Social Democracy in the 21st Century

Towards a Post-Capitalist Social Democracy

It’s the damnedest thing.

Famously, the Nordic countries dominate the World Happiness Index year after year. They are joined in the top ten by the Netherlands and New Zealand, two other ideologically social democratic countries.

In fact, in survey after survey, on metric after metric, we find the Nordics and other ideological social democracies like the Netherlands (which is considered nearly as pure a social democracy as Denmark, Finland, Sweden, and Norway), New Zealand dominating the top ten or occasionally the top fifteen or twenty. Social democratic Estonia punches above its weight as does Uruguay, the most social democratic country outside of Europe. Switzerland is also part of the shortlist of six countries that dominate measures of well-run societies. Switzerland is an odd case in that, like other banking havens, its prosperity isn’t easily replicated but in other ways, it points to a center-right model of social democracy with a very thick concept of democratic practice (the citizenry votes on everything) and subsidiarity — the practice of delegating power down the most locally appropriate level.

Most free countries on Earth? According to Freedom House, the top eight are Norway, Finland, Sweden, New Zealand, Canada, Denmark, the Netherlands, and Uruguay. Norway, Finland, and Sweden each score a perfect 100. The United States is in the middle of the pack at 62 on the list.

Most resilient states? Finland, Norway, Iceland, New Zealand, Denmark, and Switzerland, with Sweden and the Netherlands just a few spots down the list.

Most prosperous countries? Denmark, Norway, Sweden, Finland, Switzerland, the Netherlands, Luxembourg, New Zealand, Germany, and Iceland. The United States clocks in at a respectable #20 but that’s three spots behind Estonia, which has only been free of the yoke of Soviet rule for three decades but has thrived under decidedly social democratic values and governance.

On things that conservatives care about, like law and order … Norway, United Arab Emirates, China, Switzerland, Finland, and Iceland top the list.

Or best countries for entrepreneurs … the United Arab Emirates, the Netherlands, Finland, Saudi Arabia, Lithuania, Norway, Korean Republic, Switzerland, Qatar, Spain, the United States, and Sweden.

Or things that progressives care about, like The Social Justice Index [PDF]… Iceland, Norway, Denmark, Finland, Sweden, and the Netherlands. I could go on and on with examples of indexes of progressive goals dominated by the ideologically social democratic countries.

What’s the damnedest thing? Social democratic countries are clearly the best-run, most successful countries in the history of the world. The United States was at its most broadly prosperous during the decades when social democratic governance was ascendent, as were the European states. The neoliberal order is in disarray and the ideologically social democratic states — the Nordics along with the Netherlands, New Zealand, Uruguay, and Estonia — have proven especially resilient in that crisis, having better staved off neoliberal reaction and channeled that energy into tuning up social democratic institutions rather than dismantling them.

Despite all this, it’s almost impossible to find champions of social democracy for social democracy’s sake. Where are the social democratic ideologues? Youtube is chock-full of socialist bloggers and videos about the potential of socialism. There are socialist magazines and journals like Jacobin, Catalyst, CounterPunch, and Dissent. YouTube has countless panel discussions from a broadly progressive perspective. There are many magazines and journals that offer a broadly progressive perspective. Socialists advocate for something that does not yet exist while what has passed for socialism in the past (and presently in Cuba and Venezuela) has been a disaster. Progressivism is a political tendency without a coherent ideology. It represents a set of values but lacks any clear models and has been, frankly, pretty flabby over the last few decades, at least in the U.S.

THE SOCIAL DEMOCRACY LEXICON
NEOLIBERALISM: I try to avoid the term neoliberalism as much as possible because it is so often misused and poorly understood. When I do have to use it, it is in reference to a very particular form of captialist ideology that become dominant in the 1970s, reached its zenith in the U.K. from the adminstration of Margaret Thatcher through the Labour government of Tony Blair and in the U.S. under the presidencies of Ronald Reagan and Bill Clinton. It has been in decline since the late 90s and took mortal blows in the Crash of 2007 and the ensuing Lesser Depression and then with the COVID Shock of 2020.

Neoliberalism was a reaction to the New Deal policy regime that began in the 1930s in the US and reached its high-water mark in the 1960s with the passage and implementation of LBJ’s Great Society, bringing us Head Start, Medicaid, and Medicare among many others.

The defining aspects of neoliberalism were an attack on unions, turning public services over to the private sector (this was especially dramatic in the U.K. where industries like mining and the railroads were run by state-owned enterprises (SOEs), cuts in the welfare state, deregulation — particularly in competition policy, that is, the rollback of regulation that stopped or slowed the concentration of industries and injected competition back into markets. Intellectually it was marked by a market fundamentalism that held that markets could delivery nearly any and all services better than the public sector.

For the best explantion of neoliberalism, see David Harvey’s A Brief History of Neoliberalism.

Social democracy, by contrast, actually does exist and has a clear ideology or at least an underlying logic and ethics. It is the most successful political economic system in the history of the world and yet, where are the social democratic partisans?

Well, I am a proud social democratic partisan and I hope to use this substack to elucidate the logic and ethics of social democracy, examples of social democracy applied across a range of issues — from managing a national economy to education, criminal justice, the environment, global trade and immigration, and on and on across all aspects of organizing society.

The fact that highest rates of social mobility are found in the six most social democratic states, while the Land of Opportunity shows significantly more class-bound outcomes — where our life prospects are far more determined by the circumstances of our birth and who are parents are — might strike Americans as paradoxical but it’s actually a perfect encapsulation of the logic and ethics of social democracy. A strong social safety net, with especially robust investments in children combined with markets that are MORE open and competitive than our own means that not only are the least well off much better off in the Nordics countries and the Netherlands but working adults rise and fall to a much greater extent than in the U.S. where children born into poverty are more likely to stay trapped in poverty and children born into wealth are far more insulated from the depredations of the market economy than their Scandanavian peers.

I believe that we shouldn’t look at social democracy as what socialists get when they get half-a-loaf or what’s left when progressives save capitalism from itself yet again. Social democracy offers a stronger, thicker vision of democracy and pluralism built on civic republican values than democratic socialism or progressive liberalism offer. It has a stronger, more coherent vision of an open dynamic market society than either democratic socialism or progressive liberalism. At this point, its highest expression is in the Nordic Model of social democratically-managed welfare capitalism. I think that the building blocks already exist to create a social democracy that goes beyond capitalism if only we have the vision and political will to bring all those institutions together into a coherent whole.

If we look beyond the terrifying prospect of a reactionary and even fascist right on the move around the world, we also see social democrats newly energized and taking on the challenges of governance. For social democracy to live up to its full potential in the 21st Century a clearer post-capitalist vision will be necessary to steer through the wreckage of a failed neoliberal order. That future is ours for the taking. All we need to do is be bold enough to take it.