Applied Christian Democracy: the Rhineland Model

Applied Christian Democracy: the

Rhineland model

Foreword This text is meant for discussion. It is the be-

Belgium is no island in the world. Christian

ginning, not the end of a process of debate,

Democracy in Flanders is not isolated from

more debate and even more debate. It is a col-

Christian Democracy in other European

lection of ideas and thoughts that in no sense

countries. Many of the challenges, which we

pretends to be “the truth”. Rather than for-

now face, are those with which other Euro-

mulate an easy answer, in this document, we

pean member states are also confronted. It

will attempt to search for the right questions.

is for this reason that we situate this exercise in cooperation with the Centre for European

Hence, this text will also take some distance

Studies (CES), the think tank of the European

from day-to-day business. Too quickly, we

People Party (EPP). This cooperation can only

lose contact with the broader framework

enrich the debate.

through a too specific focus on a particular dossier. Because something “happens,” positions are often taken on an ad hoc basis, based on partial information available at a given moment. In order to clarify the broader framework, all too often, we find ourselves obliged to retrace our steps in order to under-

Niko Go

stand why we took a specific decision. The di-

Bart Oo

rect impetus for this “thought exercise” was the outcome of the evaluation of our electoral defeat in June 2010. It became evident that one of our weak points was the lack of a clear This is a joint publication of the Centre for Euro-

el, en Heuv

nd Koen Va

long-term narrative/vision.

pean Studies and the CD&V. This publication receives funding from the European Parliament.

With this text, we align ourselves with the

The Centre for European Studies, CD&V and the

principles of Christian Democracy in the de-

European Parliament assume no responsibility for

termination of social-economic policy. These

facts or opinions expressed in this publication or

actualized principles should be the leitmotif

any subsequent use of the information contained

in our decision-making processes, that is to

therein. Sole responsibility lies on the author of

say, the daily application of the principles.

the publication

In this text, we consciously do not include policy recommendations. First things first.

First, we should determine the framework; thereafter, we can begin to fill in the contents.

bbin, ghe,

n Kurt Va Frederic

nck,

Raemdo

rt, Reynae

ons, Wim So neycken Sven Va

‘Never waste a good crisis’

Towards another Rhineland model?

page 6

The financial-economic crisis in the Fall of

motivations is also bound for failure, a fea-

2008 was by far the biggest since the middle

ture of the socialistic model.

of the last century. Our entire financial sys-

Seven principles

tem teetered on the verge of collapse. Our

Implicitly, the Rhineland Model assumes the

economy cracked at the seams. In the mean-

existence of a direct relationship between

time, the skies have cleared, but to return to

welfare and happiness on the one side and the

“business as usual” would not be very wise.

creation of wealth on the other. We realize

The consequences of the crisis and the costs

that this relationship is not always clear cut.

of anti-crisis management will be felt in the

Often, the lack of prosperity makes people

national budgets for some time to come. A

discontent; nevertheless, increasing pros-

shock of such magnitude forces us to funda-

perity does not necessarily create more con-

mentally re-think the basis of our social-eco-

tentment. Through a good social policy, the

A strong belief in the free market to cre-

nomic model. Was this an (extreme) accident

government can insure that both wealth and

ate wealth; nevertheless, governmental

that happened by chance or was something

prosperity evolve in correlation with each

intervention is essential to ensure a fair

else going on?

other; nevertheless, only people can “cre-

result;

In his book, The Rhineland Model: for a Sustainable and Social Welfare, Yves Leterme lists seven principles that characterize the Rhineland Model:

ate happiness”. In this sense, the Rhineland The ability to reflect for a moment makes it

Model is part of a total vision on society.

Private initiative must be linked to personal responsibility;

clear that the crisis is not the origin of all our problems. But by increasing the visibility of

The society of the Rhineland Model is a society

our weaknesses it can result in hastening the

that supports people in their search for hap-

The tripartite consultation (workers,

necessary reformation. At this juncture, the

piness; it is a society where people are willing

employers, government) significantly

axiom is also relevant: never waste a good

to help each other. Obviously, the economy

contributes to prosperity;

crisis.

is a very important link in the chain, but it is not the entire chain. Nevertheless, the total

The government organizes social ben-

As in other continental European countries

chain would be incomplete, when such an

efits, but at the same time, stimulates

since the Second World War, in Belgium, the

important link would be removed.

private initiative in its execution (the

Rhineland Model contributed to a period of

social profit);

heretofore unimagined prosperity and stability. This model begins with the insight that by

Subsidiarity is a guiding principle;

definition prosperity as well as welfare must be viewed over a long-term period. Short-

Stability with respect to public financ-

term profit is always costly in the long-term.

es, growth, social climate, etc... is pur-

This lesson was once again demonstrated by

sued;

the destructive consequences of mismanagement in the financial world. At the basis of a

A long-term vision exists for the crea-

sustainable prosperity, one necessarily needs

tion of value, with attention given to the

to construct a broad social consensus. More-

interests of all stakeholders.

over, this consensus guarantees balance and stability. On the one hand, the individualistic approach of neo-liberalism might look attractive in the short-term, but it is a conflict model that does not guarantee long lasting success. On the other hand, absolute indifference towards individual expectations and

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7

It is clear that some of these principles were

In the mean time, the steps, which were taken

It is important to realize that the social en-

We have to recognize that the Rhineland

blatantly ignored in the run up to the past

in order to better regulate the financial mar-

vironment in 2010 is not the same as in 1950.

Model, as we have applied it in the last six dec-

crisis. There was often an obvious need for

kets, have allowed the pendulum to swing

Society has been fundamentally altered. All

ades, has not always cohered with the Chris-

“more Rhineland.” It does not fit with the

back a bit. The crisis has put to an end – at

we have to do is to think about the globali-

tian Democratic idea of stewardship. Each

Rhineland Model when banks use savings

least temporarily – to the calls for even more

zation of the world economy and of past de-

new generation has only a limited amount

in order to invest in abstract products and

liberalization, self-regulation and deregula-

mographic developments. Globalization and

of time to live upon the earth and has the ob-

ignore the local economy, giving absolutely

tion. Even so, it is neither the State, nor the

demographics are changes that imply conse-

ligation to pass it on in a good condition to

no consideration to an enduring balance

market, but the bankers and the shareholders

quences for the formulation of policy. Often

the next generation. Having said that, today,

between the interests of savers, consumers,

themselves, who by taking responsibility and

the solution for new problems is not to be

there is still a “supremacy of the social” in the

entrepreneurs, banks and the State. In the

avoiding greed, can restore trust. Precisely

found in the solutions of the past. Even more:

concrete implementation of the Rhineland

crisis, individual freedom was totally discon-

the ability to exercise a sense of responsibil-

the solutions of the past have often created,

Model principles. Sustainability was and is

nected from personal responsibility.

