LEFTISM REINVENTED STEPHANIE L. MUDGE LEFTISM REINVENTED Western Parties from Socialism to Neoliberalism Cambridge, Mas sa chu setts, and London, England 2018 Copyright © 2018 by the President and Fellows of Harvard College All rights reserved Printed in the United States of Amer i ca First printing Library of Congress Cataloging- in- Publication Data Names: Mudge, Stephanie L., 1973– author. Title: Leftism reinvented : Western parties from socialism to neoliberalism / Stephanie L. Mudge. Description: Cambridge, Mas sa chu setts : Harvard University Press, 2018. | Includes bibliographical references and index. Identifiers: LCCN 2017047891 | ISBN 9780674971813 (hardcover : alk. paper) Subjects: LCSH: Liberalism— Western countries. | Liberalism— Economic aspects— Western countries. | Right and left (Po liti cal science)— Western countries. | Po liti cal parties— Western countries. Classification: LCC JC574 .M84 2018 | DDC 324.2 / 17091821— dc23 LC rec ord available at https:// lccn . loc . gov / 2017047891 Jacket design: Jill Breitbarth For Dave, Leighton, and Julian Contents List of Tables and Figures ix Preface xiii Abbreviations xxiii 1 Analyzing Leftism’s Reinventions 1 2 From Socialist, to Economistic, to Neoliberalized Leftism 43 3 The Genesis and Infrastructure of Socialist Leftism 69 4 Eu ro pean Leftism’s First Reinvention 110 5 Economistic Leftism, American- Style—or, Making the Demo crats “Left” 167 6 Interdependence in the Making of Leftism’s Second Reinvention 214 7 New Economists, New Experts, New Demo crats 260 8 Making Western Eu ro pean Leftism “Progressive” 304 9 Conclusions and Implications 365 Methodological Appendix 377 Notes 397 Bibliography 449 Index 499 List of Tables and Figures Tables 4.1 Social insurance legislation passed prior to 1930 118 4.2 The Swedish Stockholm School (listed chronologically by year of birth) 138 4.3 Dalton’s recruits— the making of the Gaitskell generation of revisionists (listed chronologically by year of birth) 152 6.1 Progressive center- left organ izations affiliated with the Policy Network as of 2008 248 A.1 Twenty- two OECD countries by regime 380 A.2 The po liti cal neoliberalism index 382 A.3 Descriptive statistics (obs = party / year)— center parties only 384 A.4 Atlas organ izations in (West) Germany, Sweden, the United Kingdom, and the United States, 2008 (listed by country and founding date) 385 A.5 Data sources on the CEA and its membership, 1946–2001 393 Figures 1.1 Leftism’s reinventions: An overview 39 2.1 Neoliberalization in mainstream party programs in twenty- two OECD countries, 1945–2004 (weighted five- year averages) 62 2.2 Cross- party programmatic variation among center parties in twenty- two OECD countries (weighted party- level standard deviation in five- year periods) 63 x List of Tables and Figures 2.3 Neoliberalization in center- left and center- right programs in twenty- two OECD countries (weighted five- year averages, with U.S. parties for comparison) 64 2.4 Neoliberalization in center- left and center- right programs in twenty- two OECD countries, with components, 1945–2004 (weighted five- year averages) 65 2.5 Neoliberalization in center- left and center- right programs by regime, 1945–2004 (weighted five- year averages) 66 4.1 Voter turnout as a percentage of the eligible population, 1880–1936 116 4.2 Industrial unemployment rates ( union figures), 1920–1939 119 4.3 German vote proportions in election years, with voter turnout, 1919–1933 (years in shaded boxes = SPD in government) 124 4.4 British vote proportions in election years, with voter turnout, 1918–1935 (years in shaded boxes = Labour Party in government) 128 4.5 Swedish vote proportions in election years, with voter turnout, 1917–1960 (years in shaded boxes = SAP in government) 141 4.6 “All Marxist Paths Lead to Moscow.” CDU election poster, 1953 161 5.1 Imagery of the Republican Party, 1937 189 5.2 Imagery of the Demo cratic Party, 1937 190 5.3 The drivers of interdependence in leftism’s first reinvention 212 6.1 U.S. news articles using partisan modifiers of “economics” / “economist(s),” 1900s–1990s 236 6.2 U.S. news articles using party- specific modifiers, relative to all articles on economics topics, 1900s–1990s 236 6.3 Establishment of Atlas network organ izations in Eu rope, Latin Amer i ca, and North Amer i ca, ≤ 2004 (n = 403) 243 6.4 The parallel proliferation of free market and progressive organ izations: cumulative percent founded, ≤ 2004* 250 7.1 U.S. vote proportions in presidential election years, with voter turnout, 1960–2012 264 List of Tables and Figures xi 7.2 Congressional popu lar voting, U.S. House of Representatives, 1960–2014 265 7.3 Inflation and unemployment in the United States, 1970–2005 267 7.4 Foreign direct investment (FDI) inflows and outflows, United States, 1970–2005 268 7.5 U.S. financial balance of payments, 1970–2005 269 7.6 Trends in party identification (“strong” or “weak” versus independent), 1952–2004 271 7.7 Trade union