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What Is Living and What Is Dead in Social Democracy?

This process was well described by one of its greatest modern practitioners: Margaret Thatcher reportedly asserted that “there is no such thing as society. There are only individual men and women and families.” But if there is no such thing as society, merely individuals and the “night watchman” state—overseeing from afar activities in which it plays no part—then what will bind us together? We already accept the existence of private police forces, private mail services, private agencies provisioning the state in war, and much else besides. We have “privatized” precisely those responsibilities that the modern state laboriously took upon itself in the course of the nineteenth and early twentieth centuries.

What, then, will serve as a buffer between citizens and the state? Surely not “society,” hard pressed to survive the evisceration of the public domain. For the state is not about to wither away. Even if we strip it of all its service attributes, it will still be with us—if only as a force for control and repression. Between state and individuals there would then be no intermediate institutions or allegiances: nothing would remain of the spider’s web of reciprocal services and obligations that bind citizens to one another via the public space they collectively occupy. All that would be left is private persons and corporations seeking competitively to hijack the state for their own advantage.

The consequences are no more attractive today than they were before the modern state arose. Indeed, the impetus to state-building as we have known it derived quite explicitly from the understanding that no collection of individuals can survive long without shared purposes and common institutions. The very notion that private advantage could be multiplied to public benefit was already palpably absurd to the liberal critics of nascent industrial capitalism. In the words of John Stuart Mill, “the idea is essentially repulsive of a society only held together by the relations and feelings arising out of pecuniary interests.”

What, then, is to be done? We have to begin with the state: as the incarnation of collective interests, collective purposes, and collective goods. If we cannot learn to “think the state” once again, we shall not get very far. But what precisely should the state do? Minimally, it should not duplicate unnecessarily: as Keynes wrote, “The important thing for Government is not to do things which individuals are doing already, and to do them a little better or a little worse; but to do those things which at present are not done at all.” And we know from the bitter experience of the past century that there are some things that states should most certainly not be doing.

The twentieth-century narrative of the progressive state rested precariously upon the conceit that “we”—reformers, socialists, radicals—had History on our side: that our projects, in the words of the late Bernard Williams, were “being cheered on by the universe.”3 Today, we have no such reassuring story to tell. We have just survived a century of doctrines purporting with alarming confidence to say what the state should do and to remind individuals—forcibly if necessary—that the state knows what is good for them. We cannot return to all that. So if we are to “think the state” once more, we had better begin with a sense of its limits.

For similar reasons, it would be futile to resurrect the rhetoric of early-twentieth-century social democracy. In those years, the democratic left emerged as an alternative to the more uncompromising varieties of Marxist revolutionary socialism and—in later years—to their Communist successor. Inherent in social democracy there was thus a curious schizophrenia. While marching confidently forward into a better future, it was constantly glancing nervously over its left shoulder. We, it seems to say, are not authoritarian. We are for freedom, not repression. We are democrats who also believe in social justice, regulated markets, and so forth.

So long as the primary objective of social democrats was to convince voters that they were a respectable radical choice within the liberal polity, this defensive stance made sense. But today such rhetoric is incoherent. It is not by chance that a Christian Democrat like Angela Merkel can win an election in Germany against her Social Democratic opponents—even at the height of a financial crisis—with a set of policies that in all its important essentials resembles their own program.

Social democracy, in one form or another, is the prose of contemporary European politics. There are very few European politicians, and certainly fewer still in positions of influence, who would dissent from core social democratic assumptions about the duties of the state, however much they might differ as to their scope. Consequently, social democrats in today’s Europe have nothing distinctive to offer: in France, for example, even their unreflective disposition to favor state ownership hardly distinguishes them from the Colbertian instincts of the Gaullist right. Social democracy needs to rethink its purposes.

The problem lies not in social democratic policies, but in the language in which they are couched. Since the authoritarian challenge from the left has lapsed, the emphasis upon “democracy” is largely redundant. We are all democrats today. But “social” still means something—arguably more now than some decades back when a role for the public sector was uncontentiously conceded by all sides. What, then, is distinctive about the “social” in the social democratic approach to politics?

Imagine, if you will, a railway station. A real railway station, not New York’s Pennsylvania Station: a failed 1960s-era shopping mall stacked above a coal cellar. I mean something like Waterloo Station in London, the Gare de l’Est in Paris, Mumbai’s dramatic Victoria Terminus, or Berlin’s magnificent new Hauptbahnhof. In these remarkable cathedrals of modern life, the private sector functions perfectly well in its place: there is no reason, after all, why newsstands or coffee bars should be run by the state. Anyone who can recall the desiccated, plastic-wrapped sandwiches of British Railway’s cafés will concede that competition in this arena is to be encouraged.

