Social Europe Journal Vol. 2 No. 2

Social Europe

Volume 2 • Issue 2 Autumn 2006 Suggested Donation 5₏

the journal of the european left

Contributions by Joseph Stiglitz Mercedes Bresso Detlev Albers Anneke Ribberink Chris Lorenz Karl Duffek Dimitris Tsarouhas

www.social-europe.com

Social Justice in Europe and the World An initiative by the Party of European Socialists

Social Europe the journal of the european left • Volume 2 • Issue 2 • Autumn 2006

Editorial Board Detlev Albers Chief Editor Giuliano Amato Italian Interior Minister, Former Prime Minister Karl Duffek Director Renner Institute Elisabeth Guigou French MP, Former Europe and Justice Minister Please make sure that there are more issues of ‘Social Europe: the journal of the european left’ by paying the suggested 5€ donation for this issue or become a Sponsor Member. Visit our website www.social-europe.com for more details and payment options.

Thank you very much!

‘Social Europe: the journal of the european left’ is published by the Global Policy Institute at London Metropolitan University.

Zita Gurmai President PES Women Stephen Haseler Chief Editor Poul Nyrup Rasmussen President of the PES Angelica Schwall-Dueren Vice Chair SPD Bundestag Group Giuseppe Vacca President Gramsci Foundation Jan Marinus Wiersma Vice President Socialist Group European Parliament Henning Meyer Managing Editor

Editorial team Ben Eldridge & Ian Gardiner Design & Layout Ruth Davis & Katerina Hadjimatheou Sub-editors

Friends In co-operation with:

Jean-Marc Ayrault, Stefan Berger, Antony Beumer, Matt Browne, Proinsias De Rossa, Harlem Désir, Guglielmo Epifani, Patrick Diamond, Antonio Guterres, David Held, Andrea Manzzella, Jacques Reland, Donald Sassoon, Adrian Severin, Martin Schulz, Dominique Strauss-Kahn, Livia Turco, Heidemarie Wieczorek-Zeul, Christoph Zöpel

Social Europe the journal of the european left • Volume 2 • Issue 2 • Autumn 2006

Editorial S Henning Meyer Managing Editor

OCIAL JUSTICE IS one of the key objectives of social democracy; its definition and associated policies however often vary. What does social justice in Europe and the world mean? In this autumn issue of Social Europe we aim to shed some light on what this could entail.

At least since the report of the North-South Commission chaired by Willy Brandt at the end of the 1970s, we know that social justice in the world involves the aims of development and a sustainable economic world order. But what does this mean in times of globalisation and fast economic change?

Nobel Prize laureate Joseph Stiglitz tackles this question in his article, in which he examines the relationship between social justice and global trade.

In Europe internally, the implementation of social justice is closely linked to the polity of the European Union. In a system of multi-level governance, which level should have which policy competencies for social justice policies? Mercedes Bresso, president of the Socialist Group in the Committee of the Regions (CoR) puts forward the political role the European regions - a level of governance often undervalued can and should play.

Social Europe chief editor Detlev Albers presents his draft chapter on Europe for the new SPD party programme. His 'European Dream' sets out to define a new internal vision for Europe and its role in the world.

Last but not least, our focus on social justice is rounded up by the biography-based article by Anneke Ribberink on Gro Harlem Brundtland, who chaired the commission that brought social justice and sustainable development on the political agenda in the late 1980s.

Apart from our focus on social justice in Europe and the world, this issue includes a number of other stimulating contributions. Chris Lorenz presents a strong criticism of the European Union's higher education policies and Karl Duffek and Dimitris Tsarouhas analyse the recent elections in Austria and Sweden.

As always, we hope that you find our selection of contributions informative and stimulating reading for further debates.

Social Europe the journal of the european left • Volume 2 • Issue 2 • Autumn 2006

Letters Dear readers, We have received a quite large number of letters with suggestions, recommendations and criticism. We thank everyone for taking part in our journal project and we aim to adopt as much reader input as possible.

Due to the tight space restrictions in the journal itself however, we can only publish letters that deal with particularly important issues. In this issue, we have decided to publish just one letter, although we might publish more in future issues.

We encourage you to send your ‘letter to the editor’ to letters@social-europe.com. We reserve the right to edit letters.

Thank you very much for your participation!

Dear Editor, I wish you the best of success in publishing Social Europe. With all due respect, I seem to notice the lack of attention to the art/culture dimension, as normally happens in all economics fora. The arts could be an effective vehicle to convey your social message.

I have just seen the play Market Boy, which the National Theatre in London had commissioned David Eldridge to write as an indictment against Thatcherism and NeoLiberalism. An Iron Lady impersonator actually makes an appearance for laughs. The message of the woes of market domination is loud and clear.

I am currently rehearsing Some Explicit Polaroids by Mark Ravenhill, a play that has had great popular success in the West End of London. My point is that socialist artists are doing their bit in promoting what they believe in. Most artists are also active in associations that protect them in their conditions of work. The European Council for Artists (ECA), an umbrella organisation representing the interests of professional artists from all spheres of art and culture, has its seat in Copenhagen.

In the last 3 years, ECA officials have been working voluntarily in international fora promoting the UN Convention on Cultural Diversity. ECA is vociferous in conveying the message that an artistic product is sui generis and not to be subject to globalisation and market forces.

ECA organises an annual congress which is addressed by various experts in the field of professional activity in arts and culture. Their dissertations are then published and distributed among thousands of ECA members in 25 European countries.

ECA has also had a high profile in protecting writers suffering from unfavourable interpretations of the trans-Europe deportation warrant. ECA keeps a regular lobby among members of the European Parliament.

All these activities cost money. Each ECA chapter raises its own funds and normally gets some help from local govern-

ment. To cover the cost of ECA offices and employees in Copenhagen and also its annual congress, the European Commission has thought it fit to donate a subvention regularly for the past 10 years. All of a sudden, 7 months into the year’s programme, ECA has been informed that the EC will not be giving it any funds for 2006.

This unilateral decision – without warning or rationale – raises the risk that ECA might have to dissolve its association.

This is how insensitive the powers that be are towards an organisation that, for many years, has been protecting the social aspirations of thousands of workers in the arts, all across Europe. These artists are the same socially conscious activists who convey the social economic message in unorthodox fora that reach the grassroots of European society.

I would be grateful if your publication would give regular attention to the social economic milieu of arts and culture.

Narcy Calamatta Vice President ECA We accept the point made in this contribution and would like to encourage suggestions for arts/culture contributions in Social Europe. Please send ideas to info@social-europe.com.

Social Europe the journal of the european left • Volume 2 • Issue 2 • Autumn 2006

Contents 59 64

Social Justice and Global Trade Joseph Stiglitz

68 72 78

My European Dream Detlev Albers

87

Voted Out of Office – The Surprising Result of the Election in Austria in 2006 Karl Duffek

90

The Swedish Election 2006: What Now for the Swedish Model?

Dimitris Tsarouhas

The Regions and the Future of Europe in the Constitution Mercedes Bresso

Gro Harlem Brundtland: A True Social Democrat Anneke Ribberink Higher Education Policies in the European Union, the ‘Knowledge Economy’ and Neo-liberalism Chris Lorenz

Click on the flags for links to foreign language versions

Social Justice and Global Trade T

Reprinted from The Far Eastern Economic Review © 2006 Review Publishing Company Limited. All rights reserved.

Joseph Stiglitz Professor of Economics at Columbia University. In 2001, he was awarded the Nobel Prize in Economics

HE HISTORY OF recent trade meetings – from Seattle to Doha to Cancun to Hong Kong – shows that something is wrong with the global trading system. Behind the discontent are some facts and theories.

The facts: Current economic arrangements disadvantage the poor. Tariff levels by the advanced industrial countries against the developing countries are four times higher than against the developed countries. The last round of trade negotiations, the Uruguay Round, actually left the poorest countries worse off. While the developing countries were forced to open up their markets and eliminate subsidies, the advanced developed countries continued to subsidise agriculture and kept trade barriers against those products which are central to the economies of the developing world.

Indeed, the tariff structures are designed to make it more difficult for developing countries to move up the value-added chain – to transition, for instance, from producing raw agricultural produce to processed foods. As tariffs have come down, America has increasingly resorted to the use of nontariff barriers as the new forms of protectionism. Trade agreements do not eliminate protectionist sentiments or the willingness of governments to attempt to protect producer and worker interests.

The theories: Trade liberalisation leads to economic growth, benefiting all. This is the prevalent mantra.

Political leaders champion liberalisa-

59 Social Europe the journal of the european left Autumn 2006

tion. Those who oppose it are cast as behind the times, trying to roll back history.

Yet the fact that so many seem to have been hurt so much by globalisation seems to belie their claims. Or more accurately, it has shown that the process of ‘liberalisation’ – the details of the trade agreements – make a great deal of difference.

That Mexico has done so poorly under NAFTA has not helped the case for liberalisation. If there ever was a free trade agreement that should have promoted growth, that was it, for it opened up to Mexico the largest market of the world. But growth in the decade since has been slower than in the decades before 1980, and the poorest in the country, the corn farmers, have been particularly hurt by subsidised American corn.

The fact of the matter is that the economics of trade liberalisation are far more complicated than political leaders have portrayed them. There are some circumstances in which trade liberalisation brings enormous benefits – when there are good risk markets, when there is full employment, when an economy is mature. But none of these conditions are satisfied in developing countries. With full employment, a worker who loses his job to new imports quickly finds another; and the movement from low-productivity protected sectors to high-productivity export sectors leads to growth and increased wages. But if there is high unemployment, a worker who loses his

‘Most of the studies that claim that liberalisation leads to growth demonstrate no such thing. They show that countries that have traded more have grown more’

job may remain unemployed. A move from a low-productivity, protected sector to the unemployment pool does not increase growth, but it does increase poverty. Liberalisation can expose countries to enormous risks, and poor countries – and especially the poor people in those countries – are ill equipped to cope with those risks.

Perhaps most importantly, successful development means going from stagnant traditional sectors with low productivity to more modern sectors with faster increases in productivity. But without protection, developing countries cannot compete in the modern sector. They are condemned to remain in the low growth part of the global economy. South Korea understood this. Thirty-five years ago, those who advocated free trade essentially told Korea to stick with rice farming. But Korea knew that even if it were successful in improving productivity in rice farming, it would be a poor country.

It had to industrialise.

What are we to make of the oft-quoted studies that show that countries that have liberalised more have grown faster? Put aside the numerous statistical problems that plague almost all such ‘cross-country’ studies. Most of the studies that claim that liberalisation leads to growth demonstrate no such thing. They show that countries that have traded more have grown more. Studies that focus directly on liberalisation – that is, what happens when countries take away trade barri60 Social Europe the journal of the european left Autumn 2006

ers – present a less convincing picture that liberalisation is good for growth.

But we know which countries around the world have grown the fastest: they are the countries of East Asia, and their growth was based on export-driven trade. They did not pursue policies of unfettered liberalisation.

Indeed, they actively intervened in markets to encourage exports, and only took away trade barriers as their exports grew. They avoided the pitfall described earlier of individuals moving from low-productivity sectors into zero productivity unemployment by maintaining their economies at close to full employment.

The point is that no country approaches liberalisation as an abstract concept that it might or might not buy in to for the good of the world. Every country wants to know: For a country with its unemployment rate, with its characteristics, with its financial markets, will liberalisation lead to faster growth?

If the economics are nuanced, the politics are simple. Trade negotiations provide a field day for special interests.

Their agenda is also straightforward: Exporters want others’ markets opened up; those threatened by competition do not. Trade negotiators pay little attention to principles (though they work hard to clothe their position under the guise of principle). They pay attention to campaign contributions and votes.

In the most recent trade talks, for example, enormous attention has been focused on developed countries’ protection of their agricultural sectors – protections that exist because of the power of vested agricultural interests there. Such protectionism has become emblematic of the hypocrisy of the West in preaching free trade yet practicing something quite different. Some 25,000 rich American cotton farmers, reliant on government subsidies for cotton, divide among themselves some $3 billion to $4 billion a year, leading to higher production and lower prices.

The damage that these subsidies wreak on some 10 million cotton farmers eking out a subsistence living in subSaharan Africa is enormous. Yet the United States seems willing to put the interests of 25,000 American cotton farmers above that of the global trading system and the well-being of millions in the developing world. It is understandable if those in the developing world respond with anger.

The anger is increased by America’s almost cynical attitude in ‘marketing’ its offers. For instance, at the Hong Kong meeting, U.S. trade officials reportedly offered to eliminate import restrictions on cotton but refused to do anything about subsidies. The cotton subsidies actually allow the U.S. to export cotton. When a country can

‘Trade liberalisation should be “asymmetric”, but it needs to be asymmetric in a precisely opposite way to its present configuration’ export a particular commodity, it does little good to allow imports of that commodity. America, to great fanfare, has made an offer worth essentially zero to the developing countries and berated them for not taking it up on its ‘generous’ offer.

At home, the Bush administration might be working harder to provide greater access to low-cost drugs. In trade negotiations, though, it takes the side of drug companies, arguing for stronger intellectual property protection, even if the protection of pharmaceutical company patents means unnecessary deaths for hundreds of thousands of people who cannot afford the monopoly prices but could be treated if generic medicines were made available.

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The international community has announced its commitment to helping the developing countries reduce poverty by half by 2015. There have been enormous efforts at increasing aid and debt relief. But developing countries do not want just a hand out; they want a hand up. They need and want enhanced opportunities for earning a living. That is what a true development round would provide.

