Not frightening the horses

by Henry on June 16, 2005

Andy Moravcsik had an article in the FT yesterday which provides an interesting counter-argument to Chris’s – claiming, in effect that the French and Dutch should never have been asked to decide upon the technicalities of EU decision making (FT version with sub required here, Word version on Moravcsik’s home page here ). But Moravcsik goes further even than Giscard – he claims that the very idea of asking people to vote on the text was naive:

The convention, the constitution and the invocation of European ideals were tactics explicitly designed to increase public legitimacy. Enthused by the prospect of re-enacting Philadelphia, Europeans were supposed to educate themselves, swell with idealism, back sensible reform and participate more actively in EU politics. In retrospect, this grand democratic experiment seems naive. Abstract constitutional debates and referendum campaigns gave anti-globalisation, anti-immigrant and anti-establishment discontents of every stripe a perfect forum. EU policies already ratified by national parliaments, such as the recent enlargement, drew fire. Add the suspicion of voters unsure why a new constitution is required at all, and the enterprise was doomed.

Still, he thinks that the voters made the right choice, despite themselves.

In rejecting the resulting document, reasonable though it is, French and Dutch voters may be wiser than they know.

Why? Moravcsik believes that the recent votes demonstrated the impossibility of a ‘political’ integration process. EU leaders should return their attentions to the bread-and-butter business of the European Union, and to incremental, unflashy integration based on technocratic bargains among the big member states.

Moravcsik’s arguments stem both from his basic theoretical claims about the processes driving EU integration (he’s the best-known academic advocate of the argument that the EU is little more than a set of bargains among states) and from his belief that the debate over the EU’s ‘democratic deficit’ is a chimera (see here for the best short version of his arguments). He claims that the kinds of policies that are delegated to the European Union are the kinds of policies that national governments usually delegate – decisions over cross-border trade issues, interest rates, judicial decision making and the like – so that we shouldn’t be especially concerned when they’re delegated to a transnational rather than a national authority. In any event, there are checks and balances that allow for some degree of democratic control (the European Parliament, national parliaments and so on). These arguments can be challenged on both empirical and normative grounds. There’s a lot of evidence that EU decision-making processes do escape the control of nation states (something I’ve posted on frequently before). But more pertinently, the fact that many aspects of economic decision making are delegated and removed from direct democratic controls is by no means necessarily a good thing on normative grounds. Indeed, you could turn Moravcsik’s argument on its head – a fair amount of the animus that led to the “No” votes was less specifically directed at the constitutional text, or even at the EU, than at the general feeling that economic decision making is slipping away from democratic control, and that the EU is one manifestation of this. Indeed, I suspect (and hope) that the ‘No’ votes are the beginning of a wider challenge to the notion that vast areas of economic decision making should not be subject to political control. While I’m broadly in favour of an integrated Europe, I’m not especially keen on a EU like the one we have today, in which the imperative of the free market usually overrides national level social protections.

{ 31 comments }

1

otto 06.16.05 at 11:54 am

“I’m not especially keen on a EU like the one we have today in which the imperative of the free market usually overrides national level social protections”

One hears this argument alot, but usually without examples. Can you please provide some?

2

Henry 06.16.05 at 12:13 pm

I’m sorry – that statement does need to be unpacked a little, and the phrasing is a little loose. What I’m referring to here in an indirect way is the debate over tax competition between states, and Fritz Scharpf’s arguments over how “negative integration” (market-making) has tended to prevail over “positive integration” in ways that may have quite serious adverse consequences for the welfare state. This “paper”:http://www.mpi-fg-koeln.mpg.de/pu/workpap/wp97-8/wp97-8.html gives a good overview.

bq. There are indeed options for a reorganization of European welfare states that could reduce mass unemployment and maintain aspirations to distributive justice even under conditions of an internationalized economy, including, for example, the reorganization of rules covering the sheltered sectors of European economies to price low and unskilled labour into work, and the adoption of a negative income tax to offset the consequent loss of income by such workers. But these solutions are difficult to design and to adopt (Scharpf 1997). Under the pressures of regulatory competition and acute fiscal crises, chances are that the changes which are in fact adopted will amount to nothing more than a piecemeal dismantling of existing social benefits. As all countries are now competing to attract or retain investment capital and producing firms, all are trying to reduce the regulatory and tax burdens on capital and firms (S. Sinn 1993; H.-W. Sinn 1994), and all are then tempted to reduce the claims of those groups – the young, the sick, the unemployed and the old – that most depend on public services and welfare transfers.