ity is a central tenet of the Rhineland Model.

in their turn, new problems.

very quickly pushed into the background. In

For that reason, the rapid return to the “bo-

the mean time, much environmental dam-

nus culture” is an unsettling signal. Profit

The harmful impact of the economy on the

age is irreversible. As in the financial world,

is good, but without social responsibility, it

environment is a clear example of how one

we must ask ourselves the question whether

becomes avarice.

solution can lead to another problem. As

this is a sustainable strategy. Climate change

stated, the main objective of the Rhineland

has already led to the impoverishment of the

An evaluation of the Rhineland Model goes

Model is to allow all people to participate in

population in some developing countries,

beyond ticking off principles on a check-

the general prosperity in order to improve

and there is a similar risk that these changes

list. Questions about whether the Rhineland

welfare. This can be achieved through partic-

will also lead to the impoverishment of our

Model can still serve as an economic naviga-

ipation in the labour market or through a very

own future generations, who will be required

tion system today is primarily a question

good system of social protection for those

to intervene more drastically.

about whether these principles are still rel-

who are unable to work. The objective is par-

evant and, thereafter, an observation about

ticularly achieved through the instrument of

the translation of these principles into policy.

economic growth. Wealth is created in order

Without calling the foundation of the Rhine-

to share. Nevertheless, insufficient attention

land Model into question, we can formulate

was often given to the negative effects on the

serious concerns about their concrete appli-

environment. Today, the environment has

cation. For example, serving as an analogy, a

been put under pressure through economic

ramshackle construction can be placed upon

and social activities. Flanders is a productive

a strong foundation.

and industrialized, energy intensive, material intensive, densely populated region with a high concentration of traffic as well as agricultural activity. By extension, this is also the case for many developed regions in Europe and the rest of the world. These regions cause a great deal of ecological burdens, even outside of their own borders.

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Hence, to fail to

Option 1

Option 2

adjust to this new

We reject economic growth. We conclude

We choose for another, greener growth that

that the limits of what the earth can bear have

coheres with the Christian Democratic idea

been reached and have even been exceeded.

of stewardship: “wisely green� is our guide.

Therefore, we must find a way to wean our-

The government corrects the effects of the

selves from the need for economic growth.

free market, but not only with respect to in-

This is a position that finds fertile soil

come distribution. Economic and human ac-

amongst ecological parties, but this position

tivity puts pressure on the environment and

is not open-ended. A clear direction must be

can, thus, harm it.

situation is contrary to the Rhineland Model principles.

The reaction can be twofold:

given to which model of social protection is to be followed. How will wealth be shared,

As the market economy can fail on a social

when it is no longer created? In this model,

level, it can also fail on an ecological level. The

there are obvious winners and losers: the pie

task of the government, therefore, should ex-

does not grow, but is distributed differently.

tend to the protection of the environment by

Do we now choose for a clear supremacy of

carrying out environmental corrections. The

the ecological over the social goals? First

government can use various types of policy

ecology and, thereafter, redistribution?

instruments to achieve these goals. Through fiscal and social economic instruments (such as taxes and subsidies), necessary impulses can be given to create a change in behaviour.

Normative instruments (such as energy performance standards) have a compulsory character. Nevertheless, we need to recognize that the economy will always have some negative impact on the environment. Hence, we attempt to limit this in so far as this is possible and make a proper assessment of the social costs and benefits, including the ecological aspects.

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The second option is closely related to the

With the EU2020 strategy – the successor of

concept of sustainable development or the

the Lisbon Strategy --, Europe has already

type of development that meets the needs

chosen for the second option. Through an

of the present generation without jeopard-

increase in the employment rate with quality

izing the ability of future generations to

jobs and a strengthening of the information

meet their own needs. Its implementation

economy, the EU strives towards a strong so-

requires a process of change wherein the use

cial cohesion. Indeed, more jobs means less

of resources, the destination of investments,

poverty and more means for social support.

the orientation of technological development

At the same time, Europe wants to remain a

and institutional structures are adapted to

leader in the international approach to solv-

both future and present needs. This implies

ing climate problems, amongst other things

another hierarchy of objectives that is in line

by focussing on renewable energy, greater

with the Christian Democratic principle of

energy efficiency and lower emissions of pol-

stewardship. As was the case in the past, the

lutants.

social correction may no longer dominate the ecological correction. Sometimes difficult choices must be made: ecological corrections are not always social. For example, poor families might drive around in cars that are less environmentally friendly, or live in poorly insulated homes.

Sustainable development fits perfectly with the basis of the Rhineland Model. Economic growth is not seen as a capitalistic motive to

While the seven principles of the Rhineland Model are, in our opinion, more relevant today than ever before, their concrete implementation is crucial to policy. This translation must occur in a way that takes the significant social changes of the past decades into account. Maintaining what we have is not the same as maintaining the policies of the past.

In the remaining sections of these discussion notes, we will delve deeper into three important themes: the role of the government in the economy, the evolution towards a more contemporary social dialogue and the challenges for social security and employment.

At the end of the text, we will list a number of pertinent questions for debate.

exploit workers, but as an opportunity for everyone to be allowed to share in prosperity. Also now, growth can contribute to the realization of more sustainability. A clear illustration of this is the great potential for a so-called “green sector.�

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A government that always stands on the sidelines and allows any and every private initiative?

A government that limits itself to the defence of property rights? A government that only intervenes in order to put out fires, as was necessary in the recent banking crisis? Or, a government that takes the helm in as many domains as possible?

Government and Economy

What kind of government do we want?

In short: the Rhineland Models offers a government a guide

What should the government not do?

to think about how The Rhineland Model recognizes the added value of a government, which takes an active role in the economy and in society, but, at the same time, also recognizes what a it can or may not do and acts accordingly. It is a government that looks for strengths in the economic fabric and dares to take advantage of them. It is a government that is not blind to its own weaknesses, but, on the contrary, assists in the search for solutions and ensures

to develop its own central mission, but the end result will be different in each country.

The government does not do business. It is not the “motor” of economic growth. Even though the government can lend support, entrepreneurial people, as business leaders and employees, create prosperity.

