the potential to be a core component of a European-w= ide social democratic fight to ensure competitiveness and cohesion. Such o= bservers assert that this objective should be shared, although the means of= actualising it will vary according to particular national traditions and p= olitical institutions. It is argued that, while in France the state must p= lay a central role by enshrining working hours reduction in law, in other c= ountries different implementation strategies might be employed. For instan= ce, negotiation between social partners could be appropriate to those count= ries, like Holland, with traditions of corporatism and co-operative governa= nce. =20

Other European social democratic governments, however, are not rushi= ng to embrace the idea of working time reduction. In Britain, certainly, i= t is regarded more as an eccentric curiosity than as a measure grounded in = sound economic reality. It is too early to judge which side of the debate = is correct, since the policy is still in its infancy. It is clear, however= , that the 35-hour week is an area that Europe=92s social democrats should = continue to monitor closely.

3. Towards a positive consensus?

From the discussion above, it can be seen that it is not possible to= talk of a single standard-type European social democratic response to the = competitiveness-cohesion dilemma. It might, however, be argued that Europe= an social democrats do broadly share the same goals and that, although a si= ngle European model for the 21st century is an unlikely developm= ent, in the future one might see the emergence of a series of comparable mo= dels that share certain important traits. Although each particular model w= ould be marked by specific national characteristics, when grouped together = one would be able to detect a family resemblance shared by them all. Accor= ding to some French observers, this resemblance should feature a refusal to= accept the notion of a working poor, a refusal to submit to the doctrine t= hat any job is a good job, and a pursuit of flexibility of the sort that be= nefits employees as well as employers. However, a snapshot image of Europe= today would not reveal a family resemblance characterised by these feature= s. In particular, some have observed that Britain=92s social model shares = more in common with =91the US model=92 than it does with European social de= mocratic models. More generally, it is far from evident that Europe's cent= re-left governments will draw similar conclusions regarding which varieties= of flexibility are acceptable and which sacrifice too much on the altar of= competitiveness. For example, at present there is little evidence of a co= mmon stance regarding working hours reduction policies. =20

At the extreme edge of the view that a shared European model is unli= kely are those observers who argue that Europe=92s 21st century = social democrats may well not even share common goals. Such sceptics argue= that the links between Europe=92s social democrats have hitherto arisen be= cause social democracies have common historical routes in industrial capita= lism and in working class movements. However, these sceptics argue that th= e=20

[page-number of print ed.: 1= 0 ]

fragmentation of the industrial working class and the transition to = post-industrial society =96 to services and the so-called knowledge economy= =96 may transform different social democracies in different ways. Such pr= ofound change could buffet social democrats in manifold directions, to the = extent that they might no longer even share common objectives. =20

However, this scepticism should not imply that social democrats are = currently unable to learn from each other. The fact that common constraint= s are being faced implies that communication over potential policy response= s remains of high importance. Although one must beware of a priori = assumptions that so-called best practices can be successfully inserted into= alien environments, this proviso should not imply the end of dialogue. On= the contrary, pan-European dialogue will enable social democrats to discov= er precisely which policies can and cannot be cross-fertilised and transpla= nted and whether a core of shared practices can be established. =20

With regards to competitiveness and employment, one of the current l= ines of dialogue that must be pursued concerns the extent to which European= social democrats should relate to the Third Way. Some observers have argu= ed that the Third Way has become a standard or leading frame of reference t= hat other social democratic parties inevitably must relate to. However, ot= hers question whether European social democrats beyond Britain should refer= to the Third Way at all. Some such observers argue that the Third Way is = a political marketing tool utilised by the British Labour Party for domesti= c reasons, and that as a social model it is not sufficiently coherent to be= widely exported. =20

