ALFRED PFALLER Social Democracy in the Globalized Post-industrial Society D emocratic government, rule of the law, obser­vation of basic human and civil rights, indivi­dual freedom from unwarranted impositions by others(including the community), increasing(and sustainable) material prosperity and an adequate participation of all citizens in that prosperity can be considered to be central goals of the affluent welfare states in Europe, the Pacific Basin and North America. The goal that every citizen shall participate to an adequate extent in the prosperity of the nation is the one that is most distinctly »social democratic« even though it is by no means specific to social democratic or socialist parties. It has in the past been shared and promoted by poli­tical forces that would not consider themselves as social democratic. The slogan»prosperity for all«, which sums up very well what a»social« democracy(taken here as a generic term, not a label of a particular political group) is about, has been coined by German Christian Demo­crats. Other terms which refer to the essence of a »social democracy« are»social market economy«, »social citizen rights«,»inclusive society« or»just society«. This paper tries to outline the policies which can ensure»prosperity for all« in advanced capi­talist countries in the foreseeable future. It iden­tifies several crucial challenges that put this central social democratic value at jeopardy and discusses policy options for coping with them. Altogether, it presents a case of comprehensive optimism with regard to the economic feasibility of the agenda made up by these options. The author is less opti­mistic about the chances of constructive turns in the ideology-driven public debate and of problem­adequate policy re-designs in real-life politics, but also about the political support a truly social democratic agenda can still muster. Fundamental challenges At the turn of the millennium, the achievement of »prosperity for all« faces a number of serious chal­lenges, which require major institutional adjust­ments. These challenges are: ̈ increased exposure of national economies to international competition; ̈ relative abundance of labor and a corresponding scarcity of stable well-paid jobs; ̈ the»aging-society« syndrome; ̈ greater volatility of work-life. To these challenges another, far less comprehen­sive one could be added: the rising costs of health care and the ensuing threat to its general availa­bility. The paper will not address this problem. However it recognizes that it could – depending on a country’s particular health care system and the particular political dynamics of the adjustment process – turn into a major issue with regard to the maintenance of a»social democratic« society. Neither will the paper explore challenges that in certain respects are crucial to modern society but are not directly related to the maintenance of»prosperity for all«. These additional challenges include ̈ the»globalization« of a whole range of social relations beyond production and markets(rela­ting to culture, values which orient the con­duct of life, global commons, migration, crime, hazards of all kinds) ̈ the persistent and partially widening North­South prosperity gap ̈ the erosion of the socially cohesive traditional values inherited from pre-modern times ̈ the growing manipulative power of man with regard to its own natural fundaments(environ­ment, genetics, artificial intelligence). As mentioned, the paper’s basic concern is with the threat that the four challenges listed above pose to the achievement of»prosperity for all«. Yet 160 Alfred Pfaller, Social Democracy in the Globalized Post-industrial Society IPG 2/2000