It sounds, because I phrased it carelessly, as though I’m saying that the EU market making process _directly_ undermines national level protections. While there are probably examples of this (e.g. the ways in which EU competition rules affect national health insurance markets), the more important underlying process is, I think, the indirect one that Scharpf identifies in which heightened competition (which is in part traceable back to interdependence within the EU) undermines national welfare states indirectly. I should have said this more clearly in the post.

3

P ONeill 06.16.05 at 12:38 pm

Henry could have added another example, covered by his clause “vast areas of economic decision making should not be subject to political control” the case of the European Central Bank. The closest thing to political oversight of the ECB is the council of finance ministers, which seems to have a hard time getting its act together not least because all EU members are not eurozone members so the relevant group for the ECB is only a sub-group of the overall council. This leaves the rather technocratic ECB management with a high degree of autonomy, which one might argue has delivered higher interest rates than the eurozone currently needs. Now, one could also argue that the Fed is run similarly independently of the political world, but the comparison of Fed-US government relations to ECB-ECOFIN gets stretched pretty quickly.

4

ab 06.16.05 at 1:31 pm

Henry, Scharpf and you are probably right that Europeanization plays a certain role in overriding national-level social protection. However, two points minimize this in my view:

(1) Is Europeanization, even in its indirect form as creating a European level-playing field of competitiveness, really the causal actor in this story?

In other words, does the EU not simply provide the arena in which other factors play out. I think if you look closely at recent policies undermining social protection, most of them have to do with far bigger processes: demographic change, technological change, the rise of developing countries in Asia, etc. Yes, Europeanization probably leads to a situation where these processes impact much quicker. But the EU doesn’t seem to be the main causal actor.

(2) Even if Europeanization plays a causally active role in undermining social protection, how huge would that impact be? I think people sometimes overestimate to what extent Europe’s economies are already tightly integrated. Yes, in some sectors it’s truly one European economy, but probably the far greater part is still predominantely national (which also explains why European economies have quite different growth cycles).

5

roger 06.16.05 at 2:14 pm

Henry, a wholly excellent post. Tom Friedman’s “Golden Straightjacket” idea — that the political economy would be de-politicized to allow a maximally free enterprise system to operate — was inexplicably lauded in the 90s by the so called Third Way people, who should have known better. The only way to erect a barrier of laws around the economy such that it cannot be modified by politics, i.e. various manifestations of the popular will, is to create an undemocratic political zone. Eventually, people will get tired of the shell game — the idea that certain economic policies are enacted because “there is no alternative”, knowing full well that the lack of an alternative is an intentional social act.

To preserve an undemocratic political zone requires expanding the areas that are protected from “politics” until politics loses any serious meaning.

6

Andrew Boucher 06.16.05 at 3:07 pm

p o’neill: The ECB’s short-term rate is 2%. That’s pretty low, by any standards. Countries with lower rates are Switzerland and Japan, neither of which are examples of economic dynamism.

Long-term (10-year) German rates were almost 3% a few weeks ago. There are other reasons, but confidence in the ECB is one good reason for such low rates.

In short if people want to borrow euros, they can, and they can do it at a very good rate. European countries are growing less for other reasons.

The ECB has done a good job – given the lack of labor mobility in the EU, I don’t think it could have done a better one.

“While I’m broadly in favour of an integrated Europe, I’m not especially keen on a EU like the one we have today, in which the imperative of the free market usually overrides national level social protections.” I’m all for utopia myself, too.

7

Henry 06.16.05 at 3:08 pm

Hi ab

I agree with what you’re saying here – it’s hard to disentangle the causal impact of, say, tax competition within the EU, from pressures emanating from outside. But I don’t think that this really undermines the point that Scharpf is making at all. What he’s suggesting is that there are policy choices that _could_ be made at the EU level that would do a lot to protect the weak. But that these choices are _not_ made because of the opposition of some states to a strong ‘social Europe’ (as well as the secondary problem of coordinating between different social models). Thus we get an EU which serves as either an active or passive handmaiden to globalization, rather than a bulwark against some of its less pleasant consequences. Colin Hay makes pretty similar arguments.

‘p o’neill’ – yeah – all that I’d add to that is a reference to the manifest unwillingness of the ECB to submit itself to any but the most cursory responsibilities of disclosure etc to the European Parliament.

