from Labour Focus on Eastern Europe, No. 64, 1999.|
[The Blair/Schroeder Manifesto, "The
Third Way", published in the summer of 1999, has provoked much debate on the left in Europe. We produce
below one contribution to this debate from Gregor Gysi, leader of the parliamentary group of the German
Party of Democratic Socialism (PDS).]
Twelve Theses for a Modern
Socialist Policy: A Response to the Blair/Schroeder Manifesto
In almost all countries
of the European Union, forces representing democratic socialism are having political influence, either
through opposition, tolerance of or participation in government. This means that we have to relate to
and debate with the strategies of both neo-conservatism and Social Democracy. Common ground must be
staked out and differences highlighted. The ideas of a modern socialist left require explanation.
free development of the individual as the prerequisite for the free development of all - that is the
message of a free, modern and democratic socialism. The political challenge to democratic socialism is
to organise society in a way that ensures social and political human rights for one and all. In this
sense socialism can also be seen as the human rights policy of modern societies. It calls for equality
in freedom and is therefore based on freedom and solidarity.
Below are twelve theses for a democratic
and socialist policy at the end of the century.
1. The twenty-first century vision: combine
modernity with socialism.
Modern societies are distinct from traditional pre-capitalist or early
capitalist societies because of "the constant revolutionising of production, the uninterrupted disturbance
of all social conditions, the everlasting uncertainty and agitation" (Karl Marx). The driving force behind
these continuous innovating changes is an institutionalised competition in the economy, politics, science,
education, the media and culture, which is based on a pluralistic distribution of property, power and
Permanent modernisation is an ambivalent process. Its institutions in the economy, politics,
science, education, the media and culture have often been used as instruments of the fiercest oppression
this century. From them arose the disasters of our century: the world wars, the holocaust, genocide,
misery, starvation and environmental destruction.
The state socialist attempt to evade the spontaneity
and insecurity of capitalism by replacing competition and evolution with planned control and centralised
administration of resources has failed. Historically, this attempt was constantly under attack and we
must be mindful of the conditions this created, but the fact remains: the general conditions for innovation
and progress were either destroyed or could not emerge. Social security, therefore, did not have a lasting
economic basis. Freedom and individual initiative were limited and fundamental democratic rights were
not guaranteed. State socialism became a stagnating society which crumbled and eventually collapsed.
Nevertheless, it gave humankind an important experience that needs critical analysis, not denunciation.
Socialist policy following the collapse of state socialism should liberate the evolutionary potential
of competition in the economy, politics, science, education, the media and culture from the dominance
of capital; it should protect this competition from the process of capital valorisation and should overcome
its patriarchal structure. Only this will make it possible to use competition as a resource for the emancipation
and development of all individuals, and to control and compensate in solidarity for the risks, spontaneities
and insecurities entailed. The equality of the sexes is both consequence and precondition for such a
transformation. Embarking on the road to socialist modernity means replacing capital's dominance over
the direction, shape and speed of change in human civilisation with the dominance of social, cultural
and ecological objectives. This requires political direction, conscious social structuring and the development
of counterforces able to carry this out.
What matters is not the abolition of markets, but the creation
of different kinds of market; not the suppression of entrepreneurial initiative but the creation of a
new framework for its social and ecological guidance. That cannot be achieved through the slogans found
in Schr”der's and Blair's joint proposal, but by limiting the right of capitalist property where it works
contrary to the common good and by channel it in new directions where it now leads to ecological degradation
and social disintegration. Public property will acquire a new function.
What is intended here is
not a relapse into pre-modernity or anti-modernity, but a restructuring of modernity. The combination
of modernity and socialism is not inevitable but it could be the major task for the generation at the
beginning of the twenty-first century.
2. The Social Democratic shaping of the age of Fordist
mass production was thoroughly successful. We can't repeat it today but we can learn from it.
Schroeder and Tony Blair paint a picture of Social Democratic policy during recent decades as a source
of levelling, innovation phobia, increasing public spending put to unproductive use, etatism and irresponsibly
high material expectations. This picture is ahistorical and unjust. It ignores the advances in productivity
and innovation as well as the social and cultural advancement of broad sections of the population over
the past fifty years, advances that were the direct result of social democratic influence.