In short, trade liberalisation should be ‘asymmetric’, but it needs to be asymmetric in a precisely opposite way to its present configuration. Today, liberalisation discriminates against developing countries. It needs to discriminate in their favour. Europe has shown the way by opening up its economy to the poorest countries of the world in an initiative called ‘Everything But Arms’. Partly because of complicated regulations (‘rules of origin’), however, the amount of increased trade that this policy has led to has been very disappointing thus far. Because agriculture is still highly subsidised and restricted, some call the policy ‘Everything But Farms!’ There is a need for this initiative to be broadened. Doing this would help the poor enormously and cost the rich little. In fact, the advanced industrial countries as a whole would be better off, and special interests in these countries would suffer.

There is, in fact, a broad agenda of trade liberalisation (going well beyond agriculture) that would help the developing countries. But trade is too important to be left to trade ministers. If the global trade regime is to reflect common shared values, then negotiations over the terms of that trade regime cannot be left to ministers who, at least in most countries, are more beholden to corporate and special interests than almost any other ministry. In the last round, trade ministers negotiated over the terms of the intellectual property agreement. This is a subject of enormous concern to almost everyone in today’s society. With excessively strong

intellectual property rights, one can have monopolies raising prices and stifling innovation. Poor countries will not have access to life-saving medicines.

That was why both the Office of Science and Technology Policy and the Council of Economic Advisers opposed the TRIPS (intellectual property) provisions of the Uruguay Round. It reflected the interests of America’s drug and entertainment industries, not the most important producers of knowledge, those in academia. And it certainly did not reflect the interests of users, either in the developed or less-developed countries. But the negotiations were conducted in secret, in Geneva. The U.S. trade representative (like most other trade ministers) was not an expert in intellectual property; he received his short course from the drug companies, and he quickly learned how to espouse their views. The agreement reflected this one-sided perspective.

Several reforms in the structure of trade talks are likely to lead to better outcomes. The first is that the basic way in which trade talks are approached should be changed. Now, it is a clear negotiation. Each country seeks to get the best deal for its firms.

This stands in marked contrast to how legislation in all other arenas of public policy is approached. Typically, we ask what our objectives are, and how we can best achieve them. Around those themes, of course, there are negotiations. There are often large differences in views both about what should be the objectives and how best to achieve them. If we began trade talks from this

‘If we began trade talks from [a] position of debate and inquiry, we could arrive at a picture of what a true development round looks like’ 62 Social Europe the journal of the european left Autumn 2006

position of debate and inquiry, we could arrive at a picture of what a true development round looks like.

Thinking of the task of the WTO as creating a legal framework reflecting principles of fairness, social justice and efficiency – akin to how we think about domestic rules and regulations governing economic behaviour – helps us think about what other reforms are needed. We simply need to think about how we attempt to improve the quality of domestic democratic processes and legislation by increasing, for instance, transparency and other governance reforms.

Transparency is essential so there can be more open debate about the merits of various proposals and a chance to put a check on the abuses of special interests. Clearly, had there been more transparency and open debate, the excesses in intellectual property protection of the Uruguay Round might have been avoided.

As more and more countries have demanded a voice in trade negotiations, there is often nostalgia for the old system in which four partners (the U.S., EU, Canada and Japan) could hammer out a deal. There are complaints that the current system with so many members is simply unworkable.

We have learned how to deal with this problem in other contexts, however, using the principles of representation.

We must form a governing council with representatives of various ‘groups’ – a group of the least developed countries, of the agricultural exporting countries, etc. Each representative makes sure that the concerns of his or her constituency are heard. Such a system would be far better than the current ‘green room’ procedures wherein certain countries are put together (in the green room) to negotiate a whole or part of the deal.

Finally, trade talks need to have more focus. Issues like intellectual property should never even have been part of the Uruguay Round. There

already was an international institution dealing with matters of intellectual property. It is not only that trade ministers are ill-equipped to understand what is at issue, and they are therefore subject to undue influence from the special interests that have long held sway over trade ministries. Broadening the agenda also puts developing countries at a particular disadvantage, because they do not have the resources to engage on a broad front of issues.

The most important changes are, however, not institutional changes, but changes in mindset. There should be an effort on the part of each of the countries to think about what kind of international rules and regulations would contribute to a global trading system that would be fair and efficient, and that would promote development.

Fifteen years ago, there was a great deal of optimism about the benefits which globalisation and trade would bring to all countries. It has brought enormous benefits to some countries; but not to all. Some have even been made worse off. Development is hard enough. An unfair trade regime makes it even more difficult. Reforming the WTO would not guarantee that we would get a fair and efficient global trade regime, but it would enhance the chances that trade and globalisation come closer to living up to their potential for enhancing the welfare of everyone.

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The Regions and the Future of Europe in the Constitution

T

Mercedes Bresso Member of the Democrats of the Left Italy, President of the Piedmont Region, President Socialist Group in the Committee of the Regions (CoR)

HE GREAT EUROPEAN project seems to have been put on hold this year, following the French and Dutch rejection of the Constitution for Europe. The founding states seem to be awaiting the right moment to reinvigorate the process, while all the other member states seem confined to the role of bystanders. It therefore makes sense, given the lack of activity at a national level, to resume the debate on Europe and the Constitution from the level of the regions and regional government. The year of ‘reflection’ which followed the negative outcome of the referendums in France and the Netherlands has come to an end and we are now in a sort of further extension of this period, which I would describe as a period of uncertainty rather than reflection.

Europe is finding it difficult to talk about itself: the promises of a common area of peace and

‘Europe is finding it difficult to talk about itself: the promises of a common area of peace and prosperity no longer seem to succeed in generating energy and enthusiasm’ 64 Social Europe the journal of the european left Autumn 2006

prosperity no longer seem to succeed in generating energy and enthusiasm. The public sees Europe as distant and often incapable of responding to its concerns, whether longstanding or recent: job instability, the aggressive aspects of globalisation, enlargement of the EU’s borders and immigration. The reason for these difficulties is not the European institutions’ failure to communicate but, first and foremost, the democratic deficit which still marks European integration. The public may not be completely aware of every detail of the co-decision system but there is no doubt that it is aware that the relationship of representativeness and accountability between European law-makers and their electorate lacks transparency.

This is the same lack of transparency which allowed the debate on the European Constitution to be manipulated; it ceased to be a discussion on the common European charter and became a means of criticising governments in power and elites.

Given the crisis in the constitutional process, caused by the negative outcomes of the referendums held in two founding countries – France and the Netherlands – it is necessary to

analyse the roots of these outcomes.

On the one hand, there is clearly deep-rooted unease among the European public with regard to European integration. Once the major goal of monetary union had been attained, the integration process slowed down significantly and seemed incapable of addressing the economic and social issues which are of most concern to the European public:

• socio-economic stability, which is in crisis because of the failure of European economic policy to provide adequate resources and powers to address the challenge of globalisation; • domestic security, which is under threat from transnational crime and terrorism, the difficulty of integrating immigrants and combating illegal immigration, and environmental and health crises; • international security, which is jeoparised by growing instability in the world and the difficulties encountered by the unipolar US strategy.

While surveys show that the European public want more rather than less Europe, national political elites have been unable to persuade them that the European Constitution represents significant progress towards a more effective, more democratic Europe.

In this context, the decisive factors in the crisis in the constitutional process were the procedure of ratifying the European Constitution country by country and the unanimity requirement.

Simultaneous ratification would

have given the opponents of European integration less opportunity to link the decision about Europe to national power struggles. Moreover, if the French and Dutch peoples had known that Europe would keep moving forwards without them, they would have had a better understanding of the significance of the question, rather than confusing it with domestic matters.

On the basis of this analysis, what measures can Europe’s regions propose to breathe new life into European integration?

First of all, the Constitution for Europe represents progress for local and regional authorities.

The Constitution confirms that the EU respects the equality and national identities of the member states, inherent in their fundamental structures, political and constitutional, inclusive of regional and local self-government.

The preamble to the Charter of Fundamental Rights reiterates this concept, stating that: ‘The Union contributes to the preservation and to the development of these common values while respecting the diversity of the cultures and traditions of the peoples of Europe as well as the national identities of the member states and the organisation of their public authorities at national, regional and local levels…’.

The inclusion of the full text of the Charter of Fundamental Rights in the Constitution is, moreover, a key indication of the importance accorded to the European people’s values and fundamental rights. These include respect for the European Union’s cultural and

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linguistic diversity, of which minority and regional languages are an expression.

The Constitution also, for the first time, includes territorial cohesion among the European Union’s objectives, alongside economic and social cohesion.

As we are aware, European cohesion policy, implemented via the Structural Funds, is the aspect of EU local action most visible to the people. Pursuing the goal of territorial cohesion, Community policy aims to reduce the development disparities between and within Europe’s regions, following a model of balanced regional development.

Moreover, the European Constitution introduces a much clearer division of powers in the European system of multi-level governance and makes a number of major innovations to strengthen the system for monitoring compliance with the subsidiarity and proportionality principles.

The text of the Constitution has enhanced the concept of subsidiarity, including the substate levels of government in the definition of EU competencies.

Indeed, in the areas which do not fall within its exclusive competence, the EU can act only when the objectives of the intended action cannot be sufficiently achieved by the member states (either at central level or at regional level) but can rather be better achieved at EU level.

Furthermore, the protocol on the application of the principles of subsidiarity and proportionality was reinforced by the introduction of a new ex-post monitoring system, i.e. the possibility of bringing cases of infringement before the Court of Justice.

In general, before proposing legislative acts, the Commission has to consult widely. Such consultations must take into account the regional and local dimension of the action envisaged. The Commission then proceeds to adopt the draft legislative act, which must be accompanied by an appraisal of compliance with the subsidiarity and proportionality principles and an analysis of the financial and administrative burdens which would arise from the implementation of the proposal; this assessment must also specify any implications for local and regional authorities, which are

ments, which have a specific timeframe within which to activate the early warning mechanism and ask for the proposal to be reviewed on the grounds that it does not comply with the subsidiarity principle. This mechanism involves both chambers of national parliaments, which can, in turn, consult with regional parliaments with legislative powers, in accordance with member states’ constitutional procedures.

Once the proposal has reached the end of the legislative process and has been adopted, the ex-post phase of monitoring the application of

‘Local and regional governments have a natural and, I would say, “professional” role to play as an interface between Europe and the people’ in the majority of cases responsible for implementing Community legislation. The draft legislative act will then be forwarded under the legislative procedure to the European institutions, including the Committee of the Regions (CoR), which is consulted mandatorily on subjects which fall within its remit or where this is deemed necessary because of the regional or local impact of a proposal.

Thus, the CoR plays a key role as an intermediary between local and regional stakeholders and the European level.

At the same time, the Commission forwards the draft legislative act to national parlia-

the subsidiarity principle is opened. The new element introduced by the Constitution is the Committee of the Regions’ entitlement to bring cases before the Court of Justice on grounds of infringement of the subsidiarity principle. Although this right is limited to areas on which consultation of the Committee of the Regions is mandatory, it nevertheless underscores the CoR’s major role in striking a balance between the different tiers of the European system.

In addition to winning the right to bring cases before the Court of Justice on grounds of infringement of the subsidiarity principle, the CoR saw its politi-

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cal role strengthened by the Constitution in two respects: 1) through the entitlement to bring cases before the Court of Justice to safeguard its prerogatives, and 2) through the extension of CoR members’ terms of office from four to five years, so that they could soon run in tandem with the terms of office of the European Parliament and the Commission.

Other suggestions made by the CoR during the work of the Convention and the Intergovernmental Conference were not accepted, such as conferral of the status of a European institution, an extension of the areas on which consultation of the CoR is mandatory to include all policies with regional or local implications and the introduction of a clear legal basis for cross-border and transnational cooperation. The local and regional authorities represented in the CoR should, in any case, be aware of the progressive nature of the European integration process and welcome the elements introduced by the Constitution which seek to enhance local and regional authorities’ role in this process.

Once this step forward has been acknowledged, I believe that, in this phase of the process, it is now essential to get as close to the public as possible and listen to their concerns.

In this context, local and regional governments have a natural and, I would say, ‘professional’ role to play as an interface between Europe and the people. In our towns, cities and regions, people can often see the tangible impact of the Structural Funds and Community programmes.

European networks and crossborder programmes have enabled our local and regional authorities to learn from each other. Our young people have studied in other European towns and cities under the European Union’s Erasmus project, and our regional representations in Brussels have learned how to build relationships and dialogue with the Commission so as to be able to channel European funding as effectively as possible.

On the basis of this experience, we must develop new forms of democratic participation in Europe for the people. If the people are to play an active part in European decision-making, it is essential that they are provided with more information. Local and regional press representatives have been invited to Committee of the Regions plenary sessions so that they can take the European message directly to the people without the need for a national, centralised intermediary.

The potential of local and regional media needs to be harnessed to provide a direct line of communication between Europe and the public. We already know that the European, and regional and local levels can work together and enhance each other’s work.

That is why, in this period in which the political and economic potential of a united Europe has yet to be fully harnessed, it makes sense that the regional and local levels should serve as an interface to keep dialogue between the people and Europe open.

Moreover, it should be pointed out here that the member states whose regions are firmly

rooted in Europe through their participation in European lawmaking have, to date, all expressed extensive support for the Constitution. Therefore, more regionalism means a more pro-European approach. The greater the capacity for the people to make laws and govern via regional structures, the greater their awareness of Europe’s role in their communities.

Lastly, if the constitutional process is to be successfully reinvigorated, it is essential that the European Union is seen to work together with its supporters as it resumes the process and to take on board the people’s concerns.

We must therefore call for the common policies to be reinvigorated, and for the enhanced cooperation method to be used to overcome national vetoes.

The next few years will be a fundamental period of growth for the European Union, as it expands from 25 to 27 member states with the prospect of subsequent enlargements. We must face this challenge with a clear vision of a dynamic and mutually supportive Europe, in which regional authorities can serve as an interface with Europe.

