Social Democrats in the Wilderness

[Sheilbh]

Tony Judt: A manifesto for a new politics

As a culmination of his political thinking, the eminent historian Tony Judt, paralysed by motor neurone disease, makes an impassioned plea for a new arrangement of society

Something is profoundly wrong with the way we live today. For 30 years we have made a virtue out of the pursuit of material self-interest: indeed, this very pursuit now constitutes whatever remains of our sense of collective purpose. We know what things cost but have no idea what they are worth.

The materialistic and selfish quality of contemporary life is not inherent in the human condition. Much of what appears "natural" today dates from the 1980s: the obsession with wealth creation, the cult of privatisation and the private sector, the growing disparities of rich and poor. And above all the rhetoric which accompanies these: uncritical admiration for unfettered markets, disdain for the public sector, the delusion of endless growth.

We cannot go on living like this. The crash of 2008 was a reminder that unregulated capitalism is its own worst enemy: sooner or later it must fall prey to its own excesses and turn again to the state for rescue. But if we do no more than pick up the pieces and carry on as before, we can look forward to greater upheavals in years to come. And yet we seem unable to conceive of alternatives.

It's difficult to feel optimistic about the upcoming election. Voters are invited to choose between two major parties: one – New Labour – that has governed for the past 13 years and is responsible for the political and financial crisis facing the country; the other – the Conservatives – who are largely to blame for "breaking" the society they now promise to fix. Neither party conveys any sustained understanding of what is wrong with Britain today and both propose remedies which would do little to address the underlying challenges.

Social inequality on a scale unmatched in western Europe; dependence on and deference towards the most irresponsible financial sector in the world today; an over-mighty state, in thrall to private media influence and increasingly deaf to the concerns of civil libertarians and lawyers; a governing class drunk on "reforms", "innovations" and the presumptive merits of the private sector: these should be at the heart of public conversation in Britain today.

We need to rethink the state, and rearticulate the language of social democracy. Social democrats should cease to be defensive and apologetic. A social democratic vision of the good society entails from the outset a greater role for the state and the public sector. The welfare state is as popular as ever with its beneficiaries: nowhere in Europe is there a constituency for abolishing public health services, ending free or subsidised education or reducing public provision of transport and other essential services. We have long practised something resembling social democracy, but we have forgotten how to preach it.

In the early years of this century, the "Washington consensus" held the field. Everywhere you went there was an economist or "expert" expounding the virtues of deregulation, the minimal state and low taxation. Anything, it seemed, that the public sector could do private individuals could do better.

Today there has been a partial awakening. To avert national bankruptcies and wholesale banking collapse, governments and central bankers have performed remarkable policy reversals, liberally dispersing public money in pursuit of economic stability and taking failed companies into public control without a second thought. A striking number of free-market economists, worshippers at the feet of Milton Friedman and his Chicago colleagues, have lined up to don sackcloth and ashes and swear allegiance to the memory of Keynes.

This is all very gratifying. But it hardly constitutes an intellectual revolution. Quite the contrary: as the response of the Obama administration suggests, the reversion to Keynesian economics is but a tactical retreat. Much the same may be said of New Labour, as committed as ever to the private sector in general and the London financial markets in particular. To be sure, one effect of the crisis has been to dampen the ardour of continental Europeans for the "Anglo-American model"; but the chief beneficiaries have been those same centre-right parties once so keen to emulate Washington.

In short, the practical need for interventionist governments is beyond dispute. But no one is rethinking the state. There remains a marked reluctance to defend the public sector on grounds of collective interest or principle. It is striking that in a series of European elections following the financial meltdown, social democratic parties consistently did badly; notwithstanding the collapse of the market, they proved conspicuously unable to rise to the occasion.

If it is to be taken seriously again, the left must find its voice. There is much to be angry about: growing inequalities of wealth and opportunity; injustices of class and caste; economic exploitation at home and abroad; corruption and money and privilege occluding the arteries of democracy. But it will no longer suffice to identify the shortcomings of "the system" and then retreat, Pilate-like, indifferent to consequences. It is incumbent on us to reconceive the role of government. If we do not, others will.

