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27 responses to “Guest post by Tad Tietze: Doomed to repetition? The Left and the social democratic inheritance”

  1. WD40

    What never ceases to amaze me is how Australian social democrats (including those at this blog) focus so narrowly on what is happening in Britain and the US.

    I mean hello, who cares who the newest Labour leader is in Britain!

    The major social democratic success stories judged by electoral performance and a range of equality measures are the Scandinavian states and one or two near neighbours, yet in the literally thousands of posts on this blog all these countries get is the occasional fleeting mention. I’ve never understood that.

  2. WD40

    As a case in point, I note with boundless incredulity that there isn’t even one single post on this blog on “flexicurity”, which is one of the most interesting ideas to develop within the European social democratic tradition over the last couple of decades, whether or not one agrees with it, yet Guy Rundle(?) seems to spawn a blog post every time he sneezes.

    Come on guys, lift your eyes above your navels.

    (My apologies if I sound overly harsh).

  3. Kim

    @1 – I suspect that despite what we might like to think about social democratic internationalism, the barriers of language and cultural lineage are real. Which is a point with the whole Sweden in the South Pacific thing – I think it’s reasonably well settled that a certain homogeneity of culture and belonging, and a very collectivist history (both religious and secular) is a big factor in Swedish social democracy.

    Norway’s probably a better comparator with Australia, for a stack of reasons, but its politics, economics and history are even less well known.

    Having said all that, I suspect Judt is arguing at some level a difference between European social democracy and American liberal capitalism with the UK tugged in both directions, “different models of capitalism” and all that. But I haven’t read the book!

  4. WD40

    “Which is a point with the whole Sweden in the South Pacific thing – I think it’s reasonably well settled that a certain homogeneity of culture and belonging, and a very collectivist history (both religious and secular) is a big factor in Swedish social democracy.”

    I realise that, but it doesn’t mean such countries have nothing to teach us. We are not an American mini-me either.

  5. Kim

    I don’t disagree.

  6. john

    Australia has a very strongly collectivist history too.

  7. Richard Green

    Was the term ” Austrian neoclassical economists” actually in the book? That made me crack up (the Austrians will have kittens, they ket going on about how neoclassicism was statist). I guess that explains the idealist account of economic methodologies. It’s easier to create cartoons about whose “side” a given methodology is on than to, you know, know anything about them.

  8. John Passant

    I always enjoy Tad’s articles. They are stimulating and thought provoking and go beyond the usual social democratic hankering for the ‘good ole days’ days built on profits rates much higher than today.

    In that context I find Mike Kidron’s analysis of the post war boom – the Permanent Arms Economy – particularly insightful and a great basis for thinking about political organisation today as is the more general International Socialist Tendency analysis of stalinism as state captialism.

    If, as Marx contended, and Kidron builds on, there is a tendency for the rate of profit to fall inbuilt within the productive processes of capitalism itself, then the economic basis for social democratic reform today has greatly narrowed if not disappeared. This is because general profit rates today are about half those of the halcyon days of the 50s and 60s.

    The question then becomes what is to be done. (And before that gets the social democrats frothing, read Lars Lih.)

    Lenin’s project of building a party of the class conscious section of the working class as the base for the working class democratically overthrowing capitalism then becomes an historical necessity for the Left.

    That is not to say this is or will be an easy task. But that discussion is for another day.

  9. Richard Green

    I’ll elaborate for other purposes. What is hilarious is that the “Keynesianism” that dominated in the post war period is usually called “Neo Keynesianism” because it was still based neoclassical economics that had been in vogue before adjusted so that parts of Keynes could be incorporated. I’m pretty sure it was Hayek (the Austrian) who pointed out in the 60s that the same economics was being taught at Harvard and in Havanna. Since it could be uses to support state action, the Austrians thus thought it would inevitably be used as such. It didn’t help that parts of neoclassicism that were laissez faire even rejected Austrian shibboleths on fiat currency (like the monetarists like Friedman did) or adopted methods that were powerfully at odds with Austrian study methods (like Lucas and co).

    An assertion about placing “social justice before economics” doesn’t make much sense. “Using ideals to determine what we want from these economics” – the economics themselves as opposed to the assumptions that lazy discourse attaches to them. Unfortunately he can see only the cartoons, as if a tool can only be defined by the way the most loud of your opponents has claimed to have used it, rather than what you can use it for.

  10. Katz

    This has led some to see the re-emergence of an old-style social democracy as a necessary first step in building a radical Left.


    Undiscussed in this post is the actual, historical relationship between marxism (of any kind) and social democracy.

    This relationship is complex. In the anglophone world, full-fledged social democracy sprang into existence before any material influence of marxist ideas. In continental Europe, social democracy was to a large extent a development of revisionist marxism, bringing from marxism its central intellectual inheritance, dialectical materialism.

