Is social democracy the best system of government, or does it just make capitalism appear acceptable?

First topic message reminder :

Andrew Koppelman, professor of law and political science at Northwestern University, has written: “Barack Obama properly belongs in a specific anti-socialist movement on the left, social democracy, which accepts a capitalist economy but demands a strong state to moderate its failures and excesses.”

The concept of social democracy was originally developed by the German politician Eduard Bernstein (1850-1932), who attacked Marxism's emphasis on revolution and claimed that socialism could evolve through parliamentary democracy. Bernstein claimed that a mixed economy of public, co-operative and private enterprise would be necessary for a long period of time under social democratic direction before private enterprise would evolve into co-operative enterprise. (Little did he know about globalisation and multinational corporations!) By the post-World War II period, most social democrats in Europe had abandoned all remaining ideological connection to Marxism.

Social democracy aims to use the state for two central purposes. One is to correct capitalism’s operational failures, where capitalism wastes wealth instead of producing it. The recent global credit crunch is an example: many well-functioning businesses that were competently producing goods and services have been destroyed, in a spreading cycle of depression. Barack Obama introduced stimulus measures and bank bailouts with the aim of stopping this downward spiral.

The second aim of social democracy is for the state to ameliorate the market’s distributive consequences by spreading around the wealth that capitalism produces. This aim is the more controversial, and once provoked Thatcher into describing social democracy as “slow motion socialism”. In the USA, both Bush and McCain showed willingness to act to keep a recession from becoming a depression, but neither had any interest in redistributing wealth.

The right-wing alternative to social democracy is a government that gives the market free rein and does not intervene to ameliorate its systemic or distributive consequences. Under this concept of minimal government, whatever an unregulated market produces is appropriate and acceptable. Those who take this position understand that an unregulated market will produce booms and busts, and will leave some people impoverished. They can live with that, but it’s a heartless view.

Inequality created by free-market capitalism comes at a price. That has to be paid by those who have to take the low paid and very limiting jobs, those who despite hard work will never have enough money to be able to 'choose' anything other than the cheapest and most essential. Those who can never buy the toys and clothes for their children that their friends can who are better off, those who for economic reasons have to squeeze into a small apartment and never have the money to travel anywhere.

That price is also paid by society, and in the end it affects those who believed they have prospered from the inequality. Economic and social inequalities create bitterness, friction and confrontation; people who feel that they are badly treated by society have no reason to be loyal to a society that does not show them any respect. When the Tories had 18 years in power in the UK, crime doubled and Thatcher boasted “there is no such thing as society, only individuals”. The need to constantly compete with others to ensure one’s own welfare creates distrust between people, and the requirement to constantly perform at one’s best to prove one’s value wears down the individual. It’s hard to see that increased market thinking, and all that it has meant with changes in living conditions, has led to greater happiness and satisfaction. On the contrary, reports on worry, stress and psychological problems are increasing, not least among young people.

Social democracy supports a social welfare state based upon publicly funded social welfare. It supports legal entitlements for citizens to universal access to public services such as workers' compensation, universal health care and universal education, and other services such as child care and care for the elderly. Social democracy supports collective bargaining rights for workers and advocates freedom from discrimination based on differences of ability/disability, age, class, ethnicity, gender, language, race, religion, and sexual orientation.

Research has shown that those societies which are the most equal are the least violent. Many of the problems facing the world today, in and between nations, are due to inequality and the tensions this breeds. Upholding the policy of equality and fairness is not just a question of ideology, it is about the necessity to create a more peaceful and stable world. But does social democracy just make capitalism appear more acceptable and a little less unfair than when it’s unrestrained by right-wing governments? Rather than evolving society towards socialism, are social democrats preventing that development by smoothing off the harsher edges of capitalism?

Quite a few people on Twitter have read this thread, and several of them have asked what the difference is between social democracy and democratic socialism?

Unrestrained capitalism can generate wealth, but it creates vast inequality and relatively few people get most of the wealth that is created.  I would suggest that social democracy is a mix of a market economy and state intervention with the aim of making capitalism fairer. A social democracy is likely to have some enterprises which are publicly owned while others are privately owned. It will also have a managed economy, possibly following the philosophy of Keynes that full employment and growth can be achieved by ‘reflating’ the economy when necessary. Such a system will be funded by progressive taxation, where the rich pay proportionately more in tax than the poor (usually by graduated direct taxes, such as income tax).

Social democracy is an end in itself. On the other hand, democratic socialism aims for a society to gradually evolve to a system of socialism by democratic means rather than by revolution. Socialism has a number of definitions, but most refer to full public ownership of the 'commanding heights' of the state, workers' control of the labour process and redistributive tax policies.

QUOTE: " .... a system will be funded by progressive taxation, where the rich pay proportionately more in tax than the poor...."

Sorted!

The only slight problem there is that "The Rich" allocate a proportion of their wealth first of all to arranging a rather more benevolent system by paying clever Accountants to present their tax returns in a legal but flattering way, to control media which maintain a constant stream of favourable propaganda, and to make substantial donations to the very politicians who might administrate a "system funded by progressive taxation, where the rich pay proportionately more in tax than the poor."

