Left Out in Europe
Robert Kuttner
The European left, such as it is, got clobbered in the recent
elections for the European parliament. In the next parliament,
center-right parties will have almost twice as many seats as social
democrats. Of left parties, only the Greens gained slightly. Far-right
nationalistic parties picked up strength.
US President Obama with French President Sarcozy |
This should hardly come as a surprise. Over the past generation,
especially in places like Britain, Germany, and the Netherlands,
Europe’s center-left has worked hard to neuter itself as an opposition
force, rivaling free market parties in an embrace of high finance and
heedless globalization.
In the late 1990s and early in the present century, Gerhardt
Schroeder of the Social Democrats, then the German Chancellor, was a
leading sponsor of financial market liberalization. He also went to
great lengths to weaken labor protections.
His British counterpart, Britain’s Tony Blair, went Schroeder one
better in putting all of his economic eggs in the basket of Britain’s
financial elite. Blair intensified the financial policies of Tory
Margaret Thatcher. As in the US, the seeds of the current financial
collapse were sown under nominally left-of-center governments.
The Italian left has vanished almost entirely. In France, factional
and personal disputes have prevented the Socialist Party from offering a
coherent alternative to President Nicolas Sarkozy, who offers a
characteristically French, paradoxical combination of nationalism and
social protection.
For a generation, the European center-left has embraced essentially
the same version of global laissez-faire and liberated finance as the
center-right parties, tempered by only a marginally better version of
the welfare state.
The common formula is: liberalized capital markets; freer global
trade; reduced protections for workers; flatter taxes. The very phrase,
“center-left” is an emblem of the capitulation to global finance. Thus,
leading moderately left parties have scant alternatives to offer voters
at a time when free market capitalism has thoroughly disgraced itself.
Alienated voters either stay home or vote for the far right. It’s an
old story—and given what we know of twentieth century European history,
a terrifying one.
The ideological lines are further blurred because the center-right
also defends the welfare state. But everywhere, the cost of paying for
the failures of capitalism is rising, leaving all of the mainstream
parties with a fiscal crisis. Because of these costs, the welfare state
in much of Europe has become a defensive fortress—a society of insiders
and outsiders.
The insiders are civil servants and a dwindling number of workers
with secure jobs. The outsiders are increasing numbers young people,
women, and immigrants, who cannot find good jobs and do not enjoy the
full social protections. This bargain is not stable, either economically
or politically.
The short term winners are the center-right parties, which form the
governing party in most of the nations of the European Union. But they
hardly offer the voters much either. The leader of the British
opposition, Tory David Cameron, hasn’t a clue how to help Britain
recover from economic collapse.
But he is likely to win the next election. The ruling coalitions in
France, Germany, and Italy are not delivering economic recovery. But
absent a believable left, they will continue to govern.
The EU, once a possible instrument of social democracy on one
continent, itself has become something of a Trojan Horse. Its basic
document, the Maastricht Treaty, makes free movement of capital, goods,
services, and persons a core constitutional doctrine. Social protections
are secondary.
Thus, the European Court of Justice has recently issued rulings
defending the rights of nations such as Poland, Estonia and Latvia, with
lower social protections, to impose their standards on the core nations
of the EU. German contractors can end-run Germany’s good labor standards
by hiring Polish sub-contractors.
Construction and transport firms from the Baltics can undermine
Sweden’s system of collective bargaining. Hedge funds based in London
can buy Scandinavian firms and erode the local social compact. This has
become Europe’s version of a race to the bottom.
The politics of the EU compound the constitutional problem. The
Commission of the EU, based in Brussels, could adopt stronger social
defenses if it so chose. But center-right parties currently have a
strong majority of governments of Europe’s 27 member states. So policies
to constrain the regime of global finance cannot win support.
The British Labour government, nominally part of the center-left,
invariably votes newer member states that have center-right governments,
against anything that could be considered a restraint on free capital
movements.
The exceptions to this sorry picture are the Social Democratic
parties of Scandinavia and to some extent of Spain. The Nordic Social
Democrats have insisted on a social model that spends enough money to
provide security combined with flexibility. Denmark supports liberal
trade, but there are powerful quid pro quos.
When a Danish worker changes jobs, it is usually to move to a better
job, with the mobility subsidized by the state. There are hardly any
low-wage workers in Denmark, and no welfare state of insiders and
outsiders, except for some immigrant groups. And Denmark did not suffer
a financial collapse because it did not abandon bank regulation.
There are currently conservative governments in Stockholm and
Copenhagen, but they don’t dare tamper with the basic formula. The
former Danish Social Democratic Prime Minister, Poul Nyrup Rasmussen, is
currently Europe’s leading advocate of much tougher regulation of
financial capital.
Rasmussen might have been the next president of the Commission of the
EU, had the left not been trounced. And so the vicious circle continues.
The left offers little to voters, and the right keeps being elected.
This is surely a moment for a compelling program to constrain capital
in the broad public interest. Capitalism has demonstrated once again why
it is not capable of being self-regulating. American progressives used
to look longingly to Europe, with its stronger trade unions and its more
comprehensive social protections. Those are still there, but unraveling
under assault. What’s missing on most of the continent is political
leadership, vision, and nerve.
Robert Kuttner is co-editor of The American Prospect www.prospect.org,
a Senior Fellow at Demos, www.demos.org, and author of “Obama’s
Challenge” www.obamaschallenge.com .
(The Huffington Post)
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