Power without purpose? Social democracy is not what you think it is

The Starmer government’s ideological constraints help to explain why it appears to be making so many unforced errors and callous decisions

Political theorists are always pointing out that social democracy – the ideological perspective underlying left-of-centre politics in European democracies – is not simply a compromise position between capitalist practice and socialist principle.

I agree: it’s not that deep. Social democracy is its own creed: a close relative, obviously, but not simply socialism’s softer sibling. But it constantly upends conventional definitions of what it stands for, eschewing commitments to a ‘mixed economy’, an egalitarian welfare state, or the extension of democracy on behalf of the working class.

Understanding what social democracy is helps us, I believe, to understand contemporary Labour Party politics and the troubling trajectory of the Starmer government.

Above all, social democracy is a commitment to statism

Let’s start with what social democracy isn’t. It’s not an anti-capitalist ideology. But it’s not a pro-capitalist ideology either (not to be confused with niche, contrarian perspectives like ‘market socialism’). Social democrats don’t really see capitalism, in the sense that they do not problematise the relationship between those who own capital and those whose subsistence depends on serving it.

The social democracy-adjacent argument that the capitalist/worker relationship has complexified – due to technological change, home-ownership, social mobility, the growth of the public sector, etc. – has merit, but it’s not the real reason social democracy marginalises socialism’s core premise.

In truth, social democracy doesn’t reject socialism: ideological intermingling is normal, and it remains possible to adhere to versions of both perspectives. This is more a question of relevance: social democracy is concerned with the public realm, not private enterprise.

The core diagnosis of social-democratic ideology is that a centralised state is both inevitable and required to organise or underpin society. Acknowledging liberal ideals, this state must represent the interests of those it serves. But social democracy is in some ways an anti-democratic perspective, insofar as it recognises the risks as well as benefits of checking state power through parliamentary democracy. The influence of nineteenth century European nationalism on the nature and nurture of social democracy has been significantly under-stated.

Essentially, social democracy drew upon the raw ingredients of socialism – specifically the notion of collectivism – to broker an uneasy truce between nationalism and liberalism. Its preoccupation ever since has been on governance, leaving the struggle behind.

There is a vogueish view that social democracy, contra socialism, is focused on democratising rather than simply controlling production processes. But there is scant evidence that social democrats have ever seriously pursued this agenda, despite plenty of opportunities to do so. ‘Economic democracy’ is a socialist rather than social-democratic concept, and arguably social-democratic statism developed as a counter-weight to socialism’s idealistic experiments with syndicalism.

The Labour Party’s ideological promiscuity is both enabled and constrained by social democracy

In Britain, the Labour Party and social democracy are irredeemably intertwined. Labour is a creature of social democracy, and as such it is focused on how state power can be obtained and exercised, but social democracy also developed to provide labour movements with an animating paradigm for political action.

Labour’s social-democratic DNA is the reason the party’s broad church spans from elements of the far left, to what we now call neoliberalism. The adoption even of elements of far-right politics is not the aberration it might appear to be. Social democrats don’t agree with each other on what society or the economy should look like, but they tend to agree on how the relevant decisions should be made and enforced.

A powerful executive, with limited parliamentary oversight, is not only compatible with social democracy; it is arguably its ideal type.

The notion that social democracy’s ‘third way’ turn represented a shift away from statism needs to be decisively debunked. For better or worse, accommodating neoliberal economics has necessitated – or even been facilitated by – a huge expansion of social-democratic technocracy.

It is important that the Labour Party self-identifies as a democratic entity, a self-organising network of workers and wonks, organisers and ordinary folk. This helps to justify the lukewarm embrace of liberal-democratic ideals, since the party itself is a vehicle for popular representation.

Contrast the lack of enthusiasm all wings of the party have consistently shown towards things like proportional representation or local devolution, with the zeal with which they embrace intra-party proceduralism. But let’s be clear: party democracy is a means to end, that is, a set of processes that allow for different perspectives to be acknowledged and for conflicts to be managed. Democracy is the worst form of party organisation, except for all the others.

If we’re honest, social democracy has little to say about some of society’s most deeply rooted injustices. There is no social-democratic feminism, or race or queer theory. It has not incorporated green thought in any meaningful way: there is no narrative by which social democracy may do so that does not sound painfully glib.

The notion of a ‘progressive alliance’ seeks to address this, to some extent; the electoral benefits would be dubious, at best, but really it is an attempt to conjoin social democracy to green ideas in the formation of policy ambitions, using the only language social democrats have, i.e. the pursuit of formal power. But the idea will never be accepted by most social democrats, precisely because it suggests that political parties other than Labour might be equally capable of exercising power.

Obviously, anybody serious about tackling, say, climate change through public policy has already identified Labour as the most viable vehicle – since all roads pass via the state. Working with and within the Labour Party will frustrate greens as much as it must frustrate socialists, but social democracy doesn’t work as a governing proposition unless Labour is pretty much the only game in town.

