What’s Right with What’s Left?
European social democracy is in crisis. Rather than being the prime challenger of the neoliberal consensus, social democratic parties are struggling with their Third Way legacy. Increasingly alienated from its traditional social base having given in to the neoliberal status quo, social democracy is in danger of becoming an anachronism.
Colin Hay distinguishes between two phases of neoliberalism, ‘normative neoliberalism’ and ‘normalized neoliberalism’ (2007, 98) In the first phase, in the late 1970s and 1980s, neoliberalism was advocated by politicians like Margaret Thatcher and Ronald Reagan to be the answer to the inefficient economic management of the Keynesian model that marked the post-war period. The second phase of ‘normalized neoliberalism’ signifies its triumph as it was able to solidify its school of thought into a widespread consensus. A particular strength of neoliberalism is that it successfully advocated its inevitability and its necessitarian character.
It is exactly this kind of reasoning that was employed to incorporate neoliberal economics into social democracy under the banner of ‘the Third Way’. Theorized by Anthony Giddens (1998) and put into practice principally by Tony Blair and Gerhard Schröder, the Third Way recognized the potency of a neoliberal economic strategy in combination with a (slimmed-down) social agenda. Adopting the third way strategy, social-democratic parties for the first time became genuine ‘catch-all parties’ (cf. Kircheimer 1966). As a result, ideological differences between major political parties became negligible. It is no surprise then that the wave of privatization and deregulation across Europe from the mid 1990s onwards was to a great extent set in motion by the social democrats.
Yet, their role in ‘normalizing’ neoliberalism has undermined the ability of social democrats today to effectively challenge the neoliberal status quo. What seemed like a durable strategy in the 1990s and early 2000s has proven to be ideological suicide. Indeed, by jumping on the neoliberal bandwagon the party has ostensibly undermined its own ideals.
Forever stuck in the middle?
So is it too late for social democracy? Has it given way for once and for all to technocratic, neoliberal policy-making to which there no longer is an alternative? Hay has openly questioned such politics of inevitability. He says: “We cannot afford to supply politicians too readily with the convenient alibi (…) that in an era of globalization their hands are so tied by processes beyond their control that is naive of us to project our political frustrations on to them” (2007, 123). However, as long as this ‘myth’ continues to be believed or called upon by political actors it will be a significant depoliticizing factor. Indeed, the only truly paralyzing factor for parties on the Left is this kind of deeply entrenched pessimism about the potential policy space.
So the task for social democratic parties is to realize the potential of viable alternatives. It must not be forgotten, after all, that European integration and the creation of IGO’s are predominantly the products of executives rooted in political parties. Indeed, international institutional constellations with inherent neoliberal characteristics are stable, yet they can be subject to change. Precisely in the same way neoliberalism provided an answer to unsustainable Keynesianism, a revived social democratic alternative can provide an answer to the economic crisis caused by the fundamentalist belief in the virtue of the markets. In this sense there is new room for social democratic parties to be progressive on the economic dimension. To do this however, social democrats must show the willingness to break with their own Third Way-past. Such a process of re-positioning and self-reflection is costly, for sure. Yet, in order to viable in the long run social democrats should take the short-term pain.
Clearly, such an approach may very well signal the end of social democrats as a ‘catch-all parties’. However, this can only be beneficial in the current volatile political climate. As the centre-right parties all across Europe are steering towards the right, the social democrats have the option to reassert its identity as the centre right’s adversary.