density, 1960−2008, United States and all OECD 289 8.1 Swedish vote proportions in election years, with voter turnout, 1960–2014 307 8.2 British vote proportions in election years, with voter turnout, 1964−2010 308 8.3 West German vote proportions in election years, with voter turnout, 1961−2013 309 8.4 Cross- national trends in union density, 1960−2008 311 8.5 Foreign direct investment (FDI) inflows and outflows, Sweden, 1970−2005 324 8.6 Sweden’s financial balance of payments, 1970−2005 325 8.7 Inflation and unemployment in Sweden, 1970−2005 326 8.8 Inflation and unemployment in the United Kingdom, 1970–2005 337 8.9 Foreign direct investment (FDI) inflows and outflows, United Kingdom, 1970–2005 349 8.10 U.K. financial balance of payments, 1970–2005 349 8.11 Inflation and unemployment in (West) Germany, 1970–2005 351 8.12 Foreign direct investment (FDI) inflows and outflows, (West) Germany, 1970–2005 360 8.13 (West) German financial balance of payments, 1970–2005 361 8.14 Cross- field dynamics in leftism’s second reinvention 363 Preface On New Year’s Eve, 1999, the citizens of Western democracies cele- brated the coming of the new millennium in a moment marked by the triumph of markets and the dominance of center- left governments. The former had been in the making for decades, but the latter was a novelty. Center- left parties held the reins of government in only a handful of Western countries in 1990, but the 1992 election of William Jefferson Clinton as the forty-second president of the United States was the first of a series of turnarounds. By the year 2000 center-left parties had come to power in many Western countries, including the vast majority of the fifteen nations that made up the Eu ro pean Union (EU) at that time. With Clinton and the British prime minister Tony Blair in the lead, a new cadre of center- left po liti cal elites declared the arrival of a new era of “third way”—or, later, “progressive”— leftism.1 The event prompted a decidedly mixed reaction. Where some saw a “magical return of social democracy,” others saw a leftish brand of free market politics that was social democratic in name only.2 In 1997 the British scholar Colin Crouch, for instance, described Blair’s New Labour government as the culmination of neoliberalism’s “new hegemony.”3 For Crouch and others third wayism was mere capitulation, or a case of the left gone right—dif fer ent in degree, but not in kind, from the free market conservatism of Ronald Reagan and Margaret Thatcher. Analytically speaking, it was a puzzling state of affairs. At what point is a historically left party no longer left—and if it is not left, then what is it? The unavoidability of the left- right binary in Western politics, and thus also in po liti cal analy sis, renders answers to such questions forever contestable. The fact that third wayers themselves blurred the left- right xiv Preface distinction only complicates matters. Indeed, at the center of third way rhe toric was the claim that “old” left- right oppositions were no longer meaningful in a globalized world—and that, if social democracy (or, in the United States, liberalism) was to be saved, it had to “modernize.” In the famous phrasing of the great British sociologist Anthony Giddens, the task of the twenty- first- century center- lefts was to take their politics in a “radical” direction that was “beyond left and right.”4 And yet, at the same time, third wayers insisted that they remained defenders of social justice and opportunity and stood opposed to naked free market ideology— and thus were not to be confused with their market-loving, inequality- embracing, neoconservative counter parts. How, then, does one assess third wayers’ claims to a radical departure from the left-right binary, versus counterarguments— usually from the left— that third wayism was mere rhetorical cover for a soft version of right- wing neo- liberalism, without taking sides in a fundamentally po liti cal fray? Originally, this book grew out of a long- standing fascination (some might say obsession) with this perplexing politi cal moment. The third way period is often explained, still, in terms similar to third wayers’: due to economic or politi cal reasons or both, center-left parties had to reinvent themselves in a market- friendly way. But standards of proof for these claims are fuzzy. First of all, the “market” has no stable constitu- ency. Second, third way–era center- left po liti cal leaders proactively advanced the very same economic globalization that, they claimed, ren- dered politicians helpless. Third, while the third way center-lefts were electorally successful in the short term, they did not transform their par- ties into long- term, “natu ral” parties of government— the professed goal, for instance, of Tony Blair.5 From the 1990s forward even the most successful social democratic party in Western history, the Swedish So- cial Demo cratic Party (SAP), saw its electoral strength seriously erode.