welfare state that was created in Western Europe and the US after World War II was able to guarantee
nearly full employment over a lengthy period of prosperity, increasing earnings in line with productivity,
and index-linked social benefits in old age, sickness, disability or unemployment, although poverty was
never really abolished. Industrial mass production of material goods and private mass consumption were
prominent features of Fordism. This was combined with more scope for participation, for instance, co-determination
in [German] companies and better opportunities for emancipation. Not all, but quite a few dreams of the
Social Democrats came true. It was thanks mainly to the trades unions, Social Democracy, socialist movements
and parties, as well as the competition with state socialism, that institutions emerged which were able
to promote the interests of the working class and partially to complement the capitalist principle in
society with the principle of social participation. Unfortunately, prosperity was paid for with the oppression
and exploitation of the so-called Third World and an increasing destruction of the natural life-basis
of the human species. Yet there has been development there, too. Colonialism was overcome. Today the
impoverishment and exploitation of the Third World is the product of bilateral and international political
and economic dependency. Ecology has become a political subject and a matter of public awareness.
achievements of the social market economy are insecure and are being dismantled today not because rapidly
growing wages, increasing state redistribution, Keynesian spending policies and state control over the
major players were always wrong. The limits of the old ideal have to a large degree resulted from its
success. The crisis of the Fordist work society results from a model of growth that works only so long
as there are still new areas of human life that can be turned into wage labour, economically organised
and rationalised until less and less social labour is necessary for the production of the essential consumer
and producer goods. The wealth of free time thus created in a Fordist work society can only be used to
produce and consume more, and it is invested to further reduce living labour. But this cannot go on forever.
The ecological problems generated by this type of growth and the increase in "surplus labour" are manifested
in growing discrepancies between capital valorisation, wages, taxes and social spending.
have reached a point where we need a redefinition of the relationship between working and living. Redundant
labour cannot be completely reinvested, but it must not become superfluous time, dead time of a seemingly
superfluous underclass. And it is just as anachronistic to use this surplus time in cheap, state-subsidised
service jobs. This is the path to a new class society - on the one hand the big-income earners with
too much work and too little time, and the small-income earners in the service sector who look after
the children of the big-income earners, take care of their houses and gardens, and see to all the unprofitable
errands. This new class division would be anti-modern and anachronistic.
Rather than despising the
achievements of the social democratic era, as Schr”der and Blair do, efforts should be made to completely
revamp and integrate its achievements into new social structures. A genuine modernisation does not mean
dismantling and deregulating social institutions, it means searching for a new path of development and
deciding in favour of an alternative reform policy, linking economic, social, ecological and individual
3. The era of neo-liberal destruction of the post-war system needs not merely
to be interrupted by a Social Democratic episode of damage-containment but to be superseded by an era
of modern socialist politics.
With a series of aggressive reforms, neo-liberalism, over the
past twenty years, has begun the dismantling of Fordist welfare capitalism. This was carried out in
a way that served the interests of transnational corporations, international financial markets, the
global economic, political and cultural upper classes. The quest for a new viable way of combining economic
development and social progress is not part of the neo-liberal reform programme. The new system is, therefore,
extremely unjust, unstable and threatens peace, the environment and social cohesion.
So far, neo-liberal
reforms have been implemented only partially in Germany. Important structural elements of the social
democratic era remain intact. On the one hand, these can hold back the neo-liberal reform project because
social interests are still tied to these structures of the past era. At the same time, they can also
facilitate the reform project because these same public and corporate institutions can be restructured
around new goals.
The Social Democracy of the New Centre or the Third Way accepts the neo-liberal
approach and attempts to partially correct it. It tries to establish a larger role for the state, not
as Fordist redistributor but as "activator". The state is to establish, promote and moderate market
mechanisms and forms of competition which improve the competitiveness of nation-states and major regions
in global competition, while (in contrast to Thatcher's neo-liberalism) safeguarding a minimum social
consensus at home by promoting forms of partnership among competing social interests (for instance, the
"Alliance for Jobs" [in Germany]).
The fact that social democratic governments are in office in many
European countries proves that the people wanted a correction of the neo-liberal strategy. However, the
defeat that the German and British Social Democracies suffered in the European election is a clear sign
that their current policy cannot count on stable support. On the one hand, they are unable to take the
offensive and make use of new opportunities. On the other, they have not proven that they are either
willing or able to effectively oppose new social threats. They have failed to measure up either to neo-liberalism
or to the old traditional social democracy, disappointing both those who have pinned their hopes on new
opportunities and those who are threatened.
4. Those who want to promote new opportunities must
allow them to be opportunities for all. Those who want to deal with the new social threats cannot put
themselves in opposition to those who are the least able to defend themselves against such threats.
What is needed is a new social contract.