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Henry 06.16.05 at 3:09 pm

Andrew – perhaps you can spell out what’s ‘utopian’ about that statement?

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abb1 06.16.05 at 3:22 pm

Utopian, of course, seems the idea that you can integrate Europe while avoiding negative aspects of that integration; negative aspects that are a fundamental part of the integration.

10

Andrew Boucher 06.16.05 at 3:47 pm

Can’t say it better than abb1 just did… By what magic wand do you integrate Poland and not have downward pressure on wages of unskilled workers in the West?

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abb1 06.16.05 at 3:58 pm

Hey, I didn’t have to suffer Hegel’s dialectics for nothing all those years. “Unity and struggle of opposites”.

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Henry 06.16.05 at 4:03 pm

Where does the post above say or even hint that you can avoid “negative aspects” or tradeoffs? It’s about policy choices – whether or not you choose policies that provide for market integration without any social dimension, or whether you have policies that provide some social protection as part of the deal. Are you claiming that the latter sorts of policies are impossible by definition (as opposed to very hard to achieve because of the existing constellation of interests)? Seems to be a pretty unsustainable claim if you are.

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Andrew Boucher 06.16.05 at 4:44 pm

I’m referring to the part I clipped, “While I’m broadly in favour of an integrated Europe, I’m not especially keen on a EU like the one we have today, in which the imperative of the free market usually overrides national level social protections.”

Anyway, obviously the “latter sort of policies” are not impossible by definition. No, they’re not contradictory or inconsistent. Just very unrealistic. Obviously one can wish (with a magic wand) that there will be better social protection and integration at the same time – give the jobs to low-paid Poles and large unemployment checks to the French. But that hardly sounds like a sustainable economy to me.

On the other hand, if all you are claiming is that one can provide “some” social protection, where “some” is epsilon bigger than 0, then sure. But it seems to me that the level of social protection demanded by French workers is so large that it can’t be paid for, should there truly be integration with Eastern Europe.

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Jack 06.16.05 at 5:45 pm

How much is the EU a scapegoat for increasingly irrelevant national governments? Brussels is hardly more than a messenger of bad news for french farmers who are in greater fools paradise than British miners.

The idea that the ECB is significantly responsible for the travails of France and Germany is absurd. The least democratic aspect of Brussels is the Council of Ministers with its grotesque secrecy. Next is the lack of effective supervision of the Commission. The answer to that is to grant the Parliament proper oversight. The disgraceful affair of software patents where the commission overruled parliament is a fine illustration.

The fact is that many of the issues that we the people of Europe are interested in are European in nature and are voices if heard at all are muffled in transmission by our national governments. Governments that are too afraid to actually make any decision about these things themselves, instead relying on referenda thus illustrating their redundancy in such matters.

The constitution appears to be all the things people say it is — a tidying up of existing treaties, some necessary housekeeping and finally the constitution itself. It seems the absurdity is to have bundled it all together. The tidying up should have been done technocratically, the housekeeping (qualified majority voting for example) should have gone through bit by bit with probably approval just by elected representatives and finally a readable constitution might have been exposed to referendum mania.

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Henry 06.16.05 at 7:12 pm

Andrew I don’t think that this is true. We’ve been here before with the southern European enlargements, which also had pretty wide economic disparities, and surprisingly enough, not all that much permanent cross border migration. Admittedly, there’s a considerable difference in size between Spain, Portugal, Greece on the one hand, and Poland etc on the other – but the evidence that we have to date suggests that serious cross-border movement of peoples isn’t likely to happen. While there will be change at the margin, I simply don’t see that there will be more than that (as an aside, the unwillingness of people to move across borders to find jobs in the EU is one of the reasons that monetary policy is such a thorny question). The more worrying dynamics have to do with more macro-level concerns – the intersection between tax policy and the welfare state – and it’s here that the kinds of policy issues that the post addresses comes into play. I’m a little reassured by the recent statement by Poland’s foreign minister that Europe shouldn’t adopt a US model – but only a little. There are a lot of serious political fights ahead – but I just don’t buy into the claim that EU integration is _necessarily_ anti-social democratic.

Jack – I’m actually not as keen on an increased role for Parliament as I used to be. From my experience, increased powers for Parliament have not gone together with increased democratic accountability. Instead, we’re seeing a lot more deals done behind closed doors between the Presidency of the Council and elite leaders in Parliament (esp. under the so-called ‘early agreement process’ in codecision), and not only plenary, but committee meetings being treated as rubber-stamps.