If we had to identify just one general consequence of the intellectual shift that marked the last third of the 20th century, it would surely be the worship of the private sector and, in particular, the cult of privatisation. With the advent of the modern state (notably over the course of the past century), transport, hospitals, schools, postal systems, armies, prisons, police forces and affordable access to culture – essential services not well served by the workings of the profit motive – were taken under public regulation or control. They are now being handed back to private entrepreneurs.

What we have been watching is the steady shift of public responsibility on to the private sector to no discernible collective advantage. Contrary to economic theory and popular myth, privatisation is inefficient. Most of the things that governments have seen fit to pass into the private sector were operating at a loss: whether they were railway companies, coal mines, postal services, or energy utilities, they cost more to provide and maintain than they could ever hope to attract in revenue. For just this reason, such public goods were inherently unattractive to private buyers unless offered at a steep discount. But when the state sells cheap, the public takes a loss. It has been calculated that, in the course of the Thatcher-era UK privatisations, the deliberately low price at which longstanding public assets were marketed to the private sector resulted in a net transfer of £14bn from the taxpaying public to stockholders and other investors.

To this loss should be added a further £3bn in fees to the bankers who transacted the privatisations. Thus the state in effect paid the private sector some £17bn to facilitate the sale of assets for which there would otherwise have been no takers. These are significant sums of money – approximately the endowment of Harvard University, for example, or the annual gross domestic product of Paraguay or Bosnia-Herzegovina. This can hardly be construed as an efficient use of public resources. The outcome has been the worst sort of "mixed economy": individual enterprise indefinitely underwritten by public funds. In Britain, newly privatised NHS hospital groups periodically fail – typically because they are encouraged to make all manner of profits but forbidden to charge what they think the market might bear. At this point the hospital trusts (like the London Underground, whose PPP collapsed in 2007) turn back to the government to pick up the bill. When this happens on a serial basis – as it did with the nationalised railways – the effect is creeping de facto nationalisation with none of the benefits of public control.

The popular cliché that the bloated banks which brought international finance to its knees in 2008 were "too big to fail" is of course infinitely extendable. No government could allow its railway system simply to "fail". Privatised electric or gas utilities, or air traffic control networks, cannot be allowed to grind to a halt through mismanagement or financial incompetence. And, of course, their new managers and owners know this.

Shifting the ownership on to businessmen allows the state to relinquish moral obligations. This was quite deliberate: in the UK between 1979 and 1996 (that is, in the Thatcher and Major years) the private sector share of personal services contracted out by government rose from 11% to 34%, with the sharpest increase in residential care for the elderly, children and the mentally ill. Newly privatised homes and care centres naturally reduced the quality of service to the minimum in order to increase profits and dividends. In this way, the welfare state was stealthily unwound to the advantage of a handful of entrepreneurs and shareholders.

Governments, in short, now increasingly farm out their responsibilities to private firms that offer to administer them better than the state and at a saving. In the 18th century this was called tax farming. Early modern governments often lacked the means to collect taxes and thus invited bids from private individuals to undertake the task. The highest bidder would get the job, and was free – once he had paid the agreed sum – to collect whatever he could and retain the proceeds. The government took a discount on its anticipated tax revenue, in return for cash up front.

After the fall of the monarchy in France, it was widely conceded that tax farming is absurdly inefficient. In the first place, it discredits the state, represented in the popular mind by a grasping private profiteer. Second, it generates considerably less revenue than a well-administered system of government collection, if only because of the profit margin accruing to the private collector. And third, you get disgruntled taxpayers.

As in the 18th century, so today: by eviscerating the state's responsibilities and capacities, we have undermined its public standing. Few in Britain continue to believe in what was once thought of as a "public service mission": the duty to provide certain sorts of goods and services just because they are in the public interest. A government that acknowledges its reluctance to assume such responsibilities, preferring to shift them to the private sector and leave them to the vagaries of the market, may or may not be contributing to efficiency. But it is abandoning core attributes of the modern state.