It is also not the role of the government to determine which sector to develop. It is the job of entrepreneurs to evaluate the opportunities which present themselves. The government mainly focuses on the creation of a

that these solutions are made known.

good environment for private initiative. Not This therefore implies that every government

In the Rhineland Model, the government is

from an ivory tower, but by listening to and

will act differently. Each country, each region

not a static concept. The purpose of the gov-

in consultation with those who want to build

has its own characteristics. Belgium is small,

ernment is directly connected to its capacity

a business on those foundations. The govern-

economically open and centrally located.

to improve the long-term prosperity of a peo-

ment can create opportunities or stimulate

Logically, having good logistical infrastruc-

ple. The Rhineland-government is a service-

those potentially profitable areas, where pri-

ture is a trump card, but it is also a necessity.

oriented government. This demands that a

vate initiative has not yet been or has been in-

Furthermore, higher taxes are not self-evi-

government remains vigilant for changes in

sufficiently developed. When there is an ab-

dent: our neighbours are never far away to go

order to quickly respond to them. Today’s

sence of self-initiative, in exceptional cases,

shopping and to engage in business. Scandi-

challenges are no longer the same as the chal-

government can provide an impetus.

navian countries, with their expansive land-

lenges 60 years ago. In the same vein, today’s

masses and natural borders (sea, mountains,

government can no longer be similar to gov-

Nevertheless, the government can and must

rivers), need to be less concerned with higher

ernment 60 years ago.

support sectors by helping them search for solutions to concrete problems. It does this

taxes. Nevertheless, in an open economy, the social demands of a good social security

in the same way that it looks for existing

(and therefore also redistribution) are often

strengths in the economy in order to rein-

greater: the economy is always strongly ex-

force them.

posed to fluctuations in the global economy.

For example, Belgium has few natural re-

Still, a government must ensure that there is

sources; therefore, we cannot but emphasize

sufficient room for own initiative and crea-

the importance of education and innovation.

tivity. It should never force the thinking of

Belgium has a small national market: inter-

individuals into one particular direction, nor

nationalization is a given.

should it generate the expectation that it can solve all problems: inevitably, this leads to disappointment and even distrust.

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When does the government need to intervene?

When a large player monopo-

When social benefits (costs)

lizes the market. Furthermore, when

strongly diverge from private

a large player dominates the market or diverse

benefits (costs). A good example of

players falsify the market, the government is

this is education: when parents would have

obliged to take a closer look. A strong compe-

to organize their own children’s schooling,

tition policy is certainly one of its economic

then, there would be an insufficient number

core responsibilities. The government must

of children, who actually receive an educa-

ensure that new entries into the market are

tion. Obviously, a well educated population

not discouraged, but are rather encouraged.

is advantageous for an economy.

Similar

positive external effects can also play a role When the market fails. The fact

in the area of entrepreneurship and innova-

that the government must sometimes force-

tion. Individual companies pay too little at-

fully intervene, as a curative and a preven-

tention to the so-called network effect. The

tative measure when the market fails, was

activities of a company are often positive for

made evident by the financial crisis.

In-

other entrepreneurs or for society in general.

complete, unclear and often downright false

Here, innovation in the areas of clean tech-

information in the financial sector almost

nology and medical research come to mind.

brought the entire economy to the edge of

The government needs to stimulate entrepre-

the abyss.

Governmental regulation and

neurship and innovation when they want to

control are indispensable when the mar-

achieve an optimal outcome for society; this

kets are insufficiently transparent. Policing

is all the more important since investments

and juridical intervention are crucial for the

in innovation can often be highly cyclical.

proper collection of taxes as well as to combat

The climate debate is a negative example of

the culture of impunity and effectively fight

this. Individual producers pay too little at-

against fraud. These are the “super” primary

tention to the repercussions their activities

responsibilities of a government. The proper

have on the climate.

execution of these responsibilities is essential for creating trust within society. Even

The government can also play an important

the labour market can fail when there is no

role in the spreading of innovation, for exam-

match between supply and demand, or when

ple, via the support of “open innovation,” or

this match can only be realized at a too high

through “incubation centres,” where compa-

or a too low price.

nies are instructed on the intricacies of new techniques. Only when innovation is broadly spread, can the external benefits for a society be maximized. Here is another important element: the government does not provide support to enable companies to increase profits, but because the benefits from their activities are so significant for society.

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For the welfare of the people.

The results of the market are not always fair.

An important goal of the Rhineland Model is not only to maintain the level of prosperity and happiness of the population, but preferably to improve it. Not everyone has the same opportunities. Not everyone has the same amount of good fortune in their lives. Given the first case, the government needs to act

How should the government intervene?

The government, as the guardian of its primary responsibilities, safeguards the quality of its own services and ensures stable public finances. Responsibilities are organized as efficiently as possible on a local, provincial, regional, federal and European level. Even today, subsidiarity remains an extremely important starting point.

preventatively by making a good education

The public service sector needs to be situated

available to everyone. In this way, the future

at the right administrative level, close to the

becomes more important than origins. By making life-long education possible, people are able to keep their options open during the course of their careers; even so, inequalities will continue to exist. Physical and intellectual capacities are simply unequally distributed. Equal opportunities are no guarantee for an equal result. That is why the government must make adjustments through social security and taxes, without undermining individual responsibility. Everyone is responsi-

As important as knowing when the government should (not) intervene, is the realization of how it should best do so.

people and to the business world. Regardless of whether this proximity is created by a “physical” subsidiarity at administrative levels or electronically, by e-governmental applications, starting from the perspective of the interested party is important. The goal is not only having a government that does things well, but also one that does good things.

Knowing what is good requires permanent re-evaluation and adjustment.

ble for the expansion of personal and societal

This same permanent re-evaluation is neces-

welfare. Redistribution may not change that.

sary to determine which administrative level

A government does not redistribute in order

is best suited for a particular responsibility.

to help those, who do not take advantages

Problems, which were easily handled at the

of the opportunities given and who primar-

national level before the age of globaliza-

ily depend upon the initiatives of others. A

tion, are now sometimes better handled at

government is there to support those people,

a European level. In certain dossiers, in-

who are precisely prepared to use their tal-

tensive coordination is necessary to avoid a

ents to the maximum of their abilities.

“race-to-the-bottom,” and when such a race would happen, then, we must be prepared to

relinquish powers. Conversely, we must be prepared to ask which administrative levels continue to provide added value: does the extra cost of maintaining a particular administrative level still weigh in favour of withholding responsibilities from another level?

In past decades, there were certainly shifts of responsibilities -- just think about European integration.