Social justice is a fundamental precondition for a
lasting, truly modern politics. It must not be reduced to individual fairness. The social foundations
of individual achievement must not be ignored. Democratic socialism, therefore, aims at a new social
The basic elements of this contract would be:
* a policy that credibly faces the new
challenge - turning new opportunities into opportunities for a freer development of all, in solidarity;
* a transition to a mode of development that ensures a more just participation of everyone in social
wealth through a new way of working and living that is ecologically sustainable;
* surmounting all
obstacles in the way of women's self-determination and equality of the sexes;
* full employment,
to be achieved by exploring new fields for economic development in keeping with sustainable, ecological
and social criteria, while at the same time reducing working time and increasing the flexibility and
enrichment of work and its combination with the opportunity for voluntary creative work;
* a social
system whose costs are shared in solidarity and whose aims are basic security for everyone and availability
of new opportunities to everyone;
* a policy of restructuring public finances in a way that opens
the way to a more just social order and to new developments.
5. Modernising politics means
more than adapting to new conditions and supporting business. Above all, politics should be a deliberate
effort to structure social conditions. To this end, organised counter-forces are required.
neo-liberalism, nation-states and international organisations have simply become the executive bodies
of transnational corporations and international financial markets who view any kind of Keynesian direction
of the economy as a burden. The new Social Democracy wants to stimulate the economy and create a framework
in which market forces can work properly (Blair/Schroeder).
But the unhampered functioning of powerful
world markets is a threat to social justice and ecological sustainability. To expect social and ecological
sustainability from a strengthening of the main actors in these markets is either a demonstration of
ignorance or a deliberate ideological hoax. Any social renewal is impossible without a strong social
and ecological orientation as well as global and regional regulation.
For democratic socialists,
modernisation can't mean making politics a more efficient housemaid in the service of the economy, helping
to dispose of its unmarketable waste. And it is also not enough to improve the level of skills by better
training. In the first place, political modernisation means restoring politics as the conscious structuring
of social relations, using the forces of the market and of society as a whole for the common good.
need a policy of dialogue and a European employment pact. But these only make sense if they open up new
opportunities for the unemployed and the low paid. An orientation toward the common good means that those
who are disadvantaged have to benefit. This orientation can be successful only if a higher proportion
of wage earners share in national wealth while small and medium sized businesses are promoted and their
almost complete dependence on banks and big corporations significantly reduced.
depends essentially on the balance of forces in society and, above all, on the economy. Just as a separation
of powers is essential for political democracy, a separation of economic power is essential for a social
and ecological economic order. Developments oriented at the common good can only emerge from an institutionalisation
of ecological and social counter-powers to the power of capital valorisation and the misconceived maximisation
of income and consumption.
The powerless can't negotiate and are not partners. The overwhelming power
of organised capital inevitably produces a powerlessness in politics. The so-called constraints on political
actors arise quite simply from the predominance of the former and the relative powerlessness of the latter.
Without a change in the power structures of the economy the "alliance for jobs, vocational training and
competitiveness" will become a contract imposed in the interests of the big corporations, with some
small concessions in an overall context of social dismantling.
For decades, Social Democrats have
neglected to prepare people for the fact that the obstacles to further development can be removed only
by their own actions to change the relations of power in society. It's no accident that the calls by
Gerhard Schroeder and Tony Blair for The Third Way are appeals to the governments and not the peoples
The breakthrough to social and ecological sustainability starts when those affected recognise
their own interests and its foundation is the active involvement of citizen's initiatives, projects,
associations, trades unions, churches, expert groups and local people. A modern Left must promote initiatives
for civil self-organisation and interest representation, help them to network and take on board their
proposals for new development paths. The state and legal system can only gain by making such developments
possible and legal.
6. A combination of ecological restructuring, modernisation of work, and
laying the foundations for a multifaceted and richly varied way of life could create a sustainable type
of development that goes beyond the limitations of Fordist capitalism, is less harmful to the environment
and facilitates the economic conditions for a freer development for all.
This would mean
a new development strategy, one that would transcend the socially limiting capitalism of the post-war
period. Technologically, societies today are able to supply the needs of all people on earth with only
a small expenditure of labour. However, this development has not led to everybody working less. A growing
number of people capable of work have no paid job while others are working longer hours, sometimes
earning more and, through higher taxes and social spending, are having to care for the "superfluous"
section of society. This kind of productivity development and growth means that social integration suffers
and life-worlds decay - both for those out of work and for those in work who, because of the growing
pressures of work, lack the time and ability for varied human relations and leisure activities.
enormous increase in labour productivity has not been matched by an equivalent efficiency in the handling
of resources and productive factors. The exploitation of natural resources has grown enormously without
a comparable rise in the efficiency of their use. Such a development not only disastrously undermines
the foundations of future production and consumption but also destroys the life-worlds of people - the
foundation of which is nature.