We know that when Europe harnesses its diversity and intelligence for a common goal, it is as competitive as any other continent. We know that adapting the European Social Model to respond to new challenges can create development prospects throughout the EU, making it a leading player in the global economy and an example for the world. Then, as regards the Constitution, the crisis of recent months must serve to bring us closer to the people and elicit

67 Social Europe the journal of the european left Autumn 2006

their views on the kind of Europe they want and how the Constitutional Treaty can be brought into line with these desires.

Regional and local authorities have a key role to play in proclaiming the European vision as essential to the EU. Our districts and regions give each other mutual support daily and the European Social Model is based on local and regional implementation; I therefore believe that the regions’ commitment is important for Europe as a whole.

My European Dream Preliminary remarks

T

Detlev Albers Professor of Politics at Bremen University

HE TITLE, STYLE and language of the following article need an explanation. The title is an adapted version of the title from the famous book by Jeremy Rifkin ‘The European Dream’. Hence, in this article, America’s external view of Europe and the world meets an inside view about Europe, sometimes in a subjectively overstated way. The article is written as a possible version of the Europe chapter in the Party Programme of the Social Democratic Party of Germany (SPD), which is to be presented to the party and the public in January 2007 and is to be adopted after an in-depth discussion at an extraordinary programme party conference.

Since the days of the Gotha (1876) and Erfurt Programmes (1891), which both served as a basis for the newly founded SPD, the tradition has evolved in German social democracy to

‘Cooperation between states and governments leads to integration and democracy on a new level; European civil rights are taking shape’ 68 Social Europe the journal of the european left Autumn 2006

define basic values, objectives and strategies at intervals of several decades, each time for several decades. This sort of understanding can be found in the SPD Programme during the Weimar Republic (Heidelberg 1925) as well as in today’s SPD Programmes (Godesberg 1959 and Berlin 1989). Also, the future Party Programme, with which the Party has been dealing since 1999 in a number of working groups, is based upon such perception. It goes without saying that Europe’s integration plays a key role in every future programme of parties which belong to the Party of European Socialists (PES). In light of that statement, the German programme debate is therefore nothing but an important part of the process of self-conception of the European left. Our journal ‘Social Europe’ will participate in that process.

Text proposal:

1. Europe’s integration means for us both vision and day-today political orientation, longterm objective targets and guidance for everyday action. The European community of values evolves from national politics of basic values. Cooperation between states and governments leads to integration and democracy on a new level; European

civil rights are taking shape.

From the abandonment of war, a peaceful togetherness in a new community emerges. From the abolishment of internal borders, the beginning of acceptance of responsibility for other countries and the world as a whole arises.

2. The German Social Democrats have never defined Europe as a sealed prosperity zone or as a world power, which pursues its own selfish interests. In fact, we understood and continue to understand the integration of Europe as an indispensable forerunner for partnership and balance of interests. Shortly after the First World War, we already recognised in our Heidelberg Programme of 1925 that ‘economic reasons compellingly have to lead to the establishment of a European economic community’. Therefore, we demanded ‘the creation of the United States of Europe in order to reach interest solidarity among the people of every continent’. We stay committed to this goal.

3. Europe’s integration has enjoyed progress without parallel in the last five decades. After centuries of imperial conquest, the self-destruction of two devastating World Wars and four decades of the ‘Cold War’ shadowed by Auschwitz and Gulag, in our new century today, the old continent, being a civilian entity, is able to act as a role model for the future world order. Political and societal democracy and the constitutional and welfare state are therefore as important as the principles of communitisation and

shared sovereignty. Together, they comprise the key pillars of the European community model, which we all support.

However: Impressive as it is, what the European Union has already achieved, the structure of the EU is still unfinished and fragile. Inside the Union, challenges are growing due to the Eastern enlargement and the expectations of other countries regarding EU accession. Adding to these challenges is a number of open questions, such as the question of the EU’s self-conception and objectives. Outside, the EU already exercises so much influence that she is confronted with growing international demands for action, which range from co-shaping the world economy to the fight against terrorism.

4. From the EU-6 during the 1950s to the today’s EU-27 (after the accession of Romania and Bulgaria), it has always been possible to combine the principles of widening and deepening within the EU, i.e. the accession of new member states with progress in integration. Often, this could only be achieved after long arguments.

Interim solutions as well as different timeframes had to be accepted and some member states had to move ahead on their own with important projects, like the Schengen agreement about pushing back internal borders, or the launch of the Euro. Nevertheless, the dynamic of the integration process has always stayed intact.

Yet, in the future, decisions have to be taken in all policy fields, in internal as well as external relationships, whose importance exceeds the gradual

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consolidation of existing procedures. The crisis over the ratification of the EU Constitutional Treaty reveals that the population even in the founding EU member states increasingly doubts the earlier process of integration. Neither persuasive talks nor the continuance of the current course will reverse the situation. One should not demand less than the willingness to reorganise the basis of the Union.

5. Social life in the enlarged European Union is politically unknown territory. The Union comprises almost half a billion people and 27, soon more than 30 nations. She possesses responsibilities, which deeply touch the lives of each citizen.

The EU’s population has been prepared very differently for this situation. Some people had decades – a long time to become accustomed to the development of European decision-making power. Nevertheless, even there this did not happen without problems. Others, however, come from countries, which, only a few years ago, after a long period of struggle obtained or re-obtained their national sovereignty – and now are painfully experiencing the need to devolve great parts of their sovereignty to the EU. Every single person in her/his personal path of life is affected by different affiliations such as family, faith and political belief, but also language and culture such as regional and national identity, in bigger or smaller EU member states. Yet now, they all together have to engage in the reality of overlapping Europeanisation processes.

Every EU citizen is asked to

‘The community as a whole must develop solutions in order to meet the perceptions of political powerlessness or worse, the surrender of its citizen to globalisation and boundless pursuit of profit’ seize the chances offered by the European motto, ‘unity in diversity’.

The community as a whole must develop solutions in order to meet the perceptions of political powerlessness or worse, the surrender of its citizen to globalisation and boundless pursuit of profit. These solutions must include responsiveness to the needs of EU citizens and a guarantee of service to the public interest on a community and regional level, as well as the principle of mutual loyalty to the EU among the member states, the regions and the community. The European Parliament has to be provided with extensive decision-making power. Moreover, a balance of interests between the small and big member states must be achieved and sufficient majorities of citizens for EU legislative projects must be assured. Also, the future constitution has to allow further integration between some member states without putting the cohesion of the Union as a whole at risk.

6. The single common currency pushes economic fusion in the EU significantly ahead. In the course of a few years, the Euro has become the economic backbone of the EU’s internal mar-

ket, which has the strongest purchasing power in the world.

Already, the Euro serves as a reserve currency for numerous countries outside Europe.

Europe’s integration therefore once more takes an economic approach, upon which all participants have deliberately agreed. We social democrats however have always said that such an approach can only be accepted temporarily. Neither in Germany nor in Europe will we accept that only a market society will emerge from a (free) market economy. It is not enough to simply develop the ‘Stability and Growth Pact’ further as regards economic demands.

Also, it is not sufficient to emphasise the relevance of employment objectives vis-à-vis the European Central Bank, or to extend competition law against the process of oligopolisation and monopolisation in Europe. Further integration steps in the policy fields of taxation and constitutional rules governing public finances are, on the other hand, indispensable. The entire economic-political capacity to act is needed on the European level; only then can the primacy of democratically legitimised politics vis-àvis the economy be asserted.

Our aim is the establishment

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of a European economic democracy including collective bargaining rights and equal codetermination of employees on all levels. Alongside the ‘Economic and Monetary Union’ (EMU), a European social union must emerge obtaining the same status as the EMU. Only then can a fair balance of interests between the old and new member states, and between rich and poor regions in the EU be achieved. Here and there, the basic principles of sustainability and justice between the present and future generations must be applied. European economies have to open their markets for the economic development interests of the countries in the South; the EU must become a positive role model for hospitality in the world. The achievement of these aims will become the lynchpin of our political work in Europe.

7. Europe lives and dies with the cohesion of its citizens.

Therefore, more is to be demanded than just a community of mutual economic advantage. If the EU is to become so strong that it can survive crises, it must win people’s hearts.

There are already numerous opportunities to achieve this aim. Countless trips, over and across one European country to another, are taking place. It starts with travelling, proceeds with an exchange during educational training and very often leads to a working stay in this or that neighbouring country.

Wide areas of infrastructure have become connected by this mobility. Cross-linking in the fields of economy, science and culture is becoming increasingly natural. Europeanisation and

intercultural openings of schools, vocational training and universities are proceeding apace. Realisation and care of such diversity is Europe’s priceless intellectual capital, which gives the most important impetus for innovation.

The societal integration of the continent needs the emergence of a European public. From the regional to the European level, the media thereby plays a key role, due to its independence, plurality and democratic nature.

A knowledge-based society provides new applications of national and European information and communication. In every member state, as well as in the Union as a whole, freedom of opinion therefore has to be protected against new types of commercial control and private oligopolisation and concentration. Europe’s unity can only be consolidated if all societal and political actors deliberately open up to a process of Europeanisation. This applies to trade unions and trade associations as well as to NGOs. Last but not least: European democracy needs European parties. We endorse the reshaping of the PES, together with social democrats from all neighbouring countries, into an independent members’ party.

8. With Europe’s support, we want to achieve ‘solidarity of interests among the people of every continent’, as already argued in our Heidelberg Programme. In times of steadily expanding globalisation, the EU cannot prioritise internal integration over a common foreign and security policy anymore, since both areas are mutually dependent. The entire Union

has to contribute to the developing world’s domestic politics (Weltinnenpolitik). The fight against hunger and poverty, for sustainable economic development, climate protection and biodiversity are thus indispensable. Yet, the reliance on peaceful conflict resolution, on financial stability, good governance and the protection against corruption and state collapse also belong to universally public goods for which we stand. We support all attempts of the international community to reach binding agreements for the protection of these common goods.

Both the competence and influence of the United Nations and its sub-organisations have to be strengthened. Also, the UN has to press ahead with its internal reforms in terms of a broad participation of all nations’ governments and parliaments. Military action which goes beyond self-defence needs an UN mandate. Equally, we insist upon the democratisation of the world economy, which should provide all countries, in particular developing ones, with fair possibilities for development. Both the UN Economic and Social Council (ECOSOC) and the UN Environmental Programme (UNEP) should be given similar competences to the UN Security Council. In this context, we explicitly support the relevant proposals of the Socialist International.

EU joint external action is not only demanded when major questions relating to internal affairs and the world economy are looming. The EU-27 also needs a close network for political and economic consultations with its immediate and wider

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neighbours, not least because it has to meet the demand for accession from a number of neighbouring European countries. In the South East of the continent, from the Balkan countries to Turkey, the prospect of accession has to be given to those countries which have convincingly established the democratic principles of the Community. Contractually established special relationships, at least a customs union, should be built up with the neighbouring countries in the East as well with the Southern Mediterranean countries.

Moreover, cooperation within the framework of the Council of Europe and the Organisation for Security and Co-operation in Europe (OSCE) is important too.

Gro Harlem Brundtland: A True Social Democrat

‘M

Anneke Ribberink Senior Lecturer in Contemporary History, Free University of Amsterdam

Y NAME IS Gro!’1. If you were to choose one sentence to epitomise the former Prime Minister of Norway, then this one is appropriate. She hated formalities and ostentation.

During her career Gro Harlem Brundtland developed a socialdemocratic based egalitarian vision for the future of society that is still significant at the present time. In 1997 she summed up her ideas in one sentence as follows: ‘As a social democrat I strive to change society in such a way that it is healthy for people, enhances equality and distributes primary needs in an honest way.’2 Without diminishing her importance in reducing the gender gap at all levels in society and as a Director General of the WHO, this essay will especially pay attention to her role as leader of the World Commission on Environment and Development (WCED) and to the socio-economic policy under her premiership. These areas will clarify the choices Brundtland made in the ongoing debate on the course of social democracy. This essay will show that she combined her ideas about the need for making the world healthier and for eradicating poverty with the

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so-called Nordic model for a welfare society. In this way she placed herself in the egalitarian and collectivist tradition as well as the green strand of social democracy.

Some Life Data

Gro Harlem was born on 20 April 1939. Her Swedish mother, Inga Brynolf, had studied law. Her father was a physician.

Gro had two brothers and one sister. Both parents were the centre of a social-democratic circle. Her father, Gudmund Harlem, was a cabinet-minister twice in the years 1955-1965. At 6 years old, Gro became a member of the social democratic youth organisation. Her career developed quickly at school as well as in the party. Her qualities as a politician were soon clear to many. At Oslo University she studied medicine until 1963. After she finished her study she worked for several years, from 1965-1974, as a physician and as associate director for Oslo School Health Services. On 9 December 1960 she married the young student in international law, Arne Olav Brundtland. The marriage would produce four children, three boys and a girl. The youngest son Jörgen, who suffered from severe depression, committed suicide in 1991, dur-

‘The report, ‘Our Common Future’... would bring Gro Harlem Brundtland much praise from all over the world, from scientists as well as political leaders, not least from the developing countries’ ing Gro’s third term as Prime Minister. It was to be the greatest tragedy of her life. She wrote openly and extensively about this sad episode in her autobiography. The report about her agonising feelings of guilt is very moving. As a result of the emotional stress she divided her job in 1992 and handed over the party leadership to Thorbjörn Jagland.

Her political star had been rising from the day she became environmental minister -from 1974-1979. In 1975 GHB became deputy party leader, in 1977 member of parliament and in 1981 full party leader and Prime Minister for the first time. She was Norway’s first female PM and besides this was the youngest until that time. She would fulfill 4 terms (1981, 1986-1989, 1990-1993, 19931996). From 1998-2003 GHB was Director General of the World Health Organisation (WHO).

