Sunday, 13 December 2009

A Strange World

A Strange World

13th December 2009

The Malta Independent on Sunday

Alfred Mifsud

Isn’t it a strange world? European politics have been consistently rewarding the right-of-centre parties in one election after another, most notably in France, Italy and Germany, and whereas these right-wing governments are being forced by the financial crisis to adopt Keynesian measures involving state intervention more typical of socialist policies, in the only recent electoral success of the left in Europe through the PASOK victory in Greece, the government there will be forced, by the overwhelming debt and financial problems it has inherited, to adopt consolidation policies more typical of right-wing parties. Greek socialists are probably realising that the journey was more enjoyable than the destination.

I muse. What do left-wing parties, including Malta’s PL, have to do for a better future when many right-wing parties have plagiarised Keynesian economic policies and secured consistent electoral majorities, thanks to their being perceived as both businesslike and socially sensitive?

Only in the UK and in Spain has the left managed to plagiarise the right’s businesslike reputation and win electoral support. Both mandates were, however, secured before the financial crisis brought an increased tendency among electorates to choose governments with both businesslike and social sensitivity attributes. In fact, the UK Labour success seems to be nearing its end after a 12-year run, if current opinion polls remain unchanged up to the general election next spring.

How are socialist parties to resolve this crisis of identity in which electorates keep choosing left-wing policies but tasking right-wing parties to implement them? Should the left spend their time in opposition merely biting their nails as they wait for the right to mismanage the economy so much that they have to call in left-wing parties by default to execute a right-wing job, as in the case of Greece?

To bring the argument closer to home, by the time of the next general election, the PL will have been out of government for 26 years – if the 1996-1998 period is excluded. During this time, the PN has shed its conservative role and usurped from Labour the social democratic mantle, foisting on the PL a crisis of identity that renders it difficult for Labour to persuade the electorate that they stand for something different from the PN, rather than merely standing for the same thing with better execution.

Better execution, through reduction of bureaucracy, more transparency and re-energised commitment, is easy to promise but in the end it is a matter of credibility. Under its former leadership, following the 1998 debacle, Labour lost credibility – which remains the main currency for political success. It stands a much better chance now, under its new leadership.

The question remains, however, whether gaining credibility for better execution will be enough to bring Labour back in government or whether they will also need to refine their policies to render them distinguishable from those of the PN. And in the event of the latter, in what way are they to become distinguishable and yet retain popular support among an electorate that does not seem to have the appetite to move out of the centre stream?

I think the challenge is to educate the electorate to distinguish between real social democracy and fake copies that look cheap and attractive but store problems for the future, ballooning till they become unsustainable to the point of explosion, causing the sudden collapse of the social model that the electorate wholeheartedly wants.

The social democracy model is that a fair portion of government tax revenues, generally about 50 per cent, has to come from a progressive direct taxation system in which one contributes according to one’s abilities and receives according to one’s needs, in order to guarantee a social safety net that is high enough to offer protection from poverty but not so high that it encourages dependence.

The right-wing parties, who had to adopt the social model to occupy the mainstream and win election, have corrupted it. They introduced the concept of social benefits to all, irrespective of means. That would be ideal, if it were sustainable. Unfortunately, it is not. If taxpayers feel entitled to a children’s allowance and a free health service, irrespective of their means, we might just as well remove taxation and let everyone pay his own. But then we would have to kiss the social solidarity model good-bye. Do we want that?

Should we continue to pay children’s allowance to high-income earners rather than use such funds to reduce the deficit or increase social benefits to those who really need them?

Should we persist in pretending that we can afford a free health service to all, irrespective of means, if this inevitably means that such ostensibly free services will have to be rationed, disadvantaging the truly needy through long waiting lists and through discrimination that gives better accessibility to the wealthier, who generally have the connections to ensure priority service from our public offerings?

The PL must distinguish itself by espousing the real social democracy model that gives benefits to those who really need them, thereby protecting the sustainability of the social model in the interests of the most needy in society. It should expose the malicious nature of the copycats who adopt the social model for convenience rather than out of conviction, but in the process, like the father who spares the rod, will spoil the child.

There is a living example of what this will lead to. The shipyards’ experience, whereby government engineered its death by a thousand cuts rather than taking decisive action in time to restructure the enterprise to lasting commercial success, should be a salutary lesson to the fate of our social model under the care of managers who adopt it merely for election convenience rather than out of social conviction.

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