This argument posits two principle functions that the Third Way is d= esigned to play in the domestic British arena. Firstly, New Labour is held= to employ the Third Way in order to distinguish itself from both Thatcheri= sm and =91Old Labour=92. Secondly, the Labour Party is deemed to be seekin= g to use Third Way rhetoric as a lever to tilt public opinion towards accep= tance of the Euro. According to this argument, New Labour is trying to con= vince the British public that Britain is similar to its continental partner= s, since such a perception could psychologically prepare the ground for Bri= tish entry into the EMU. It is argued that the Third Way plays a key role = in this strategy, since it is sold as a creed that unifies all Europe's soc= ial democrats and as a model for the future of European-wide social democra= cy. It has been argued by some critics that the Third Way thus employed is= predominantly a form of political packaging, and that its content should n= ot be emulated by other European social democrats. For instance, although = some commentators cite low unemployment as a current British success story,= critics stress that the Third Way is unlikely to close the growing gap bet= ween Britain's richest and poorest. Such critics also argue that the Third= Way's emphasis on supply-side flexibility is unlikely to reverse Britain's= current high levels of child poverty, or alter the statistic that only the= four cohesion nations have lower incomes per capita. Regardless of whethe= r one ends up a Third Way zealot or a sceptic, the key point is that debate= is necessary in order to ensure that if one country's social democrats are= considering importing a set of policies they are absolutely clear about th= e nature of this import. In other words, European social democrats must be= clear about the practical consequences of the theories they learn from eac= h other. =20

[page-number of print ed.: 1= 1 ]

The discussion above implies that no positive consensus has yet been= reached regarding which social model(s) best solve(s) the competitiveness-= cohesion dilemma. In fact, the very notion of exporting entire models is e= xtremely problematic, and some of Europe's social democrats have even liken= ed it to an imperialistic urge or missionary zeal. It is indeed possible t= hat attempts made to win universal acceptance for single models are hubrist= ic and, as such, doomed to failure. On this evidence, it would appear that= European social democrats should seek to trade certain aspects of models, = rather than these models=92 over-arching frameworks.=20


Inequality and Exclusion: The Role of the State

As noted above, the quest for high competitiveness can yield a doubl= e quarry: high employment but also increasingly divergent levels of income = and wealth. This concertina effect, whereby the affluent stretch further a= way from those on low incomes, is an example not just of inequality among w= age earners but of exclusion, since those at the bottom edge of the labour = force may well be excluded from society=92s =91winners=92 circle=92. They = may, for instance, be deprived of the opportunity of bringing up a family i= n a safe, healthy and financially secure manner.=20

This section considers a variety of perspectives upon the roles that= modern states should play in the fight against such inequality and exclusi= on. Broadly speaking, one can distinguish a traditional social democratic = position which conceives of inequality principally in terms of an uneven di= stribution of wealth, and which posits that the state should intervene dire= ctly in order to restore an equitable balance by means of progressive taxat= ion and public spending. Against this can be placed the neo-liberal positi= on that accepts drastic inequality as an ineluctable economic fact, a neces= sary feature of a vigorous capitalist system. According to the neo-liberal= s, the state should limit itself to an, at most, extremely minor role in th= e fight against inequality, for they argue that an overactive state is grav= ely detrimental to economic dynamism. The Third Way claims to occupy a pos= ition distinct from both traditional social democracy and neo-liberalism. = Although the Third Way does not encourage outright economic laissez-fair= e and attacks the right for abandoning the excluded, it does concur wit= h the argument that overactive states impede the enterprise culture and, he= nce, damage the economy. In particular, the Third Way argues that social d= emocrats must accept that globalisation has profoundly influenced the state= =92s capacity to intervene in the fight against inequality. Greater econom= ic openness and factor mobility is held to have created an equity-inefficie= ncy trade-off, whereby if the state wishes to preserve economic dynamism it= must limit the extent to which it uses the benefit and tax systems to figh= t exclusion. Against this backdrop, the Third Way argues that the =91Old L= eft=92s=92 reliance on =91tax and spend=92 is economically flawed and that = it promotes mediocrity and conformity rather than enterprise and individual= excellence.