Although, the total elimina-

tion of an administrative level is hardly ever considered, it is insufficient to say that an administrative level should be kept simply

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because it delivers “good work.” The relevant

Stability in public finances should be

The government as regulator

question to ask is whether a level is in the best

achieved in a thoughtful and sensible way.

is careful not to over-regu-

position to accomplish the work at hand. The

The first step is for the government to organ-

late. The ability to do business should be

Rhineland Model rejects a government that

ize its main tasks as efficiently as possible.

facilitated. Perhaps it is tempting to make

acts primarily to remain in power. A govern-

This is, however, not a plea for a “minimal

rules that eliminate all possible transgres-

ment is always an instrument, and never the

state.” In Anglo-Saxon countries, all too of-

sions, but when this happens, promising

goal itself.

ten, there is a one-sided focus on the cost of

new initiatives can be stifled. We must have

government. The Rhineland Model main-

the courage to make a proper estimation

tains a more balanced approach and also pays

about how much it would cost society to

attention to government output: the govern-

eliminate every little risk. It is impossible

ment may use taxes in order to carry out its

to guarantee for 100% that there will never

main tasks in a qualitative way, that is, as long

be another banking crisis, that is, unless we

as it functions as efficiently and effectively as

want to reduce the banking sector to a sim-

possible. Amongst its own organizations, it

ple conversion of savings into loans. If we

chooses a method that coheres with the avail-

would do this, then, we would have to pay a

able resources. A modern government exer-

very heavy price: in the past, financial inno-

cises a sensible, carefully planned as well as

vation was a powerful stimulus for business,

future-oriented budgetary, IT and personnel

even when certain financial activities were

policy. It makes use of an efficient person-

obviously insufficiently sustainable. Proper

nel planning and uses labour forces where it

regulation ensures that the chance of a new

needs them. It does not automatically replace

crisis is drastically reduced and that financial

The Rhineland Model is resolutely in favour of subsidiarity.

Responsibilities must be given to the appropriate administrative level.

those civil servants who retire. It also allows

services have a more sustainable character,

As many responsibilities as possible must be

competition to flourish where and when pos-

without placing a too heavy burden upon the

given to the local level, the closest layer of gov-

sible. Certainly, the government needs to

dynamics of the banking sector. The same

ernment to the people. For this, a competent

make use of necessary future-oriented profi-

is true for environmental policy: a sensible

municipal government is needed. However,

ciencies in order to fulfil its role as a strategic

green policy can be far more fruitful than

the more tasks that are pushed towards the

partner. Its position in a tight labour market

blind regulation. It is better to put a proper

local government, the more capable it must

(with a battle for talent) and in the informa-

price on pollution than to put a very restric-

be.

Economies of scale and more flexible

tion economy should not come under pres-

tive legislation into place, which cannot be

procedures for inter-municipal cooperation

sure; when this happens, then, its ability to

controlled in practice. The government that

are therefore urgently needed. Stronger mu-

serve suffers. Here too, a sustainable balance

makes better rules, with fewer administrative

nicipal governments will strongly question

must be sought with the private sector.

burdens, will strengthen the competitive po-

the rationale for intermediary administrative

sition of our country and our businesses. The

levels. Strong municipal governments and

government should not become an excuse to

gains in efficiency can and must go together.

avoid personal responsibility. It is not the mere fact that a government permits or does

It goes without saying that an intensive coop-

not punish an activity that makes that activ-

eration across the levels of the various admin-

ity socially acceptable in all circumstances.

istrative departments is necessary.

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23

As a partner, the government

The government as social pro-

The government as a partner is

The government as consumer/

can provide an extra boost. For

tector ensures that people

actively involved in the social

trendsetter takes responsibil-

example, it can do this by safeguarding the

dare to take risks. For example, it is

debate, even when the main

ity as a socially responsible

relationship between education and busi-

important that people are unafraid of falling

responsibilities are with the

employer.

ness. But even here, the government should

into poverty when a project goes wrong. The

trade unions and the employ-

come a role model as the largest consumer in

prefer to take a secondary role. The obvious

government participates in the development

ers’ federations. Without a doubt,

the Belgian economy. For example, a quality

objective (e.g. in the case of entrepreneur-

of a social net that also functions as a spring

good working conditions, permanent educa-

government should not leave invoices unpaid

ship) is connected to financing and to tar-

board; not as a hammock. Redistribution is

tion and investment in innovation are shared

or pay them late. A sustainable government

geted support. The government, as a financer

a real characteristic of the Rhineland Model.

responsibilities. The government does not

should be an example to others by requiring

of private projects, makes its criteria clearly

This covers, e.g. the organization of social

act alone, but in dialogue with all the stake-

its employees and (political) representatives

known up front. There should be no financ-

security, minimum workers’ benefits, mini-

holders and interested parties. Broad public

to drive in environmentally friendly cars. By

ing without a promising and viable project.

mum loans, etc... Next to the provision of

support for the government’s policy (where

paying attention to innovation, it also creates

Governmental financing is not a synonym

social security is the individual obligation to

social debate is only one element) increases

a market for renewed business. The govern-

for subsidising; nevertheless, projects with

contribute to the general welfare. Similarly,

the chances of success.

ment guarantees equal chances for everyone,

high uncertainty, like high tech start ups,

the principle of a just government must be

who participates in the selection process for a

may especially require active participation by

guarded. Effective inspection services, a de-

governmental job. As an attractive employer,

the government. Governmental investment

termined fight against social and fiscal fraud,

the government promotes a strong employ-

should, however, always take place with an

etc. are necessary to build trust in the gov-

ment policy.

eye on the exit: once the government takes

ernment and uphold social security. Coun-

leave of a project, then, the private sector can

tries where there is a high level of trust, such

step in as financier.

as in Scandinavian countries, perform better.

24

The government must be-

25

While other economic organizational systems start from the primacy of politics or the conflict between social classes, a dialogue between workers and their employers is the basis of economic and social organization in the Rhineland Model. Trade unions and employers’ organizations attempt to find mutual interests and achieve goals together. Instead of agreeing to compromises, where everyone loses something, the goal is to find a win-win solution.

Social Dialogue

Social dialogue and the Rhineland Model are practically synonymous.

In Belgium, social dialogue is expressed on three levels: Workers’ input in individual businesses;

Is social dialogue coming up against its own limits?

Throughout these years, the common thread of the social dialogue model was the cooperation of workers and employers at all levels in order to achieve economic progress together.

Nevertheless, in the past years, the classical model of dialogue has become increasingly more difficult. This has to do with effects of the intensification of globalization as well as the fact that the ability to maximize profits has reached its limits or has been slowed down. Without a doubt, other broader social

In the first decades after World War II, the

developments play a role, such as the fading

basis for every agreement was an interchange

support for solidarity or the lack of trust in

between increasing productivity, wages and

the ability to reform social and political insti-

a strengthening of social security. The basis

tutions.

Dialogue about salary and working con-

of social security in Belgium was the “draft

ditions at a sectoral and inter-sectoral

agreement for social solidarity” from 1944.

