New Democrats, New Labour, and Europe's Social Democrats

Yale Open Course <Power and Politics in Today's World>

Lecture 6: Reorienting the Left: New Democrats, New Labour, and Europe's Social Democrats

The 1990s and the 2000s were marked by the reorienting of the left especially in the UK and the US where it began to shift more to the center and adopt neoliberal policies. The decrease in industrial jobs which led to a decline in union membership weakend the left-of-center parties, leading their leaders such as Tony Blair and Bill Clinton to distance themselves from the left flank of their parties and cater to the center and center-of-right constituents.

Notes

• After Thatcher, Labour Party out of power until Tony Blair

  • Tony Blair: “new constitution for the Labour Party”

    • removed Clause 4: nationalization of the means of production/distributional exchange

  • Bill Clinton @ democratic leadership council

    • similar to New Labour

    • “New Choice” → “personal responsibility to make future America better”

Absolute vs. relative gains

• no win-win situation for relative valuation

  • one of the reasons for neoclasscist’s distaste of relative valuation

• relative gains are often more potent in politics

  • but local reference groups matter more than distant ones

    • source of indivious or solidaristic comparison

      • Solidaristic: vulnerable to the logic of the divide-a-dollar game

    • unions can function as institutional backbone for solidarity of people below median income

Thought experiment:

• Lottery scenario 1:

  • Steve wins $2 mil, but next day gets a call that says there was a second winner and his prize money now is $1 mil

• Lottery scenario 2:

  • Art wins 500K but gets a call the next day that says he’s won $1 mil because there was no second winner

• Who’s unhappier?

  • Steve → loss aversion (similar to endowment effect)

    • it bothers people more to have something taken away than gaining something (Daniel Kahneman)

    • to motivate people to do something, better to talk about avoiding a loss rather than a prospect of gaining something

      • prospect theory

• Problem:

  • unions - becoming less effective → becoming smaller and weaker

    • US membership peak in the 1950s and falling ever since

    • UK peaks in the 80s and declining

  • places where unions are powerful within the left-of-center parties, they will pull away from the median voter

    • ex. UK 80s, South Africa 2000s v. Germany

      • In Germany, agreement by unions applies to non-union workers

        • interest of unions and of all workers better aligned

• Political triangulation

  • left-of-center party (candidate) peeling away from the flank to attract median voters and the other side (esp. true when unions and left-of-center party are weak)

    • ex. Bill Clinton, Tony Blair

    • the flank abandoned, no place to go

Multiparty system

• more representative? yes at the election stage but not at the governing stage?

• more likely to be egalitarian and redistributive? inequality less severe in France and Germany (multiparty states) compared to UK and US

• BUT:

  • unions are declining in these systems

    • because of:

      • globalization of capital (low exit cost for capital)

      • jobs increasingly going to technology

• Implications:

  • ↓ union membership, ↓ union leverage to negotiate

    • left of center parties less effective in protecting workers

    • protecting unionized workers might come at the price of losing below-median income workers, service workers, long-term unemployed

• In multiparty states, the number of parties are going up

  • the major party moves to center → new party takes up the flank

    • greater fragmentation on the left

  • industrial jobs ↓ → left party weaker → new parties to take up the open seats

• party fragmentation makes it difficult to sustain solidaristic ideologies among the below-median voters

  • fragmentation on the left can lead to fragmentation on the right

DIAGRAM

• SPD loses voters → CDU moves to center to pick up new voters → the left and right flanks open for other parties to collect votes

• Proportional representation (PR) system

  • Multiparty system

  • the previously acknowledged benefits of better representation & ↑ equality in qusetion