It is possible and necessary to embark on a new path of economic development
and to find a type of development that is in harmony with the environment and human needs. What is on
the agenda is a socio-ecological transformation that can also be called a "global revolution" (Club of
Rome). Three aspects of this transformation must be highlighted:
1. the transition to ecological
sustainability and the inevitable reorientation of production from manufacturing material goods to the
production of real human wealth - the universal needs, abilities, pleasures, productive forces etc. of
individuals produced in universal exchange (Karl Marx);
2. a global offensive for overcoming poverty,
hunger and underdevelopment and
3. a breakthrough towards gender equality in politics, the economy,
science, education, the media and culture. A modern Left does not, however, reduce the abolition of patriarchal
power to a policy on equality. It regards the emancipatory struggles of women as one of the major movements
for changes in society.
Nothing less than a transformation of world society is on the agenda. Breaking
out of the structures of power in our society means confronting the dominance of capital valorisation
in society, society's destructive exploitation of nature as well as the dominance of the North over the
South and of men over women.
The entire system of production, services, housing, transport and way
of life as they have existed in the twentieth century have to be restructured. There has to be a real
improvement in the efficient use of natural resources and in our ability to handle them "productively"
over the next twenty years. These are the undeveloped market of the future for which we need labour,
capital and, most of all, knowledge. Ecological and social transformation would bring with it comprehensive
innovation and investment and could lead to a net increase in jobs even in the mid-term.
to achieve this goal, a new framework for markets is indispensable. Among other things, it would have
to incorporate into its prices, by means of eco-taxes, emission regulations, etc., the costs of previous
economic activity which up to now have not been included in business costs. Structural and regional policies
could also make a contribution to a better form of development. The new economy would be based on a globalised
exchange of information, a far-reaching regionalisation of material and energy cycles and the localisation
of many services, enabling the full use of regional labour capacity and the creation of environmentally
friendly economic cycles. The necessary revolution leading to an efficient use of natural resources requires
a reorientation of research and technology policy towards sustainable development.
sustainability and modernisation of work would involve a differentiated and flexible way of providing
work and earlier retirement for everyone. A modern working society must also make possible a new combination
of work and creative communal and individual work. Finding versatile and meaningful fields for community
and individual action can start with the ecological transformation of private life. It would also have
to involve local people regaining sovereignty over the structuring of their own affairs in their communities
and regions and would give rise to a large number of social and cultural projects. Creativeness and commitment
must no longer be limited to individual careers, high incomes and exclusive consumption for a few. Everyone
should be employed - both with paying jobs and with personal work - according to their abilities and
needs in order to find a sensible combination of work, life, enjoyment and personal fulfilment.
7. The growth of a low-wage sector results in a lasting division of society. The alternative is to find
new areas for sustainable development, to reduce working time and to increase flexibility.
Growth oriented at the world market and at the reduction of additional wage costs will not solve the
problem of mass unemployment. Traditional labour market policy is insufficient and the creation of a
low-wage sector polarises society and wrongly subsidises businesses. Without finding new areas for work
and without a new distribution of work in society there will be a permanent division between high income
earners, their servants and the unemployed.
The crisis of employment can be resolved. A modern socialist
policy has to find new solutions that are more in keeping with its ultimate goal - the free development
of all. Four possibilities should be mentioned:
(1) First, a solution to the problem of employment
would involve an ecological transformation of production and production-related services as well as the
replacement of goods and technologies that damage the environment by ones that are ecologically sound.
Since only 20 percent of the workforce is needed to provide the necessary material goods for society
as a whole under current productivity conditions, it would require a considerable extension of social
services: in education and training, health, nursing care, scientific, cultural and sports activities,
social and psychological care, counselling, support for self-help projects, communication and environmental
protection. These fields are inexhaustible for human activity. Already today the majority of the workforce
in the Western world is employed outside material production. But services should not be reduced to the
provision of "human capital" for businesses. People-oriented services form the core of the production
of wealth in the twenty-first century. The modern leisure industry is only a late Fordist phenomenon,
the internet may be the incipient form of a new knowledge and communication society still hidden in
the folds of the old system, obscured by commercials and passive entertainment.
decisions for a new path of development, for viable future areas of employment are indispensable. They
must also be twinned with institutional innovations. A modernised work society cannot limit itself to
creating more jobs. It must create institutions that are in line with new social structures and lifestyles.
The social preconditions of the Fordist work society, based on the model of the male family head in the
job for life, has been superseded by the modernisation process of the past fifty years. Work roles and
patterns today are significantly different. Yesterday a trainee, today self-employed and part-time worker,
tomorrow unemployed and the day after that maybe entrepreneur and finally a share-holder in receipt of
welfare benefits. The diverse social roles can no longer be clearly attributed to certain social classes,
strata and groups.
