Most political commentators concur that social democratic parties have been in decline over the past ten years or so. Is social democracy historically doomed? Is this terminal decline or simply a bit of a rough patch? We have been here before: in the 1920s, Communism was looking forward to a bright future and social democracy seemed destined for extinction. This gloomy prospect re-surfaced again in the 1940s and 1950s, when Communist parties in several European countries (notably France, Italy and Greece) took the ascendancy over weakened social democratic forces. Some spoke again of the death of social democracy in the aftermath of May ‘68. In the 1969 presidential election in France, Gaston Defferre, the socialist candidate, received a mere 5% of the votes, lagging considerably behind Jacques Duclos of the French Communist Party (21%). Each time, the most pessimistic predictions turned out to be wrong: each time social democratic parties in Europe proved to be extremely resilient and bounced back.

Given these precedents, it would seem unwise to argue yet again that the end is nigh for social democracy, however bad its current situation. This said, its electoral, ideological and programmatic prospects are today so uncertain that it looks as if social democracy is engaged in a battle for its survival.

A steady electoral decline

The electoral decline of social democracy is often overlooked. Despite a modest increase in the mid-1990s (average voting peaked at 29.7% in the EU 12, which excludes Spain, Portugal and Greece, countries that did not compete in democratic elections until the 1970s), social democracy has consistently lost votes over the past 50 years. The European average for the 1990s was below the 1980s average (31,1%), and well below the 1950s average (33,2%). Ironically, when social democracy dominated European politics in the 1990s, it was itself in retreat in electoral terms. This electoral weakness explains to some extent why the social democratic domination did not last. As for the 2000-09 period, the decline has steadily continued, with the average being 26.6%.

The beginning of the social democratic slump dates back to the 1970s and has been confirmed in the following decades. More worryingly for these parties, it has intensified since 2000. To sum up, since the 1970s, social democracy has, on average, lost votes, each decade proving less profitable than the previous one: – 1.5% in the 1970s, – 0.6% in the 1980s, – 1.9% in the 1990s and – 2.6% in the 2000s. Between the 1950s-1960s and now, social democratic parties in northern Europe have lost about 20% of their votes.

This electoral decline affected all parties, although some in the south tend to be less affected (the PASOK in Greece, the PSOE in Spain and the PS in Portugal). While the erosion is not linear (consider the electoral successes of the 1990s), the trend is confirmed over the long term. The parties which were hegemonic on the left and influential in national politics have been hit hardest (Labour party in the UK, the SPD in Germany, the SAP in Sweden, the PS in Belgium, the PvDA in the Netherlands, the SD in Norway, the DNA in Denmark).

The situation today looks pretty bleak for some parties which have fallen below a 20% threshold (PvDA received 12% of the share of the votes in the 2009 European elections). For these parties, their future as ‘natural governing party’ could be compromised in the long run.

This electoral trend was emphatically confirmed in the 2009 European elections. Social democratic parties were the main losers on this occasion despite harbouring high hopes of doing well after the debâcle of financial capitalism and market politics. These poor results are all the more surprising given that, almost everywhere in Europe, conservative forces are in decline. The main lesson of this election was that social democratic parties were severely rejected where they are traditionally strong (France, Germany, UK, Italy and Spain). One can note also that the slump in votes of social democratic forces benefited the radical left in several countries (France, Germany, Portugal and to some extent Greece).

Ideological and cultural meltdown

The continuous electoral decline of social democracy is only one side of the coin. Over the past 25 years, social democracy has also seen dramatic transformations from a cultural and ideological viewpoint. What was ‘historic’ social democracy about? It was a reformist force which accepted capitalism on the condition that it be regulated by the state. Its ethos was egalitarian and it aimed to achieve social justice and economic redistribution through an interventionist state in socio-economic areas. Social democracy possessed two other essential features: a strong working-class base and a close relationship (and in some cases, solid organic links) with trade-union organisations. A number of political scientists have argued that what constituted the originality of social democracy was less a set of policies (e.g. Keynesianism) than its proximity with the working classes and a specific cultural and partisan tradition (party organisation, activism).

All aspects of social democratic life have been transformed: the nature of the party (from mass parties to catch-all or cartel parties; from parties of the salaried workers to parties of the more affluent fractions of the middle-classes), the party life, the leadership, the relationship with the unions, its membership, its electorate and, obviously, its policies and ideology.