Social democracy’s triumph in 2024 foretells its coming fall

Labour’s landslide win at the 2024 general election was a product of the party’s social-democratic identity. The Conservative government’s reputation for incompetence – more so than its flawed policies – sealed its fate. Keir Starmer presented himself as competence personified. He could be trusted with government because governance is what social democracy is for.

It was important that Labour was seen to stand for little else. The fact that Starmer was able to contrast his pragmatic social democracy with that of his more dogmatic predecessor was ideal. The sense that Starmer had duped the left-leaning party membership of the Corbyn era by promising a change only in personality, not policy, became a strength not a weakness; it demonstrated a leader willing to put country before party, even if doing so was uncomfortable.

The notion that governing involves a degree of self-denial – of sacrificing progressive ideals for the greater good – is an article of faith among social democrats. Of course, it is always articulated as a tactical necessity rather than a deeply ideological judgement at the heart of social-democratic identity. It’s usually both.

There is a problem though. At some point, once power is achieved, the virtue of being for being in government is overshadowed by the question of what – and who – social democrats are in government for. When it loosens its ancestral link to socialism and the labour movement, the Labour Party does not really have an answer to this question that is comprehensible beyond its own ranks.

Every ideology has its blind spots: undoubtedly, social democracy’s biggest intellectual hole is social class. To recognise exploitative class relations is to suggest implicitly that a commitment to maintaining social order – a pre-requisite of occupying national government – is negotiable. This is an incredibly difficult balancing act, which helps to explain why the Labour Party is so seldom in power: it is almost impossible to walk this tightrope without being unbalanced, eventually, by even the slightest of twitches.

When incomes are rising for most, Labour can usually get away with symbolic nods to its working-class heritage. At times like the present moment, however, a more substantive nod to class is required. Given the political risks this entails, the Starmer government’s championing of ‘working people’ is about as good as it is going to get. Working people are to be defended against their employers, to some extent, but mainly against the poor. This is how we have arrived, for example, at savage cuts to disability and incapacity benefits, as Labour plans to inflict suffering on a large part of the actually-existing working class. These cuts will be taken forward without consultation, with primary legislation used not to enable parliamentary scrutiny but rather to restrict the potential for legal challenges.

Image credit: 10 Downing Street. Licence: CC BY 2.0

The Starmer leadership’s ongoing dalliance with ‘Blue Labour’ reveals Labour’s torment over its class credentials. For some social democrats, Blue Labour’s simplistic account of working-class conservativism provides a rationalisation for anti-socialist and anti-liberal positioning.

But Blue Labour is a social-democratic distress call, not a serious set of ideas. It tells us that the Labour Party recognises it needs a renewed relationship with the working class, but lacks the intellectual tools and social foundations to develop one. Starmer hardly needed a philosopher king to tell him that Labour’s apparent support for immigration was an electoral risk.

Now, absurdly, Blue Labour figures are imploring Starmer to embrace MAGA and its Faragist variant more widely – a deeply unpopular position among most of the British electorate, not least because most of the electorate understand that it deprioritises British interests in favour of American and Russian foreign policy ambitions. Labour Together, the Starmerite think-tank captured by Blue Labour before the general election, misrepresented its own electoral segmentation research in order to push Labour to adopt a hard ‘anti-woke’ line on low-salience issues like trans rights.

Blue Labour supporters have misread the 2024 election outcome, which was a repudiation not validation of populist politics (albeit not an enthusiastic one). And like any political grouping formed around a moral and intellectual void, it attracts more than its fair share of grifters and egotists. The licence they are being granted to act as Starmer outriders will, eventually, lead to political fissures at the highest level that will present as disharmony and a lack of control to an electorate still just about willing to reserve judgement on Starmer’s authority.

To solve Britain’s problems, Labour might need more than problem-solving

The main flaw of the jarring ‘working people’ conception is that few people see themselves reflected in it. Most poor people don’t meet the definition, and more affluent groups don’t want to.

The term’s non-specificity is a recognition that social democracy works best when it can marshal a cross-class alliance. But there needs to be some policy substance to this political strategy. For Labour, this means investment in the public services and universal benefits that everyone can call upon when they need them, and an industrial strategy designed to deliver good jobs over the long term rather than short-term growth at all costs.

All of this, alas, is easier said than done. Britain is no longer the master of its own fate. Whether you want to emphasise a long-running process of relative decline, the accelerated decline brought about by the previous government, or the turmoil being induced by the Trump administration – take your pick – it is clear that our options for boosting and harnessing economic growth are now incredibly limited.

With real incomes falling for most people – despite what the Spring Statement claimed last week – the only source the government can look to for the resources it needs is the very wealthy. But we should not pretend this is straightforward either. Unlike the 2010s, economic capacity now lags behind demand, and taxes on the rich alone will not curb consumption enough to enable productivity-enhancing supply-side investment at the required scale.