That does not mean social injustice has decreased: on the contrary, it is growing.
But the lines of classification are not so clear. There are blue and white-collar workers with relatively
good incomes, the self-employed who are quite well off but also those who for many years live close
to the poverty line, successful businesspeople but also businesspeople gone broke, without any social
safeguard, doctors and university graduates, some without work and some in very well-paid positions.
Consequently, the concentration on normal working relationships is inadequate and the diversity of incomes
and jobs must be taken into account for when setting up rules for work and laying out systems of social
(3) The basic preconditions for the modernisation of work are the creation of new
ecological, social and cultural areas of employment as well as the creation of new structures of employment.
By shortening the average work-week for men and women to thirty hours, it should be possible to shorten
the overall cycle of lifetime employment and allow work to be combined with voluntary communal and individual
Lifetime employment must be reduced in various and flexible forms. In this area a balance
of interests between employee and employer is necessary and possible. Flexibility means various possibilities
in terms of working hours. Flexi-time, the individual choice of working hours, is one possibility. It
addresses more than just part-time work, training, "Sunday" years, parental leave and flexible replacement
schemes. Offering working hour choice to older employees should provide them with an opportunity for
making a smooth transition into retirement. People of 55 years and older should be legally entitled to
choose their own working hours.
(4) Work in the public sector and in the social services should
not be measured by the criteria of capitalist profitability. The forms this kind of work should take
is still to be decided. In part it would continue as public service work but closer to the citizens
it serves. At the same time, the non-profit or "third" sector, between the private and the state sectors,
needs to be expanded. This would be organised by autonomous entities. Public institutions and organisations
under local supervision could farm out new socio-cultural and ecological projects financed in part by
public funding and partly by charges and prices. The businesses chosen to run the projects would have
to live up to certain labour-market, social, ecological and local political criteria. Another possibility
would be the creation of individual income by combining social safeguards with an allowance for taking
over socially meaningful jobs. Shorter working hours twinned with fundamental safeguards for times without
employment should make it possible for the individual to find time for training in their own field of
work, or for co-operation in non-profit or charitable projects of cultural, ecological, social, scientific
or pedagogical nature while in employment or instead of it.
8. Participation of citizens in
the wealth of society does not, exclusively, mean more private consumption; rather it will lead to a
better quality of life for both women and men.
Abandoning a mode of consumption that reduces
pleasure to mass consumption and eventually leads to a worsening quality of life and stultification,
does not mean forsaking the positive aspects of the Fordist consumer society. What is required is not
the elimination of consumption, but the use of the material wealth, mobility, space and the world of
goods in a different way. Consumption will bring pleasure and satisfaction if it reflects the variety
of enjoyable behaviour and the richness of human relations. To this end the individual needs free time
and self-determined work. This will not lead to a reduction of purchasing power or demand. Collective
bargaining in the next century should be used to translate rises in productivity into rises in the quality
of life. Looking after one's own body, bringing up children, private life, the flat, house and garden,
food and drink, local affairs, harmony with the environment - these are not parts of life that require
commercialisation, these are not areas of life that we want to be liberated from by a growing services
sector. These are part of our life world from which we derive pleasure and satisfaction, perhaps even
more than from career and work. The battles of the future will be to a growing extent about new life
styles. A redistribution of opportunities in life is a fundamental condition for preserving social cohesion
A major reduction in working time is an essential if women and men are to participate
equally in work and leisure. It would create new opportunities for women's real involvement in the renewal
of democracy. True equality would require that there are no sectors with such low levels of pay that
women or men would become financially dependant on their partners. A co-operative work society, a new
employment policy and a more self-determined combination of gainful employment with voluntary work would
make it possible to overcome the exploitation of stereotypical "women's work" and the misuse of those
female qualities encouraged by patriarchal socialisation (solidarity, caring, social sensitivity and
readiness to compromise) in the mostly poorly paid service industries.
In this and other fields the
strength and development of trades unions assumes a pivotal role.
9. A new development path
requires a change in economic regulation and institutional reform, without which there could be no project
of social and ecological transformation.
A social and ecological transformation requires a change
of behaviour in a host of actors - individuals, organisations, businesses, state authorities etc. Changing
behaviour patterns, in turn, presupposes a reform of the institutions that structure and regulate such
behaviour. This is not a simple counterposing of regulation by the free market or by the state. Institutions
work well to the extent that they correspond with the opportunities and means of the actors. The Fordist
regulatory system, based on oligopolistic markets, big organisations, corporate bargaining procedures,
and bureaucratisation of economic activity, of natural resource exploitation and of the labour system,
is out of step with social reality at the end of the twentieth century. The traditional regulation of
international markets and money has collapsed without new and effective institutions having emerged.
