‘Marx’ or the Market? Intra-party Power and Social Democratic Welfare State Retrenchment

Abstract

Differences in the intra-party balance of power explain variation in social democratic responses to the economic crisis of the late 1970s. This article evidences this claim by analysing the case of welfare state retrenchment by social democratic parties. Welfare state retrenchment is electorally risky for social democrats and often contrary to their principles. Therefore cases of welfare state retrenchment by social democrats provide an excellent case study of the difficult trade-offs parties have to make between office, policy and vote pay-offs. The article claims that leadership-dominated parties advance office-seeking strategies and are therefore responsive to economic conditions and public opinion. Conversely, activist-dominated parties advance policy-seeking strategies and therefore support traditional social democratic policy platforms or seek more radical solutions. By comparing seven social democratic parties (Denmark, France, Germany, the Netherlands, Spain, Sweden and the UK) between 1980 and 2005, this article explains variation in when social democrats introduced welfare state retrenchment.

Notes

1. Welfare state policies include more programmes, such as pensions and sickness programmes. Old age and health are life course risks, whereas unemployment or poverty are class risks. Reducing life courses risks is more risky because voters are affected more by life course risks than by class risks. Social democrats differ from Christian democrats in their support for measures reducing class risks. Because reducing class risks is a typical social democratic set of policies, this paper concentrates on the retrenchment of such measures.

2. A credible opposition has catered to working-class voters in the past, by supporting the welfare state and labour regulation measures. This also includes socialist and Christian democratic parties.

3. Votes are only instrumental in obtaining office or implementing policy. Hence, I consider vote-seeking behaviour as part of office-seeking.

4. The hypothesis that office-motivated parties change into policy-motivated parties is left out because it is not empirically observed in this research project.

5. The factionalism that characterises the PS also enabled party leaders like Mitterrand to manipulate the party by forming flexible intra-party coalitions (Kitschelt 1994).

6. This influenced the decision in all three parties to introduce participatory mechanisms, shifting power from leaders to activists.