Some commentators argue that social democracy’s problems today are essentially of an ideological nature. They point out that Third Way politics and its attempt at representing a ‘Thatcherism with a human face’ have failed. Others stress the poor performance in office of some social democratic leaders: Tony Blair and his manufacturing of an illegal war in Iraq, Gerhard Schröder’s dismantling of large chunks of the German Social State, Walter Veltroni’s and Massimo d’Alema’s destruction of the Italian left after entering in a coalition with right-wing parties and Gordon Brown’s enduring love for the financial markets. This is what the then Chancellor of the Exchequer was saying in 2006 in his annual speech at Mansion House:

‘The message London's success sends out to the whole British economy is that we will succeed if like London we think globally (…) if we advance with light touch regulation, a competitive tax environment and flexibility. (…) And just as two years ago we promoted the action plan for liberalising financial services across Europe, I can tell you that the Treasury is now working with Charles McCreevy [European Commissioner for Internal Markets and Services] and with you to ensure that the forthcoming European financial services white paper signals a new wave of liberalisation. (…) In 2003, just at the time of a previous Mansion House speech, the Worldcom accounting scandal broke. And I will be honest with you, many who advised me including not a few newspapers, favoured a regulatory crackdown. (…) I believe that we were right not to go down that road which in the United States led to Sarbannes-Oxley, and we were right to build upon our light touch system through the leadership of Sir Callum McCarthy - fair, proportionate, predictable and increasingly risk based.’

This being said, to blame the more right-wing leaders for all social democratic ills is rather unconvincing as allegedly more left-wing social democrats (e.g. Lionel Jospin in France) have also embraced some of the Third Way narrative and implemented Blairite policies when they were in office (privatisation of public services, social dumping to attract foreign investors, tax cuts for the rich and cuts on social benefits for the poor, deregulation of markets and promotion of economic competition in the European Union, unconditional support of economic globalisation, harsh law and order policies as well as severe restrictions on immigration from poorer countries).

At home and in Europe, social democratic parties have consolidated the ‘neoliberal consensus’. Since the 1980s, social democrats have promoted free markets and turned a blind eye on income inequality. A recent study has shown that in advanced societies, unprecedented levels of wealth and comfort have been accompanied by mental and emotional suffering. In other words, there is a striking contrast between their material success and social failure. Recent social democrats (notably Tony Blair) have assumed that social problems bear little relationship to average incomes. In reality, evidence suggests that income differentials within populations matter a great deal. In the most unequal societies (the United States, Portugal, the United Kingdom and New Zealand), social relations deteriorate and levels of trust are lower. Social structures that create relationships based on inequality and social exclusion inflict social pain (health-related problems such as obesity, alcoholism and mental illness, poorer educational attainment, higher teenage birth rates and higher imprisonment rates).

With Tony Blair and Gerhard Schröder, uncritical support of globalisation became the new mantra. Between 1997 and 2002, Lionel Jospin privatised more public utilities than any right-wing government during the same period. As a result, large sections of social democracy have done very little, if anything at all, to improve the lives of the millions of unemployed and poor people. In reality, the gap between rich and poor has significantly increased while social democrats have been in government. And the middle classes, who can no longer rely on effective and cheap public services, are also increasingly struggling. Peter Mandelson once famously said that he was ‘relaxed about people getting filthy rich’. His wish has come true. Today, Britain is still the Little America that Margaret Thatcher successfully established in the 1980s. It is a country where economic and cultural inequalities remain shockingly entrenched, where public services continue to be sparse and mediocre, where electoral turn outs are ridiculously low and where economic competition and consumerism are the cardinal values. So the problem with social democracy is much deeper and more serious than a mere change of rhetoric or personnel.

A conservative force

In the 1990s, social democracy has become a conservative force, both politically and culturally. In June 2002, addressing a select group of ‘socialist’ luminaries including Bill Clinton, Peter Mandelson’s message was clear: ‘We are all Thatcherites now!’ Blair thought that adopting a tempered version of neoliberalism would make his party look young and modern. Quite the opposite. For the first time in its history, social democracy has borrowed the ideas and policies from its right-wing opponents. It has ceased to venture fresh and progressive ideas. Social democracy used to be clearly on the left; a political force that was fought by the right because of its progressive pedigree. Social democrats can be proud of their past achievements: the introduction of universal suffrage, the extension of political and social rights to the working class, the establishment of the welfare state and, after May ‘68, the adoption of post-materialist and anti-authoritarian policies. Has social democracy anything distinctive to say about many of the problems we currently face? No. Until the 1990s, every ideological modernisation and every policy innovation offered an alternative to the free market ideology of the right. This is not to say that these social democratic policies aimed at overthrowing capitalism. They aimed to tame it and make it acceptable to the worst-off in society by imposing redistributive policies when social democrats were in power. This was the meaning of the social democratic compromise with capitalism; a compromise between the interests of labour and those of capital. There was no such thing as the Third Way, essentially the rebranding of the Reaganomics of the 1980s. On the one hand, it claimed to ‘empower’ communities and individuals, on the other it methodically carried out the deregulation of market forces and pursued privatisations.

