Having It All
Goodhart, David & Barkan, Joanne
THE BLAIR-SCHROEDER third-way manifesto published in the Spring issue ("The Third Way/Die Neue Mine, annotated by Joanne Barkan) is not a pretty document. But it does not deserve the...
...There is also in the document, and in third way rhetoric more generally, too much stress on the successful and too little on the loyal, boring, average performer without whom no business or organization could survive...
...Businesses often run at less than their full potential because they cannot find the right people...
...B B RIEFLY, A FEW specific points...
...This is partly the result of sociological and economic change: the social pyramid has become a light bulb, manufacturing has turned into services, ties of class and region have given way to a far more individualized experience of life...
...On the one hand she wants to mock the claim to newness of the third way by pointing out that her beloved Swedes have been making the market work for everyone since the 1930s...
...It was, like most documents of this kind, thrown together rather haphazardly by a working party of like-minded British and German center-left politicians just prior to the European Parliament elections of June 1999...
...But it was just rhetoric...
...There seems to be no serious attempt to link the center-left values listed at the start with the manager-speak that dominates much of the rest of the document...
...Instead they want to focus on raising the floor—increasing the incomes of the less well off and investing heavily in public health and education to give everyone a decent start in life...
...And why not...
...and devolved power to a Scottish parliament, Welsh assembly, and London mayor—thereby breaking the one and only law of political science, that those with power never spread it about...
...On the other hand she wants to join in the general dismay at the rhetoric of free market managerialism...
...As any labor economist will tell you the best way to find a job is to have one already...
...THE BLAIR-SCHROEDER third-way manifesto published in the Spring issue ("The Third Way/Die Neue Mine, annotated by Joanne Barkan) is not a pretty document...
...They want all of those things too...
...But knowing what the electorate thinks it thinks does help you sell your policies to increasingly uncommitted voters...
...Where will the new jobs come from...
...Rather, left-wing social democracy since the 1930s produced a culture of solidarity...
...In much larger and more heterogeneous places like Britain or America it is impossible to imagine Swedish solutions being of much value...
...First, what should a third-way theory of justice/fairness look like...
...Moreover, the growing number of low-wage/low-skill jobs combined with a loss of medium- to highwage/ semi-skilled jobs is a problem the third way was supposed to fix...
...Focus groups are far more representative than activists...
...He writes, "The decline in the number of jobs for people of below average intelligence is a serious problem, although one that political correctness suppresses...
...How can we best make our case...
...Some third-wayers polemicize in this way disingenuously...
...I am not an expert on Swedish social democracy...
...It has learned that as well as market failure, there is state failure...
...W]hat should a third-way theory of justice/fairness look like...
...substantially reinvented the tax-benefit system, raising the income floor for many low earners...
...This is probably the more popular view even among third-wayers, but they don't seem to have the political will to impose the required redistribution...
...Sixth: At the end of his piece, Goodhart poses a question—"a big philosophical one," he says...
...the left has for so long been associated with failure that it has to go over the top to try to adjust the stereotype...
...They had one re sponse, and Goodhart parrots it verbatim: "But DISSENT / Summer 2000 n 87 ARGUMENTS Sweden is a small, ethnically homogenous country, where a high degree of solidarity is culturally ingrained...
...Perhaps, again, the third way means you can have it all despite what those lefty puritans might say...
...In most parts of the developed world the left has been in political retreat for the past twenty-five years...
...88 n DISSENT / Summer 2000...
...Actually, it's a lengthy, formal document, presented by the prime ministers of two significant European nations, that claims to explain in some detail the ideas behind and policies of the third way...
...That does not mean that you ignore activists and turn focus group prejudice into policy...
...Everyone knows that political discourse takes place at an appallingly low level these days, but "small-d" democrats agitate to raise that level...
...To accomplish this politically, they will have to recreate a movement based on a sense of shared values, aspirations, and life experiences...
...As far as I know, this is Goodhart's idiosyncratic observation and is not typical of third-wayers...
...and "Perhaps, again, the third way means you can have it all despite what those lefty puritans might say...