16

Jack 06.17.05 at 1:53 am

Isn’t that kind of stitch up the a vulnerability of the parliament exploited by the Council? I donn’t wish to diminsh that as a problem and I think the problems of getting somewhere decent from here are great and possibly insurmountable
I do think that if the parliamentwas making more decisions it would perhaps get as much media coverage as say the US governement gets in the UK and at least some of the fixing would have public consequences. For example many of the activities of the council are currently technically secret but traceable to the interests of particular countries. More thorough press coverage would make it clear who was behind a move even without the highly desirable development of an opening of the council. I think the Council should exist as some kind of senate but its current role is appaling. I guess I am saying that increased power for the parliament alone won’t fix things all by itself but I do think that it is a necessary part of a satisfactory solution, that there would be important indirect benefits and that the national level political classes are clearly interested in preventing it accquiring much political legitimacy. Like the Tamils in Sri Lanka everyone knows the status quo in indefensible but it is not int the political interest of anyone in power at the national level to fix it while it is more useful as awhipping boy and to say otherwise is to throw youorself open to all kinds of calumny. This is for example a neat explanation of why opposition to further developments is not based along more general political affinities and is not stable.

The European project ahs been fantastically successful in preventing war amongst its members for an unprecedented length of time and in its amazing economic development and democratisation work but it gets no popular credit or kudos for such achievemenets and no-one in the press or mainstream politics reminds us of the importance of its contributions because national governments take the credit for the good bits and blame it for everything bad. The EU isn’t what makes French farmers over subsidised yet it appears to be getting the blame. It is one of the most absurd things I have ever heard. No EU and the subsidies would be born directly by the French and that I think might change the French attitude.

17

abb1 06.17.05 at 3:21 am

It’s about policy choices – whether or not you choose policies that provide for market integration without any social dimension, or whether you have policies that provide some social protection as part of the deal.

When you integrate two dissimilar countries, like, say, France and Poland, there are natural consequences that are bound to happen: businesses will move to Poland attracted by cheap labor (‘giant sucking sound’) and labor will move to France attracted by higher wages and more generous social safety net. This is as certain as that water is running downhill. This will inevitably create pressure in France to weaken social protection and to lower the wages.

If you try to raise wages and social protection in Poland to the level of France, then businesses in Poland fail and the Polish economy will be quickly destroyed, just like it happened in East Germany. Pols will move to France and it’ll weaken social protection there and bring down the wages. See unification of Germany for a recent example.

These are simply laws of nature, the only policy that can minimize this is the policy of minimizing the integration itself.

18

dave heasman 06.17.05 at 3:28 am

When you integrate two dissimilar states, like, say, Alabama and California, there are natural consequences that are bound to happen: businesses will move to Alabama attracted by cheap labor (‘giant sucking sound’) and labor will move to California attracted by higher wages.

19

Jack 06.17.05 at 4:13 am

abb1,
those are not the only things that might happen and it is not a zero sum game.

Those things are quite likely to happen even if you don’t put the two countries together as with China and the US.

Poland is not the only and possibly not the main pressure on French social security. In fact France might be better off importing some Polish workers rather than exporting jobs to Poland. France would have demographic challenges under the best of circumstances.

There are real discomforts caused by integrating Poland into the EU but that is not to say that nothing can be done to ameliorate them. On the other hand more discomforts are atributed to such integration. There is a lot of messenger shooting going on here. The devil remains in the details.

20

abb1 06.17.05 at 4:44 am

But Jack, what’s to ameliorate here? Business gravitates towards cheap labor. Labor gravitates towards high wages. Integration removes barriers and allows it to happen. This is what integration is.

How do you ameliorate the laws of nature? There was a dam. You start making holes in the dam. Water starts running downhill, first little by little, then stronger and stronger, and then you can’t stop it until it finds some new equilibrium.

If everything goes well, then the new equilibrium will have wages, social safety net and prices somewhere in-between France and Poland (or whoever, say, Turkey).

21

Jack 06.17.05 at 5:34 am

abb1 think bout your damn metaphor. Damns let water through all the time, we build salmon ladders, we compensated people that lived in the villages that were flooded, we use the flow of water to generate electricity. All without changing the laws of nature.