But you cannot run trains competitively. Railways—like agriculture or the mails—are at one and the same time an economic activity and an essential public good. Moreover, you cannot render a railway system more efficient by placing two trains on a track and waiting to see which performs better: railways are a natural monopoly. Implausibly, the English have actually instituted such competition among bus services. But the paradox of public transport, of course, is that the better it does its job, the less “efficient” it may be.

A bus that provides an express service for those who can afford it and avoids remote villages where it would be boarded only by the occasional pensioner will make more money for its owner. But someone—the state or the local municipality—must still provide the unprofitable, inefficient local service. In its absence, the short-term economic benefits of cutting the provision will be offset by long-term damage to the community at large. Predictably, therefore, the consequences of “competitive” buses—except in London where there is enough demand to go around—have been an increase in costs assigned to the public sector; a sharp rise in fares to the level that the market can bear; and attractive profits for the express bus companies.

Trains, like buses, are above all a social service. Anyone could run a profitable rail line if all they had to do was shunt expresses back and forth from London to Edinburgh, Paris to Marseilles, Boston to Washington. But what of rail links to and from places where people take the train only occasionally? No single person is going to set aside sufficient funds to pay the economic cost of supporting such a service for the infrequent occasions when he uses it. Only the collectivity—the state, the government, the local authorities—can do this. The subsidy required will always appear inefficient in the eyes of a certain sort of economist: Surely it would be cheaper to rip up the tracks and let everyone use their car?

In 1996, the last year before Britain’s railways were privatized, British Rail boasted the lowest public subsidy for a railway in Europe. In that year the French were planning for their railways an investment rate of £21 per head of population; the Italians £33; the British just £9.4 These contrasts were accurately reflected in the quality of the service provided by the respective national systems. They also explain why the British rail network could be privatized only at great loss, so inadequate was its infrastructure.

But the investment contrast illustrates my point. The French and the Italians have long treated their railways as a social provision. Running a train to a remote region, however cost-ineffective, sustains local communities. It reduces environmental damage by providing an alternative to road transport. The railway station and the service it provides are thus a symptom and symbol of society as a shared aspiration.

I suggested above that the provision of train service to remote districts makes social sense even if it is economically “inefficient.” But this, of course, begs an important question. Social democrats will not get very far by proposing laudable social objectives that they themselves concede to cost more than the alternatives. We would end up acknowledging the virtues of social services, decrying their expense…and doing nothing. We need to rethink the devices we employ to assess all costs: social and economic alike.

Let me offer an example. It is cheaper to provide benevolent handouts to the poor than to guarantee them a full range of social services as of right. By “benevolent” I mean faith-based charity, private or independent initiative, income-dependent assistance in the form of food stamps, housing grants, clothing subsidies, and so on. But it is notoriously humiliating to be on the receiving end of that kind of assistance. The “means test” applied by the British authorities to victims of the 1930s depression is still recalled with distaste and even anger by an older generation.5

Conversely, it is not humiliating to be on the receiving end of a right. If you are entitled to unemployment payments, pension, disability, municipal housing, or any other publicly furnished assistance as of right—without anyone investigating to determine whether you have sunk low enough to “deserve” help—then you will not be embarrassed to accept it. However, such universal rights and entitlements are expensive.

But what if we treated humiliation itself as a cost, a charge to society? What if we decided to “quantify” the harm done when people are shamed by their fellow citizens before receiving the mere necessities of life? In other words, what if we factored into our estimates of productivity, efficiency, or well-being the difference between a humiliating handout and a benefit as of right? We might conclude that the provision of universal social services, public health insurance, or subsidized public transportation was actually a cost-effective way to achieve our common objectives. Such an exercise is inherently contentious: How do we quantify “humiliation”? What is the measurable cost of depriving isolated citizens of access to metropolitan resources? How much are we willing to pay for a good society? Unclear. But unless we ask such questions, how can we hope to devise answers?6

What do we mean when we speak of a “good society”? From a normative perspective we might begin with a moral “narrative” in which to situate our collective choices. Such a narrative would then substitute for the narrowly economic terms that constrain our present conversations. But defining our general purposes in that way is no simple matter.

In the past, social democracy unquestionably concerned itself with issues of right and wrong: all the more so because it inherited a pre-Marxist ethical vocabulary infused with Christian distaste for extremes of wealth and the worship of materialism. But such considerations were frequently trumped by ideological interrogations. Was capitalism doomed? If so, did a given policy advance its anticipated demise or risk postponing it? If capitalism was not doomed, then policy choices would have to be conceived from a different perspective. In either case the relevant question typically addressed the prospects of “the system” rather than the inherent virtues or defects of a given initiative. Such questions no longer preoccupy us. We are thus more directly confronted with the ethical implications of our choices.

What precisely is it that we find abhorrent in financial capitalism, or “commercial society” as the eighteenth century had it? What do we find instinctively amiss in our present arrangements and what can we do about them? What do we find unfair? What is it that offends our sense of propriety when faced with unrestrained lobbying by the wealthy at the expense of everyone else? What have we lost?