    During the twentieth century, the democratic left throughout the developed world wrestled with the concept of dialectical materialism. Overwhelmingly, since the 1960s, for a wide variety of reasons, western social democratic political movements have abandoned any serious engagement with dialectical materialism.

    Dialectical materialism is the engine in the marxist concept of social transformation. Without that, marxism is nothing more than a bunch of slogans that may have ethical appeal but which are devoid of explanatory power.

  11. Dr_Tad

    @1-5 Judt does cover non-Anglophone social democracies, but he also includes “non social democratic” social democracy in places like the US. He makes a general point about the post Great Depression period (esp. post-WWII) that similar policies were taken up everywhere.

    I think this is a common argument from social democrats… that the post-war boom was the product of a wider Keynesian consensus that stretched over to the conservative parties. Robert Manne makes a case for this in Goodbye To All That. The danger in this is that it robs social democracy of its specific political character as a movement related to social justice in the interests of the working class — and we can all learn to love Menzies again! I am very sympathetic to Richard Green @9 about the murkiness of the economic policies of the post-war boom, therefore.

    To put it more bluntly, my argument is that social democracy can only have a golden age if capitalism is having a golden age. The rest of the time its contradictory character of trying to improve society for the working class while not fundamentally challenging the capitalist system means being capitalism’s doctor when the system is sick. Even Scandinavian social democracy follows this general pattern, having dismantled some its crowning achievements with the re-emergence of economic crisis and volatility in the post-1973 period.

    Here is where I think I differ with @9… the economic “tools” bequeathed us are tools for running a particular (capitalist) economic system. I think Marx was right to argues that modern (“vulgar”) economists are ideological prize fighters for the bourgeoisie; that their theories start from the presumption that the system is rational and eternal rather than asking whether or not it is. Judt seems to accept the idea that capitalism can be made more rational simply through the application of certain policies when he explains the post-war boom, but falters when discussing the GFC, in some ways conceding that working people will have to pay for the crisis, although preferably less than the neoliberals would want.

    When he implies economics should be subverted to social justice he is positing something that requires a more radically transformative project. If Marx did nothing else, he made a clear argument that while capitalism allowed the development of productive forces that could provide plenty for all, a different social system was needed to bring those productive forces under collective, rational human control.

  12. Dr_Tad

    Further to @8, this is an excellent but critical historical review of the concept of the “permanent arms economy”: http://isj.org.uk/index.php4?id=660&issue=127

  13. Dr_Tad

    Katz @10 There have been debates in the radical and broader Lefts of several anglophone countries (including Australia) about what fills the vacuum when really existing social democracy is in crisis but a growing constituency supports social democratic policies.

    My recent article in Overland (http://web.overland.org.au/previous-issues/feature-tad-tietze/) suggests that the Greens represent a non social democratic Left formation that has filled the gap in the market. But on the Marxist Left some see the need for themselves to create a transitional space to win people to more radical projects through shared involvement in such a formation.

  14. Katz

    That sounds a lot like a replay of the relationship between the Old Left and the New Left in the 1960s.

    That encounter turned out badly for the Old Left.

    I doubt that the Old Left has any New Tricks left.

  15. akn

    I’ll buy in the WD40’s peculiar comments about the absence of any comment on LP about Sweden before (later) addressing some of the significant points raised in this post Tad.

    For the meantime, WD, some of us are very familiar with the history and politics of Sweden through reading the work and contact with the following Australian author: Higgins, Winton. Ernst Wigforss: The Renewal of Social Democratic Theory and Practice. Political Power and Social Theory, vol 15, 1985 (cited on Wikipedia).

    Winton took his bearings from Ernst in pursuing a vision of social democracy in which, as Ernst put it, the state had a role to play in “soul craft” by which he meant that the state has a legitimate role in bringing into being the sorts of democratic subjectivities necessary to inhabit a sophisticated democracy. The state achieves this through ordinary mechanisms of the provision of welgfare and other services (education, health). The effect is to relieve citizens of the “deforming effect of poverty”, as Marx put it. In other words, part of the process of creating a democracy is creating the people who are able to fully participate as citizens and one of the key means of doing this is creating an economic and social culture in which fear of poverty does not curtail the sorts of projects that people undertake over a lifetime.

    I could go on as you may have by now have noticed.

    Kim @3 notes that it is widely accepted that there are particular cultural attributes of Sweden that make its path to strong social democacy quite specific – strong Protestantism and a common remembered history of excoriating pre-war poverty aligned with the fact that social democracy (under Wigforss) led Sweden out of that poverty. For a while there Sweden was a model of social democracy for the ACTU in Australia and there was a major discussion about corporatism and tripartitism following strong support for the Swedish model by Laurie Carmichael and sections of the CPA. Absent the Swedish history, common bonds and civil society, Australian capital was less than co-operative with this idea.