My point is that the problem still exists even if we don’t let Poland into the EU. In fact I think Poland inside is much less of a problem than Albania outside for example.

To recap, there are pressures. These pressures wil l doubt force change. Some of that change willbe painful. I’m saying almost the same thing as you but drawing a different conclusion. I think that these forces you identify do exist and can’t bewished away, I believe and indeed hope that they will force some changes. On the other hand I don’t want to throw up my hands in horror and resign myself to being replaced by a cheaper Pole.

This is hardly a new problem, we have done it before with Spain, Greece, Ireland and the rest and it hasn’t been a disaster. In particular European integration is not the source of the problem but merely a way of handling it. In addition mny of the problems of France may be exacerabated by the process but not caused.

22

SamChevre 06.17.05 at 6:05 am

Dave–re #18 When you integrate two dissimilar states, like, say, Alabama and California, there are natural consequences that are bound to happen

That’s exactly what happened as the South became integrated into the US economy starting around the turn of the century. The South’s growth definitely hurt some Northern workers in the short term. It almost wiped out the New England textile industry. It has been one of the biggest factors in holding down union power in the US, since the South never unionized. Southern workers–black and white–moved North in large numbers starting in the 30’s (and were not well accepted, for both cultural and job-competition reasons).

I agree with AB–integration will put downward pressure on Western European wages and social protections, although the impact is likely to be less severe than that of globalization in general.

23

abb1 06.17.05 at 7:20 am

Globalization in general is different: it’s under control of the national government. France can always impose high tariffs on Albanian products and block Albanian labor from coming to France. They have control and the means to fine-tune their policies to optimize whatever they want to optimize. It’s just so happens that at the moment business/corporate interests prevail over the labor interests in most of the West; certainly it’s a temporary situation.

But once you integrate with someone, you pretty much lose control.

24

rjw 06.17.05 at 8:20 am

I’m looking for a specific example of the sort of policy that could reasonably be adopted at EU level in search of a more “social” europe, as suggested above.

I’m personally rather sceptical that the EU can really go too far in this direction without causing more problems than it solves.

What the EU does best is technocratic market shaping activity, where the aim is to set ground rules that everyone can live with. Think trade policy, competition policy, and the single market.

What it tends to do badly is handling “fuzzy” policy areas where there are big distributional concerns in play, because then rent seeking gets in the way of getting the policy right (think CAP, budget). Like social policy.

25

Jack 06.17.05 at 8:24 am

It’s not working like that for the Italians and its not working like that for the US with Mexico. I am sure that there will be some downward pressure on wages related to integration but it is not the only or even the most significant source of such pressure.

Downward pressure on wages is not the only effect of integration. Illegal employment is bad in itself and for local legal workers in particular. There are also other effects that are less negative. British farmers are one of the strongest lobbies in favour of allowing east European workers into the country because many of them would cease to be viable without the help. Integration also helps Poland so that fewer people will wish to leave. We haven’t been flooded yet, we have survived similar things quite happily, and it is easy to overestimate the competitiveness of east european industry for example.

The same wage adjustments also help cope with the pressure from China. I believe that Germany had more immigration from Poland before it joined the EU.

Just like the social security debate in the US the mixed effects of European integration are being used to distract attention from the politically inconvenient elephant in the room which is the huge cost of welfare payments to French farmers, unhelpful demographics and a general lack of adaptability. There is no reason to expect French tarriffs, even if you could justify them in theory, to be any more effective in practice than was the Bush steel tarrif.

It is also hard to be so precise about what counts as labour interest. Subsidies are often paid for by workers and received by factory owners or farmers. That is certainly not what popular opposition is about in Britain.

In any case the debate is shockingly low minded. Sometimes it is worth doing something because it would help someone else. The French have their heads in the sand and their government is doing little to make them pay attention. They are using the same “Look, over there” tactics with the debate about the British rebate.

26

Henry 06.17.05 at 9:03 am

abb1 – there isn’t any ineluctable “law of nature” here whatsoever. The empirical literature argues otherwise. Colin Hay’s work is the key reference point here – “looking at”:http://www.europanet.org/conference2002/papers/b1_hay.doc the “hyperglobalization” thesis of which your claims are a variant, he finds:

bq. It is important to be clear about this. Capital is not blessed with perfect information; its does not enjoy perfect or even near perfect mobility; the cost of capital flight (as distinct from the hollow threat of capital flight) is not zero; cheap labour and deregulated labour markets do not correlate well with economic performance in contemporary Europe, let alone provide optimal returns on capital invested; and, as a vast recent literature has demonstrated, exhibited patterns of capital investment clearly belie any notion that social democratic policies are unambiguously corrosive of competitiveness (see, for instance, the pioneering work of Swank 1998, 2002). In short, each of the assumptions of the model has been demonstrated to be false.

