Globalization and the Limits of Democratic Choice Social Democracy and the Rise of Political Cartelization MARK BLYTH M uch contemporary analysis of the limits of social democracy in Europe focuses upon the role of external factors(Cerny 1995, Moses 1997). In particular, the idea that globalization has»changed everything« has gained a great deal of currency. Specifically, it is held by both academics and pol­iticians that external global constraints, capital account openness, in­creased trade dependence etc., have narrowed policy options for social democratic governments to such an extent that left parties are no longer able to govern as left parties(Scharpf 1991, Blair and Schroeder 1998). In­stead, a new supply-side social democracy based around skill formation is seen as the only way forward for progressive politics(Giddens 1998). Another development of note in contemporary Europe is the rise of neo-populist movements and right-wing fringe parties, some of which have either gained power or have come close to doing so. Le Pen’s per­formance in the last French presidential elections, the emergence and consolidation of Haider’s Freedom party in Austria; and the explosion and subsequent implosion of the Fortuyn list in Holland are but the most obvious examples. Interestingly, these two seemingly discrete phenom­ena may have much in common. Those European social democratic parties that regained power in the 1990s have in many cases failed to produce traditional social democratic policies. Instead, with explicit reference to the external constraints of glo­balization, social democratic politicians have told their constituents that the policies of the past have no place in the present. Yet there is good. This »globalization« is nothing to be feared; rather, it should be embraced. As a result, welfare reforms long associated with the right are actively pro­moted by social democrats while»job-security« has given way to the »life-long learning« needed to flexibilize labor markets and compete in the global economy. Unfortunately, those most at risk in this new world of global competition and flexible labor markets are those concentrated at the lower end of the income scale; and it is precisely among this part of the voting population, among the social democratic core, that we see 60 Blyth, Globalization and the Limits of Democratic Choice ipg 3/2003