In effect, privatisation reverses a centuries-long process whereby the state took on things that individuals could not or would not do. The corrosive consequences of this for public life are, as so often, rendered inadvertently explicit in the new "policy-speak". When British politicians and civil servants bother to justify the abandonment of traditional public service monopolies, they talk of "diversifying providers". When the UK work and pensions secretary announced plans in June 2008 to privatise social services – including short-term palliative welfare-to-work schemes which enable Whitehall to publish misleadingly low unemployment figures – he described himself as "optimising welfare delivery". The chief shortcoming of the old public services was the restrictive regulations and facilities – one-size-fits-all – with which they were notoriously associated. But at least their provision was universal, and for good and ill they were regarded as a public responsibility.

The rise of enterprise culture has destroyed all that. A private company does not present itself as a collective good to which all citizens have a right. Unsurprisingly, there has been a sharp falling off in the number of people claiming benefits and services to which they are legally entitled.

The result is a hollowed-out society. From the point of view of the person at the bottom – seeking unemployment pay, medical attention, social benefits or other officially mandated services – it is no longer to the state, the administration or the government that he or she instinctively turns. The service or benefit in question is now often "delivered" by a private intermediary. As a consequence, the thick mesh of social interactions and public goods has been reduced to a minimum, with nothing except authority and obedience binding the citizen to the state.

Any society, Edmund Burke wrote in Reflections on the Revolution in France, which destroys the fabric of its state must soon be "disconnected into the dust and powder of individuality". By eviscerating public services and reducing them to a network of farmed-out private providers, we have begun to dismantle the fabric of the state. As for the dust and powder of individuality: it resembles nothing so much as Hobbes's war of all against all, in which life for many people has once again become solitary, poor and more than a little nasty.

The left has failed to respond effectively to the financial crisis of 2008 – and more generally to the shift away from the state and towards the market over the past three decades. Shorn of a story to tell, social democrats and their liberal fellows have been on the defensive for a generation, apologising for their own policies and altogether unconvincing when it comes to criticising those of their opponents. Even when their programmes are popular, they have trouble defending them against charges of budgetary incontinence or governmental interference.

So what is to be done? What sort of language – what political or moral framework – can the left propose to explain its objectives and justify its goals? There is no longer a place for the old-style master narrative: the all-embracing theory of everything. Nor can we retreat to religion. But even if we concede that there is no higher purpose to life, we need to ascribe meaning to our actions in a way that transcends them. Merely asserting that something is or is not in our material interest will not satisfy most of us most of the time.

What is it that we find lacking in unrestrained financial capitalism, or "commercial society" as the 18th century had it? What do we find instinctively amiss in our present arrangements and what can we do about them? What is it that offends our sense of propriety when faced with unfettered lobbying by the wealthy at the expense of everyone else? What have we lost?

[Sheilbh]

Of all the competing and only partially reconcilable ends we might seek, the reduction of inequality must come first. Under conditions of endemic inequality, all other desirable goals become hard to achieve. Whether in Delhi or Detroit, the poor and the permanently underprivileged cannot expect justice. They cannot secure medical treatment and their lives are accordingly reduced in length and potential. They cannot get a good education, and without that they cannot hope for even minimally secure employment – much less participation in the culture and civilisation of their society.

In this sense, unequal access to resources of every sort – from rights to water – is the starting point of any truly progressive critique of the world. But inequality is not just a technical problem. It illustrates and exacerbates the loss of social cohesion – the sense of living in a series of gated communities whose chief purpose is to keep out other people (less fortunate than ourselves) and confine our advantages to ourselves and our families: the pathology of the age and the greatest threat to the health of any democracy.

If we remain grotesquely unequal, we shall lose all sense of fraternity: and fraternity, for all its fatuity as a political objective, turns out to be the necessary condition of politics itself. The inculcation of a sense of common purpose and mutual dependence has long been regarded as the linchpin of any community. Inequality is not just morally troubling: it is inefficient.