From the past, we learn that it is far easier for

level and, to a lesser degree, at regional

Central to this document is the text passage:

agreements to take shape when there is room

and European levels;

“The opening of the way towards social pro-

for financial movement, but agreements are

gress must result, at the same time, from

not possible, or are at least severely limited,

Co-management of the social security

the prosperity of a world that has returned

when the economy is weak. This illustrates

institutions by the trade unions and em-

to peace and from a just redistribution of in-

that even today economic growth is the pre-

ployers’ organizations.

come from increased productivity.” This pas-

ferred instrument to realize the objectives of

sage expresses the entire paradigm of a self-

the Rhineland Model.

perpetuating social growth that benefited from the economic success of the period af-

In recent years, the classical inter-sectoral

The dialogue at the level of business was

ter the War. From the beginning of the mid-

model of negotiation has lost credibility and

recently extended to small businesses; the

seventies, this model began to crack under

efficiency. Recent agreements were insuffi-

management of social security institutions is

the pressure of the petroleum crisis. From

ciently ambitious and ineffective. They were

made more professional by the introduction

that moment on employers’ organizations

also paid for in cash by the taxpayer. The

of management agreements.

strongly advocated accords, which would

competitiveness of our enterprises hardly

Today, especially the inter-sectoral dialogue

safeguard competitiveness. Finally, this de-

improved. Too little job creation made it

needs to be updated.

mand expressed itself in the 1996 legislation

impossible to substantially reduce labour

concerning competitiveness. After qualita-

costs, without passing the bill on to later gen-

tive agreements about, e.g. employment,

erations. Moreover, the combination of fewer

education and the equal treatment of women,

jobs and more spending has led to a sombre

since then, there have been continual agree-

outlook for social security. Companies, em-

ments about salary development, based on

ployees and the State have ended up in an ap-

the development of wages in neighbouring

parently lose-lose-lose situation.

countries.

28

29

The framework of the 1996 legislation seems to be too limited and limiting. The debate has been reduced to a discussion about salary norms, while no global strategy has been developed with respect to the evolution of employment, education, social policy, research and development, etc.. The 1996 legislation, globalization and economic development have allowed both employees and business to

Towards a contemporary social dialogue?

get used to a defensive posturing. Everyone

Internationalization

of

the

social dialogue.

International competition continues to increase, also in markets that heretofore appeared to be immune. For many problems, there is no real international approach; the ultimate example can be found in wage negotiation. For each country, this leads to a number of external factors, where people become trapped in a TINA-model (“there is no alter-

tends to defend their own interests against

A different approach to so-

native”). Neither the social partners, nor the

the other, where the frontline of the debate

cial conflicts. There are increasingly

national governments are left with any choic-

has become the issue of wages. Both sides

more social conflicts, where both sides tend

es. Whoever fails to resist must pay the high

have lost sight of the fact that we have lost

to over-react. Despite clear agreements (the

price of losing market share or labour oppor-

terrain in many other areas. An offensive,

“gentlemen’s agreement” of 2002), employ-

tunities.

communal strategy would be far more ben-

ers make greater use of litigation in order to

inequalities are thus “imported,” and the

eficial for both parties.

break strikes. Wildcat strikes and or unac-

number of losers is high. Therefore, is it not

Ultimately, international income

ceptable strike practices, such as hostage-

in everyone’s interest to start a European-ori-

Social dialogue strongly maintains national

taking, are becoming more prevalent. Social

ented consultation model? In the first phase,

borders, while competition is growing in-

negotiators could take a more active and pre-

a European social minimum can be achieved

creasingly more international.

Although

ventative role in order to obstruct these types

(e.g. at the level of working hours and mini-

the national social partners’ room for ma-

of practices. The right to strike needs to be

mum wages). Furthermore, the approach

noeuvring has decreased given international

reconciled with personal responsibility. For

towards the restructuring of multinationals

pressure, there is no social dialogue at an

example, actions that focus on public trans-

can be better coordinated at a European level

international level. The lack of international

portation almost automatically result in tre-

in order to avoid that countries are played off

social dialogue creates a negative spiral that

mendous social and economic damage, while

against each other.

is comparable to the protectionism that

often the motives for the actions do not seem

blocked past economic progress. Is sustain-

proportional to the damage caused. A sus-

Social dialogue at a Belgian,

able economic growth feasible with falling

tainable social dialogue requires balance to

Flemish or European level?

wages, low interest rates, monetary conflicts

return between the rights of those who take

As long as responsibilities become more frag-

and international imbalances?

action and the interests of society in general.

mented, the idea of a “central” social dialogue sounds increasingly strange. The fragmentation of responsibility results in technical problems for negotiations: on the one hand, the possibilities are limited through internationalization; while on the other hand, the

•

classical exchange becomes more difficult because the “means of exchange” find themselves at another level than where the original dialogue took place. The concept of subsidiarity pops up again with respect to the question of social dialogue.

30

31

Expansion of the themes. Today,

Clear priorities and more am-

portant in our economy, are more susceptible

the inter-sectoral, but also the sectoral so-

bition. Over the past years, too often, the

to this reality than are the industrial sectors.

cial dialogue is limited to a discussion about

social dialogue has been a “conference of re-

Moreover, productivity needs to be increased

wages. Qualitative themes such as training

distribution,” where available resources were

through innovation. The margin for the imi-

or procedural aspects of labour law are dis-

assigned a particular destination. There was

tation of better foreign technologies has been

cussed, but these discussions remain for the

no real vision behind the redistribution, let

greatly reduced. Furthermore, the ambition

most part at the level of general recommen-

alone a communal vision of the social partners

to also use people with lower productivity in

dations. Other themes like innovation, sus-

on how to execute social or labour policy. In

the labour process puts a brake on increases

tainability, etc. are scantily treated.

contrast with some neighbouring countries,

in productivity.

the social partners never spoke about a comA more active role for the

munal ambition concerning necessary struc-

From a defensive to an offen-

government. In an increasingly more

tural reform, which was a big handicap for ne-

sive dialogue. With a focus on wage

international and complex society, a dialogue

gotiations. When there is a common goal and

control, for years, we have aimed our ener-

that limits itself to employers and employees

ambition, far more is achievable. Precisely the

gies and means at the protection of existing

will never achieve the desired results. Unlike

ability to form a necessary consensus is the

employment in existing sectors with exist-

the past, the government must enter into the

strength of the Rhineland Model.

ing products. It costs ever more energy and

dialogue as a full partner, and not only as a financier.

funds to maintain the success of these initiaTowards a new type of debate

tives. Structural labour market reform and

concerning wages.