    The turn to the right in Sweden appears to be a closure of a particular moment in that social democracy rather than an end to Swediswh s-d. Sweden is not immune to the same sorts of issues prevalemnt all over Europe.

    There, that should satisfy your demand for discussion of Sweden which appears to be a thread derail. Others nmeed not engage if they don’t want to.

  16. Geoff Robinson

    But the rise of neo-liberalism was in part a response to social democratic overeach in the 1970s, and the poor productivity performance of state socialism demonstrates that the Hayekians were onto something. Doesn’t the productivity resurgence of the 1990s in Australia and the US (not anticipated by left commentators) demonstrate that capitalist relations of production continue to foster the development of the productive forces?

  17. wrong+arithmetic

    @ Katz, etc. yep old left and new left are dead. facts. The next left is in the wind, it can be marked with an ‘x’, it is an unknown.

    I’m unsure what you are getting at with your comments on Dialectical Materialism. I think that the authenticated philosophy of Stalinism was a disaster, one disaster among a larger one. Eric Aarons notes in his biography that he never really understood the dialectic and later felt that it acted as a shibboleth. In this way it is one of the slogan’s of really exiting Marxism, rather than what would give them substance. This remains obvious in the socialist sects that still exist.

    But at the same time you have, Adorno, Sartre, Althusser, Foucault, Derrida, Deleuze, Badiou and Negri who all saw or see themselves as somehow within Marxism, or continuing Marx’s problematic, some of whom openly made philosophy a centre question for the crisis that was opening up with decline of Communism after 1968. Adorno, Althusser and Badiou could easily be said to have validated dialectical thought against the philosophy of Stalinism; on the basis of these three names it is impossible to say that Marxism is defunct for philosophical thought.

    But how do these questions relate to the present impasse? I think it is interesting that Marx haunts Judt in this book: he has to name and dismiss him. This is the same with Robert Manne, David McKnight and Clive Hamilton. There is some understanding that history has moved on, but there is also an insistence that that history is closed off to thought: the thoughts of that history are just bad, we must lock them away.

    I personally don’t think the unknown left to come will come without overcoming is fear of Marx. This sort of what Tad alludes to with Judt’s inability to go beyond an idealist reading of the 1970s and the present crisis.

  18. Dr_Tad

    Geoff @16. The Hayekians were onto something, but only in the sense that a broken clock is right twice a day, IMHO… i.e. By the late 1960s the state capitalist developmental model common to both sides of the Cold War divide was no longer delivering the rates of expansion that it had previously. However, even in the most autarchic regimes (e.g. Stalin’s Russia up to the 1960s), productivity and growth rates were very high for a uniquely prolonged period.

    This is a problem with the social democrat/Keynesian v neoliberal debate, that each side chooses a point in time where its preferred model seemed to be working better and generalises that experience as if it were eternally true.

    To answer your specific question about Australian productivity, it seems clear that successive recessions, economic restructuring and attacks on wages and working conditions together allowed significant recovery of productivity growth. Yet the fact that growth rates have not returned to the high and stable levels of the post-war era speaks to the failure of the economic rationalist model to restore accumulation to pre-1970s levels.

    That Australia’s recent growth has been partly sustained on the basis of incredibly high levels of private household indebtedness and partly on the good fortune of resource exports to China has hidden the declining productivity growth of the 2000s. Of course the neoliberals will argue that’s just a reason to whip workers harder, as has been revealed in the Treasury’s Red and Blue Books. But we are not back to the post-war golden age by any means. Things look even more dire outside Australia where Chinese growth has not played such an important role.

    None of that is an argument that capitalism is a system that lacks dynamism. Marx himself clearly writes of both its dynamism but also that it is a system characterised by volatility, crisis and constant “revolutionising” of productive forces and social relations. This is not the same as his longer-term analysis which is that increasing productivity through labour-saving innovations undermines future productivity growth (expressed at one level in terms for a tendency for the rate of profit to fall even as absolute profits increase).

    For Marx the last 40 years of capitalist volatility would have been unsurprising. It is the long post-war boom that would have been more taxing to explain, although I find the Permanent Arms Economy thesis more convincing than other Marxian or mainstream explanations.

  19. harleymc

    I’m not sure which parallel universe Judt was writing about.
    The last 3 decades are characterised as “three decades of neoliberal hegemony”.
    Lets not forget some of the other contesting movements, the sucessful fight against Apartheit, womens’ movement, fair trade movement, global mobilisation against poverty, collective work on HIV/AIDS the rise of eco-consiousness, the land rights movement, Anti – nuke movement, ride of micro-credit…. We can all add in a whole range of movements where individualism wasn’t king and collective action changed the world. Collective action not neo-liberallism toppled the corrupt state- capitalist regimes of eastern europe, sorry but no gold star for the neo-cons there.
    Economic neo-liberalism was a top down ideology and it suited the ruling class very nicely, but our lived experience is that there were many other isms contesting the playing field and making real changes to people’s lives.