[page-number of print ed.: 1= 2 ]

New Labour, and some in the SPD, now talk less of the state's duty t= o redistribute economic wealth and more of its duty to redistribute chances= and opportunities via strong education and training. Indeed, the Blair-Sc= hroeder manifesto explicitly prioritises equality of opportunity at the exp= ense of equality of outcome. This revised conception of equality correspon= ds with a reformulated notion of the state's role in the fight against ineq= uality and exclusion. According to the Blair-Schroeder document, the state= should facilitate (not guarantee) greater equality, through a policy mix t= hat relies more heavily upon education and training than upon high welfare = spending and steeply progressive taxation. However, some observers have qu= estioned whether such a radically improved education system can be achieved= without increased taxing and spending. Two provisional conclusions regard= ing the future trajectory of Europe=92s social democratic debate on equalit= y, exclusion and the role of the state are therefore as follows: first, soc= ial democrats must decide whether to pursue equality of opportunity, or whe= ther equality of outcome remains a laudable and viable goal for the 21= st century; second, they must explore whether Third Way policies are = truly capable of delivering equality of opportunity without significantly i= ncreasing the tax burden.=20

Some French observers argue that, compared to New Labour, their PS p= laces a greater emphasis upon the state=92s role in the battle against ineq= uality and exclusion. Such commentators can point to Jospin=92s declared i= ntention to use the state to impose a sense of order upon an otherwise wild= world economy. This rhetoric suggests that, compared to the followers of = the Third Way, Jospin envisages the state playing a more active, direct rol= e in the fight against inequality and exclusion.=20

However, the French and British governments are united in the emphas= is they have placed on =91co-ordination=92 as a vital principal in both the= formulation and implementation of policies designed to tackle inequality a= nd exclusion. For example, some commentators have heralded the Jospin admi= nistration=92s legislation against exclusion and extreme poverty, which was= enacted in 1998, as evidence that a co-ordinated style of government optim= ises the state=92s ability to deliver policies that counter social exclusio= n and inequality. Although originated by the Ministry for Employment and S= ocial affairs, this policy combines the efforts of several ministries. The= Exchequer distributes funds; the Transport Ministry is mobilised to provid= e cheaper transport for the unemployed; the Secretary of State for Housing = is tasked with refurbishing unoccupied premises and with negotiating cheape= r housing, plus hospitalisation and health care for the very poor; and the = Secretary of State for Professional Education is involved with opening up n= ew opportunities and trades for the unemployed. This co-ordination also ex= tends to various professional bodies, trade unions, medical boards, employm= ent bureaux, non-governmental associations, and so forth. The intention is= that by fostering a sense of common purpose, all layers of government are = injected with a greater degree of energy and motivation.

New Labour=92s Social Exclusion Unit is a comparable attempt to ensu= re that the government formulates co-ordinated responses to inequality and = exclusion. This is a single unit which draws from different ministries and= also from outside experts. This kind of =91joined-up government=92 is unu= sual in British politics, since it goes against the grain of the traditiona= l=20

[page-number of print ed.: 1= 3 ]

Whitehall system which has tended to be rigidly departmental. On t= his evidence, it would seem that the concept of co-ordinated, 'joined-up go= vernment' is a feature of both the French and British governments' efforts = to tackle exclusion and inequality. This correctly implies that social dem= ocratic governments must consider not just which policies are transplantabl= e best practices; they must also consider which styles of government= can be learnt from.


Democracy, Identity and Citizenship

A key issue for all of today=92s social democratic governments is th= e changing nature of citizenship and identity. Rapid advances in communica= tions and information technology =96 in particular the rise of the Interne= t =96 will profoundly affect the ways citizens view themselves and their go= vernments in the 21st century. Globalisation does more than pos= e a set of challenges for social democrats=92 traditional economic policies= ; social, political and cultural activities will increasingly be extended b= eyond the boundaries of nation states and technological advances will mean = faster transfers of people, ideas, goods and information. Some observers b= elieve that people will become more individual and more critical of governm= ents, since instant access to vast reserves of information from across the = globe is likely to encourage people to question accepted norms and received= modes of behaviour. In the face of such major social, technological, cult= ural and economic change, social democratic governments have a pressing nee= d to formulate compelling visions of democracy, identity and citizenship fo= r the 21st century.=20

1. The renewal of democracy

Some commentators argue that a key task of social democratic governm= ents must be to modernise, or renew, democracy for the 21st cent= ury. The dismally low turn out to several recent European elections indica= tes that many citizens are highly sceptical about the relevance and/or valu= e of contemporary politics and politicians. It has accordingly been argued= that political and governmental structures must be redesigned and reinvigo= rated, so as to encourage people to engage once more with the democratic pr= ocess. Such a process of renewal must take place at both the national and,= increasingly, the supranational level.