The Brundtland Commission

Informally, in March 1982, Gro Harlem Brundtland was asked

by UN Secretary General Perez de Cuellar whether she would be interested in presiding over a commission due to investigate world wide problems relating to the environment, poverty and population. One motivation pre-

sented by the Secretary General was that Gro Harlem Brundtland happened to be the only (former) Prime Minister with a history in dealing with environmental problems as a minister. Apart from her environmental past, she had acquired a position in dealing with problems concerning safety and armaments because of her membership of the Palme Commission (1980-1981). It was only natural for her, as a true Social Democrat, to integrate her thoughts about the necessity of disarmament into the way she looked at world problems.

So, all things considered, she did not need to think long when in December 1983 the formal request was made by the UN General Assembly. She gathered a commission consisting of government officials, financial specialists and policy-makers in the field of science, technology and agriculture, with the greater part from developing countries. This was smart, because it assured the World Commission on Environment and Development (WCED) of acceptance from these countries in a way that would not have taken place had the commission been composed otherwise.

In the fall of 1987 the report, ‘Our Common Future’, was fin-

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ished and presented to UN’s General Assembly, session 42. It would bring Gro Harlem Brundtland much praise from all over the world, from scientists as well as political leaders, not least from the developing countries. No wonder, since the report presented an integrated vision of world problems under the concept ‘sustainable development’, meaning a vision of economic growth that would be favourable to all countries of the world, without damaging effects for future generations.

‘Humanity has the ability to make development sustainable – to ensure that it meets the needs of the present without compromising the ability of future generations to meet their own needs.(…)technology and social organisations can be both managed and improved to make way for a new era of economic growth. The Commission believes that widespread poverty is no longer inevitable’.3 The report pleaded for the rich countries to hand over part of their wealth to the developing countries and to stop or at least reduce as much as possible environmental pollution.

One way this process could come into effect was if the rich countries spent less money on the arms race. In the most urgent cases (plan for Tropical Forests, Plan for Desertification, plan for clean water, plan for contraceptive materials) less than one month of world wide arms spending would be enough for financing these programmes together. At the same time the developing countries should be allowed economic growth that would stop or at least reduce their poverty problems and the population

problems which result from that poverty. It was understood that no economic growth could take place without at least some environmental pollution, but the developing countries should be helped by being advised on non-polluting industries and technology. It was an integrated and stimulating vision, completely in balance with Brundtland’s own egalitarian and social democratic ideas. Its great merit was its logic. Who in the world would doubt that the path set out in the report was the right one? Because of this it got such a good reception and because of this the concept ‘sustainable development’ was to stay on the UN’s agenda for the future. And this was a success in itself.

And yet, was the road sketched not just all too easy and simple? As called for in the report, in 1992 a follow up conference was organised in Rio de Janeiro, where Gro Harlem Brundtland delivered the opening speech. Results from the Earth Summit in Rio de Janeiro included a treaty on global warming and deforestation, a Biodiversity Convention and a plan for the future (Agenda 21), setting out strategic aims.

Nevertheless, the disappointing conclusion from the 1992 conference itself was, that – no matter how much had been done already – too little had been achieved in terms of the Brundtland Report; a message repeated at a UN conference on ‘sustainable development’ in Johannesburg in 2002.

No doubt Gro Harlem Brundtland was sincere in the aims she put forward. From the day she began her medical studies she was convinced that

health problems were not just an individual issue, but were linked to welfare, poverty and the environment. As a minister for the environment she already did her utmost to combat acid rain and she succeeded in preventing a national disaster when oil poured into the North Sea from a sinking platform. Her personal result as Prime Minister was Norway’s share in development aid, rising from 0.7 per cent of GNP to more than 1 per cent in the early 1990s. During her fourth term she demonstrated sincerety and courage when at the UN Population and Development Conference in Cairo in 1994 she dared to make a connection in a speech between religion and the meager way problems of population were being solved in developing countries because of resistance from the churches to contraceptives and abortion. This speech caused her to be strongly attacked in the Egyptian fundamentalist press.

One decision aroused world wide criticism and would be a serious blow to Brundtland’s

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Gro Harlem Brundtland during a press conference at the WHO Headquarters in Geneva, 2003 Credit : WHO/P. Virot

reputation as a champion of the environment. While ‘Our Common Future’ called for restrictions on world fisheries and whaling, during her third term as PM the Norwegian government broke the international ban by resuming the harvesting of whaling in 1992.

Brundtland’s argument for allowing commercial whaling was that it only concerned redundant stocks. Furthermore the decision should be supported by a scientific commission of the International Whaling Committee. But that could not stop the international protests, including from such organisations as Greenpeace. There are those who say that the decision was designed to please the fishing population in Norway in order to make them pledge their vote to their country’s membership of the European Union,

that has a reputation for setting fishing quotas. But the Norwegian government fiercely denied this allegation.

Socio-economic policy

‘Social justice’ was of paramount importance for Gro Harlem Brundtland. This is also clear when looking at her performances in the socio-economic field when she was Prime Minister.

The Nordic countries (Denmark, Sweden, Norway, Finland) do have vital characteristics in common, making them different from other industrialised countries.

‘Characteristics such as a large state sector, extensive welfare provisions, high social welfare costs, high taxes, generous benefits and active labour market policies have been used by various writers to describe the degree of ‘Nordicness’.’4 Other features are the relative equality in income distribution and the low degree of unemployment.

Norway is different from the other Nordic countries in that it possesses huge amounts of oil.

Norway is therefore the richest of the Nordic countries. Just like Great Britain in the 1980s, the possession of oil prevented Norway from great disasters in the economic field when the depression made itself felt. The other side of the coin is that when there are problems with oil, things go wrong in Norway as well. And that was just what happened in GHB’s second term.

Especially in her second term (1986-1989), Gro Harlem Brundtland faced a huge task in managing her country in the economic and social field. The heritage from the previous Conservative government under

‘By the end of her fourth term Gro Harlem Brundtland could be satisfied. The Norwegian economy was prospering and its exports booming’

Kare Willoch was not a favourable one. After a period of zero economic growth in the beginning of the 1980s, the economy had been booming again with a GDP per capita of 5 per cent in 1985. The consequence was that Norway was living at far too high a level. Internal consumption was too high, prices and wages were too high and so was inflation. In addition, there was a crisis in the oil industry, because prices had fallen throughout the world. The Norwegian people lost 10 per cent of their income and there was a strong deficit in the national balance of payments. Another difficulty was, that Gro Harlem Brundtland presided over a minority government (as with all her cabinets) and stood up against a non-socialist majority in parliament. She reacted to the crisis in a Keynesian and Social Democratic way. The government’s prescription was to impose a halt in the growth of wages at 4 per cent and a rise in the interest rate in order to curb national spending. Taxes were raised and the Norwegian currency was devalued by 12 per cent to stimulate export. Oil prices were put in line with the OPEC regulations to give the economy a further boost. Last but not least, the people earning the highest incomes had to swallow a decrease by two percent. Gro

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Harlem Brundtland herself claims that one of the mainstays of her success was that she continuously consulted with the social partners, employers and trade unions, to get the necessary support for her governmental rules.

The result was impressive. The government managed to get the economy back on track again and by the 1989 election year, inflation had been curbed, the budget was showing a surplus and foreign trade was booming.

However, the price to be paid was an unemployment rate that in two years’ time had more than doubled from 2 to almost 5 per cent, low in comparison to other Western countries during that decade5, but high for a nation used to full employment. This last factor in particular caused a serious blow to the Social Democratic party at the elections: it received 34 per cent of the votes, compared to 40 per cent in 1985. And this notwithstanding the fact that political friends as well as adversaries and excellent economists praised Brundtland’s government for its performance in economic terms. The unemployment rate would even be higher at the beginning of the 1990s (6% in 1993) and would be a burden until the end of her fourth term.

The struggle against unemployment was therefore high on

the agenda of Brundtland’s third and fourth cabinets (1990-1993 and 1993-1996). Her governments fought against unemployment in those years by increasing public spending. Still, public finances were relatively sound, with deficits at the beginning of the 1990s, but a surplus in 1994 and 1995. In this way they could pay for an active employment policy. People, especially young people, should work if they could and if there were any skills deficits these could be repaired by courses, prolonged education, training programmes and so on.

Work places were being created by wage subsidies and financial support to employers. Social benefits would still be granted if necessary, but it should firstly be investigated whether or not a person could work. Indeed, social benefits were still high and, in addition, a huge amount of money went to the health, age and education sectors.

Furthermore, child care was being improved from gender as well as economic perspectives in order to encourage the combination of work with family care.

The result was a huge public sector in which many women worked. Government’s share in total employment was 30 per cent in 1993 and 1994. The fight against unemployment was a success in so far as the figure fell to 4% again in 1995. Besides, Norway’s economy was prospering, certainly compared to its neighbours Sweden and Finland, both of which experienced a depression during these years.

By the end of her fourth term Gro Harlem Brundtland could be satisfied. The Norwegian economy was prospering and its exports booming. Its specific form of welfare society, the pre-

cious pearl of the social democratic movement, was intact (as in the other Nordic states). The majority of Norwegian people were still behind the idea of welfare society, although there was criticism: too much bureaucracy and regulation, excessively high taxation, too much restriction of personal freedom and not always the certainty whether the measures for creating work places were actually that effective. A further political success was the creation of the European Economic Area (EEA) in 1991 – an idea especially promoted by Brundtland – although it was a great disappointment for her that in the referendum of 1994, the Norwegian people spoke out against entering the European Union by a slight majority of 52.2 per-cent.

Final remarks

In her motto from 1997 cited in the introduction to this essay, Gro Harlem Brundtland summarised her egalitarian ideas about the road to a better world.

Did she succeed in her goals?

Let us start with the difficult part, her aim to make the world healthier and more equal. The Brundtland Commission produced a report sketching the path the world should follow: ‘sustainable development’ should be striven after world wide.

Unfortunately, not a fraction of what is necessary in this field has been realised as of yet, as is also shown in the recent movie An Inconvenient Truth by Brundtland’s good friend and former American vice-president Al Gore. Right now, a quarter of the world’s population still possesses three-quarters of the world’s energy sources and countries such as China and India are

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using polluting industries in building their economies in a massive way. China is responsible for the second highest level of emission of CO2 globally (after the United States of America).

Presumably, by 2050 great parts of the third world will bear the consequences of global warming in the form of flooding and water shortages. That is, if we continue in this way. Indeed, one solution might be to install some sort of supervisory body with directive powers – or to strengthen the directive powers of the UN – and implement the ideas from the Brundtland Report. The road will be long and difficult, but the plan is there and this can be credited to Gro Harlem Brundtland and her commission.

European social democracy has more to be grateful for as far as the legacy of the former Norwegian Prime Minister is concerned. In the ongoing debate on which socio-economic course to follow, she showed that the ‘Nordic model of welfare society’ deserves at least to be studied very carefully.

Of course, there was criticism of aspects of Gro Harlem Brundtland’s performance, but the lesson she taught is that to be a true Social Democrat is still relevant.

Endnotes 1

Harlem Brundtland, G., (2002): ‘Madam Prime Minister. A Life in Power and Politics’, New York, Farrar, Straus and Giroux, p. 244 2

Luttikhuis, P., (1997): ‘Interview with Gro Harlem Brundtland, NRC Handelsblad’, 15 September 3

World Commission on Environment and Development (1987): Our Common Future, Oxford/New York, Oxford University Press, p. 8.

(1995): Political Leaders of Contemporary Western Europe.

A Biographical Dictionary, London, Mansell Publishing Ltd., pp. 49-56 Goodland, R., a.o. (eds.)

(1991): ‘Environmentally Sustainable Economic Development: Building on Brundtland’, Paris, United Nations Educational, Scientific and Cultural Organization Harlem Brundtland, G. (2002): ‘Madam Prime Minister. A Life in Power and Politics’, New York, Farrar, Straus and Giroux

4

Marklund, S. and A. Nordlund (1999): ‘Economic Problems, Welfare Convergence and Political Instability’, in: Kautto, M., a.o. (eds.) (1999): Nordic Social Policy. Changing Welfare States , London: Routledge, pp.

19-53, over there p.19.

Kautto, M., a.o. (eds.) (1999): ‘Nordic Social Policy. Changing Welfare States’, London, Routledge Offermans, C. (2006): ‘Zweer het dogma van groei af’, NRC Handelsblad , 27/28 May

5

To give an example: in Great Britain under Thatcher unemployment rose to 8 % (3.5 million) in 1985. In the height of the depression in the Netherlands (1982) unemployment rose to 12%.

References Aerts, M. (2005): ‘In afwachting van de première. Over sekse en het minister-presidentschap in Nederland ‘, in: Te Velde, H. a.o.

(2005): Omtrent de minister-president. De positie van de ministerpresident vanuit historisch perspectief ,The Hague: Ministerie van Binnenlandse Zaken en Koninkrijksrelaties

Ribberink, A. (2005): ‘’I don’t think of myself as the first woman Prime Minister’: Gender, Identity and Image in Margaret Thatcher’s Career’, in: Toye, R. and J. Gottlieb (eds.) (2005): ‘Making Reputations. Power, Persuasion and the Individual in Modern British Politics’, London/New York, IB Tauris, pp.166-179 World Commission on Environment and Development (1987): ‘Our Common Future’, Oxford/New York, Oxford University Press

Davis, R. (1995): ‘Gro Harlem Brundtland’, in: Wilsford, D. (ed.)

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Higher Education Policies in the European Union, the ‘Knowledge Economy’ and Neo-liberalism

T

Chris Lorenz Professor in the Department of History, Free University of Amsterdam

O ALL APPEARANCES higher education in both the EU and the US has turned into a more fashionable topic for politicians and journalists than it was ten years ago. Since rumour has it that in the ‘age of globalisation’ we are living in a ‘knowledge society’ and that our economies are basically ‘knowledge economies’, higher education has attracted more public attention than it did before.