As he argues, the problem isn’t economic integration _as such_; it’s the _institutional form_ of integration, and, most particularly, the straitjacket that the ECB creates on social democratic forms of policy intervention.

bq. 4. This brings me to a final and in many respects a most important point. In so far as strong pressures for policy convergence can be identified within EU-Europe they are more easily attributed to the institutional architecture of EMU that they are to any globalisation of EU-European economies. Indeed, there is a strong argument to be made that it is in the interaction between deepening European economic integration on the one hand and the specific deflationary bias enshrined at the heart of monetary union on the other that contemporary pressures for welfare residualism and the further neoliberalisation of all EU-European social models arise.

In short, the problem is _not_ one of Polish plumbers – it’s of the specific kinds of institutions that we have. The causation is simply taking place at a different level to the one that you’re claiming it is – and it’s a level where there are possible reforms that don’t undermine European integration as a whole.

27

Jack 06.17.05 at 9:56 am

Tyler Cowen makes a similar point in a bottom up way. There is more to it than just the wage.

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abb1 06.17.05 at 10:34 am

Thanks, Henry. This sounds very counter-intuitive, but, of course, a lot of true statements do, especially when the problem is as complex as this.

I’ll only point out that his arguments (capital doesn’t have perfect information, capital is not 100% liquid, etc) don’t necessarily refute this notion of ‘hyperglobalization'; they only suggest that hyperglobalization is not going to happen overnight, it’ll be advancing slowly. You know, maybe existing companies won’t move to Turkey, but most of the new ones will open in Turkey – that kinda thing. So, OK, maybe it’ll take 5-10 years for the strongest welfare state to be undermined, not 6 months. So what.

29

Henry 06.17.05 at 11:51 am

abb1 – in fairness, it _is_ counterintuitive, and certainly not what I expected when I first started getting interested in this area. The most solid empirical work on this has been done by Geoffrey Garrett – the Hay piece cited above provides a brief overview of some of its conclusions (as well as some criticisms). Garrett does seem to show that social democratic regimes do about as well as neo-liberal regimes over a substantial period of time. As Hay points out, there may however be some policy adjustment going on there (i.e. weakening of social democracy) that isn’t being picked up in Garrett’s stats. Also very interesting in this context is Carles Boix’s book on how social democratic regimes may be able to introduce successful supply-side solutions (i.e. better training schemes etc) to attract and retain investment.

I think that this is a very important set of results. There’s a general sense out there of inevitability – that social democracy is inexorably threatened by interdependence in an increasingly globalized world. Yet there isn’t all that much empirical evidence out there that this is so, and a lot of evidence that suggests that it isn’t so. Where people like Colin Hay and Mark Blyth really do us a service is in pointing to the importance of the _ideological_ layer in there. In other words, much of the pressure on social democracy that we are seeing comes not so much from external forces as such, as from an ideological consensus that social democracy can’t really compete as a model of economic organization. This, to my mind, is a quite pernicious myth – and if we buy into it, we’ve lost the battle.

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abb1 06.17.05 at 1:04 pm

Oh, Henry, I have no doubt whatsoever that a reasonable social democratic regime will beat a typical neo-liberal regime by most of the criteria, including such a fundamental one as the productivity of labor: higher wages on the lower end create a strong incentive to increase productivity. And the productivity is, basically, the central characteristic of an economic system, the system with highest productivity wins (or so I was told).

But this is a different subject. What I was trying to say is that social democracy can only exist in a fairly homogeneous managed environment, it’s a highly regulated model that’s always looking for an equilibrium, unlike the neo-liberal one that has a clear direction: higher returns and the rest be damned. So, all I am saying is that it’s difficult to believe that two of each can be integrated into one.

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Henry 06.17.05 at 4:28 pm

Abb1 – I guess I don’t agree that social democracy is always looking for an equilibrium. Sheri Berman has a very-interesting sounding book coming out on social democracy soon which addresses some of these questions – I’ll be blogging it in some form when I get a copy.

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