National governance

Europe=92s social democratic governments preside over markedly diffe= rent types of nation states. For instance, Britain and France are still ve= ry centralised, whereas Germany is a highly decentralised, federal country.= However, some observers believe that decentralisation should be a vital f= eature of all modern European democracies. They argue that by providing la= yers of government that are both visible and democratically accountable at = a local level, political decentralisation can reconnect people with the pol= itical process. Decentralisation is=20

[page-number of print ed.: 1= 4 ]

accordingly held by some observers to be a crucial way of renewing d= emocracy. This subsection looks at certain devolutionary steps that have b= een taken in France and Britain, and it asks whether these measures are cap= able of reinvigorating democracy and of binding the citizen back to the sta= te.=20

In Britain, New Labour presents itself as carrying out a project of = sweeping modernisation, a crucial aspect of which is to renew democracy. H= owever, not all commentators are convinced that the desire to modernise and= democratise permeates every layer of the Blair project. Such observers ha= ve argued that New Labour embodies a contradiction between devolution and c= entralisation. On the one hand, New Labour has brought in a set of measure= s to decentralise political power and to overhaul the British constitutiona= l order. On the other hand, New Labour is criticised for =91control-freake= ry=92, for seeking to stifle internal rank and file Labour Party debate, an= d for seeking to concentrate power in =91Number 10 Downing Street=92 and at= the Labour Party=92s Millbank headquarters. With regards to decentralisat= ion, New Labour has established a Scottish parliament based on a popular re= ferendum; it has set up an elected assembly in Wales and, more recently, in= Northern Ireland as well, and it has legislated for a London mayor. This = list represents profound change and seems to suggest that, just as Thatcher= ism replaced restrictive economic practices with an open economy, so New La= bour intends to replace an over-centralised state with a decentralised, mor= e democratic one. =20

Or does it? Some critics assert that New Labour has not brought abo= ut a deep modernisation of the British polity and that, on the contrary, in= many areas attempts have been made to diminish the spirit of decentralisat= ion and to regain central control. A current example cited by critics of N= ew Labour is the turmoil over the nomination of Labour=92s candidate for th= e London mayor. As with the election of Labour=92s leader in the Welsh Ass= embly (Alun Michael), the accusation is that =91Number 10's' preferred cand= idate is being foisted upon reluctant party members by means of a biased el= ectoral college system. Critics of the government are therefore able to as= sert that even, or perhaps especially, New Labour=92s decentralising measur= es are tarnished by its desire to concentrate power in the centre and to st= amp out nuisances (i.e. those who might challenge the party line). The cha= rge is that decentralisation New Labour style enables the voter to choose w= homsoever s/he wants, so long as it is Tony Blair=92s preferred candidate. = =20

Some critics argue that this tendency to centralise political power = is a feature of New Labour=92s preferred mode of governance: corporate popu= lism. This term is intended to reflect the notion that New Labour's model = of agency is the modern corporation: integrated, efficient, high-tech, and = rich. Its policies, or products, are marketed to appeal to everyone and th= ey are portrayed as non-ideological, technocratic solutions to the problems= of the =91ordinary man=92. The positive outcome of this approach is held = to be a highly efficient, result-orientated government. On the negative si= de, some commentators assert that this approach stifles debate and leads to= a form of over-centralised control politics. These observers allege that = corporate populism is anti-political, even anti-democratic, insofar as it s= eeks to suggest that in a given area there is one, and only one, technocrat= ic solution to everyone=92s problems.=20

[page-number of print ed.: 1= 5 ]

Such observers argue that corporate populism=92s anti-democratic te= ndencies make it a style of government wholly inappropriate to the task of = renewing British democracy. Furthermore, it has been suggested that New La= bour=92s uncomfortable combination of devolution and centralisation could b= e its electoral undoing. It is argued that the government risks alienating= its own grass roots activists as well as the wider electorate, which may c= ome to view New Labour as a paranoid government that is unwilling to allow = genuine debate and which desperately tries to rein back a devolution of its= own making.