Today, nego-

strategies for economic innovation can lead

tiations can also be held about a classical

to higher returns on investments, provided

inter-sectoral wage norm, with an eye on es-

that they are broadly endorsed by the social

tablishing a “win-win-win” situation in the

partners.

long term. Nevertheless, it is important to clarify and modernize the framework. Two premises are essential: First, labour cost reductions, which should restore competitiveness, should be replaced by income tax reductions, once competitiveness is restored. The instrument as well as the chronology must be reversed. Second, the government must become a full partner in the inter-sectoral agreement. This is to say: not as the one, who pays the bill at the end of the day, but as the facilitator and the guarantor of the partners’ return of investment through greater competitiveness. Hence, there is real wage control, with the guarantee that workers will benefit from the extra jobs that are created.

In this way, it can be simultaneously avoided that ever increasing productivity gains are necessary to enable wage increases. Gains in productivity are increasingly difficult in the present economic reality. The service sectors, which have become relatively more im-

32

33

Social Security and the Labour Market

The ultimate objective of the Rhineland Model is to enable all citizens to participate in the well being of society.

The ultimate objective of the Rhineland Model is to enable all citizens to participate in the well being of society. Whether through participation in a labour market with quality jobs or through the granting of decent benefits. There exists an important link between the labour market and social security. Social contributions resulting from labour are responsible for the bulk of revenues that provide for social security. Labour also often grants one the right to receive social security benefits. Moreover, one of the Rhineland Model’s principles is that a good social security system requires people to not make unnecessary use of it. On the contrary, everyone is expected to exert him or herself to the maximum in order to contribute to the creation of the general prosperity.

In other words: social security is meant to bridge the gap where there is a “lack of work.”

Hence, the economic role of labour in the

Labour should not be reduced to pure eco-

Rhineland Model is twofold. Labour not only

nomic data.

provides for individual income, for produc-

development, human values, solidarity and

tion and for the value added of a company,

cooperation with others are only a few of the

but labour is also essential as a source to fi-

values that employment helps to develop.

nance social security. More working people

The employee is therefore never only an eco-

are, therefore, a means to improve the well

nomic factor, he is always still a human be-

being of both those who work and those who

ing, who through his labour contributes to

do not work. Labour market reforms should

the development of personal, ethical and so-

integrate both approaches to work (the in-

cial goals. The creation of prosperity, with-

trinsic welfare component and the economic

out the creation of well being, is a poor way to

component). In this way, we can improve

interpret labour and the economy.

Human contact, individual

both the well being and prosperity of the working individual as well as that of society in general.

In light of the ageing of the population, the low participation of many groups in the labour market as well as the shortage of labour supply for certain professions and sectors, it is clear that a reinforcement of the labour supply is urgent. Without this reinforcement, we will never be able to maintain economic growth at the present level. Targeted economic immigration can resolve difficulties to fill certain job openings. Existing immigration flows should add more to the advancement of national prosperity. Unfortunately, immigration is often reduced to the problem of asylum seekers and to a too limited narrative about solidarity. That narrow perspective neglects the fact that the participation of immigrants in the labour market also contributes to the creation of prosperity.

The government is needed to guide this pro-

At this juncture, we will now delve deeper into the organization of social security; hence, we frequently and without hesitation cross the borders of the labour market policy. As we have pointed out, these two factors are inherently connected to each other.

cess through an active labour market policy and by combating discrimination. The narrative about rights and duties needs to be pushed forward in the public debate. This will help to improve the social acceptance of immigration (in all its forms).

36

•

The setting and risks

Social protection must be conceived in broader terms than social security. Outside of social security, a number of assistance mechanisms have been developed that are entirely financed from the national treasury. There are also other social allowances for educa-

Therefore, the specificities of our social security system are concerned with a number of outside factors; factors that have not remained stable over the last decades.

After the Second World War, our social wel-

tion through scholarships and grants. Often

fare system was developed as a step-by-step

allowances, which fall outside of social secu-

response to a number of risks. In essence,

rity, are subject to a prior income test (means

systematically larger in size than their pre-

the social welfare system must ensure finan-

tested). The same is true for subsidized ser-

decessors. In the past, financing through

cial stability, even when people experience

vices like childcare and homes for the elderly.

repartition was self-evident. Due to hyperin-

for life. Today, mixed careers and job changes are rather the rule than the exception. This means that there is a necessity for a type of social security that does not hinder the mobility of the labour force. This applies in particular to those workers with international careers (e.g. expatriates and cross-border workers),

In the past, new generations were

a reality that is becoming increasingly more prevalent.

Competition in the global market

bad luck. On the one hand, through income

flation after WWII, repartition became a ne-

was for the most part limited so that labour

replacement benefits, which attempted to

cessity: wealth that had been previously ac-

costs were less problematic. Moreover, in-

compensate for a person’s loss of income.

cumulated was no longer of any value. Now,

dustry dominated economic activity, so that

Pensions provided an answer to the risk

however, the phenomenon of ageing and low

there were fairly many jobs for low skilled

that someone, who became very old, was no

birth rates put financing through repartition

workers. Nevertheless, globalization implies

longer capable of earning a salary through

under extreme pressure. In a few years, for

that there is more pressure to decrease wages,

labour. From the beginning, therefore, the

every person who is active in the labour mar-

therefore, making it more difficult to finance

retirement age was set at 65, barely differing

ket, there will be someone, who is inactive.

social security. This is especially true for low

from the average life expectancy. The risk of

Connected to this, low and relatively predict-

skilled workers. Insofar as we continue to fo-

loss of income through illness, disability or

able inflation figures have led to a renewed

cus our economy on products with a higher

loss of employment was also offset. On the

interest in capitalization.

added value – where competitive pricing is less important –, education becomes even

other hand, as a supplement to salary, compensatory payments were provided to avoid

The typical family situation after

more important.

those (often unforeseeable) costs -- linked to

World War II, the so-called “bread winner’s

the rearing of children or medical care – that

model,” stood central in the construction of

could result in a life of poverty.

social security. The husband went to work,

Social security arrangements can not impede

European integration is being felt.

while the wife cared for the family. Today,

the free movement of workers, goods and ser-

From the beginning, it was explicitly decided

however, familial forms are now more diverse

vices. To limit social security on the basis of

for a system of social security where there was,

and less stable; hence, it is more difficult to

(sub)nationality is, for example, not possible.

on the one hand, a clear link between the ad-

fall back upon the kind of solidarity that was

vancement of social rights and, on the other

once found within the family. This develop-

hand, work. This was different than, for exam-

ment has led to the call for individual and

ple, the United Kingdom, where the starting

fragmented rights: social rights are demand-

point was universal social rights. Neverthe-

ed irrespective of the rights of the partner.

less, the relationship between work and the development of social rights cannot be perceived

