Where next after the third way?

Christoph Arndt and Kees van Kersbergen
Christoph Arndt and Kees van Kersbergen

Christoph Arndt and Kees van Kersbergen reflect on their article ‘Social democracy after the Third Way: restoration or renewal?’, available now on Policy & Politics fast track.

What do social democratic parties do after they regain power after the Third Way? This was the guiding question for our study of the public policies of the current Danish social democratic government (2011-2015). The Third Way (TW), with Britain’s New Labour as its forerunner, was at first a successful strategy for many European social democratic parties to regain power after long bourgeois incumbencies in the 1980s and 1990s. However, it usually ended in electoral disaster since TW policies did not square with the preferences and values of many social democratic core voters who then abstained or shifted to other left-wing or right-wing populist parties. One should therefore not expect social democratic parties to return to Third Way-style policies after regaining power.

Our case study of Denmark, however, shows that that is precisely what happens and that it has similar negative electoral consequences. Danish social democracy was the first social democratic party that regained power in a centre-left coalition after having paid the price for governing with a TW platform between 1993 and 2001. We examined the social democratic-social liberal government that has ruled Denmark since September 2011 and found among other things that it:

  • curtailed the early retirement and disability pension schemes by tightening eligibility;
  • engaged in cutbacks of social assistance for younger claimants under 30;
  • introduced and expanded mandatory programs for (younger) labour market outsiders;
  • decreased the maximum unemployment benefits;
  • Cut the corporate tax rate and decreased the marginal taxes for middle incomes.

These instruments stem largely from the TW toolkit and contributed to the crumbling popularity of the social democratic-social liberal government since 2011 which was constantly trailing behind the alternative bloc of centre-right parties. One obvious flipside of the updated TW strategy is that the winners of such reforms don’t reward social democratic governments for those social policy reforms and responsible economic policies, while the losers do punish social democracy by abandoning the party and turning to extreme left and populist right-wing parties.

Based on the Danish experience and some comparative reflections, we conclude that other future social democratic governments might pursue many elements of an updated TW that we found in the Danish case. However, there are most likely also considerable cross-national differences caused by a variety of factors such as electoral considerations, party competition, coalition partners, policy-learning, and the strength of intra-party factions. The new German grand coalition, for instance, has a much more balanced account when it comes to implementing TW policies. The coalition introduced some generous pension policies, marking a clear departure from Schröder’s Agenda 2010 policies, while at the same time it committed itself to the educational upgrading of the labour force and sound fiscal policies. The Dutch Labour Party is in a coalition with the Liberal VVD and this coalition is pursuing some rather Anglo-Saxon style workfare policies and is also engaging in various fiscal cutbacks.

To examine and explain such cross-national variation of current and future social democratic governments, our article is also a pilot study for a future comparative project that studies social democratic parties in Denmark, France, Germany, the Netherlands, Norway, Sweden, and the UK after 2010. Here we want to examine questions such as:

What do social democratic parties do? How do they govern? How can we explain the variation between the countries, e.g. why do we see a TW-style Danish social democracy, but a more orthodox labourist German social democracy? What trade-offs do social democratic governments face after returning to power with or without a revised TW agenda? In this way, we want to examine the fate of European social democracy in the early 21st century in our future research project.

Christoph Arndt is an Assistant Professor of Comparative Politics, and Kees van Kersbergen is Professor of Comparative Politics, Department of Political Science, Aarhus University

If you enjoyed this blog entry, you may be interested in a similar article: Poverty and social policy in Europe 2020: ungovernable and ungoverned

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