The French state is also highly centralised. Indeed, France has a v= ery long history of centralised government stretching back to the Jacobins = and, earlier still, to Colbertisme. However, the nature of the relationshi= p between French citizens and the state has changed considerably in the 18 = years since Mitterand=92s first left-wing government implemented a set of d= ecentralisation laws, known as the Lois Defferre. These transferred powers= to local authorities, regional and departmental assemblies, municipal coun= cils, and to mayors. It has been argued from the French centre-left that t= hese devolved arrangements balance =96 in an albeit complicated manner =96 = the vertical, pyramidal functioning of centralised state power with a horiz= ontally expanding network of local power. People can now see and experienc= e things being done on a day to day basis by men and women they know, and w= ho embody the authority and decisions of the state. These arrangements are= held to be a way of renewing democracy and citizenship through fostering a= n inclusive sense of common social identity.=20

Some French observers also claim that this kind of political decentr= alisation has proved a valuable weapon in the fight against inequality and = exclusion. Such commentators support this assertion through reference to t= he current government=92s 'emplois jeunes' programme. This scheme i= s designed to create jobs for the young on the basis of five-year contracts= , and it seeks to co-ordinate the various levels at which the French state = operates. Those ministries deemed to be in closest proximity to citizens= =92 everyday life =96 education, sport, culture and social security =96 are= mobilised in the effort to create socially useful jobs. At the same time,= town councils are asked to work in conjunction with local representatives = of the state administration (prefects), MPs, and non-governmental or= ganisations, with a common objective of creating new jobs that target local= needs and problems. This nationwide, decentralised, brainstorming session= has succeeded in thinking up new types of jobs =96 such as placing young p= eople on buses to act as mediators between the drivers and unruly children.= =20

However, some observers are sceptical about the true extent of Frenc= h decentralisation. Such commentators point to the fact that in France the= local arms of government are very far from autonomous. They also note the= leading role played by the government in the introduction of the 35-hour w= eek. This is deemed to show that in France the impulse of the strong centr= al state persists. In support of this analysis, it should be noted that in= the =91emplois jeunes=92 project the central government is omnipres= ent in the decentralisation itself, for it plays a pivotal co-ordinating ro= le and, moreover, because local authorities' budgets are largely comprised = of state transfers. It would seem that in France one does not witness a=20

[page-number of print ed.: 1= 6 ]

deep political decentralisation but that, rather, schemes like the =91emplois jeunes=92 and the 35-hour week display a new, creative use= of central control. =20

This discussion implies that, with regard to the renewal of democrac= y, it may not be possible to prescribe a single =91solution=92 to be shared= by all European countries. For instance, in Germany a highly decentralise= d federal structure may be deemed an appropriate barrier against authoritar= ian government and a means to preserve local identities. However, one migh= t argue that in France =91creative central control=92 is the best way to re= invigorate democracy and build a sense of shared civic identity. Whether o= r not devolution will succeed in reinvigorating the British polity remains = to be seen. Indeed, the jury is still out on whether or not New Labour wil= l allow devolution the free rein it needs in order to stand a fair chance o= f succeeding. It would seem that different policies regarding democracy, c= itizenship and identity will succeed in different countries. One must bewa= re attempting to impose unitary answers that fail to allow for the particul= arities of different nations=92 historical and political contexts.=20

Global governance

An important feature of globalisation is that the nation state=92s c= laim to be the principal unit of political and economic power is increasing= ly under threat. Issues related to democracy and citizenship are therefore= of crucial relevance to current debates concerning the nature of global go= vernance. If we are all now citizens of a global village, it would seem re= asonable to desire supranational institutions that are democratically accou= ntable. The recent mass protests against the World Trade Organisation in S= eattle suggest a significant degree of popular alienation from certain of o= ur existing international institutions. Indeed, whether or not in favour o= f Seattle-style direct action, many on the left are now concerned that in t= he modern world economic power is all too frequently able to elude democrat= ic control. Whereas in the past capitalism was enmeshed with nation state = systems, we now witness a stateless form of global capitalism. =20