The Third Way model suffered from a deep democratic deficit. It professed a commitment to ‘people’s democracy’ but made sure that neither party members, nor voters would truly engage with politics when it mattered. Even worse, when they did get involved and opposed the decisions reached by social democratic governments, their opinions were ignored or dismissed altogether (in New Labour’s case, consider the Iraq war, the privatisation of the London tube, the PFI projects).

Turning things around

While studying the German SPD in the 1910s, Roberto Michels verified the existence of an ‘Iron law of oligarchy’. By this, Michels meant that the SPD was run by a coterie of professional politicians who made all the decisions. Things have further deteriorated since then. Today, party members and officials are mostly confined to rubber-stamping decisions and canvassing voters in the run-up to elections.

In order to be seen as a credible force to the public (and this includes their own members and traditional voters), social democratic parties will have to set themselves a twofold objective: Firstly, they have to rejuvenate their internal democracy. Party bureaucracies need to engage with their members, to consult them more often and to give them more responsibility. What is more, members have to be listened to and heard whenever they strongly disagree with the leadership (the example of the Iraq war springs to mind as far as the Labour party is concerned). In short, social democratic parties have to re-politicise their members. Party members should behave again as proper activists and cease to be mere supporters or cheerleaders.

Secondly, social democratic parties have to be far more committed to solving wealth inequalities between populations than they have been over the past twenty years. It follows that they have to be more concerned about the needs of their ‘own’ people (the hard working salariat) and less attentive to their opponents (the vested interests of the world of finance and beyond). This is not just a question of social justice, but also one of fighting for safer, healthier and more efficient societies.

Ironically, when they came to power in the late 1990s, Blair and his allies gave a new lease of life to much discredited neoliberal policies. The Third Way was a project in political submission to the ideas, policies and vested interests of the right. Unable to correct the growing inequalities (or unconcerned by the growing inequalities), the new social democrats have ended up losing their traditional supporters: the working and salaried classes. Today, so-called ‘disillusioned’ high earners are returning en masse to the conservatives. The bases of New Labour are crumbling.

It is undeniable that social democracy has also failed to propose a progressive future for the European Union. It is telling that important neoliberal policies were implemented between 1997 and 2002, while social democrats were running an overwhelming majority of member states in the EU (12 out of 15). What has the Party of European Socialists (PES) done for ‘Social Europe’? Next to nothing. Yet, every five years the same hollow social democratic chants ring out: ‘Social Europe! Social Europe!’ Whether as heads of governments, in the Commission, or in the European Parliament, social democrats have worked alongside reactionary forces to promote ‘unfettered markets’ (according to the words in title 3 of the Constitutional Treaty). Instead of developing concrete steps to promote solidarity and employment, they have voted in favour of policies that have fostered competition between member states. This in turn has created an incentive for some countries to practice social dumping. It has made the European Union a place of high unemployment, low wages and dismantled public services.

Back in the 1980s, social democrats believed that the Single European Market and later on the eurozone would enable them to launch the market-corrective policies that they could no longer implement nationally. In the end, it had the opposite effect: the neoliberal policies adopted by all member states (including social democratic ones) have further restricted redistributive policies nationally. These choices have facilitated economic and social policies which have gone against the interests of social democracy, i.e. its proclaimed social justice agenda. Today, social democracy faces two major constraints: free market globalization (an economic constraint) and the institutions of the European Union which support free market policies (a political constraint).

Casino capitalism is proving to be a disaster for humankind and for the environment. The financial crisis provides social democrats with a golden opportunity to dispense with their neoliberal frame of thought and action. For its own sake, social democracy urgently needs to ditch the insane idea that one can promote the ideals of social justice while using the economic dogmas of Milton Friedman and Friedrich Hayek. In these troubled times, social democracy can only recapture a sense of purpose and make a useful contribution to progressive politics, if it rediscovers its egalitarian roots and shows empathy for the underdogs. It is not too late to do so, but social democracy has a long way to go.