In post-religious societies such as our own, where most people find meaning and satisfaction in secular objectives, it is only by indulging what Adam Smith called our "benevolent instincts" and reversing our selfish desires that we can "produce among mankind that harmony of sentiments and passions in which consists their whole race and propriety". We should be paying greater attention to the things states can do. The success of the mixed economies of the past half century has led a younger generation to take stability for granted and demand the elimination of the "impediment" of the taxing, regulating and generally interfering state. This discounting of the public sector has become the default political language in much of the developed world.

But only a government can respond on the requisite scale to the dilemmas posed by globalised competition. These are not challenges that can be grasped, much less addressed and resolved, by any one private employer or industry. The most that can be expected of the private sector is short-term lobbying in defence of particular jobs or protection for favoured sectors – a recipe for just those pathologies and inefficiencies normally associated with public ownership.

It was not by chance that the late-Victorian reformers and their 20th-century liberal successors turned to the state to address the shortcomings of the market. What could not be expected to happen "naturally" – quite the contrary, since it was the natural workings of the market that created the "social question" in the first place – would have to be planned, administered and, if necessary, enforced from above.

We face a similar dilemma today. The reaction against unrestrained financial markets has obliged the state to step in everywhere. But since 1989 we have been congratulating ourselves on the final defeat of the over-mighty state and are thus ill-positioned to explain to ourselves just why we need intervention and to what end.

We need to learn to think the state again. How, in the face of a powerful, negative myth, are we to describe its proper role? We should begin by acknowledging, more than the left has been disposed to concede, the real harm that was done and could still be done by over-mighty sovereigns. There are two legitimate concerns.

Coercion is the first. Political freedom does not primarily consist in being left alone by the state: no modern administration can or should ignore its subjects altogether. Freedom, rather, consists in retaining our right to disagree with the state's purposes and express our own objections and goals without fear of retribution. This is more complicated than it may sound: even well-intentioned states and governments may not be pleased to encounter firms, communities or individuals recalcitrant in the face of majority desires. Efficiency should not be adduced to justify gross inequality; nor may it be invoked to suppress dissent in the name of social justice. It is better to be free than to live in an efficient state of any political colour if efficiency comes at such a price.

The second objection to activist states is that they can get things wrong. The American sociologist James Scott has written wisely of the benefits of what he calls "local knowledge". The more variegated and complicated a society, the greater the chance that those at the top will be ignorant of the realities at the bottom.

We have freed ourselves of the mid-20th-century assumption – never universal but certainly widespread – that the state is likely to be the best solution to any given problem. We now need to liberate ourselves from the opposite notion: that the state is – by definition and always – the worst available option.

Our first task is to remind our audience of the achievements of the 20th century, along with the likely consequences of a heedless rush to dismantle them. This may sound less exciting than planning great radical adventures for the future, and perhaps it is. But as the British political theorist John Dunn has wisely observed, the past is somewhat better lit than the future: we see it more clearly.

The left, to be blunt, has something to conserve. And why not? In one sense, radicalism has always been about conserving valuable pasts. In October 1647, in the Putney debates conducted at the height of the English civil war, Colonel Thomas Rainsborough warned his interlocutors that: "the poorest he that is in England hath a life to live, as the greatest he . . . every man that is to live under a government ought first by his own consent to put himself under that government . . ." Rainsborough was not pointing to some misty-eyed egalitarian future; he was invoking the widely held belief that the rights of Englishmen had been stolen and must be reclaimed.

In a similar way, the anger of early 19th-century radicals in France and Britain was driven in considerable measure by the belief that there were moral rules to economic life, and that these were being trampled underfoot by the new world of industrial capitalism. It is that sense of loss – and the revolutionary sentiments it stoked – which fired the political energies of early socialists. The left has always had something to conserve.

We take for granted the institutions, legislation, services and rights that we have inherited from the great age of 20th-century reform. It is time to remind ourselves that all of these were utterly inconceivable as recently as 1929. We are the fortunate beneficiaries of a transformation whose scale and impact was unprecedented. There is much to defend.