Deregulation provides no solution but only a negative variation based on the interests of free market
capitalism. A new development path requires institutional reform in the economy, the social system and
the tax system. Any new system of economic regulation should take into account the following points:
The first task would be to establish a world market framework that put in place common standards
of political and social rights, ecology, product quality and consumer protection. World markets need
regulation that also guarantees opportunities for the economies of less developed countries. Financial
markets must be regulated in a fashion that does not hamper productive investment but scales down speculation.
Apart from agreements on environmental and social standards, a regulation of international capital markets
is most urgent. The introduction of (Tobin) taxes on foreign exchange and capital transfer, public supervision
of banks and a stronger linking of the dollar and Euro are essential steps.
the difficulties of re-regulating world markets, we should expect far more initiatives from European
Social Democratic governments. The major regional players will have to take the lead. The fact that rich
countries reject the introduction of certain environmental and social standards, citing international
competition, is not only dishonest but also writes off the future.
Institutions for ecological
regulation of the economy have yet to be established. The underlying principle would be that ecological
resources, depending on their nature and importance, would remain the property of regional or local
communities, nations or the people of the whole world, and could not be privatised. Private enterprise
could use such resources, in ways to be determined, but only in return for financing their reproduction.
In addition to eco- taxes, other suitable instruments could be certificates and environmental charges...
State promotion of the economy, which tends to preserve existing structures and limit competition,
could gradually be shifted to the independent sector which would be responsible for innovative investment.
Promotion of economic development would then not by guided by state bureaucracies but by democratically
constituted economic promotion bodies with co-determination based on the principle of parity. Over the
longer term, economic promotion would gradually be self-financing and removed from the state budget.
A number of public services obviously cannot be provided efficiently by state-owned companies
in their current form. Privatisation, however, is not in the common interest. Especially problematic
are solutions that replace local state monopolies with supra-regional big companies in monopoly positions
with no ties to either the region or local community. What is needed here, once again, is to find new
ways between public and private.
One possible way would be publicly constituted agencies under democratic
supervision with the broadest participation possible, not managed by state bureaucracy, which would include
a number of smaller and medium-sized companies and would provide the necessary services. In this area
pluralistic competition could be linked with public control. We need to give more consideration to such
ideas and test them in practice...
Finally, we need a reform of industrial relations and codetermination.
From the point of view of the effects of their activities on society and the environment, big corporations
are no longer the exclusive concern of their private owners. It is no longer adequate to think just of
the interests of the workforce in such big corporations [as happens in codetermination]. Supervisory
boards need to have a tripartite composition. [Translators note: supervisory boards in German companies
are made up of representatives of the workers and the employer.] The interests of the public could be
institutionalised in a public bank, the representatives of which would not come from the state bureaucracy
but would be elected by non-governmental organisations.
10. A modernisation of the social welfare
system requires the participation of most people in financing it and introducing a demand-oriented social
safeguard, ridding the solidarity- based insurance systems of out-of-area services, limiting entitlements
and the obligation to pay for high income earners, more efficiency and democratic self-management in
the use of funds, as well as universal standards for all mandatory insurance schemes.
state is a second area in need of institutional reform and regulation. Welfare and social systems developed
and index-linked under Fordism, such as health and pension insurance, unemployment and nursing-care insurance,
have been subject to heated debates and insufficient attempts at reform for a long time. The reform of
the health system and pension schemes which the German government has just ushered in has a number of
approaches that are correct - especially the introduction of a fundamental safeguard - but there are
still a lot of problems.
We need a reform of the social system that better corresponds to the new
social structures that have evolved in the twentieth century and which would support the transition to
a new ecological path of development and a new link between economy and way of life. This requires two
big steps - a universalisation of social welfare and the introduction of a basic safety net. In future
there should be only one mandatory basic social insurance and one basic health insurance...
social security system has to guarantee conditions fit for human beings to live in. It is not enough
to simply safeguard material existence. It has to open up opportunities and provide challenges for active
participation and advance in society, for the acquisition of further qualifications and for active participation
in economic activity as workers or self-employed.