...Or rather it deserves both more and less than her spraycan has come up with...
...Yet the important point is that the Swedish model depended not on small size or ethnic homogeneity but on policies supported by a mass social democratic movement: centralized bargaining, solidaristic wages, income redistribution, tax incentives for business investment, extensive labor market programs, and public investment in education at all levels...
...If radical third-wayers invest heavily enough in public health and education to give truly everyone a decent start in life, they will need lots of money, which will have to come from taxes...
...Of course the center-left has long accepted the market part of the mixed economy, but until now its representatives have usually done so grudgingly...
...Second: After celebrating the accomplishments of Tony Blair's government at great length, Goodhart admits (in a parenthetical phrase in his second-to-last paragraph) that the gap between rich and poor "has been growing in Britain under New Labour despite an increase in redistribution...
...They will have narrowed the gap between rich and poor...
...Their feistiness is at odds with the third way's top-down technocratic approach...
...The result was a series of crushing political defeats—in Britain the Tories won four successive general elections...
...Their ethos certainly clashes with Goodhart's smug elitism...
...Here's a sampling from Goodhart: archaic class associations, uncritical embrace of the state, mismanagement of the economy, hostility to the market, nostalgia, left-wing cynicism, Marxisant, conservative, old left-wing view, lefty puritans...
...He bollixes up his next point, too...
...It is also true that its economic management has been boringly orthodox...
...This harsh social order could be improved only through high public spending financed by steeply redistributive taxation...
...Dragging them down is the stuck-in-the-mud left opposition...
...This will impress no one who believes that politicians and parties in a functioning democracy should engage citizens in substantive debate...
...DAVID GOODHART is the editor of the Londonbased Prospect magazine, which is at www.prospect-magazine.co.uk . DISSENT / Summer 2000 n 85 ARGUMENTS Joanne Barkan Replies A A COMPETENT POLEMICIST, David Goodhart has produced a slick diatribe against left critics of the third way in general and, in particular, my annotation of the Blair-Schroeder manifesto...
...This is the political hybrid that people have been waiting for, in Britain at least, for thirty years...
...But contrary to much left-wing cynicism, there has been a substantial (albeit carefully disguised) redistribution of income from the better off to the less well off...
...The second question relates more to Germany and continental Europe than to Britain...
...In the past three years it has introduced a minimum wage...
...Lefties"—all old-fashioned ideologues— make noise...
...These hostile trends have been compounded by the left's political failures, at least in Europe: its archaic class associations, its uncritical embrace of the state, its obsession with taking your money and spending it on an inefficient public sector, its mismanagement of the economy, its apparent hostility to the market...
...The decline in the number of jobs for people of below average intelligence is a serious problem, although one that political correctness suppresses...
...More, because her dissenting scribbles cannot in the nature of things add up to a coherent critique...
...But in the labor market, supply can create its own demand...
...The third way's raison d'être was to preserve and improve the well-being achieved by European social democracy...
...They acknowledge that financial incentives for most people are extremely important, without denigrating public spiritedness...
...It is true that it inherited a rosy outlook from the previous government...
...In a nineteenth-century mining village it was clear that the mine owner's wealth in a sense caused the poverty of the miners...
...And contrary to the rather astonishing claim in the Blair-Schroeder document (not challenged by Barkan) that "public spending has reached the limits of public tolerance" it will actually increase by 5 percent in real terms next year...
...In the case of New Labour in Britain, the party became a disciplined political machine, on a permanent war footing with the media, happy to DISSENT / Summer 2000 n 83 ARGUMENTS use all the techniques of modern politics...
...For Goodhart and other third-wayers, nice modernized folks stay put in the private sector and make their money quietly...
...Third-wayers, however, never confront openly how much "a high degree of equal opportunity" costs in public funds or how much they need a strong citizen movement to advocate the spending or how many activities (for example, education at all levels, child care, elderly care, transportation, health care) must be pulled out of the privatesector market...
...First: The main polemical device of thirdwayers is to present themselves as the only modernizers—those who swim with "the tide of the future" as Goodhart puts it...