The average career was relatively

as a one-to-one ratio. Child benefits and health

stable. A person, who began as an employee

care are, for example, universal rights. On the

in the private sector, or were self-employed

side of financing, taxes now account for more

or became a civil servant, remained so until

than one third of the means of social security;

his or her retirement. This led to the devel-

therefore, social security is no longer a concern

opment of various parallel systems of social

of the employees and employers alone. The

protection, without any regard for the prob-

government has also become a full partner.

lems of transition. Unlike today, jobs were

38

41

Society in 2010 has fundamentally changed

Thanks to the broad distribution of

from the society that existed directly after the

trustworthy means of anti-conception, the

Second World War. Even so, the “old dangers”

costs of child rearing are less unpredictable

are still present. People still want to protect

than in earlier times. Even so, child support

themselves against the loss of income and

hardly covers all costs that are related to the

against extensive and unpredictable costs.

bringing up of children. This example shows

But are we really able to adequately protect ourselves against the old risks in the now changed environment?

The understanding of a pension or

a retirement has been fundamentally altered.

that a permanent monitoring of the objectives, i.e. the input and output of our social

Besides these “classic” risks, a number of new risks have emerged:

security, is essential. Where necessary, the

system will have to be fundamentally revised

Whoever has received a low or a

in order to maintain the desired level of social

poor education has difficulty in finding work.

protection.

Those who remain unemployed for a long time, run a higher risk of falling into poverty.

Our social security (and social pro-

The evolution towards an information econo-

tection in general) system is less successful

my requires workers to have other capacities

in keeping certain groups out of poverty, for

(e.g. the evolution from hand to head work,

example, single-parent households and peo-

thorough-going computerization). In other

ple, who have had to live from an allowance

words, the lack of a (proper) education is a

for a long time. Are we using our limited

new risk.

resources in a sufficiently effective and selec

tive way?

Trying to combine the demands of

Originally, people expected that the average

a family with work has become increasingly

career path lasted “until death.” The pen-

difficult. There are significantly more two-

sion was a buffer in case ageing outlasted this

income households/single parents. The lack

scenario. Today, we expect much more out of

of time for both responsibilities is a new risk.

the same pension. A pension is expected to maintain a person’s standard of living after he or she has completed his or her time of active work. Although the retirement age has remained the same, due to progress made by medical science, life expectancies have

dramatically increased. It is for this reason that the active time of work has been -- relatively speaking -- shortened. Furthermore, there are relatively less resources available in comparison to relatively more expenditures.

Connected to the ageing of the population and lower birth rates, the financing of pensions in particular and social security in general is heavily under pressure. The objectives of social security must be brought into line again with the available means.

40

41

Solidarity without borders?

When the reality no longer sufficiently meets expectations, then, people become more critical with respect to social security. Support is gradually weakened. This is clear from the very strong growth of private insurances (pensions, hospitalization, etc...).

Solidarity in social security takes place at a number of levels:

In this

way, solidarity also comes under pressure.

Furthermore, solidarity is not always desired.

The first form of undesired solidarity can develop out of a lack of controls. For example, whenever the unemployed do not put forth enough effort to get a new job, then, they create avoidable expenditures and, hence, higher premiums for others. The same is true for those, who are guilty of procuring fraudulent benefits. Social security is not unconditional.

Social rights stand over and against social responsibilities. The rules of the game must be respected by everyone.

Solidarity between high and low incomes. This type of soli-

Sometimes, however, the rules of the game

The concept “solidarity” requires some ex-

darity especially stems from the fact that

are under discussion. Also, “pure” solidarity

planation. For example, it is not the case that

in Belgium salary contributions are unlim-

is not always desired. A large group of people

the payment of unemployment or medical

ited, while limits exist for the calculation of

think that they pay a very great deal and get

benefits automatically means that we are in

the payment.

In fact this translates into a

very little in return. What happens at the end

solidarity with the unemployed or the sick.

relatively small difference between the maxi-

of a career illustrates this problem clearly.

Solidarity occurs when people are prepared

mum and the minimum allowances.

Whoever steps out of the labour market at a

to convert a portion of their contribution,

young age, contributes less to social security,

which they pay into the social insurance pool,

Solidarity with respect

but will nevertheless receive social benefits

into rights for others (thereby revoking some

to families with (and without)

for a longer period. Here, we are concerned

of their own rights). In private insurance, a

children. Everyone contributes to the fi-

about the amount that one receives for re-

“pure” solidarity does not exist, because there

nancing of child support. The pension rights

tirement: a pension that is based on an in-

is a direct relationship between the contribu-

for a married couple are higher than those of

complete career is lower than a pension that

tion that is paid and the payment that fol-

a single person even when the contributions

is based on a complete career; nevertheless,

lows, e.g. when a house burns down. He, who

were identical .

the difference that one receives remains rela-

pays nothing, gets nothing in return. He, who pays much, is repaid proportionately. In

tively insignificant. The problem becomes Solidarity between

clearer in the case of the Belgian early retire-

social security, this is different, which means

those with a normal working

ment plan that is meant to “bridge” the pe-

that additional forms of insurance (e.g. 2nd

life and those with a short-

riod between the earlier ending of one’s ca-

and 3rd pillar pensions, hospitalization) do

(ened) working life.

reer and the standard retirement age (“bridge

not come under the heading of “social secu-

pension”). Not only is society in solidarity

rity.” “Private social security” is a contradic-

with the pensioner by financing unemploy-

tion in terms.

ment benefits until the age of 65, but the society allows the person to continue to build full retirement rights over the entire “bridge” period. The solidarity that is required of those, who remain in the labour market, is quite extensive. Can this be defended, when the average benefit payment is heavily under pressure?

42

43

Towards a more contemporary social security

Striving for more uniformity.

Transparency and responsibil-

Mixed careers are now the rule rather than

ity as core concepts. People can

the exception. Major differences between the

only be held responsible for their decisions,

various social security schemes hinder job

when they correctly understand their impli-

mobility. The same applies to the outdated

cations. Information contributes to the re-

distinction between blue collar and white col-

alization that a good social protection is not

lar workers.

evident, but requires the efforts of everyone.