These new buzzwords have been spreading within and beyond academia with some success and have been at the very heart of European higher education policy discourse for a decade1.

Seen from a historical perspective this sudden public preoccupation with the idea of the ‘knowledge society’ and ‘knowledge economy’ is surprising, because European thinkers from the Enlightenment onwards – from Voltaire to Comte and Heidegger to Foucault and Habermas – have been emphasising that the systematic production and application of knowledge is the specific characteristic of ‘modern’ – European-style – societies. So given the fact that the ‘knowledge economy’ and ‘knowledge society’ have been known to ‘civilised’ Europeans for more

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than some 250 years, this idea could hardly be presented as a new message. Therefore one can expect that the new meaning of ‘knowledge society’ will differ from the traditional one rooted in Enlightenment thought.

This expectation is confirmed when one discovers that its new proponents represent universities as enterprises and academics as entrepreneurs.

Simultaneously, real entrepreneurs are now represented as the ‘stakeholders’ of the ‘McUniversities’, who are entitled to populate their ‘boards of trustees’. The ideology of the ‘knowledge economy’ thus simply means that the domain of knowledge production is economised: homo academicus is modeled after homo economicus. Capitalist economy no longer finds its ideological legitimation in scientific terms, as was the case in ‘late capitalism’ according to the influential diagnosis of Jürgen Habermas, because science now has to justify itself in economic terms2.

In the following paper I will examine European higher education policies after the Bologna Declaration in order to trace the theory and practice of the ‘knowledge economy’. My paper is structured as follows:

‘The Bologna Declaration fundamentally represents the silent transformation of the idea of the Humboldtian research university into the idea of the neo-liberal “McUniversity” ’ 1. First, I will present a description and analysis of the Bologna Declaration itself, issued on 19th June 1999 by the joint Ministers of Education of the EU countries.

2. Second, I will analyse the historical setting of the Bologna Declaration, notably the declaration of Lisbon, the declaration of Paris and – last but not least – the activities of the World Trade Organisation in general and of GATT – the General Agreement on Trade and Tariffs – and GATS – the General Agreement of Trade in Services – in particular.

3. Third, I will sketch the political context in which the Bologna Declaration functions.

In particular, I will consider neo-liberalism and ‘New Public Management’ (NPM).

I shall argue that in the context of neo-liberalism, NPM and the ideology of the ‘knowledge economy’, the Bologna Declaration fundamentally represents the silent transformation of the idea of the Humboldtian research university into the idea of the neo-liberal ‘McUniversity’.3 1. The Bologna Declaration

First I want to take a closer look at the Bologna Declaration itself4. The following eight

objectives are clearly identifiable: 1. the creation of one ‘higher educational space’ in Europe – what this means is not specified.

2. the objective of increasing the international competitiveness of this European higher educational space – this turns out to be the leading idea.

3. the adoption of a system of easily readable, compatible and comparable degrees, in order to promote European citizens’ employability and the competitiveness of the European higher education system.

4. ‘the adoption of a system essentially based on two main cycles, undergraduate and graduate’ (BA and MA). This system is better known as the AngloSaxon model, although the declaration itself avoids this label.

The first cycle should last at least three years and also be relevant for the labour market.

5. the establishment of a uniform system of credits – later known as the ECTS system – as a proper means of promoting the most widespread student mobility’. Why mobility is good, is not explained. Remarkably, credits can also be acquired in

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non-higher educational contexts.

6. the ‘promotion of mobility for both students, teachers, researchers and administrative staff’. Why this is good is not explained either: in the age of globalisation mobility just seems to be a good in itself. This is also reflected in the omnipresence in policy documents of the notion of flexibility.

7. the ‘promotion of European co-operation in quality assurance with a view of developing comparable criteria and methodologies’. What ‘quality control’ consists of and why a separate ‘quality assurance’ apart from the professional mechanisms of quality control is good, is not explained. External controls on teaching and researching faculties are simply presented as a natural phenomenon and nobody asks what happened to the idea of professional autonomy of the faculty and to the idea of academic freedom. The new emphasis on control is reflected in the prevalence in policy documents of the notions of accountability, efficiency and of quality control.

8. the ‘promotion of the necessary European dimensions in higher education, particularly with regards to curricular development, inter-institutional co-operation, mobility schemes and integrated programmes of study, training and research’.

What these ‘European dimensions’ would consist of, is not made explicit.

So, all in all, the Bologna Declaration calls for the integration of all the national systems

of higher education in the EU into one European educational system with the major aim of increasing its ‘international competitiveness’. In order to achieve these goals the basic structures of the national systems must be made uniform, with the same cycles and degrees and, last but not least, the same mechanisms of control of the faculty.

The last couple of lines of the Bologna Declaration are ominous, because this declaration is not just meant to be a policy statement or a policy event, but a continuous process that will be with Europeans indefinitely. In Bologna the EU took a conscious decision to keep the systems of higher education in Europe in a state of permanent supervision and reform. So much for the Bologna Declaration itself.

Now we need to take a closer look at the historical context in which the Bologna Declaration was formulated because its meaning can only be established by its context. This context, as I stated before, consists of a couple of other declarations, starting with the Paris declaration of 1998.

2. The Paris and Lisbon Declarations, the WTO, GATT and GATS

The Paris declaration of 1998 is the direct precursor of the Bologna Declaration. This Paris Declaration airs serious European concerns about the competitiveness and the global attractiveness of European higher education, especially in comparison to North America and Australia – incidentally both English speaking global regions.

The competition with the ever

growing and promising Asian student market is being lost by Europe, according to this declaration – with the UK as the only exception.

The ‘exceptional’ success of UK higher education probably explains why ‘the’ Anglo-Saxon structure of higher education was accepted in Bologna as the general European model without much discussion. The possibility that the exceptional English ‘success’ on a global scale might be explained by the exceptional global position of the English language and not by the formal structure of their educational institutions, has not been considered seriously. The language issue in European higher education is hardly ever discussed at policy level. My hunch is that this is due to the fact that the linguistic domain is very resistant to policy measures as such, and policymakers don’t like that idea.

The European worries about the global market in higher education in Paris were primarily economically motivated, although symbolic references to European culture were not missing5. The economic motive and agenda was even more open at the EU-gathering in Lisbon in March 2000. Given the perceived successes of the US and of Australia in producing substantial ‘export value’ in the domain of higher education, the EU decided that European inferiority on the global educational market could no longer be tolerated6. In Lisbon the EU formulated its bold intention to become ‘the most dynamic and competitive economic bloc in the world’ – nothing more and nothing less, and not in the long run, but ‘subito’ – before 2010.

80 Social Europe the journal of the european left Autumn 2006

Given the idea that the global economy is a ‘knowledge economy’ the EU inevitably came to the conclusion that European higher education had to become the most dynamic and most competitive in the world too.

Therefore the EU Ministers of Education translated this intention in 2001 into an ambitious agenda for the educational domain7. Predictably the ‘Lisbon Process’ has as yet only resulted in serious disappointments, because in 2005 it was already crystal clear to even the greatest EU-policy optimists that its objectives would not be met – even approximately. The remedy for this ‘delay’ is of course sought in speeding up the ‘Lisbon Process’ in all EU member states, and in shifting the responsibility for the ‘process’ to the EU member states.

So, the Paris Declaration of 1998, the Bologna Declaration of 1999 and the Lisbon Declaration of 2000 are three of a pair. This leads me to consider a treaty seldom mentioned in the EU-declarations, the GATS. Just like in a bad marriage, in the EU (and its policy papers) the things not discussed are often more important than the things that are discussed.

As we have seen, all the European declarations and plans considered so far basically contain an economic view of education, by considering higher education primarily in its function for the European economy and in terms of a marketable commodity. This is more apparent in the Paris and Lisbon Declarations than in the Bologna Declaration itself, although there too there is an emphasis on the function of higher education for the labour

market. Therefore the transformation of a great number of quite diverse national systems of higher education into one competitive European ‘educational market’ is the primary objective of all declarations considered. How this objective is to be realised in practice is far less clear, the more so because national governments remain responsible for the implementation of these objectives. To all appearances the EU is already facing serious problems in this respect8.

The basic idea behind all educational EU-plans is economic: an enlargement in the scale of the European systems of higher education, just as has been realised with the economic systems in Europe before, in order to enhance its competitiveness by cutting down costs9.

Therefore a Europe-wide standardisation of the ‘values’ produced in each of the national higher educational systems is called for. The introduction of the European Credits Transfer System – of ECTS-points – in order to make all European grades compatible and comparable can thus be compared to the introduction of the Euro, because the ‘value’ of higher education all over Europe will in the future be calculated, compared and exchanged in terms of the same ECTS-points – at least in theory and if we abstract from minor practical issues like the language problem.

In contrast to the introduction of the Euro, however, the introduction of the ECTS has not taken place at one point in time, but is a process with very different speeds in the different European states – with the

Netherlands taking the lead. The overall intention and direction of the process is nevertheless clear: to create one European market for higher education in order to become more competitive in the global struggle for the well paying (especially Asian) students.

This leads me to consider the WTO and the GATS as the global contexts of the Bologna Process.

A very important background to European developments in higher education – though seldom mentioned in the EU-declarations – are the policies of the WTO since its foundation in 1995 and the GATT in general, and the GATS in particular. The reason for the absence of WTO, GATT and GATS-regulations in EU-policy statements may be that these regulations are not subject to any parliamentary control, so actually they look bad for democratic business10.

And, contrary to the Bologna regulations, the GATS regulations do have the status of international treaties, enforceable by international law and international courts. This characteristic makes them quite important in practice.

The aim of the WTO is to get rid of all regulations and measures that are impeding a world-

wide free trade. This policy is based on the assumption that an uninhibited free trade will lead us to the best of all possible worlds. GATS is applying the same free trade principle to services, and in our context it is crucial to realise that higher education is defined by GATS as one service among others, along with utilities like energy and water supply, health care, housing and social security, that is: domains that used to be seen as the core of the public sector in Europe.

The neo-liberal GATS point of view will have far reaching consequences for the citizens of Europe: higher education, instead of being a right of citizens of nation states, laid down by law, may be redefined as and transformed into a commodity – into an international service that must be sold and bought from any international provider.

For US-citizens this point of view may not look revolutionary, but for most Europeans it surely is.

However, on second sight the implications of the GATS-view may even surprise US-citizens, because GATS, among other things, prescribes the so-called ‘national treatment rule’. This rule prohibits the national governments, which subscribe to

‘The transformation of a great number of quite diverse national systems of higher education into one competitive European ‘educational market’ is the primary objective of all declarations considered’

81 Social Europe the journal of the european left Autumn 2006

the GATS-regulations concerning education, to treat providers of services inside the national borders differently from providers from outside the national borders. Although this rule also contains a few clauses for exceptions, it may easily induce future outside providers of higher education to sue national governments for subsidising their institutions of higher education on grounds that subsidies are impediments for open market competition and therefore are frustrating free and international trade. This is what we already are witnessing in the domain of agriculture, and a similar pressure may one day lead to the end of all publicly financed higher education, or at least bring it into the danger zone in which it is forced to legitimise itself as a ‘non-market service’. So the free trade principle may also create victims on its way to the best of all possible worlds.

Another GATS-regulation is the so-called market access rule, prohibiting national governments to refuse access to their service market for any reason.

Although this rule too contains a few clauses of exception, this may lead to a situation in which, for instance, an openly racist institution will start to supply educational services without risk of being banned because this would constitute a breach of free and open market competition. Or a situation in which Tom Cruise and John Travolta will join financial forces in creating the first ‘Scientology University’.

So by redefining higher education as a service just like any other – as a marketable commodity – the WTO and GATS

are basically eroding all effective forms of democratic political control over higher education. As far as GATS-regulations allow for exceptions to the basic economic rule, these still have to be considered and justified in terms of their economic consequences. Small wonder there is so little discussion in the EU and the US about that.

Nevertheless, it is obvious that the economic view on higher education recently developed and formulated by the EU-declarations is similar to and compatible with the view developed by the WTO and by GATS. In the end, the EU- and the GATS-views will probably also have similar implications. The so-called ‘Bolkestein rules’ concerning freeing the trade in services in the EU are unmistakingly pointing in the GATSdirection. The only exceptions concerning the free trade of services that are mentioned in the original and in the revised EU-proposals are financial services, telecom services and ‘services’ connected to the public administration of EU-member states, because they are already regulated by other EU-rules.

Education is only mentioned once in both the original and in the revised proposal11. So EU member states may and probably will categorise higher education as a service while keeping elementary and secondary education outside the domain of services.

3. Neo-liberalism and New Public Management (NPM)

The political context of the Bologna Declaration and its accompanying declarations consists of neo-liberalism and of neo-liberal public policy – so-

82 Social Europe the journal of the european left Autumn 2006

called New Public Management (NPM). NPM is characterised by a paradoxical combination of free market rhetorics and quasitotalitarian practices of control.

This combination explains a number of the characteristics of NPM-institutions and practices – and the universities are being transformed into NPM-institutions as we speak.

The programme of neo-liberalism implies the introduction of the market mechanism in all societal domains, including the former public domain of socalled ‘public services’. The neo-liberal picture here immediately gets very complicated because these domains do not have any structure similar to a market-structure – and history suggests that this is the case for very good reasons. Neo-liberalism is, in principle, trying to turn back the clock to the early 19th century in this respect by re-individualising the services which were collectivised in Europe during the 19th and 20th century by applying its market dogma.