A basic needs-based social safeguard must be available
for everyone. A compulsory index-linked basic social safeguard does not need to fully insure the high
living standards of high income earners. This could be done privately. Claims based on contributions
could go as high as twice the basic level. Everyone would have to contribute, regardless of type of income,
except those unable to work, those on basic entitlements (eg pensioners) and children until they have
finished their education. High income earners would pay into the solidarity-based insurance scheme up
to a certain limit. There would be no obligatory contributions for income beyond a certain upper limit
but neither could there be social insurance claims made on that income. Higher income earners could make
their own provision for income beyond the threshold level. Apart from private insurance, this could
involve company pensions, collective social schemes, co-operative insurers and the like. Income from
these sources should also be free of premiums in the basic safeguards system. Welfare, unemployment benefit
and allowances and mandatory pensions could, in their present form, be phased out over a longer period.
... The mandatory basic safeguard would therefore replace today's pension and inemployment insurance
schemes. As health and nursing-care insurance could also be standardised, there would only be two mandatory
insurance schemes left to be paid for by income earners.
The contributory system is preferable to
the tax-financed system (such as basic state pensions) because the latter can be changed arbitrarily
by a change in government policy. The contributory system has a built-in, quasi-ownership-based claim.
For children up to age 18 a basic child benefit would be paid, related to age and covering basic needs.
After the age of 18 they could, when in need, claim the basic social insurance independently of parental
income. This would also apply to students and would replace the student loan scheme.
must show solidarity and pay into the insurance funds. However, payments should not be assessed on the
basis of gross wage costs but on the basis of value creation. Companies that are labour intensive with
high wage costs have been disadvantaged in the past. This change would bring about a more just and functional
distribution of costs among businesses...
11. The tax system must be fundamentally modernised,
simplified and made transparent as well as oriented towards tax justice: lower taxes on small incomes,
higher taxes on large-scale private property and on unproductively invested profits and revenues from
financial investments. A reform of public finances could lead to a fairer social system and a more sustainable
form of development.
A fundamental reform of the system of taxes and charges is urgently required.
First of all, the SPD's plan to broaden the basis for taxation by doing away with exceptions, subsidies
and exemptions while at the same time lowering the rate of taxation is correct. The taxes businesses
pay in Germany are not too high in absolute terms; the share of the tax burden between big corporations,
small businesses and workers has been levied incorrectly and unjustly both from an economic and social
standpoint However the Social Democratic approach does not suffice for a real reform of tax law...
finance in Germany and in other leading Western nations has been sliding into serious crisis for years.
This crisis is seen mainly as a problem of public debt. Since the early 1980s national debt has risen
by 600 per cent in Germany; in 1997 the total amount of national debt exceeded more than DM 2,000 billion.
Almost one in four DM of taxes now goes towards debt service. And the debts are growing further. About
25 per cent of the 1999 budget is covered by loans and the sale of federal state property...
of public finance does not primarily arise from the fact that so far "the road to social justice had
been paved with ever higher levels of public spending", as Tony Blair and Gerhard Schroeder would have
it. That is certainly not true of the previous government in Germany. The crisis was mainly caused by
the fact that public finance lost that part of revenue that used to come from corporate and wealth taxes.
In fact, in Germany tax on profits and corporate income constitutes an increasingly smaller part in overall
tax revenue while the share of tax on wages rose by 20.7 per cent alone between 1992 and 1997 and constitutes
the biggest item for the treasury. The burden of taxes and charges on wages and salaries is much too
high. Under the condition of Fordism in crisis, by and large, only the major corporations have received
big tax breaks for reasons of competition. Incomes from property rose more than proportionally.
far as business is concerned, the myth of Germany as a high-tax country is not true: the actual average
corporate tax is 21 per cent. According to the OECD amongst the industrialised nations only the Netherlands
have a lower rate, while it is much higher in the US (27 per cent), Denmark (28.6 per cent) and Great
Britain (32.4 per cent). If German businesses were still taxed according to the 1980 regulations the
government would have DM 100 billion more every year. The problem is that the major corporations avoid
taxation or are exempt from it so that small and medium-sized enterprises as well as wage-earners have
to shoulder the main burden.
The crisis of public finance has to be resolved in a different way.
The way that the Social Democratic government in Germany is attempting to solve the problem is socially
unjust. As an alternative, a reform of public finance should be based on the following principles:
Earnings above the poverty line (be it from wages, salaries, other earnings, profits and revenues) should
be subject to progressive taxation. Pensions, revenues from life insurance policies and other old age
payments as well as the basic social safeguard (as soon as it has been introduced) are exempt from taxation.
In other words, the basis for taxation is broadened, exceptions are abolished and effective instruments
are applied to counter tax avoidance by big corporations, the rich, and loan and insurance companies.
Higher taxes are levied on capital revenues from transactions in international financial and foreign
exchange markets. More pressure is necessary to harmonise taxation legislation within the EU.
are those who have benefited and profited from the developments that led to the crisis in public finance.