    I’m not sure if the book text or the review is to blame for the other big muddling that come through in the post but social-democrat is NOT the same as democratic soocialist, these seem to be used interchangebly in the article.

  20. WD40

    It is perhaps worthwhile reading this post in conjunction with this post by Skeptic Lawyer: http://skepticlawyer.com.au/2010/09/26/who-is-in-charge-of-bread-supply-in-london/

    There will be no “left” alternative to “neoliberalism” until lefties bother to actually learn some of the language and concepts employed by mainstream economists and to accept that many of these concepts do actually make sense.

  21. Dr_Tad

    WD40 @20 I had written a more substantive reply to the Skeptic Lawyer post. But on second thoughts it’s such transparent ideological fluff I won’t bother.

  22. WD40

    “But on second thoughts it’s such transparent ideological fluff I won’t bother.”

    Don’t be so hard on yourself, Dr Tad.

  23. Ginja

    Did Keynesianism utterly fail in the 1970s? The Right uses this line all the time.

    First, it fails to take into account multiple oil shocks (one reason for the more benign level of inflation in the 80s and 90s was probably a much lower oil price).

    Second, were Keynesian policies actually followed in the seventies? Counter-cyclical fiscal policies often weren’t followed. Governments kept on spending in an inflationary environment (often for legitimate reasons).

    Looking at the Australian post-GFC stimulus, even Keynesians like me are amazed at how comprehensively Keynes has been vindicated. Same goes for China. The US is in the doldrums simply because its stimulus was way to small to do the job – as Paul Krugman warned at the time.

  24. Ginja

    ..way too small to do the job, I should say.

  25. WD40

    I should also point out for the benefit of Dr Tad that Skeptic Lawyer’s central thesis own local food romanticism is largely supported by that notorious right-wing ratbag, Peter Singer:

    “You have to ask yourself what’s particularly good about being local. People say, “Well, I want to support my local economy.” But if you’re living in a prosperous part of the United States, what’s really ethical about supporting the economy around you rather than, say, buying fairly traded produce from Bangladesh, where you might be supporting smaller, poorer farmers who need a market for their goods? So I think that just in terms of supporting your local economy, I’d say no, you should support the economy where your dollars are needed most. But then people will say, “Yes, but there’s all the fossil fuel used in shipping it over from Bangladesh or wherever.” But people often don’t realize that if you’re shipping something like rice by sea, the fuel costs are extremely low. Shipping is a very efficient way of transporting. It may be that if you’re buying rice in California, the rice from Bangladesh has used less fossil fuel than California rice, even counting what it takes to get there. We also found that when we looked at tomatoes produced in New Jersey early in the season by being grown on heat, when you calculate the amount of oil that goes into heating the greenhouses, it turns out that you could have trucked them up from Florida with a similar amount of oil. If people are prepared to eat locally and seasonally, then they probably do pretty well in terms of environmental impact. But there’s not many people who live in the northern states of the U.S. who will say, “I’m not going to have any tomatoes between November and July.” So I think there’s a certain amount of double talk about local food that’s just too rosy.”


    Peter Singer is that very rare beast, a lefty who actually explores ideas with an actively engaged brain as opposed to fuzzy minded sentiment and sloganeering.

  26. Dr_Tad

    WD40, you refer us to Skeptic Lawyer, a self-proclaimed member of the “libertarian Right” as guidance for the Left and expect me to take you seriously.

    Whatever the specifics of localist food movements of the sort s/he criticises, the world market in food sees more than sufficient calories produced to feed everyone but hundreds of millions (if not billions) unable to access enough of them. That is the reality that must be explained, not the “just so” piece of economic theory and appalling stereotypes s/he regales us with.

    Of course I’m sure that Skeptic Lawyer will argue that this is just the result of bad governments, etc, distorting the natural operation of “free” markets, but that will just be like libertarian Right nutbag Grover Norquist on Lateline last night. Whatever question Leigh Sales asked (including about the GFC) the answer was the same: too much regulation, too many taxes, not enough free market.

    The other reality libertarians and market zealots skirt around is how states are integral to making markets work in the interests of capital. They even go to war to open them up. Look how “free” the Iraqi people are now with all that market economics being so helpfully introduced down the barrel of a gun. Sure 600,000+ had to die, but the place is so much economically freer now.

    I’ll be passing on your and Skeptic Lawyer’s friendly advice to us Leftists, thanks very much.

  27. Austin

    @WD40… if you want to talk about ignoring leftist ideas from outside our cultural bubble, what about Bolivia and Venesuala etc? Are we on the left still perhaps not ready to see brownish third world people as having ideas we could learn from?