Increasing borrowing is not an obvious alternative. High interest rates have pushed up borrowing costs – reducing them would create additional inflationary risks. With the ability of the Bank of England to purchase government debt (i.e. quantitative easing) probably exhausted, the government might consider compelling financial institutions to hold more domestic gilts, but this seems extraordinarily hazardous at a time when global economic volatility and intensifying climate risks are unsettling financial markets.

The politics of either approach could be prohibitive anyway, especially for a social-democratic government. Taxes that look like redistribution – rather than payment for services received – will smell like socialism to middle-class people, even if they won’t personally be liable to pay them. Higher borrowing will smell like incompetence, and/or will be presented as such by the media.

If a way through the economic impasse is to be devised, it is going to need long-term commitment, with pain before the pay-off, and a willingness to experiment, with wrong turns before the right course is found. The electorate needs to believe that Labour is governing in pursuit of a shared purpose, not simply governing because it won.

The Starmer government reflects the social-democratic preoccupation with modernising the state

This is not to suggest, however, that the Labour government does not have a purpose. As a dedicated social democrat, Starmer is laser-focused on reforming and retooling the machinery of government.

Some of the results are strikingly lefty, at first sight. But there is a pattern. The railways are being effectively nationalised – but arguably for reasons of operational efficiency, rather than a commitment to collective ownership. Travelling by train won’t be any cheaper, but nor will the rail infrastructure be meaningfully upgraded. Labour has also increased various taxes, such as imposing VAT on private schools and closing inheritance tax loopholes. But these feel like rather piecemeal measures, correcting various carve-outs previous government have granted to special interests, rather than emblematic of an egalitarian zeal.

Perhaps we can say the same about Labour’s plans for workers’ rights. It is in some ways a far-reaching set of reforms. On the other hand, it can be seen in the context of a labour market that has been transformed in the last twenty years, with employment insecurity, low-paid self-employment and work intensification becoming endemic. The playing field is thankfully being tilted back to employees as employment protection is modernised, but restrictions on trade union activity will not be fully repealed. Further retrenchment of the welfare state will also undermine workers’ bargaining power (especially gig workers).

The technocratic character of social democracy is most evident in Labour’s plans for the state bureaucracy. The government’s decision to trim the size of the civil service, and abolish bodies such as NHS England, are part of a cost-cutting drive. But they are also part of two wider agendas, that is, the public sector reforms spearheaded by Pat McFadden – building a civil service that is agile rather than hierarchical, with pay linked more closely to performance – and a desire for the elected government to have more direct control over delivery. When Chief Secretary to the Treasury, Darren Jones, isn’t busy comparing disability benefit cuts to cutting his kids’ pocket money, he is taking forward sensible and genuinely innovative reforms to government financial software.

Starmer has tied himself to this agenda on multiple occasions, also adopting uncharacteristically inflammatory language: it is clearly at the heart of his ambitions for his premiership.

Labour’s use – and misuse – of ‘missions’ as a governing framework is relevant here too. Mission-based governance is seen as way to reform the state from the top down. But the missions themselves are a mix of vague ambitions and conventional targets, and there has been no attempt to embed the approach in economic organisation beyond the state.

The white paper on English devolution was similarly underwhelming, offering very few new powers to sub-national authorities and actually abolishing a layer of local government. Only a social democrat could have concocted something like ‘Strategic Mayoral Authorities’, then decided this would fit the bill as the flagship element of ‘a generational project of determined devolution’.

I am a social democrat, by the way, among other things. The disability benefit cuts are beyond the pale but, for the most part, I approve of what my former Renewal co-editor Nick Garland describes as the Starmer government’s ‘plain old Labour’ vibe.

Yet Garland is also right to acknowledge that, on their own, ‘old-fashioned, even boring, social-democratic instincts’ are not going to be enough. This is at least partly because these instincts are being pared back to their bare essentials, with public sector reform surviving as a priority while the number of children in poverty grows, the international aid budget is decimated, and the paradigm-shaping promise of Rachel Reeves’s Mais lecture becomes a distant memory.

What explains this shift? Arguably, social democracy has become a victim of its own success. Its hegemony within the family of progressive perspectives has deprived social-democratic parties of the wider sources of inspiration, legitimacy and political support that are needed to furnish and sustain a programme of change.

The prime minister is strongly committed to social democracy’s core tenets; this is an observation, not a criticism. But it is worth reflecting on just how peculiar the moment of Starmer’s ascendancy was. As he became Labour leader, the incompetence, dishonesty and elitism of the incumbent government shed a remarkably positive light on both Starmer personally and the value of social-democratic statism. At the same time, the socialist influence within the Labour Party had been thoroughly discredited by the failings of Jeremy Corbyn’s leadership.

Starmer was made for this moment. Yet there is an absence here that cannot be ignored.

As the Blue Labour spasm indicates, Labour is struggling to both anchor itself in the everyday life of electors, and provide a compelling account of the difference social-democratic governments can make. Social democracy has never been able to take on the task of delivering progress alone, and it is time to take the risk opening up Starmerism to ideas drawn from other traditions.