Oh, bugger! Back to the debate.

State accountants OW, who all get paid the same, to ensure that the rich get taxed more and the less proportionately.
Now am I describing capitalism?

Technically, civil servants employed within Her Majesty's Revenue & Customs (HMRC) are qualified accountants within the accepted meaning. As in all matters Parliamentary, however, their actions are directed by their Political Masters, the government ministers.

The inherent vice of capitalism is an unequal sharing of blessings. The inherent virtue of Socialism is the equal sharing of miseries.
Winston Churchill, speech in the House of Commons (1945-10-22)

nice one OW

Some depressing thoughts from Neal Lawson, the chair of ‘Compass’.  

Social democrats face irrelevance at best, extinction at worse

"No social democratic party anywhere in the world is on the front foot. Sure, parties may find themselves in government – as they do in Denmark, Germany and France, in their own right or as part of a coalition – but this happens by accident and tends to be down to the failures of the right. And in office, social democrats tend to follow austerity or austerity-lite measures. No social democratic party has a strident and confident set of intellectual and organisational ideas that propel a meaningful alternative political project.

Social democracy is a 19th-century construct that achieved some successes in the 20th-century but is hopelessly prepared for the 21st century. This is because all the forces that once made social democrats strong have disappeared. The collective experience of the war, the existence of a unified, organised and seemingly growing working class and the brooding presence of the Soviet Union – a threatening alternative to free markets that forced big concessions from employers who feared revolution happening in the West – all combined to ensure that capitalism momentarily made historic compromises with social democratic parties.

The 20th-century underpinnings of social democracy have not just evaporated, but have been replaced by other hostile forces. Globalisation and individualisation act as pincers to further restrict the possibilities of any social democratic renewal."

Please read on.........
http://www.compassonline.org.uk/a-crisis-of-social-democracy-irrelevance-or-extinction/

It may be an over-simplification to describe the activities of Social Democrats as a camouflage for less generous people.

e.g. As in a certain Brussels debating chamber, which makes no laws and cannot even be trusted to audit itself.

Parties are going to have to become really democratic, localising power and building platforms for collaboration around things like energy, loans and new media.

That seems to be the general direction Milliband seems to be heading with the Labour Party?

I'm lucky enough to have been invited to hear him speak on Monday - if the chance arises I can explore this very point

Please do boatlady, if you get chance to speak to his advisers too, please tell them to get Ed to speak more forcefully on the subjects against the tories.

Martin Schulz, the former president of the European Parliament, is now the leader of Germany’s SDP. The party has risen by 10% in the polls since he took over and is currently slightly ahead of Angela Merkel’s CDU. The far-right AfD is attracting only around 10% support, suggesting that Germans have either been reading their history books or, in some cases, have long memories. Although social democracy is unlikely to “build Jerusalem in England’s green and pleasant land”, it’s a lot better than the movement to the extreme right which has produced Brexit and Trump and even threatens to empower Marine Le Pen.

Will European Social Democrats regain some mojo?

Extracts from an article by Frank Schnittger:-

"One of the secular trends in European (and global) politics in recent decades has been the gradual erosion in the influence of social democratic parties and a rise in centre-right parties promoting market-led globalisation and austerity. The recent backlash against that has not resulted in a swing back to social democratic parties, but rather in a swing even further right as exemplified by Trump, Brexit, and the rise of far-right nationalist parties in Europe.

However, the sheer incompetence, recklessness and extremism of Trump, May, Le Pen, and other far-right leaders may cause even relatively conservative voters to look for an alternative. The post-war settlement which gave rise to an American dominated world order and the EU is now seen as being threatened with extremely uncertain consequences. The New Deal, public education and the welfare states within Europe as well are now threatened by Trump and Brexit. Having been on the defensive as these achievements were gradually whittled away, progressive leaders may find the public mood becoming more receptive to strong and socially progressive state interventions in the economy.

The Brexit negotiations could get ugly, but they could give social democrats some of their old mojo back. The warmongering, corporatist, nationalist, and fascistic tendencies exhibited by Trump and the Brexiteers makes it easy for social democrats to define themselves as progressives without even having to stray too far from the centre of the political spectrum. Whether it will be a last hurrah or the beginning of a new dawn remains to be seen."

For the whole article:-
http://www.eurotrib.com/story/2017/2/6/45553/48951

Andrew Marr writes in today's Sunday Times that "Tech" companies such as Apple, Google, Amazon, Microsoft and Facebook now have a market capitalisation that exceeds anything previously enjoyed by Oil Companies or Industrial Manufacturers. Which explains why mere governments are powerless to insist upon compliance with their local tax regimes.

This may sound like stating the bleedin' obvious, but in the article Marr urges politicians to act to protect small business and retailers from unfair tax exposure to competition with the global companies, by working closely with others - notably in our case with the EU.

(No link: paywall)