Even so, the request for greater transparency also leads to more bothersome questions: is a smoker himself responsible for his health

A social security that is more

People also need to distance themselves from

care bill? Can people be held responsible for

employment oriented. Social pro-

the idea that a job is for life. At the age of 65,

poverty? In other words, where does individ-

tection needs to have a strong foundation.

in so far that a surgeon may no longer have

ual responsibility end and social responsibil-

We are unable to share in prosperity, without

a steady hand necessary to accomplish preci-

ity begin?

first creating it. The organization of social

sion operations, a construction worker may

security must first encourage work. In this

also no longer be able to lug heavy bricks, but

Transparency can also be improved on the

way, it ensures its long-term sustainability.

is that a reason to become inactive at the age

side of financing: The two pillar system,

Working should be more profitable than not

of 65? Perhaps it’s the easiest solution, but

where only work related risks are financed

working, also with respect to social rights

it is no longer sustainable when we want to

through contributions on labour income,

and in particular to pensions. By making the

maintain a high level of social protection. To-

would serve to refocus the essence of social

difference between taxes and social contribu-

day, more than ever, career changes must be

security. This implies that other sources of

tions clearer, we safeguard public support.

considered and even permanently prepared.

income other than labour would be used to

Moreover, social security should not become

Greater professional and geographical mobil-

finance social security. Transparency can

an excuse for unemployment or inactivity.

ity can certainly help.

also be improved by limiting social security to real social risks.

People should not be financially discouraged to look for a new job. Unemployment is a

Social security can even contribute to a long-

bridge towards work. For this reason, it is

er career via a sensible use of paid leaves. This

important to differentiate between unem-

is connected to the “flexicurity” approach:

ployment benefits, as a temporary transition-

the employee is certain that he can fall back

al payment, and unemployment benefits, as a

on a good social protection and quality jobs.

defence against poverty for those who are un-

The employer can structure work more flex-

able to work for longer periods of time. Both

ibly, but also the employee gets more time for

systems must be aimed at helping people to

his or her family.

return to work. Moreover, job protection can be constructed in such a way that it becomes

At the same time, we need to admit that not

an instrument for job security. The way in

everyone is in the position to function within

which job protection receives form must pro-

the “normal” economy; hence, the further ex-

vide the ex-employee with opportunities for

pansion of the social economy is necessary.

further education and outplacement. When

This too contributes to the public support for

an employee is given notice, then, this should

an extensive social security.

not become a time to wait before unemployment, but a period to “re-launch” oneself.

44

45

A social security suitable for

Prevention

support. The

Expectations need to be re-

all families. One question remains at

days that social security was synonymous

alistic. Neither social security, nor the

the forefront: What is social responsibility?

for benefits are now gone. We need to avoid

government can solve all . problems. When

As a society, in which situations do we want

the situation where people become depend-

people want to combine a family, and work,

to be in solidarity? For example, a question

ent (long-term) on social welfare payments.

and sport, and culture, and travel, and, and

pertinent to the pension rights for both part-

This means, for example, an accelerated

...., then, there would never be enough leave

ners: should society pay, when one partner

movement towards service.

For example,

systems. The same is true for health care: re-

has not built upon his or her rights, or is that

permanent education ensures that the risk

search leads to new therapies and medicines,

(partially) a responsibility of the partner?

of unemployment at an older age is drasti-

often at a higher price. Is it feasible to con-

cally reduced. Also career guidance, advice,

tinue to recover medical expenditures from

coaching and outplacement are included in

social security? At once, very difficult ques-

this list of services.

tions are pushed to the foreground: what is

and

an acceptable cost price for one extra year of life? Should we prefer to put resources into covering a large group of patients than into disorders that rarely occur? Or, should we opt for more selectivity?

46

47

The beginning of the debate …

To get the discussion going, we end this contribution with twenty-five questions. Perhaps these are not the most pressing questions, and certainly not the only ones. In the first place, they are meant as “inspiration.”

What is our position on accept-

ing an environmental correction as a new principle of the Rhineland Model? How far are we willing to go? Do we want to be a leader on taking this position, even if it means extra costs in the short term, or a competitive disadvantage?

48

49

How do we avoid more social in-

Are we prepared and able to give

What tasks for which the govern-

Where do we draw the line be-

justice when pushing through environmen-

up policy-making levels, which clearly no

ment is currently responsible, would be bet-

tween protecting privacy and the govern-

tal corrections? Does the social dimension

longer have an added value? Are we pre-

ter abandoned? In which domains should

ment’s duty to actively fight fraud? Where

always need to be prioritized over the eco-

pared to take a distance from responsibili-

the government refrain from taking any

do we draw the line between the freedom

logical dimension?

ties, when another level can do a better job?

more initiative?

of a doctor to prescribe therapies and controlling a doctor’s prescription of medicines with respect to the policy of cost saving?

Does the government need to

Do we really want a “zero-risk”

Should a government be allowed

Is it the role of the government to

participate in sector (industrial) policy? In

society at all costs? How does the govern-

to make profits from the economic activi-

curb bonuses in the private sector?

other words: where does the line need to

ment weigh the reduction of risks against

ties that it sets up?

Can it directly intervene on determining

be drawn between the choice of a sector

rising social costs?

and support for a sector?

the amount that is awarded or only in determining the criteria of recognition (focussing on the long term)? Is an international approach needed?

50

51

What is the role of the financial

Should the government have a

Is working longer for the same

Do we continue along the path

system in our economy? Does the financial

minimum target with respect to investments

wage a means to increase the competitive-

of a social Europe? For example, through

system only serve to provide capital to en-

in innovation? Even when that is at the cost

ness of our economy?

minimum social rights and by entering into

trepreneurs or is it also allowed to develop

of the provision of social services?

a European social dialogue?

some additional activities (like stock speculation)?

1What is the government’s role

Should the government play or

Do we need a new consensus on

Do we want to constrain solidar-

in the financial system? Does the govern-

demand a greater role in the general social

social conflicts? Can ways be found to re-

ity with short-term career options? Are we

ment allow the market free reign and only

debate between trade unions and employ-

spect the right to strike without it leading

prepared to either absolutely discourage

make use of corrections when the market

ers’ organizations?

to major social and economic losses?

or totally eliminate the mechanism of early

fails, or does it act more proactively in or-

retirement ?

der to prevent imbalances in the financial system itself?

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53

How are we able to strengthen the

How can we focus more on the

labour market? Is that possible by making

rights and obligations of the socially in-

inactivity (not working) more attractive

sured?

Is there a need for more solidarity

in our society?

Can a good protection against be-

Where do we draw the line in fur-

thering solidarity in the health sector? What can society finance? Where does personal

and/or by rewarding more work?

responsibility come in?

How far do we want to go in the

What kind of solution can we of-

Is it useful to follow the German ex-

ing made redundant be synonymous with

levelling the social system (workers, self-

fer to lower the high risk of poverty of sin-

ample and build a “debt break� in the Con-

a type of redundancy protection that en-

employed and civil servants)?

gle-parent families?

stitution: that is, a limitation of the amount

courages a fast exit from unemployment?

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of debt that a government may incur?

55