...They'll have— heaven help 'ern—social democracy...
...In Germany the left also lost four elections in a row...
...Public bureaucracies have interests of their own, and those often work against the interests of their users—usually the poor...
...It doesn't take a genius to realize that culturally ingrained solidarity did not make social democracy possible...
...Goodhart's big philosophical question has a simple answer in the real world...
...In an obvious sense that is true, and there are pockets of unemployment where no number of qualifications will help...
...Yet the fundamental divide is political...
...Although Barkan is right to warn that new forms of bureaucratic failure can easily be introduced if the social engineers do not have a proper appreciation for the complex beast they are trying to manage...
...Others want to hold to some notion of a shared life experience covering all citizens and a limit to the gap between top and bottom...
...Significant numbers of immigrants began settling in Sweden in the 1960s...
...Goodhart gets off to a foolish start by trying to justify the mediocrity of the manifesto...
...And what of Barkan's nostalgia...
...What should we fight for...
...increased employment rights...
...JOANNE BARKAN is a freelance writer who lives in New York City...
...Leftists not only protest (a fine thing, from my point of view), they also promote policies to deal with disruptive international capital flows, currency speculation, civil rights abuses and low wages in developing nations, and environmental degradation...
...The right has always stood for property, hierarchy and order, but in Europe at least it has, until recently, been rather skeptical about the free market...
...But Sweden is a small, ethnically homogenous country, where a high degree of solidarity is culturally ingrained...
...They have nothing to say because they've simply adopted the neo-liberal point of view: European nations can maintain high living standards by competing successfully in the global economy...
...The British Labour Party and the German Social Democratic Party distributed it widely...
...And ARGUMENTS yes, others have been here before, not only in Sweden...
...They end up relying on embarrassingly silly claims like Goodhart's "we can have it both ways...
...The most radical thirdwayers would like to play down the focus on the gap between rich and poor...
...Bill Gates has not amassed his fortune by exploiting the poor of Seattle...
...Businesses often run at less than their full potential because they cannot find the right people...
...This type of left desires a lively, engaged citizenry...
...Her conservative premise is that there was a golden period of social democracy in Europe (and America...
...they know full well that different left traditions— many of them critical of European social democracy—have produced an array of nuanced critiques...
...Here is Goodhart's rendition: "But in the labor market, supply can create its own demand...
...The Blair-Schroeder manifesto 86 n DISSENT / Summer 2000 does the opposite...
...Third-wayers lump together all leftists who question their project, and they use stock phrases to describe them...
...Can Germany shake up its highly regulated form of market economy on the business/finance side without also interfering with what seem to be the advantages of co-determination and its regulated labor markets...
...Low-wage/low-skill jobs for such people are needed . . ." Plenty of lowwage/low-skill jobs exist...
...Barkan is also, I believe, confused when she compares "the basic values of the left (social justice) and the right (free markets...
...Wealth creation is no longer a zero-sum game...
...The free market is not a value...
...Low-wage/low-skill jobs for such people are needed, and also for people with the potential to move on to better things who find it hard to get a foot on the employment ladder...
...Goodhart makes even more of a muddle when he tries to defend the "free market...
...Many third-wayers bury themselves with similar contradictions because they want both to prove their modernism and reassure their voters...
...And, after having cut tax rates, how will they maintain funding commitments during economic downturns...
...Third-wayers never engage alternative left views of globalization...
...The most radical third-wayers would like to play down the focus on the gap between rich and poor (which has been growing in Britain under New Labour despite an increase in redistribution...
...Second, staying with the labor market, Barkan cannot tolerate the idea that we need a low-wage sector...
...He says it's no more than "a rather ephemeral political statement that resounds with the platitudes required by official political life...
...it is a social institution or a set of practices, and there is no reason why it is inherently inimical to social justice—a market economy with a high degree of equal opportunity and hefty inheritance taxes could be socially just...
...T]here is no reason why it is inherently inimical to social justice—a market economy with a high degree of equal opportunity and hefty inheritance taxes could be socially just...