Small wonder therefore that the neo-liberal programme has been facing fundamental obstacles in practice. The first and most fundamental problem is that it is hard to conceive of several of the former domains of ‘public services’ being transformed into market-like structures without destroying them all together for a large part of the population. The public health situation in the US, where at least one fourth of the population has no health insurance at all and another third is not adequately insured represents this problem in optima forma. The pension situation in the US, where an ever growing

proportion of the working population has no pension whatsoever and a majority has no adequate pension, is another example12. In this respect the future of a large part of the working population of neo-liberal ‘market societies’ is nothing less than a ticking time bomb. The deregulation and privatisation of the public sector is therefore fraught with fundamental contradictions which are usually ‘solved’ at the expense of ‘consumers’ and taxpayers and to the advantage of the new ‘shareholders’ and the managerial class.

1. a continuous fall in service levels; 2. a continuous fall in the level and quality of employment, that is, de-professionalisation and a fall in the number of jobs; 3. ever rising prices for the consumers of ‘services’.

Applied to higher education the introduction of NPM has typically meant: 1. a continuous worsening of student – staff ratio, implying a continuously rising work pres-

‘Every budget cut is just a stepping stone to the next’ Now, given the factual absence of the market mechanism in the sector of public ‘services’, another principle has taken its place in order to determine the prices of these services. In NPM the ‘vacant place’ of the market mechanism in the quasi-market of ‘public services’ has been taken over by the twin notions of efficiency and accountability. Given the absence of any substantial notion of effectiveness from NPM-discourse – because the notion of effectiveness presupposes the statement of substantial goals – being efficient is just defined as being cost-effective.

And being accountable (and ‘transparent’) simply means for NPM-institutions being able to control and document their cost-effectiveness. Small wonder therefore that NPM in the former public sector has manifested itself in the typical combination of:

sure on the faculty. Since NPM sees the faculty primarily in terms of labour costs it is certain that this tendency will persist in the future13; 2. a continuous shrinking number of faculty members and the delineation of a ‘core’ and a ‘periphery’ of part-time and untenured faculty; 3. ever rising tuition fees for students14.

Cutting costs has basically turned into the goal of the quasi-markets of the ‘public services’ itself, which also explains another feature of NPM in higher education: the permanent character of saving policies and of reorganisations in order to save. Since there are no substantial goals behind this policy, every budget cut is just a stepping stone to the next.

83 Social Europe the journal of the european left Autumn 2006

The total hegemony of instrumental rationality (alias efficiency) since the 1980’s has recently been rebaptised by George Ritzer as the ‘McDonaldisation of society’.

We therefore should not be surprised to see the existing universities in Europe being transformed into entrepreneurial ‘McUniversities’. ‘Greater managerial power, structural reorganisation, more emphasis on marketing and business generation, moves towards performancerelated pay and a rationalisation and computerisation of administrative structures’ are characteristic of this new type of higher education according to Park and Jary as are ‘comparability and standardisation (of institutions, managers, academics, students)’15. The phenomenon of ranking (of citations, journals, individuals, research groups, departments and universities) is therefore an integral part of this transformation16. Nevertheless, this structural transformation of public higher education in the form of ‘managerial colonisation’ of the public sector is never publicly discussed.

Probably this is also due to the circumstance that this managerial colonisation process is being cloaked under quasi-professional mechanisms like audits and accreditation with their faint echos of professional ‘judgement by peers’17.

NPM originated in the US in the 1980s and was quickly taken over by a number of Anglo-Saxon states as Berg, Barry and Chandler have argued: ‘Development of NPM in the public sector followed the emergence in the USA of ‘entrepreneurial government’, designed to steer the course of

public sector reform. As a movement for change the NPM were also seen in a number of different countries as far apart as New Zealand, Australia, Canada and Sweden, where its impact has been most felt. Its arrival in England was seen in attempts to introduce a series of managerial techniques and control strategies that had their roots in the private sector. In higher education the British government introduced league tables, ostensibly to rank the quality and quantity of teaching and research, relying on indicators to loosen the grip of professional autonomy on academic work. As Throw has explained: ‘the withdrawal of trust in its universities by the government has forced it to create bureaucratic machinery and formulas to steer and manage the universities from outside the system’18.

Therefore the denial of the bureaucratic and ‘control’ impulse in NPM-discourse is ‘cynical’, although in NPM-discourse the label ‘cynical’ is usually identified with any criticism of NPM-discourse itself19.

Why the professional autonomy of academics must be distrusted (and on what grounds) and why bureaucratic formalism is to be preferred over professionalism has never been justified: it is a crucial presupposition built into NPM-discourse and thus beyond any discussion and critique. The same holds for the question of who controls the controllers under NPM, because the problem of control is not solved by NPM but only shifted: from the professionals to the managers20. There is not a shred of evidence – either factual nor logical – that this move represents an improvement in

any sense, while there is quite some evidence to the contrary.

Thus NPM is transforming the universities into ‘a fast-food outlet that sells only those ideas that its managers believe it will sell, that treats its employees as if they were too devious or stupid to be trusted, and that values the formal rationality of the process over the substantive rationality of the end’21.

The net-result of the NPMinspired reform of the universities is nothing less than an organisational structure which shows some remarkable similarities to the former leninist parties.

Patrick Fitzsimons described the situation as follws: ‘Because managerialism sees itself as the antidote to chaos, irrationality, disorder, and incompleteness, there are no spaces within such a social order in which autonomy can be contested legitimately.

Managerial definitions of quality, efficiency, improved productivity or self-management, construct a particular version of autonomy.

Those who do not desire these managerial constructs of autonomy are simply defined as absurd, as under managerialism, these notions appear as self-evidently ‘good’22. Like ‘dissidents’ in Leninist parties, ‘dissidents’ in NPM-organisations are usually seen and treated by management as objects to be disciplined and punished – and preferably to be removed from the organisation.

If occasionally ‘irregularities’ in managerial practices cannot be denied, then a specific manager may be criticised (or even fired), but never management as such23.

However this may impact on the faculty working at universities, all future citizens in the European Union will be faced directly or indirectly with what

84 Social Europe the journal of the european left Autumn 2006

actually amounts to the silent privatisation and ‘marketisation’ of higher education in the EU. What used to be a legal right of citizens – higher education – is being transformed into a marketable commodity without any political debate at the national level. Every political discussion about the future of higher education and universities is being smothered by the neo-liberal catchwords of ‘globalisation’ and ‘knowledge economy’. So for all who prefer the Enlightenment idea of knowledge and the Humboldtian idea of the university to the neo-liberal ‘McUniversity’, it is high time for a ‘wake up’ call.

Endnotes 1

See Gerard Delanty, ‘Ideologies of Knowledge Society and the Cultural Contradictions of Higher Education’, in: Policy Futures in Education, vol.1 (2003), nr.1, p.71-82; Peter Scott, ‘Universities and the Knowledge Economy’, in: Minerva 43 (2005), p. 297-309.

2

Jürgen Habermas, ‘Technology and Science as ‘Ideology,’’ in: Steaven Seidman (ed.), Jürgen Habermas on Society and Politics: a Reader, Boston, MA: Beacon Press, 1989, pp. 237265 3

See M. Parker and D.Jary, ‘ The McUniversity: Organization, Management and Academic Subjectivity’, in: Organization 2 (1995), 2, 319-338, George Ritzer, ‘McUniversity in the Postmodern Consumer Society’, in: Quality in Higher Education 2 (1996), nr.3, p.185 – 199; D.

Hayes and R. Wynwyard (eds.), The McDonaldization of Higher Education, Westport and London 2002.

http://europa.eu.int/comm/ education/policies/201/et_2010_en.html.

8

4

See: Jürgen Schriewer, ‘Bologna und kein Ende. Die iterative Konstitution eines Europäischen Hochschulraumes’, in: R. Hohhls a.o. (eds.), Europa und Europäer. Quellen und Essays zur modernen europäischen Geschichte, Stuttgart 2005, p.461 – 469: Hilde de RidderSymoens, Nieuwe wijn in oude zakken, of toch niet? De Bolognaverklaring in historisch perspectief, Amsterdam 2002 5

Typically, only the economic policy goals are transformed into policy practice. See the trade unions criticism in European Trade Union Confederation, The European’s Union’s Lisbon strategy, at: http://www.etuc.org/a/652.

6

According to the New York Times editorial ‘Imported brains’; 3 December 2005, in 2004 565,039 foreign students contributed about $13.3 billion to the United States economy.

Nevertheless fears are growing of losing the international educational market to the EU, Canada and Australia due to the barriers erected after 9/11.

7

See the Official Journal of the European Commission, 14.6.2002, Detailed work programme on the follow up of the objectives of education and training systems in Europe (2002/C 142/ 01). See also the European Commission policy document Education and Training 2010.

Diverse Systems, Shared Goals,

The EU-document, A New Start for the Lisbon Strategy, concluded rather euphemistically that halfway through the ‘Lisbon process’ – in 2005 – ‘the results are not very satisfactory’, and continued, in a surprising way: ‘The implementation of reform in Member States has been quite scarce. The reform package consists of 28 main objectives and 120 sub-objectives, with 117 different indicators. The reporting system for 25 Member States adds up to no fewer than 300 annual reports. Nobody reads them all’. The rather obvious conclusion that the EU would benefit from less policy and less reports is not drawn because this conclusion would violate the presupposition supporting all policy discourse: policy as such is good and more policy is even better.

See http://europa.eu.int/growthandjobs/intro_en.html. See also ‘Time to move up a gear’ – Commission President Barroso presents Annual Progress Report on Growth and Jobs’ at http://europa.eu.int/rapid/pressR eleasesAction.do?reference=IP/0 6/71&format=HTML&aged=0&lan guage=EN&guiLanguage=en, and http://europa.eu.int/ growthandjobs/intro_en.html.

9

In the Netherlands, enlargement of scale has been the most important instrument of saving policies in education since the 1980’s. See my ‘The Myth of the Dutch Middle Way’, in; Wissenschaftsrecht vol.33 (2000), 189-209.

85 Social Europe the journal of the european left Autumn 2006

10

The European Commission is the political body negotiating on GATS. As is well known, the European Parliament does not have effective authority to control the European Commission.

Political control outside the European parliament over GATS is even more opaque because higher education is still predominantly the domain of national Ministries of Education, that do not have a direct link with or access to the European Commission. See for this problem in a general framework: John Morijn, ‘Addressing Human Rights concerns within the World Trade Organization. A perspective on Human Rights and Trade and its application to Article XX of GATT’, Lisbon – Coimbra 2002, and John Morijn, ‘A Human Rights perspective of Liberalisation of Education Services within the WTO & EC’, (unpublished paper).

11

See the Council of the European Union 5161/05, Interinstitutional file 2004/2001 (COD) at http://www.dienstenrichtlijn.nl/richtlijn/

12

See ‘The Next Retirement Time Bomb’, The New York Times 11 December 2005; ‘Time for a reality check. Don’t be fooled: the pensions mess cannot be fixed overnight’, in The Economist 26 st. January 2006; ‘Desperate Measures. The World’s Biggest and Most Expensive Health-care System is Beginning to Fall Apart. Can George Bush Mend it?’, The Economist 26 January 2006. For a disquieting analysis see: Thomas Geoghehan, ‘Litigation Hell. Is the Rule of Law in Trouble Too?’,

in The Berlin Journal Issue nr.8 (2004), p.47-51, at: http://www.americanacademy.de/ fileadmin/berlinjournal/BJ8.pdf, and Thomas Geoghehan, ‘The Law in Shambles’, Chicago 2005.

13

For the worsening staff – student ratios in the case of the UK see Jim Barry and Mike Dent, ‘New Public Management and the Professions in the UK. Reconfiguring Control?’, in: Mike Dent, John Chandler and Jin Berry (eds.), Questioning the New Public Management, Aldershot 2004, p.13. For the US see M. Parker and D.Jary, ‘ The McUniversity: Organization, Management and Academic Subjectivity’, in: Organization 2 (1995), 2, p.328: ‘In material terms, academic labour has certainly become subject to more pressures. More competition to publish, more teaching, more administration combined with less personalized relationships with students are common experiences and a source of demoralization for many’.[-]. ‘General conditions are simply objectively worse – the decade after 1980 saw a 25 percent rise in student load, 37 percent decline in pay and 22 percent less spent on libraries’.

For the Netherlands de Weert mentions a 30% reduction in faculty positions since the 1980’s: Egbert de Weert, ‘Pressures and Prospects Facing the Academic Profession in the Netherlands’, in: Higher Education vol. 41 (2001), p.95. For the Dutch case see my ‘The Myth of the Dutch Middle Way’.

For Germany see: Uwe Schimank, ‘New Public Management and the Academic

Profession: Reflections on the German Situation’, in: Minerva 43 (2005), p.361-376, p.371: ‘With a widening gap between student numbers and numbers of academic staff, teaching loads have grown heavier [-]’. See also: ‘Bronxford in Deutschland. Die Hochschulen zwischen Glanz und Elend’, in: Das Parlament Nr. 03 / 16.01.2006.

For France see: Luigi Del Buono a.o. ‘Livre Noir sur les Universités Francaises’, Paris 2003.

For the effects of the ever rising workpressure on the faculty see Elisabeth Berg, Jim Barry and John Chandler, ‘The New Public Management and Higher Education: a Human Cost?’, in: Dent, Chandler and Barry (eds.), Questioning the New Public Management, p.161-175

18

14

22

In countries where higher education used to be free, like Germany, this has meant the introduction of tuition fees.

15

Parker and Jary, ‘ The McUniversity’, p.320-21.

Berg, Barry and Chandler, ‘The New Public Management and Higher Education’, p.164-5.

19

Schimank, ‘New Public Management and the Academic Profession’ p.362: ‘With increasing control has come a loss of traditional forms of autonomy’, and p.365: ‘[-] a reduction in academic self-governance is an explicit goal of NPM [-]’.

20

See Parker and Jary, ‘ The McUniversity’, p.328: ‘ ‘Quality’research, like ‘quality’ teaching and administration, will require bureaucratized regimes of surveillance to ensure that it is achieved, labelled and rewarded’

21

Parker and Jary, ‘ The McUniversity’, p.335-6.