The answers to such questions should take the form of a moral critique of the inadequacies of the unrestricted market or the feckless state. We need to understand why they offend our sense of justice or equity. We need, in short, to return to the kingdom of ends. Here social democracy is of limited assistance, for its own response to the dilemmas of capitalism was merely a belated expression of Enlightenment moral discourse applied to “the social question.” Our problems are rather different.

We are entering, I believe, a new age of insecurity. The last such era, memorably analyzed by Keynes in The Economic Consequences of the Peace (1919), followed decades of prosperity and progress and a dramatic increase in the internationalization of life: “globalization” in all but name. As Keynes describes it, the commercial economy had spread around the world. Trade and communication were accelerating at an unprecedented rate. Before 1914, it was widely asserted that the logic of peaceful economic exchange would triumph over national self-interest. No one expected all this to come to an abrupt end. But it did.

We too have lived through an era of stability, certainty, and the illusion of indefinite economic improvement. But all that is now behind us. For the foreseeable future we shall be as economically insecure as we are culturally uncertain. We are assuredly less confident of our collective purposes, our environmental well-being, or our personal safety than at any time since World War II. We have no idea what sort of world our children will inherit, but we can no longer delude ourselves into supposing that it must resemble our own in reassuring ways.

We must revisit the ways in which our grandparents’ generation responded to comparable challenges and threats. Social democracy in Europe, the New Deal, and the Great Society here in the US were explicit responses to the insecurities and inequities of the age. Few in the West are old enough to know just what it means to watch our world collapse.7 We find it hard to conceive of a complete breakdown of liberal institutions, an utter disintegration of the democratic consensus. But it was just such a breakdown that elicited the Keynes–Hayek debate and from which the Keynesian consensus and the social democratic compromise were born: the consensus and the compromise in which we grew up and whose appeal has been obscured by its very success.

If social democracy has a future, it will be as a social democracy of fear.8 Rather than seeking to restore a language of optimistic progress, we should begin by reacquainting ourselves with the recent past. The first task of radical dissenters today is to remind their audience of the achievements of the twentieth century, along with the likely consequences of our heedless rush to dismantle them.

The left, to be quite blunt about it, has something to conserve. It is the right that has inherited the ambitious modernist urge to destroy and innovate in the name of a universal project. Social democrats, characteristically modest in style and ambition, need to speak more assertively of past gains. The rise of the social service state, the century-long construction of a public sector whose goods and services illustrate and promote our collective identity and common purposes, the institution of welfare as a matter of right and its provision as a social duty: these were no mean accomplishments.

That these accomplishments were no more than partial should not trouble us. If we have learned nothing else from the twentieth century, we should at least have grasped that the more perfect the answer, the more terrifying its consequences. Imperfect improvements upon unsatisfactory circumstances are the best that we can hope for, and probably all we should seek. Others have spent the last three decades methodically unraveling and destabilizing those same improvements: this should make us much angrier than we are. It ought also to worry us, if only on prudential grounds: Why have we been in such a hurry to tear down the dikes laboriously set in place by our predecessors? Are we so sure that there are no floods to come?

A social democracy of fear is something to fight for. To abandon the labors of a century is to betray those who came before us as well as generations yet to come. It would be pleasing—but misleading—to report that social democracy, or something like it, represents the future that we would paint for ourselves in an ideal world. It does not even represent the ideal past. But among the options available to us in the present, it is better than anything else to hand. In Orwell’s words, reflecting in Homage to Catalonia upon his recent experiences in revolutionary Barcelona:

There was much in it that I did not understand, in some ways I did not even like it, but I recognized it immediately as a state of affairs worth fighting for.

I believe this to be no less true of whatever we can retrieve from the twentieth-century memory of social democracy.

  1. 3

    Bernard Williams, Philosophy as a Humanistic Discipline (Princeton University Press, 2006), p. 144.

  2. 4

    For these figures see my “‘Twas a Famous Victory,” The New York Review, July 19, 2001.

  3. 5

    For comparable recollections of humiliating handouts, see The Autobiography of Malcolm X (Ballantine, 1987). I am grateful to Casey Selwyn for pointing this out to me.

  4. 6

    The international Commission on Measurement of Economic Performance and Social Progress, chaired by Joseph Stiglitz and advised by Amartya Sen, recently recommended a different approach to measuring collective well-being. But despite the admirable originality of their proposals, neither Stiglitz nor Sen went much beyond suggesting better ways to assess economic performance; non-economic concerns did not figure prominently in their report. See www.stiglitz-sen-fitoussi.fr/en/index.htm.

  5. 7

    The exception, of course, is Bosnia, whose citizens are all too well aware of just what such a collapse entails.

  6. 8

    By analogy with “The Liberalism of Fear,” Judith Shklar’s penetrating essay on political inequality and power.

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