Social democracy's traditional reflex would be to desire a system of= governance with which to re-impose a sense of order. However, differences= of opinion exist among today=92s European social democratic leaders regard= ing just how governable globalisation is. For instance, some commentators = argue that there is a divide between the Third Way=92s response to globalis= ation and that which is offered by the French PS. Although voices from wit= hin New Labour have called for the reform of such bodies as the WTO and IMF= , some observers believe that New Labour=92s approach to globalisation is a= n essentially defensive one. Such observers argue that New Labour prioriti= ses reactive policies, such as the need for countries to deregulate, rather= than active ones, such as the need to build a form of global governance ca= pable of imposing a true degree of equitable order upon the global free mar= ket. Some would argue that the French PS favours a more active approach, w= ith emphasis upon the potential to regulate or humanise globalisation. Jos= pin has indeed declared that globalisation is not a fate to be passively ac= cepted: =91It has been created by humankind=92, he says =96 the implication= =20

[page-number of print ed.: 1= 7 ]

being that globalisation can be regulated by humankind as well. Acc= ordingly, Jospin has argued that international financial movements, togethe= r with the Internet, should be regulated in order to mould globalisation in= to a shape beneficial to society. This is more interventionist language th= an that which is used by New Labour in Britain. Once again, it would appea= r that although Europe=92s social democrats are agreed on the questions =96= in this case the need to reform international institutions and to develop = compelling responses to globalisation =96 as yet they are divided over whic= h are the best answers.=20

2. Rights and Responsibilities

This autumn, Tony Blair talked of the need for today=92s social demo= crats to forge 'a modern, responsible notion of citizenship'. The Blair-Sc= hroeder manifesto seeks to elucidate what such a modern, responsible citize= nship would entail. It states that in the past =91the balance between the = individual and the collective was distorted=92. Yesterday=92s social democ= rats are described as having placed too great an emphasis on =91universal s= afeguards=92 at the expense of promoting =91entrepreneurial spirit=92 and i= ndividual excellence. Furthermore, =91too often rights were elevated above= responsibilities=92. Behind these claims lies the Third Way notion that m= ajor social, technological and economic changes have led to much greater de= mands for individual autonomy and diversity. Accordingly, in Britain one w= itnesses the Third Way argument that far greater emphasis must be placed on= individuals=92 responsibilities. They are still to be entitled to certain= state-guaranteed rights =96 the citizen is not to be entirely abandoned to= the cut-throat individualism of a deregulated market =96 but in this moder= n world they will increasingly be expected to =91stand on their own two fee= t=92. =20

A similar vision of modern citizenship and responsibility would appe= ar to characterise the thinking of some within the German SPD. Certain voi= ces from within the German government have argued that as a result of risin= g education standards, growing individualism, and a critical mass media, me= mbers of civil society are now more responsible for themselves than they we= re in the past. It is argued that, just as these societal changes require = governments to reconsider the roles to be played by the state, so they dema= nd a corresponding re-appraisal of citizenship, with greater weight now to = be placed upon the individual=92s responsibilities.=20

The Third Way=92s =91modernised=92 notion of citizenship and individ= ual responsibility connects with a number of economic policies. These incl= ude those that increase supply-side flexibility, and Welfare-to-Work measur= es that are not designed as safety nets to catch passive individuals but ar= e intended to be springboards which require a degree of dynamism from those= people hoping to benefit from them. The common strand that binds all such= measures together is the objective of producing (or enabling the emergence= of) individuals who are more energetic, self-sufficient, entrepreneurial, = and hence less burdensome on the state.

Some observers characterise this Blair-Schroeder manifesto notion of= modern citizenship as an 'enlargement of individual responsibility'. The = individual is called upon to take more=20