...As long as ownership, control, and profits belong to one group that employs the other, can there ever be an end to conflict...
...It's all there: superficial and contradictory analysis, passive acceptance of the neo-liberal worldview, unimpressive policy notions, an I-know-better-than-you stance, and indifference to (or disdain for) the best of the democratic tradition...
...This is even more vacuous now than forty years ago because Sweden's population includes as high a proportion of non-EU immigrants as any other EU nation...
...It is entirely honorable to experiment with different ways to increase the efficiency of public services (while keeping them free at the point of use), even if the ideas do often come from free-market 84 n DISSENT / Summer 2000 thinkers...
...The truth is that the old left-wing view that the poor are poor because the rich are rich no longer holds (at least less than it did...
...increased foreign aid by 28 percent...
...The association of the free market with the right is also a relatively recent thing...
...We do...
...So far, the answer seems to be that it is possible...
...I know this to be true from my own experience...
...Its achievements seem to be considerable...
...Third-wayers can't yet accept this...
...Unlike orthodox neoliberals, third-wayers promise publicly funded job training and subsidies for low-income workers, but they (like Goodhart) invariably dodge the important questions...
...Here Barkan wants to have it both ways...
...ARGUMENTS Most leftists understand that decent living standards and equality of opportunity in the twenty-first century will require some "social democratic" (or Keynesian) regulation of the global economy...
...Finally, two questions for the third-way: one a big philosophical one, the other a more policybased one...
...No kidding...
...Gaitskell led a class party that was created and controlled by the trade unions...
...Third: As part of their modernizing effort, third-wayers stress the supply side of economics (as Reaganites did before them...
...Neither Goodhart nor the manifesto has anything to say about the global economy, despite the fact that third-wayers invented their project to respond to what they see as traditional social democracy's failure to cope with the pressures of globalization...
...The left drifted away from where most people were...
...This is a major problem...
...That said, we should not ignore the semi-programmatic statements of those who rule, and Dissent is right to open a discussion about it...
...Increasing the incomes of the less well-off will require more tax money...
...But there is not a gaping metaphysical divide...
...Goodhart doesn't understand that when businesses cannot find the personnel they need, the demand is already there...
...Now it is, hence the "welfare entrepreneurialism" of Gordon Brown's last budget, which both redistributed money to lowincome families and gave new tax breaks to ecommerce entrepreneurs...
...People still cared about fairness and about decent schools and public services, but they did not trust the left to deliver them any longer...
...And the low-wage part of the equation need not condemn people to poverty...
...She is wrong...
...It's available on their Web sites...
...It has also managed the economy in a competent manner—employment and incomes have risen steadily...
...Instead they want to focus on raising the floor—increasing the incomes of the less well off and investing heavily in public health and education to give everyone a decent start in life...
...Further, public spending is now rising rapidly...
...the state can top-up wages as it is now doing on rather a large scale in Britain through the working family tax credit...
...But that is the open secret of third-way politics and the cause of so much intellectual discomfort to more traditional leftists: we can have it both ways...
...its political platforms aim to educate the reader and rally the troops...
...This is what gave birth to the third way...
...Fifth: Sweden—with its high living stan dard and impressive levels of equality and democratic participation—was a vexation for conservatives for decades...
...Indeed, New Labour has used its political skills to engineer progressive social change to an extent that it rarely gets credit for...
...Third-wayers also, of course, embrace the market more wholeheartedly than the left has done in the past...
...They don't, like Goodhart, cynically blow off a substandard document with an "it's-just-for-the-voters" attitude...
...There is an element of bending the stick here...
...Of course, that is having it both ways...
...This document is not the Communist Manifesto of the third way...
...Once they've done all that and levied "hefty inheritance taxes" (and regulated the global economy enough to carry out their macroeconomic program), they'll no longer have what self-respecting free-marketers would call a free market...
...It's simply unmet demand...
...Sociologically, Britain was not then ready to practice the third way...
...In the 1950s and 1960s the Labour revisionists around Hugh Gaitskell used rhetoric similar to Tony Blair's...
