In late March, leaders of European Union member nations agreed at their annual summit meeting, in Lisbon, on a program of sweeping economic liberalization aimed at bringing Europe into the Internet age. For the most part, the talk was of sweeping away the remnants of state regulation and welcoming the bracing winds of private enterprise. The European leaders, still facing double-digit unemployment, set a target of the creation of 20 million jobs and an annual economic growth rate of 3 percent, relying primarily on market forces.
The European Union is taking a "new direction, away from the social regulation agenda of the '80s ... [toward] innovation, competition, and employment," declared one Tony Blair, the British prime minister and the leader of a center-left party, at least nominally. Though most European leaders are from the labor or social democratic parties, the rhetoric and program of the EU summit were almost entirely in the idiom of economic liberalism: Respect market forces, and growth will follow. It must have been a satisfying moment for Baroness Thatcher, long retired from active politics, but still evidently the guiding spirit not just of European conservatives but of the entire political spectrum.
A minority, led predictably by the French, called for a greater balance between economic competitiveness and social cohesion. But for the most part, the Europeans remain dazzled by the U.S.-style Internet economy, which they associate with the liberation of private market forces and high rates of innovation and growth. To be sure, the Europeans, both center-left and center-right, continued to emphasize social investment--Internet access for all schools, job training, child care, and government-funded research. But the consensus on behalf of economic liberalization was so powerful and so widely shared among nominally conservative and nominally socialist leaders that one had to wonder whether conservatives are right that ideology is dead.
Everyone, it seems, is a freemarketeer. So is the long-heralded end of ideology at hand?
Yes, and no. Certainly, the great struggle of the twentieth century, between the totalitarian state and an open, pluralist society, has been resolved in favor of liberal democracy. There are still plenty of dictatorships in the world, but they are practical failures. Whenever ordinary people, as in Iran, get a chance to vote, they overwhelmingly opt for tolerance, pluralism, and democracy. The command economy is also defunct.
So the great debates of the new century will be fought largely within the family that believes in political democracy and a capitalist organization of the economy. But as even the European summit demonstrated, there are many flavors of both.
For example, though Tony Blair's brand of the third way favors privatization of commercial enterprises once run by the state, the main domestic initiative of the Blair government is a massive modernization of the United Kingdom National Health Service (NHS), the premier (now somewhat threadbare) exemplar of socialized medicine. The Labor government will pump some 20 billion pounds ($31 billion) into the NHS over four years, raising its funding to 7.8 percent of GDP, which is about a point above its ebb under the Tories but well below the European average. Blair will revive, not abandon, the NHS, which is still relied upon by most Britons and which still delivers reliable basic care.
If ideology means a set of first principles, the ideological debate between left and right is certainly at its narrowest in more than a century, and the fulcrum of debate has shifted slightly right. Even within the democracies, nobody seems to be calling for more state ownership, more regulation, higher taxes, or larger public deficits. Both center-left and center-right are according great respect to the discipline of competition.
Yet this consensus is also somewhat deceptive. In Europe, the center-right and the center-left accept that substan-tial state involvement in health, job training, education, environmental control, and family support is both desirable and politically inevitable. Despite the embrace of the market as the engine of growth, there is broad acceptance, at least in Europe, that there are some things markets cannot accomplish, equitably or even competently. In addition, there is a consensus that market forces produce a socially intolerable distribution of income, wealth, and life chances, which requires countervailing interventions and investments by the democratic state. In the United States, this consensus is tacit, which blunts it as a clear ideology.
And while there is widespread support on both sides of the Atlantic for deregulation of ordinary commerce, there is also broad recognition that a new economy requires new forms of regulation if it is to operate efficiently and transparently. TAP's recent special double issue on the Internet economy identified intellectual property, privacy, competition policy, and equal access as just four of the issues that must be resolved by public regulatory policy. By the same token, as the private economy globalizes, necessary public regulation of everything from pollution control to bank capital standards must struggle to catch up.
So American liberals and European social democrats remain necessary guardians of both the mixed economy and of a conception of society that values expanded political democracy as an end in itself--a liberalism for the twenty-first century. If the moderate right has won the debate on the issue of a basically capitalist organization of commerce, the moderate left has achieved a consensus on behalf of substantial social outlay and public regulation of capitalism's ground rules.
Why, then, does the right often seem to have the energy while many liberals seem reluctant champions of their own world view?
First, I think, while liberals were the architects of containment of the USSR, for conservatives the defeat of communism took on the character of a crusade. Many conservatives, preposterously, saw communism as just the logical conclusion of liberalism and social democracy. The collapse of the Soviet Union, fortuitously on the watch of Thatcher and Reagan, was immensely energizing to the right. It was seen as a victory not for the mixed economy and the complex liberalism of the Western democracies, but for laissez-faire.
Second, much of what liberals defend and seek to complete is embodied in the great social inventions of the past century--trade unionism, social insurance, universal public education. This gives liberalism itself a rather conservative and sometimes bureaucratic cast. It is liberals who want to build upon the recent past, and conservatives who are euphoric about change. Social Security, though widely supported, is old hat; 401(k) plans resonate with the new economy. In planning our direct mail campaign for the new, biweekly American Prospect, a copywriter proposed the slogan "If this were the stock market, we'd be the hot new IPO." I had to remind him that this is not the stock market. But market is hip, and social is fuddy-duddy.
Third, globalization tends to undermine civil society by removing many decisions from the compass of democratic deliberation and reserving them for the market. Many champions of the global economy who are nominal liberals, such as New York Times columnists Tom Friedman and Paul Krugman, are simply oblivious to this. They see the effort to extend national standards to newly globalized commerce as mere protectionism. Many liberal legislators, confused about first principles, dazzled by market rhetoric and industry lobbying, but also allied with the labor movement, support global standards with guilty consciences rather than as the right thing to do.
Fourth, the individualism associated with market triumphalism breaks up liberal coalitions. Too few forms of social outlay serve everybody, as citizens. The ideology of the new economy has it that we are all masters of our fate, and we deserve what we get. Society, perhaps, should invest in the next generation and "compensate the losers." But that concept makes for a weak politics.
Finally, conservative ideology boils down to a simple big idea: Markets Work. Liberal counter-ideology takes at least a paragraph: Markets work well for much of society, but many realms require political organization, economic regulation, and social investment. Besides, markets tend to intrude where they don't belong, and periodically they go haywire. None of this fits neatly on a bumper sticker, and it makes for a complex manifesto--I know, I wrote one--and a necessarily subtle politics. But the end of ideology, like the end of history, is rot. There is still a large debate over first principles and practical details within the broadly capitalist family, and liberals need the courage of their convictions. ¤