[page-number of print ed.: 1= 8 ]

control of his/her destiny and to rely less upon traditional social = democratic props such as the welfare state. This enlargement of responsibi= lity involves a shifting of perspective from the sphere of guaranteed right= s to that of duties. However, an important question mark hangs over this e= nlargement of individual responsibility, for some observers ask whether it = represents a withdrawal too far from traditional social democracy. These c= ritics feel that the Third Way=92s =91modern citizenship=92 is too much of = a concession to the demands of a globalised economy, too abject a retreat u= nder the onslaught of neo-liberalism and, hence, the abandonment of the ind= ividual. By contrast, Third Way adherents depict this enlargement o= f individual responsibility not as a withdrawal, but as a necessary aspect = of social democracy's renewal. Debate among Europe=92s social democrats mu= st therefore assess whether or not the Third Way has correctly grasped the = nature of the modern world and, by extension, whether the Third Way is capa= ble of substantiating its claims to empower, rather than abandon, individua= l citizens.=20


Conclusion

This paper confirms that the left everywhere must react to deepseate= d social and economic transformations. The discussions above suggest some = significant commonalities in Europe=92s social democratic responses. Socia= l democrats across the continent are united in the search for a series of = =91both/and solutions'. For instance, a common desire has emerged to promo= te both flexibility and cohesion; most social democrats now seek both econo= mic dynamism and social justice, just as many policy makers appear to want = to retain both traditional social democratic goals and employ market-driven= methods to achieve them. However, significant differences persist over ho= w to pursue these dual objectives. Each country's experience of the profou= ndly changed and rapidly changing modern world remains intensely different.= It is not surprising, therefore, that the sections above reveal continued= divergence between social democrats over how best to approach globalisatio= n and the transition to post-industrial societies. =20

Furthermore, since September 1999 (when the conference upon which th= is paper is based was held) a further line of difference between today=92s = social democratic governments has emerged. In September it appeared to som= e that Blair and Schroeder shared a common enthusiasm for deregulation, low= taxes and a minimalist state. However, Schroeder is now showing signs of = moving away from Blair and closer to Jospin. Schroeder=92s disastrous show= ing in a series of provincial elections seems to have persuaded the German = Chancellor that the Third Way is by no means the only way and, moreover, th= at it might well be one leading him to political catastrophe. His decision= to rescue Philipp Holzmann, the building group, with public money, and his= opposition to Vodaphone=92s hostile bid for Mannesmann imply that Schroede= r is prepared to veer away from the Third Way and back to a more traditiona= l form of social democracy. It therefore seems that talk of the Third Way/= Neue Mitte as the new mainstream of European social democracy is ext= remely premature. Indeed,=20

[page-number of print ed.: 1= 9 ]

on this recent evidence, it might be argued that a future centre-lef= t consensus is more likely to resemble Jospin=92s brand of relatively inter= ventionist social democracy. =20

However, the above discussions suggest that the notion of any single= template =96 be it Third Way or Jospinite =96 for a 21st centu= ry European social democracy remains very problematic. No one has generate= d a response that can lay claim to being the single, right answer. Indeed,= this paper suggests that it is highly unlikely that such a single pan-Euro= pean social democratic =91answer=92 can exist: national contexts and tradit= ions diverge to too great an extent. =20

This in no way implies that Europe=92s social democrats should stop = talking to each other; although entire models may not be exportable, aspe= cts of given models can be borrowed and adapted to fit different national c= ontexts. Furthermore, even where national governments end by agreeing to d= isagree, their differing policies will gain greater rigour and strength thr= ough having been formed in the crucible of pan-European debate. Europe's s= ocial democrats must continue to develop dialogic networks that enable them= to determine what can be learnt from each other, and =96 with regard to t= he EU =96 where policy co-operation might be fruitful in the 21st century. The challenges of the modern world are now known. The question= s have been posed; social democratic answers must now be formulated with gr= eater clarity.=20

At the time of writing, Greg Chambers was based at the European I= nstitute Policy Unit of the London School of Economics. The author i= s grateful to Dr Kirsty Hughes, former Head of the European Institut= e Policy Unit, for her advice in preparing this paper.

This paper is based on the seminar 'European Social Democracy in = the 21st Century', jointly organised by the= Friedrich-Ebert-Stiftung London and the European Institute Policy Unit of = the London School of Economics, and held in London on 9/10 September= 1999.

The views and opinions expressed in publications of the Friedrich= -Ebert-Stiftung London Office do not necessarily represent the views= of the Foundation.

=A9 Friedrich Ebert Stiftung | te= chnical support | net edition=20 fes-library | Juli 2000
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