Against the background of huge unsolved problems in society requiring financing and the unjust accumulation
of wealth amongst the economically powerful, a temporary wealth tax on big property and on the assets
of insurance and loan corporations and investment companies is necessary for a transitional period of
In the long run, a decrease in mass unemployment and the reform of the welfare state as
well as revenues from new development paths will pay off. A new kind of full employment would cut the
costs of unemployment (about DM 170 billion in Germany in 1998) tremendously and raise tax revenues.
All expenditures are checked for their contribution to the necessary economic and socio-ecological
conversion. Subsidies that merely preserve existing structures are phased out. Those contributing to
the socio-ecological transformation of society and thus to a possible elimination of mass unemployment
are retained and extended...
A reform of local government finance will lead to a new quality of self-administration
in the communities and regions. Communities must be in a position to positively influence local ecologically
oriented economic cycles and to assume a leading role in establishing a public employment sector.
12. International security and the preservation of peace depend above all else on a just world economic
order, non-violent forms of implementing human rights, respect for the claims of ethnic, political and
cultural groups, and a UN monopoly on the use of force.
Following the experience of the most
appalling of all wars in history and the failure of the League of Nations, the United Nations Organisation
was created and its Charter established an international law that outlaws war, is oriented towards consensus
and bases international relations on fundamental democratic principles. Furthermore, for nearly half
a century the balance of terror prevented the horror of war in Europe.
The return of war to the European
continent, its extension to Africa and Asia, its re- legitimisation in the politics of the capitalist
metropolitan countries and many other countries results from the fact that the mutual restraints on the
military arsenals of East and West have now been loosened. It was not intended, that confrontational
and military concepts of security should be replaced by co-operative and civil ones, nor has it happened.
Gorbachev's New Thinking about a civil restructuring of international relations has been without effect.
With the collapse of the Soviet Union and the end of the Warsaw Pact, the West was no longer interested
in such ideas.
International conflicts, wars and proliferation of arms of mass destruction have increased.
Unjust economic relations, underdevelopment of the South, US and NATO ambitions to establish a world-wide
military monopoly on the use of force, the undemocratic nature of international relations, disregard
for human rights, international law and the rights of ethnic, political and cultural groups by many countries
- all of these are causes of current crises and wars.
Neo-liberal radical globalisation , accompanied
by cultural imperialism, jeopardises traditional social structures and alternative opportunities for
development and provokes resistance. Without underestimating specific causes in individual regions and
countries, it must be said that dictatorial regimes, ideological fundamentalism, wars about distribution
and a world-wide militarisation of politics are the consequence of economic, political and military
strategic decisions by the metropolitan countries.
Currently anti-militaristic forces are weak and
the monopoly of the West on the use of force is almost without restraint. But politics established on
that basis is short-sighted, counter-productive and irresponsible. It creates new tensions and aggravates
old ones, destroys civilian and co-operative thinking and, at best, solves warring conflicts by causing
new ones, and in the long run probably worse ones. Universal application of human rights, individual
freedom and democracy cannot be brought about by military threats or war. But human rights is a requirement
for lasting peace.
Firstly, those wanting to pursue policies to prevent wars and remove and contain
existing military conflicts, must first of all reduce the instruments of war, especially in the dominant
military powers of NATO. Disarmament must again be a primary focus of international politics: arms exports
must be downsized and eventually banned altogether, the manufacture of new arms and especially high tech
weapons and the extension of the attack-capable armed forces must be effectively limited or stopped.
The proliferation of weapons of mass destruction can only be prevented by disarmament by the nuclear
Second, the recent re-legitimation of war as "the continuation of politics by
other means" has to be stopped and the UN monopoly on the use of force has to be restored. A surrender
of sovereignty in security matters to democratised international institutions could provide joint security
on a reliable basis. Not the enlargement of NATO and extension of its military strategy or an activation
of the Western European Union as the military wing of the EU but a decisive strengthening and democratisation
of the United Nations and the OSCE in Europe offer a way out of the spiral of wars.
Third, a just
world economic order and the opening of alternative and self-determined opportunities for development
for the countries of the South is the most important prerequisite for removing the causes of dangerous
regional conflicts over distribution, regional ambitions for supremacy and local militarism.
civilian crisis prevention, an international crisis early warning system and peace education and research
must assume a totally new status. Non-violent and effective forms of implementing human rights as well
as the rights of ethnic, political and cultural groups could complement existing instruments under international
Peace too is the continuation of politics by other means. The continuation of the current international
economic policy, of current security strategies, of the traditional power-political instrumentalisation
of human rights, and current Western attitude towards the UN and OSCE will not bring peace. The socialist
Left must contribute to a new beginning in each of these areas.
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