We do not typically associate "the left" with caution. In the political imaginary of western culture, "left" denotes radical, destructive and innovatory. But in truth the democratic left has often been motivated by a sense of loss: sometimes of idealised pasts, sometimes of moral interests ruthlessly overridden by private advantage. It is doctrinaire market liberals who for the past two centuries have embraced the relentlessly optimistic view that all economic change is for the better.

It is the right that has inherited the ambitious modernist urge to destroy and innovate in the name of a universal project. From the war in Iraq through the unrequited urge to dismantle public education and health services, to the decades-long project of financial deregulation, the political right – from Thatcher and Reagan to Bush, Blair and Brown – have abandoned the association of political conservatism with social moderation which served it so well from Disraeli to Heath, from Theodore Roosevelt to Nelson Rockefeller.

If it is true, as Bernard Williams once observed, that the best grounds for toleration are "the manifest evils of toleration's absence", then much the same should be said of social democracy and the welfare state. It is difficult for young people to appreciate just what life was like before them. But if we cannot rise to the level of a justificatory narrative – if we lack the will to theorise our better instincts – then let us at least recall the well-documented cost of abandoning them.

Social democrats need to apologise a little less for past shortcomings and speak more assertively of achievements. That these were always incomplete should not trouble us. If we have learned nothing else from the 20th century, we should at least have grasped that the more perfect the answer, the more terrifying its consequences.

Incremental improvements on unsatisfactory circumstances are the best that we can hope for, and probably all we should seek. Others have spent the last three decades methodically unravelling and destabilising them: this should make us much angrier than we are.

To abandon the labours 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 promise that social democracy, or something like it, represents the future that we would paint for ourselves in an ideal world. But this would be to return to discredited story-telling. Social democracy does not represent an ideal future; it does not even represent the ideal past. But among the options available to us today, it is better than anything else to hand.

Can we still afford universal pension schemes, unemployment compensation, subsidised arts, inexpensive higher education, etc, or are these benefits and services now too costly to sustain? Is a system of "cradle-to-grave" protections and guarantees more "useful" than a market-driven society in which the role of the state is kept to the minimum?

The answer depends on what we think "useful" means: what sort of a society do we want and what sort of arrangements are we willing to seek to bring it about? The question of "usefulness" needs to be recast. If we confine ourselves to issues of economic efficiency and productivity, ignoring ethical considerations and all reference to broader social goals, we cannot hope to engage it. For too long, the left has been in thrall to the 19th-century romantics, in too much of a hurry to put the old world behind us and offer a radical critique of everything existing. Such a critique may be the necessary condition of serious change, but it can lead us dangerously astray. In the 19th century, "history" sat uncomfortably on the shoulders of a generation impatient for change. The institutions of the past were an impediment. Today, we have good grounds for thinking differently. We owe our children a better world than we inherited; but we also owe something to those who came before.

However, social democracy cannot just be about preserving worthy institutions as a defence against worse options. Nor need it be. Much of what is amiss in our world can best be captured in the language of classical political thought: we are intuitively familiar with issues of injustice, unfairness, inequality and immorality – we have just forgotten how to talk about them.

George Orwell once noted that the "thing that attracts ordinary men to Socialism and makes them willing to risk their skins for it, the 'mystique' of Socialism, is the idea of equality." This is still the case. It is the growing inequality in and between societies that generates so many social pathologies. Grotesquely unequal societies are also unstable societies. They generate internal division and, sooner or later, internal strife – usually with undemocratic outcomes. As citizens of a free society, we have a duty to look critically at our world. But that is not enough. If we think we know what is wrong, we must act on that knowledge. Philosophers, it was famously observed, have hitherto only interpreted the world in various ways; the point is to change it.

Tony Judt's Ill Fares the Land: A Treatise on Our Present Discontents will be published by Allen Lane this week (£20). To order a copy for £18 with free UK p&p call Guardian book service on 0330 333 6846. To read a recent Guardian interview with Tony Judt go to guardian.co.uk/theguardian/2010/jan/09/tony-judt-motor-neurone-disease

[Sheilbh]

On Judt I recommend his lecture in the New York Review of Books (not the New Yorker, sorry) and this really very sad profile/interview:
http://nymag.com/news/features/64626/

[Admiral Yi]

Long (very) on prose and rhetoric, short on logic.