Patrick Fitzsimons, ‘Managerialism and Education’, in: The Encyclopeadia of Education, at: http://www.vusst.hr/ENCYCLOPAEDIA/managerialism.htm

23 16

The EU is presently working on a European ranking of journals and a European citation index.

See for a short history of university ranking: Rachelle L. Brooks, ‘Measuring University Quality’, in: The Review of Higher Education vol. 29 (Fall 2005), no. 1.

17

See A. Foster-Carter, ‘Deliver us from the Quality Police’, Times Higher Education Supplement, 27 March 1998; M. Loughlin, ‘Audititis…. Whatever that Means’, in: Times Higher Education Supplement, March 22, 2002, 20.

86 Social Europe the journal of the european left Autumn 2006

See Tony Cutler, ‘Making a ‘Success’ out of a Failure: Darker Reflections on Private and Public Management’, in: Mike Dent, John Chandler and Jin Berry (eds.), Questioning the New Public Management, Aldershot 2004, p.207 – 224, who argues that in both private and public sectors ‘ ‘failure’ leads to pressures to change management and structures but not to abandon a belief in the efficacy of management’. This boils down to the position that ‘the managers have failed, long live management’ (p.207).

Voted Out of Office – The Surprising Result of the Election in Austria in 2006

A Karl Duffek Director of the Renner Institute, the political academy of the SPÖ in Vienna

Translated by the FES London Office

USTRIA’S SOCIAL-DEMOCRATIC Party SPÖ won at the country’s national election primarily on the electoral campaign, during which the party managed to turn initial disadvantages into a narrow majority over the conservative ÖVP. The next government will be led by SPÖ-Chairman Alfred Gusenbauer.

In the initial scenario back in 2002, early elections had been brought forward after the Federal Chancellor, Wolfgang Schüssel (of the ÖVP, the Austrian People’s Party) terminated the alliance with his coalition partners, Jörg Haider’s FPÖ. His gamble produced the desired effect: Gains of about 15% put him clearly ahead, with the Social Democrats well back in second position, while the FPÖ incurred considerable losses. Schüssel formed a new government with the FPÖ, which, after a split in the FPÖ, admittedly became increasingly a government led solely by the Conservatives. Schüssel succeeded in holding together his precarious coalition through to the end of the legislative period. However, after a halfhearted attempt at pension reforms

‘Resignations, court cases and conflicts between the [SPÖ] party and the unions became the order of the day in late spring’ 87 Social Europe the journal of the european left Autumn 2006

which would have put a one-sided burden on employees, no important political projects were turned into legislation in the last two years of the government. Rising unemployment, especially among young people (where it almost doubled between 2000 and 2005), low growth rates and low levels of public investment, and an amazing lack of activity in the field of education policy following the poor results of the PISA Study were all factors which tarnished the image of the conservative/ right-wing populist coalition.

As a result, at the beginning of 2006 the SPÖ was three to five percentage points ahead in all the polls. Then however, a financial scandal caused the BAWAG Bank, which belonged to the trade unions, enormous damage and brought the Union Congress as proprietor to the edge of ruin. The great majority of the persons involved were Social Democrats or at least close to the SPÖ.

Resignations, court cases and conflicts between the party and the unions became the order of the day in late spring. The Social Democrats’ image of economic competency and their approval rates began to founder.

The Election Campaign

In the summer of 2006 the election strategies of the political parties mirrored their situations: The ÖVP put its hope on the sovereignty of its Chancellor – especially since his term as EU President had come to an end

‘The result of the 2006 election was clear: the ÖVP was voted out of office. A loss of eight percentage points, equivalent to an absolute figure of 460,000 votes, is a very definite result’ without any major problems – avoiding much public exposure, preferring to emphasise the country’s positive development. At the same time they operated a pre-election strategy via intermediary organisations and other subsidiary channels aiming to discredit Alfred Gusenbauer, the SPÖ leader and to attack the party over the bank scandal.

As the challenger, the SPÖ naturally placed emphasis on attacking the government, while also concentrating on a consistent topic-based election campaign centred on the fairer distribution of wealth. Education, health, pensions and unemployment were given priority in the election campaign. At the same time, efforts were made to maximise the public appearances of the party leader. Even before the election campaign proper had begun, Gusenbauer was visiting all the districts of the country in order to contrast his popular touch to the aloofness of the Chancellor.

The Greens initially presented some very interesting proposals, but then returned to their characteristic role of the contemplative alternative party not used to engaging in controversial topics. The right wing populist parties BZÖ and FPÖ focused their campaigns exclusively on matters relating to foreigners and immigration – taking advantage of weaknesses of the other parties positions, though often going beyond the bounds of what is acceptable in a civilised democracy.

88 Social Europe the journal of the european left Autumn 2006

The Election Result and its Reasons

The result of the 2006 election was clear: the ÖVP was voted out of office.

A loss of eight percentage points, equivalent to an absolute figure of 460,000 votes, is a very definite result.

The reasons, however, are diverse.

For a start, ÖVP’s feel-good campaign began to go wrong when the problems of care for the elderly came to the fore after it was revealed that Wolfgang Schüssel’s mother-in-law was being looked after by an illegally employed care worker – and Schüssel’s reaction was very clumsy: he attempted to avoid talking about the problem of care for the elderly in general and then suggested in a singularly unwise remark that his in-laws’ affairs were hardly a matter which need concern him.

Suddenly, the contest was not about whether Schüssel or Gusenbauer would be the better Chancellor, but about the question of which party took which topic seriously. The campaign had shifted from a personality- led one to a topic-led one, which was just what the Social Democrats wanted.

Secondly, the ÖVP misinterpreted from the outset the mood of the voters.

The desire for change was admittedly fairly lukewarm, but at the same time a considerable majority was of the opinion that they had personally not profited from the passable economic data.

Clearly, the message on the ÖVP’s election posters, ‘Hier geht’s uns gut’ (we’re doing alright here) did not meet its mark.

Thirdly, the bank and union scandal, after the lapse of a few months, was no longer such a hot potato as it had seemed and the willingness – revealed only at the last minute – of the Chancellor and his finance minister to accept international invitations from the prime speculators shifted the focus of the scandal and prevented it from being seen as uniquely of the responsibility of the SPÖ.

Fourthly, Alfred Gusenbauer managed, in his TV appearances, to present

% 2006

2002

Voter participation

78.5

84.3

SPÖ

35.3

ÖVP

Seats 2006

2002

36.5

68

69

34.3

42.3

66

79

GREENS

11

9.5

21

17

FPÖ

11

10

21

18

BZÖ

4.1

Unofficial final result of the general election in Austria on 1 October 2006

himself as an equal opponent of the governing Chancellor. In direct confrontations between the two men, Gusenbauer was a model of calm and equilibrium in contrast to the belowthebelt attacks from his opponent.

Fifthly, many of the votes won in 2002 by the ÖVP were ‘loan votes’.

They returned to the right-wing populist parties which – together – gained an increase of over five percentage points.

Sixthly, the expectation of a sure election victory may have also dampened the mobilisation of the ÖVP clientele. A drop in voter turn-out of 5.8% speaks volumes in this respect.

Hardly anyone was expecting a lead for the SPÖ; even the most optimistic polls for the party predicted not more than a close race.

That means that even having won the election, the SPÖ also lost around 130,000 voters, primarily as non-voters, but some of them to the right-wing populists. It is worth taking a look at a detailed analysis of this development.

With a total of around 15% of the vote, the right-wing populist parties remain a political force in Austria which needs to be taken seriously, be it with or without Jörg Haider. In other words, this is not only a question of political charisma, but also of political agenda: Especially in the urban areas (in Vienna the SPÖ had to concede 2.8 percentage points), the Social Democrats are fighting increasingly on

89 Social Europe the journal of the european left Autumn 2006

7 two fronts, caught between an increasingly popular Green Party and the far right. The fact that the conservatives experienced something similar this time, though in far more dramatic form, is no consolation.

The Way Ahead

The unexpected outcome led to such a shock within the ÖVP that initially, the party seemed unwilling to negotiate about the only realistic consequence of the election result, a grand coalition.

Despite comments from some conservative quarters, the public would seem to have little enthusiasm for that sort of talk. The public expects respect to be shown for an election result which is as it is. And support in the polls for Alfred Gusenbauer as the legitimate Chancellor of Austria is growing rapidly.

The SPÖ is still reacting with emphatically conciliatory signals and is now urging for negotiations about policy. A grand coalition is the option favoured by two-thirds of all Austrians, though there is still a lingering feeling that such alliances lead to standstill, isolation and disputes. The recently ended legislative period has shown, however, that a small coalition can lead to the same problems.

The Swedish Election 2006: What Now for the Swedish Model?

I Dimitris Tsarouhas Assistant Professor, Department of International Relations, Middle East Technical University, Ankara

N THE PREVIOUS issue of Social Europe, Stephen Haseler argued that neoliberalism was on the defensive and ‘Social Europe’ was now ruling supreme over our Continent (Haseler, 2006, p.5). For many political analysts, the Swedish election of last September provided yet another test as to the ability of social democracy to defy the right’s challenge.

Paradoxically, though the result for the Social Democrats was the worst for over 80 years leading to a centre-right victory, it appears that the Social Democrats lost a tactical battle but won the war. Despite their attempt to portray their victory as a ‘liberal revolution’, the centre-right in Sweden has accepted the social democratic consensus of high taxes, a sizable public sector and strong trade unions. Its victory resulted from their ability to portray themselves as better administrators of the social democratic consensus, whose erstwhile monopoly owners, the Social Democrats, failed to revitalise. Nonetheless, the defeat for the Social Democratic Party (SAP) at a time of high growth and healthy public finances sends a warning signal to social democrats and indicates that, should the centre-right manage to recapture the support of the middle class,

90 Social Europe the journal of the european left Autumn 2006

SAP’s historical role as the natural party of government can be undermined. What is more, centre-right unity can, over the long run, challenge the Swedish Model by allowing its instigators to go beyond adjustment policies and seek to introduce wide-range changes in welfare and labour legislation. No disaster therefore; but little room for complacency.

The Election

With a majority of seven, the centre-right coalition of Moderates, Liberals, Christian Democrats and the Centre Party has won a mandate to implement its programme for the next four years. The Moderate Party has been the clear winner of the election, while the Centre Party became the third largest in Parliament. Both the Liberals and Christian Democrats suffered losses, with the former’s senior party executives involved in a spying scandal against the Social Democrats two weeks prior to the election (Svenska Dagbladet, 7 September 2006).

On the left coalition, only the Green Party stood its ground: the Social Democrats have recorded their worst result since 1920, while the Left Party suffered heavy losses. A series of maverick parties, from the populist ‘June List’ to the Feminist

‘Looking tired and moody in television debates, Göran Persson’s image stood in sharp contrast to youthful and mild-spoken leader of the Moderates Fredrik Reinfeldt’ Initiative failed to make a strong impact, in contrast to the farright, which narrowly missed entering Parliament. Turnout stood at 81.9%, approximately two percentage points higher than in the last general election.

The Pre-Election Period

Far from a landslide, the result is nevertheless impressive.

Traditionally, the Right wins elections (1976, 1991) when the economy is in trouble and the Social Democrats are unable to provide the necessary fixes.

This time around, the economy is strong, with GDP growth in the second quarter of 2006 at 5.1% (Statistics Sweden, 20 September 2006); total export volume is high and state finances healthy. What must account for the result is an erstwhile dirty word for the Right: unemployment. Having promised to bring unemployment down to 4% by the end of the last electoral cycle, Persson’s government merely managed a 5.7% of open unemployment, while about 3% of the potential workforce was in labour market programmes. With youth unemployment in double-digit figures, the opposition rephrased the Tories’ ‘Labour Isn’t Working’ 1979 slogan to good effect. Paradoxically, the Social Democrats chose to downplay the issue and Persson promised

last May that, come September, unemployment would not be an electoral issue. Qualitative surveys after the election showed that employment and the state of the economy stood at the forefront of voters’ concerns (Dagens Nyheter, 18 September 2006).

But the reasons for the Social Democrats’ defeat should not be traced solely on that issue: after twelve years in power, a series of minor scandals involving party functionaries and the late response of the government to the 2004 tsunami disaster convinced voters that it was time for a change. The governing party had increasing difficulties differentiating itself from the state apparatus and accusations of favouritism were constantly on the agenda. In an age of 24hour information, personalities are crucial in an election outcome and this time round Persson was a liability for the Social Democrats. Looking tired and moody in television debates, Göran Persson’s image stood in sharp contrast to youthful and mild-spoken leader of the Moderates Fredrik Reinfeldt. Persson’s attempts to paint his main opponent with the brush of the ‘unreconstructed neoliberal’ were a spectacular failure, particularly since Reinfeldt committed his party to tax-financed welfare and tax

91 Social Europe the journal of the european left Autumn 2006

cuts targeting low- and middleincome earners. Persson’s purchase of a luxurious villa also stood in contrast to his image of a traditional Social Democratic leader with a strong connection to the labour movement.