...He writes as if quite uninformed about, as well as hostile to, the left...
...If he had wanted to write a more serious essay, Goodhart could have started with this growing inequality and tried to analyze it...
...In his catalogue of the "left's political failures," Goodhart lists "its obsession with taking your money...
...But it does not deserve the graffiti that Joanne Barkan splattered all over it...
...In the good old days we all knew where we stood, left was left and right was right—the social order was a pyramid, the economy was dominated by manufacturing industry with greedy bosses at the top and decent trade unionists at the bottom...
...So what is Barkan's problem with the third way in general and this document in particular...
...Goodhart specifies that the "official political life" that "required" this set of "platitudes" was the European Parliament elections of June 1999...
...B B UT THE Blair government has done rightwing things as well as left-wing things, or rather it has learned from the past failures of the left...
...Less, because she invests too much effort into deconstructing a rather ephemeral political statement that resounds with the platitudes required by official political life...
...How should we understand what's happening to us...
...The latter focus their analysis and policy proposals on the growing gap between rich and poor nations and between rich and poor people within nations, including prosperous ones...
...Most democratic leftists take statements produced by the left (and center-left) seriously not only because they want to upgrade the quality of political life, but also because they see programmatic statements and philosophical manifestos as tools for mobilizing their constituencies...
...they can compete successfully by deregulating all markets (including labor), privatizing more of the public sector, eliminating government deficits and debt, lowering taxes, letting traditional industries make their way to "developing" countries, and so on and so on...
...Third, notwithstanding Barkan's admiration for the pro-market Swedes, she is still in the grip of Marxisant categories...
...Her problem seems to be twofold: it is not Swedish enough and it does not seem to represent any advance on a 1960s-style social democracy...
...First, Barkan complains that training people does not create jobs...
...I'll mention specific examples from Goodhart's essay because they're illustratively third wayish...
...Because decent-paying jobs in industry are the jobs that have declined in significant numbers, I assume Goodhart means industrial workers when he mentions "people of below average intelligence...
...It lectures us not to expect too much from the public sector, urges everyone to submit to market forces, and assures us that government technocrats will tweak whatever needs tweaking in order to provide all things to all people...
...When Tony Blair praises market dynamism and individual advancement and in the same sentence waves the flag of social justice, people like it...
...After they've collected and spent all the money and given everyone a decent start, guess what...
...Incidentally, that increase will help keep the public spending/GDP ratio markedly above the level in the social democratic "golden age" of the 1960s and 1970s...
...Most European Union (EU) nations and the United States must use immigrant labor to get all the work done...
...The idea was to show their respective electorates that modernizing third wayism was the tide of the future...
...Yes, it is about polls and power, yes it can be cynical, but it takes people where they are, not where left intellectuals would like them to be...
...Other than in the odd sweatshop that is not the case today...
...He's also reproduced in his writing the defects of the politics he's trying to defend...
...H H AVING SHACKLED themselves intellectu ally, third-wayers regularly produce su perficial, piecemeal, and contradictory analyses...
...Yet several paragraphs later, he fairly crows that public spending in Britain "will actually increase by 5 percent . . . .Incidentally, that increase will help keep the public spending/GDP ratio markedly above the level in the social democratic 'golden age' of the 1960s and 1970s...
...Has Barkan not heard of the separation of ownership and control and the fact that most of the owners are now pension and insurance funds...
...Goodhart's style seems cruder and yet (this is only a guess on my part) more a product of genuine ignorance...
...Of course, these things can sometimes be in conflict, and working out policies that try to maximize them both is not always easy...
...Fourth: Spending less of the taxpayer's money is a cardinal point in the third way credo...
...Others want to hold to some notion of a shared life experience covering all citizens and a limit to the gap between top and bottom...
...from which the third way is unnecessarily deviating, seduced by the siren voices of free-market individualism...
...The Blair/Schroeder document does have its flaws...
...It's not supply creating its own demand...
...Third-wayers genuinely do admire the creativity of entrepreneurs and want them to reap much of what they sow...
Vol. 47 • July 2000 • No. 3