[Sheilbh]

Long (very) on prose and rhetoric, short on logic.

Americans.  Speaking English, thinking German

One of the reasons it appeals to me is this question of a sort of hollowing out of society which is what I worry has happened.  I think we've lost the moral cohesion that's terribly important for any society.  He rejects religion which I'd like back in the public sphere (though I'm not a believer) but I think it has to be rejected because it's dead over here.  I think what appeals is this conservative (in the sense of conserving) social democracy does reinject a moral and philosophical purpose to society which we need.

[Grallon]

Are you in agreement with the assesment of this author?

Myself I've long held capitalism in its pesent form to be wholly exploitative and almost entirely destructive.  The 2008 meltdown was merely the beginning since "they" swung back to their usual shennanigans as soon as "they" were bailed out of trouble by public funds...  However the nation states that bailed the guilty parties out are now tottering towards bankrupcy or at least financial paralysis, which was perhaps the goal from the onset since said states were the only actors that could (can?) put a stop to this systemic highway robbery that is called neo-liberalism.

But perhaps we must wait until the motherfuckers have eaten themselves out of a natural habitat before we can finally move on to somethign else.  That is if this 'natural selection' process doesn't bring us all down with them along the way...




G.

[Grallon]

...  I think we've lost the moral cohesion that's terribly important for any society.  He rejects religion which I'd like back in the public sphere (though I'm not a believer) but I think it has to be rejected because it's dead over here.  I think what appeals is this conservative (in the sense of conserving) social democracy does reinject a moral and philosophical purpose to society which we need.

Religion as a 'check & balance' mechanism?




G.

[Admiral Yi]

Current society lacks moral purpose because communal moral purpose is in opposition to individual freedom of choice.  Communists have moral purpose; Utopians have moral purpose; Religions have moral purpose.  States that elevate individual freedom of choice do not have moral purpose absent an external threat.

[Sheilbh]

Are you in agreement with the assesment of this author?

Broadly.  I don't think he answers the problem of local conditions.  But I think his central point about our society is correct, I think that privatisation has actually just created lots of companies that are too big to fail without delivering gains in efficiency is similarly correct.

Religion as a 'check & balance' mechanism?

Religion as purpose and, I suppose, automatic fraternity.  I still think the recent crash was fundamentally a moral failing and that Wall Street was made by and a reflection of Main Street. 

[Sheilbh]

Current society lacks moral purpose because communal moral purpose is in opposition to individual freedom of choice.  Communists have moral purpose; Utopians have moral purpose; Religions have moral purpose.  States that elevate individual freedom of choice do not have moral purpose absent an external threat.

Exactly. 

[Admiral Yi]

Exactly.

And that's a good thing.

[Grallon]

Current society lacks moral purpose because communal moral purpose is in opposition to individual freedom of choice.

It constitutes an opposition only when you evacuate the 'responsability' side of the 'individual freedom' equation... 



G.

[Oexmelin]

How is the dissolution of society a good thing, exactly ?

[Oexmelin]

Exactly.

And that's a good thing.

or rather, if there is not moral purpose, what's the point from which you judge such a stance is "good" ?

[Sheilbh]

And that's a good thing.

No I think it's obvious and not terribly relevant when discussing social democracy that it opposes individual freedom of choice in the sense that it is opposed to liberalism, that's part of its origin and philosophical basis.  Liberalism is about the individual social democracy is about the community and society.  I worry that Thatcher was right and that there is no such thing as society.

I also don't think the communist thing is useful where the extent of crusading moral purpose is that found in a Methodist church hall or a Fabian meeting.  At worst it's sort-of tinged with religion and slightly utopian.  But I'd argue that we've lost any communal story in our society, it's just become individual gratification.  A world of wankers.

But you're right a religion provides a moral purpose to a society, a sense of direction and communality.  So does utopian thought, even of the rather delicate and incremental form social democracy takes.