Fundamentally, what the Social Democrats also failed to appreciate was the ideological repositioning of their opponents: the ‘new Moderates’ played all the right, social democratic tunes regarding welfare and accused the SAP of reneging on its historical mission of providing people with employment rather than making them reliant on benefits. The neoliberal flag has instead been taken up by the Centre Party, a traditionally rural-based party with a record of collaboration with the Social Democrats. It was the Centre Party that allied itself to SAP in the 1930s to build the original Swedish Model, and their cooperation extended in the 1950s and then again in the mid-1990s. Until recently, Centre was party in an agreement with the Left and the Social Democrats to dismantle nuclear power stations and advocated strong welfare. Under the leadership of Maud Olofsson, however, the Centre Party has tied itself tightly to the Alliance mast. It has ceased calling for the phasing out of nuclear plants and is closest to the agenda of Swedish employers regarding the burdens of red tape and bureaucratisation of the labour market service (AMS). Centre supported a loosening of hire-and-fire regulations, making sympathy strike actions illegal, and favoured local- or plant-level agreements instead of economy-wide concertation (Svenska Dagbladet, 5

August 2006). While Centre emerged as the voice of business, the Christian Democrats concentrated their campaign on support for the elderly and the Liberals focused on school discipline and immigration, without resorting to the near-racist language of their 2002 campaign. The Social Democrats, on the other hand, emphasised the strong state of the economy and promised more resources put into health services. Both the Green and Left parties also followed their usual trajectory, with the former emphasising environment-friendly policy measures and the Left party concentrating on public sector growth to counter unemployment.

An Era of Post-neoliberal Politics

It is the transformation of the Moderates that emerges as the most striking factor behind the election result. Gone are the days of ‘regime change’ and welfare state retrenchment. The post-neoliberal Right has accepted a tax-financed generous welfare state and high public sector employment. There is more than an echo of David Cameron in Reinfeldt’s political rhetoric and media strategy of a caring man and responsible husband. After years in the political wilderness, the postneoliberal Right captures power by appealing to an increasingly a-political electorate and promising better administration of the status quo.

Tax cuts combined with strong welfare means that extra revenues have to emerge from somewhere. It is this aspect of their strategy that, should it succeed, entails the possibility of a

wider transformation of Sweden’s political economy. For all their proclaimed commitment to collective agreements and strong trade unions, the Moderates’ agenda entails substantial cuts in unemployment insurance benefits and a steep increase in unemployment insurance fees (a-kassa).

Concretely, the Alliance has promised a reduction of unemployment insurance benefit from 80% of average wage today to 70% after 200 days out of work and 65% after 300 days.

Reducing unemployment is thus linked to a reduction in state benefits, in an apparent attempt to make work more attractive and increase income differentials between those at work and those reliant on benefits (bidrag). At the same time, fees for entering an unemployment insurance fund will rise to an average of 270 SEK per month.

Though unable to provide a convincing explanation as to how lower benefits reduce unemployment, the Right has successfully portrayed the Social Democrats as the ‘benefit party’ (bidragspartiet) and, tongue firmly in cheek, claimed to represent the new ‘Party of Work’ (Arbetspartiet). The usual mobilisation in support of SAP by the Confederation of Trade Unions LO was unable to obstruct the Right’s message. In fact, one has to go back as far as 1991 to see such a low support for SAP among LO members, with only 54.4% endorsing Persson’s party.

The Moderates are now the second biggest party among LO members, albeit with a still low 11.1 % (Dagens Nyheter, 18 September 2006).

The most worrisome aspect of the centre-right’s manifesto

92 Social Europe the journal of the european left Autumn 2006

revolves around their intention to make contributions to a-kassa obligatory. Traditionally, unemployment insurance schemes are administered by the trade unions and the link between akassa membership and union membership remains intact.

Though union membership and a-kassa membership are formally distinct, in practice most employees are also unionised.

However, by now a-kassan is subsidised up to 90% by the state (Dagens Nyheter, 13 July 2006; TCO Tidningen, 18 May 2006). Making a-kassa obligatory would reduce the incentives for union membership, potentially leading to a decline that would reduce the unions’ powerful role in Sweden’s political economy. Currently standing at about 80% of the workforce, the strong position of trade unions in the Swedish labour market averted the turn to neoliberalism in the 1990s and secured peaceful labour relations.

Moreover, the breakdown of corporatism in the same period did not mean a complete abandonment of samförstand. In fact, recent years have witnessed the return of the labour market’s ‘big elephants’, LO and the private employers’ confederation Svenskt Näringsliv (SN), to the negotiating table on a range of issues, including the regulation of the labour market following the opening of borders to Central and East European workers after the last wave of EU enlargement (LO information note, 30 August 2005). Emboldened by the Alliance’s victory, SN has been quick to call for comprehensive changes in the country’s labour law on sympathy strike action and a comprehensive reform of

the tax- and benefit system (Näringsliv 24, 19 September 2006). For the time being, only the Centre Party seems ready to embrace such calls; its Frenchinspired proposal to ‘flexibilise’ the labour market for those under 26 did not make it to the Alliance’s manifesto.

In that context, the 2007 round of collective bargaining, the biggest in the last few years involving over three million employees in the public and private sector, becomes particularly significant. Some within LO have indicated their willingness to go back to one- or twoyear agreements instead of the usual three-year ones, should the Alliance implement its labour market and labour law reforms. Used to the traditional exchange of wage moderation for labour-friendly legislation (Pizzorno 1978; Iversen 1999), it remains to be seen whether LO will resort to costly strike actions in an attempt to block the proposed reforms, or whether the unions will refrain from politically motivated actions. At present, a division seems to be emerging between those who demand compensation for the proposed reduction in unemployment insurance through the 2007 collective bargaining and those, usually export-oriented industrial unions who claim that such issues should be left outside the bargaining table. In addition, some unions are ready to accept the ‘flexicurity’ model of Denmark, where a flexible labour market is regulated by the labour market partners rather than, as in the case of Sweden, state legislation on labour protection (Nyhetsbyrån Direkt, 31 March 2006). Finally,

the leading role of the exportoriented sector in wage formation is currently under challenge from within LO, whose unions organising employees in transport and public services feel hard done by the Industrial Agreement and the wage increases it has delivered over the last ten years.

Elsewhere in Europe social democratic parties seek to distance themselves from the unions, and the latter adopt a cautious approach to governments ‘red’ or ‘blue’. The LO reaction to the Alliance victory bears testimony to Sweden’s exceptional status within the social democratic family.

Nonetheless, the ability of LO to exert a powerful influence on labour market regulation depends on striking a fine balance between coordinating its member unions around a common platform and restraining their more militant tendencies.

The new political landscape is a litmus test for LO and its role.

Sweden in Europe

Europe was emphatically absent from the pre-election campaign, save for the opposition’s call to make Sweden’s voice ‘heard more’. The Social Democrats remain divided on the issue (Aylott 1997) and are unlikely to bring it up to the fore of the

debate any time soon. Also, despite recent statements by the spokespeople of the Greens, the latter are unlikely to change their negative stance to ‘Brussels’ due to grassroots pressure. The same holds for the Left Party. The new government, on the other hand, is unlikely to bring the Constitutional Treaty before Parliament. It has stressed that, as a whole, it will follow the Social Democrats’ policy in supporting further enlargement. Apart from a lofty rhetoric on placing Sweden at the heart of developments, the centre-right did not count on foreign policy as one of its strong points: in fact, one of the few comparative advantages of PM Persson compared to Reinfledt was his experience and knowledge of international politics. Reinfeldt’s surprise decision to appoint former Prime Minister Carl Bildt as new Foreign Minister may, however, mean that Sweden will play a more active role than expected both in European and international affairs. Finally, the Liberals’ pro-NATO stance is unlikely to have an impact as Reinfeldt has said that, in line with Swedish tradition, consensus on the subject is necessary.

As SAP remains Sweden’s largest party and decisively antiNATO, no major policy change is expected on that front either.

‘For the first time in twenty five years in Sweden and in Europe, the right has moved beyond neoliberalism and embraces welfare ideology’

93 Social Europe the journal of the european left Autumn 2006

Val

Votes

Percent

% +/- (2002)

Seats

M +/-

Moderates

1418067

26,2%

+10,9%

97

+42

Centre Party

430169

7,9%

+1,7%

29

+7

Liberal Party

408385

7,5%

-5,9%

28

-20

Chr. Democrats

359854

6,6%

-2,5%

24

-9

Social Democrats

1915441

35%

-4,8%

130

-14

Left party

317255

5,8%

-2,5%

22

-8

Green Party

280513

5,2%

+0,6%

19

+2

Other

308719

5,7%

+2,6%

Table 1: Swedish Election Results 2006 Source: Election Sweden

Lessons for European Social Democracy

Swedish elections have always had a special importance for European social democracy; in 2006, that was no different.

With crucial elections coming up in France and the UK, what does the Swedish result suggest?

For Europe’s progressives, the election outcome may not necessarily be as gloomy as it looks.

Bo Rothstein has argued that, by making the Alliance accept the basic tenets of the Social Democrats’ approach on tax, gender politics and welfare, the Social Democrats have shown how neoliberal ideology is dead and buried. The election’s central issue was on which one of the government alternatives would make the social democratic consensus operate better (Dagens Nyheter, 20 September 2006). In that sense, the SAP defeat was more a result of short-term and Sweden-specific factors, related to the prime Minister’s aloofness, a series of scandals that damaged the party’s image and the inadequate attention it paid to the

problem of unemployment, especially among the young.

Such a reading of events may, however, be complacent and slightly misleading. The postneoliberal right’s return to power in Sweden sends a warning signal to progressives throughout Europe.

1. By embracing welfare ideology and denouncing market fundamentalism, the right lays the ground for long-term transformation. It is worth remembering that New Labour did not win the tax argument in Britain by attacking the Thatcherite settlement; on the contrary, it accepted its basic principles. The New Moderates and their allies may well seek to imitate Blair on the issue of tax cuts: proclaim their allegiance to state-financed welfare only to undermine it through tax cuts appealing to the middle class. Once this issue is won, the sustainability of Sweden’s exceptional welfare state will be vulnerable to consistent attack. It may be no coincidence that the centreright has often complained that, on tax issues, Sweden is not, and should become, a ‘normal’ European country.

2. A second lesson concerns the integration of migrant commu-

94 Social Europe the journal of the european left Autumn 2006

0 nities. The impressive gains of the far-right Swedish Democrats (SD) on a local level have caused anxiety in all mainstream political parties and a long overdue debate on how to tackle the rise of the SD has now started.

Although the far-right did not manage to enter Parliament, its populist language and attempt to scapegoat immigrants for diverse social problems resonated well with the electorate at the local level. Social democracy cannot longer afford to ignore the issue and the farright parties exploiting real concerns. It is time to engage in dialogue with the parties representing such views, and expose their racist inclinations. The SD’s attempts to portray itself as a ‘patriotic movement’ have to be tackled head on, before it manages to hijack patriotism and other noble values as its sole legitimate representative.

The Social Democrats are, in electoral terms, a unique success case in west European politics, having been in office since 1932 for all but nine years. This success has resulted from the enduring alliance between the working and middle classes.

The identification of SAP with an efficient welfare state and

high quality services made it the natural party of government.

For the first time in twenty five years in Sweden and in Europe, the right has moved beyond neoliberalism and embraces welfare ideology. The Social Democrats’ mission of humanising capitalism becomes more challenging, considering that in a media and consumerist age peoples’ party preferences are increasingly flexible. The mission now is to rebuild the working class – middle class alliance, as Social Democrats cannot afford to alienate any of the two. Social democracy has to have the courage to go beyond Third Way politics; this can be useful only as a tool to gain power, but cannot dictate the political agenda nor set the priorities for tackling unemployment, crime or environmentrelated problems. Now that the right attempts to reclaim the centre ground, social democracy’s goal should be to redefine the ‘middle ground’ – and lure it to a progressive political direction. The post-neoliberal right is determined to succeed where the neoliberal right failed.

Progressives ought to cherish the challenge.

References Axelsson, C. And Petersen, L. ‘Svenskt Näringslivs sex krav’, Näringsliv 24 19 September 2006 Aylott, N. (1997) ‘Between Europe and Unity: The Case of the Swedish Social Democrats’ West European Politics 20 (2): 119-136 Billger, O. et al. ‘Folkpartiet fruktar en väljarflykt’, Svenska Dagbladet 7 September 2006 Haseler, S (2006) ‘The Failure of Neo-liberalism: Now ‘Social Europe’ Defines the Continent’, Social Europe 2(1): 5-13 Iversen, T. (1999) ‘Contested Economic Institutions. The Politics of Macroeconomics and Wage Bargaining in Advanced Democracies’, Cambridge: Cambridge University Press.

Jacobsson, C. ‘A-kassor bryter mot lagen’, Dagens Nyheter 13 July 2006 Laurén, L. ‘Koppling mellan fack och a-kassa luckras upp’, TCO Tidningen 18 May 2006 LO (2005) Rekommendation av Svenskt Näringsliv och Landsorganisationen i Sverige (LO) om anpassning av förbundsavtal för företag som blir tillfälliga medlemmar i arbetsgivareförbund inom Svenskt Näringsliv, 30 August Mellgren, F. ‘C till val på arbetsrätten’, Svenska Dagbladet 5 August 2006 Pizzorno, A. (1978) ‘Political Exchange and Collective Identity

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in Industrial Conflict’, in Alessandro Pizzorno and Colin Crouch (eds.) The Resurgence of Class Conflict in Western Europe Since 1968 vol.II, London: McMillan, pp. 277-98 Raft, V. ‘Arbetsmarknad: Tummen Upp för Danska Modellen – fack’ Nyhetsbyrån Direkt, 31 March 2006 Rothstein, B. ‘Valet en trimf för socialdemokraterna’ Dagens Nyheter 20 September 2006 Statistics Sweden (2006) ‘Sweden’s GDP: +5.1 per cent in second quarter 2006’, Nr. 2006: 136 Schück, J. ‘Så röstade väljarna hela Sverige runt’, Dagens Nyheter 18 September 2006

Social Europe the journal of the european left • Volume 2 • Issue 2 • Autumn 2006

Endnotes

We would like to express our special gratitude to Chloé Aublin and Jeannette Ladzik who helped a great deal in the development of this issue.

All the views expressed in the articles of this issue are those of the authors and do not necessarily represent the views of Social Europe Forum.

All rights reserved Social Europe Forum © 2006 96 Social Europe the journal of the european left Autumn 2006