A fortnight ago I made the case that the social democratic project in the West is under stress and may come unraveled. This does not mean I think it was a mistake. On the contrary, it was a brilliant achievement in its day.
During the dark years of the Great Depression neither democracy nor free market capitalism seemed likely to survive. Fascism and Communism presented themselves as the only truly modern approaches to political and economic life, and their followers strutted, arrogantly confident that the future was theirs.
Communism promised a Revolution that, in one great act of political will, would put an end to the agonies of the era. This was very alluring. After all, when men and women with a strong sense of social responsibility faced the vast problems of urban poverty, corrupt politicians, and endless labor strife, it presented what seemed like an endless and exhausting and finally futile struggle. Thus, when Lincoln Steffens, a turn of the century Progressive, wanted to promote the cause of the Soviet Union after visiting in 1919, he said, “I have seen the future, and it works.”
Fascism had its own mythology of inevitable triumph, and it appealed less to idealist and more to those with a pragmatic bent. Few fascist fellow travelers were enthusiastic about Mussolini’s grandiose pageantry or Hitler’s ruthless rhetoric. But like the Progressives of the same era who were tempted by Communism, they had an exhausted sense that nothing else would work. As people used to say, at least Mussolini made the trains run on time.
Thus the achievement of social democracy. A vastly expanded social safety state and the hugely enlarged regulatory state consistent with a modicum of democratic accountability and economic prosperity? It worked, and thus the liberal consensus became the Establishment consensus.
Yes, it worked, but there is a law of social existence akin to the second law of entropy. As St. Augustine observed, the city of man cannot know true peace, for it is always being convulsed by the futility of its worldly desires. Whether the inevitable creative destruction of economic progress or the more obvious traumas of market bubbles and bank panics, whether bitter political conflicts or cold and hot wars, social life is always seething with instability.
Over the last fifty years social democratic regimes have evolved and adjusted to contain and moderate these instabilities, which at every juncture was a good thing. However, as forest managers now know, if we put out all the fires for generations—which is to say if our goal is to maintain forest “stability” year in and year out—the fuel for a catastrophic fire builds and builds. Eventually, through no fault of their own, the forest managers face a fire they can’t manage, one that is far bigger and more destructive for having been put off for so long.
As I suggested in my last column, that may be our situation now. The long-term success of social democracy has insulated us from some of the inherent instabilities of social existence, especially the relentless process of creative destruction that must be part and parcel of a growing economy. This has built up fuel on the forest floor of society, as it were.
Now a fire has broken out. The financial crisis of 2008 was a huge blow. The large-scale consequences were contained and moderated by tools of government intervention developed during recent decades. But now the underlying solvency of these tools is being shaken in the sovereign debt crisis. In midst of all this, most of us are now coming to realize that we are far more economically vulnerable than we had realized.
The political imperative of our time is to face up to this economic vulnerability. We are supremely adaptable animals, but we can’t respond intelligently and creatively to challenges if we insist on denying them and keep them at arms length.
To my mind, the core of the European Union is currently in a state of denial. The Greeks have become keenly aware that their future will involve “austerity,” a clinical word that means reduced standards of living for most people. However I don’t think the average Frenchman or German or Italian has faced up to the fact that they are vulnerable: to devaluation (most likely through inflation), increased taxation, or cuts in benefits—or more likely a combination of all three. The great relief that follows when “technocrats” take power suggests the hope that expert financial managers can put out the fires. The European Union is “all in” when it comes to social democracy.
The situation is different in America on two counts.
First, we’re more like the Greeks than the Germans, or at least a good portion of us are. The feeling of economic vulnerability is palpable in the Occupy Wall Street movement. The recent college graduate tells the reporter that he has $50,000 in student loan debt and no job. Then he asks a question that he clearly thinks condemns the current system: “What am I supposed to do?” The same sense that we are close to being disarmed and unable to face the future provides a great deal of the motivation for the Tea Party, whose push to cut, cut, cut in order to survive reflects a profound sense of vulnerability.
Second, where Europe is moving toward greater and greater political consolidation, as the call for technocrats to govern indicates, since the breakdown of the liberal consensus in the 1970s, American political life has become more and more strident and divided. Today the political differences are very raw.
This causes a great deal of dismay among ruling elites. Many commentators see our increasingly bitter political divisions as a threat to a stable and orderly governing class capable of making policy adjustments to pressing problems. That’s true, but perhaps good rather than bad. Our divisive politics, however dysfunctional when it comes to policy, is now increasingly linked to our keen sense of vulnerability, which means that the political gridlock is gridlock of the real issue.
Tax vs. cut? In a very crude but real way we are moving toward a referendum on the single most important political issue of our time—the future of the social democratic project.
R.R. Reno is Editor of First Things. He is the general editor of the Brazos Theological Commentary on the Bible and author of the volume on Genesis. His previous “On the Square” articles can be found here.