Economics and politics - comment and analysis

Does the Left have a future? By Paul Steinhardt and Kai Tschauder

Does the Left has a Future?

By Paul Steinhardt and Kai Tschauder

‘Does the Left have a future?’ asked John Harris in the Guardian recently. Harris wants to know if and under which conditions a party, such as Labour, that is committed to values of ‘equality of opportunity,’ ‘solidarity’ and a ‘public space’ may in the future return to government. Translating the latter socio-political target as a commitment to a ‘public or common general interest,’ we want to make clear for the start that we, as avowed Leftists, are also being haunted by this question. What can the Left learn from Harris’ article?

Harris correctly points out that the socio-political values and goals mentioned above ​​have been historically represented by social democratic parties. He also rightly points out that the Social Democrats have suffered dramatic electoral losses in many countries. The decline of German Social Democracy is a particularly instructive example.

Decline in the context of government policy

It is interesting to see that, as figure 1 shows, the start of the decline of the SPD can be determined in time very well. Clearly, the decline of German social democracy is closely connected with the government policy of the Red-Green coalition between 1998 and 2002. In other words, the decline of the SPD began at the time when the Social Democrats were in power, when they pronounced that there was no alternative to capitalist globalization and when they started to implement policies that were congruent with the supposed or actual operating conditions of this economic system.


Figure 1: Electoral results in Germany 1965-2015. 

Instead of ‘solidarity,’ the Social Democrats started to speak about ‘ownerhip,’ which is nothing else than a neoliberal buzzword for a system which demands that every individual takes care of her- or himself. Specifically, every individual has the duty to acquire relevant knowledge and skills, so that that she can successfully compete with other individuals/one-man businesses on the labour market. Everyone has, so the mantra went and goes, the opportunity to be successful on the market, but, in return, there is her or his strictly individual risk. If you fail to sell your ‘product’ you lose.

Gerhard Schröder expressed this ideological sea-change with admirable clarity:

“We will cut back social welfare benefits, promote personal responsibility and we will demand greater contributions from every individual.” “Those who can work, but do not want to, cannot count on solidarity. There is no social right to laziness” (see here and here).

In such a world, there is no longer a place for social solidarity, which finds its expression in something like the ‘public general interest.’ In addition, the mandarins of the conservative counterrevolution also told the population that production – of everything – is simply more efficient if the state leaves it to ‘private initiative.’ Education, health care, pensions and public infrastructure must therefore be privatised, subdued to the logic of profit-making. Those who did not see the necessity of privatisation well enough, were basically stupid. Did you miss the implosion of the state-controlled economies?

There is no class consciousness

It is undeniable that more and more people think in this direction. As a consequence, they become unable to define themselves part of a group that stands up for common interests, for example labour unions and political parties with social programs. We agree with Harris that there is no class consciousness among the citizens of many contemporary societies and that this reduces the chances of social democratic parties to win elections. The problem, however, goes deeper than to just accept that many accepted the ideology of the ‘classless society’ as a result of highly successful neoliberal brainwashing. According to Harris, those who see the discussion in these terms simply ignore that the socio-economic basis for class consciousness is no longer present:

“First, traditional work – and the left’s sacred notion of “the worker” – is fading, as people struggle through a new era of temporary jobs and rising self-employment, which may soon be succeeded by a drastic new age of automation. Second, there is a new wave of opposition to globalisation, led by forces on the right, which emphasise place and belonging, and a mistrust of outsiders. And all the time, politics rapidly fragments, which leaves the idea that one single party or ideology can represent a majority of people looking like a relic. The 20th century, in other words, really is over. Whether the left can return to meaningful power in the 21st is a question currently surrounded by a profound sense of doubt” (see here).

For Harris, these developments constitute indisputable evidence of the end of a society in which workers could play a politically relevant role. Hence, Jeremy Corbyn’s demands for ‘decent’ work for all is nothing but a relic of a past long gone. Those who talk about ‘fair’ wages, humane working conditions , job security, participation, social welfare or even about the municipal ownership of public goods and tax redistribution measures fool themselves: these antiquated notions are simple no longer operable in the world in which we are now living.

The worker as an ‘endangered species’?

Certainly, it makes little sense for a political party to represent the interest of a stratum of workers if there are no longer any such workers. But is it true? The question is whether Harris’ assertion has anything to do with reality. It is easy to find out. Let us give a definition of ‘worker,’ then we can find out if it is realistic or worthwhile for political parties to stand up for their interests or not.

Harris does not provide a definition. It is clear from his examples that by workers he means salaried workers who work for companies in the so-called manufacturing sector. If we consider the evolution of employment in this sector, one has to agree with Harries – for policies geared towards the interests of these workers no majority can be found any longer (see Figure 2, the evolution of employment in manufacturing in Germany).


Figure 2: Evolution of employment in the secondary sector in Germany. 

But ‘workers’ are of course all wage earners, all people who bring their knowledge and skills to a company in return for a wage, which is their dominant mode of economic integration. If we consider wage earners as ‘workers,’ then the impression that ‘workers’ are an endangered species has to be quickly corrected (see figure 3).

will02Figure 3: Employees and self-employed people compared to the total population 1970-2015 in Germany.

The opposite of Harris’ alleged relationship is true. In Germany, the number of ‘workers’ (i.e. wage earners) increased. The share of self-employed people fell. The majority of wage earners now works in the tertiary sector (services) see figure 4).


Figure 4: Evolution of employment in the tertairy sector. 

These economic changes mean a whole lot, but they are not important for the social position of workers or for their exploitation. It is not only a steel worker who has an interest in ‘decent work’ in the sense that Corbyn sees it. Is an employee at a software company happy when she has to work for low wages and under great stress, when there is no insurance in case of illness or if she has to take some work after retirement in order to make ends meet?

It should be noted that the proportion of self-employed people, at least in Germany, has not increased, but has in fact fallen. This is not to deny that there have been socially relevant changes in this area. The number of self-employed persons stagnated over the past 50 years. However, enormous changes have taken place. As Figure 5 shows, the number of self-employed fell dramatically in the primary sector, while their numbers in the tertiary sector saw a striking increase.


Figure 5: Proportion of selfl-employed people in the three economic sectors. 

That there are fewer self-employed in the primary sector can be easily explained by the fact that productivity in agriculture has increased enormously. The rising share of self-employed in the tertiary sector, on the other hand, refers to a trend which is expressed by the concept of ‘outsourcing.’ Instead of hiring people and giving them permanent contracts, employers increasingly use so-called contract work (even to the point of the abysmal ‘zero hours contracts’). Contract work has the charm, so to speak, that work is cheaper for employers, that it is only there when it is needed and that there no annoying dismissal procedures and other social rights employers have to reckon with. Of course, in many cases the ‘personal dependence’ of such self-employed workers from ‘their’ employer(s) is hardly distinguishable from that of formal and salaried employees. Using a new buzzword, legislation made possible the return of a fairly old phenomenon, the day labourer.

Certainly, the left has no future if they, like Harris, develop policies which are based on fictions. Policies will only have a future if they are based on the reality of the majority of people in their respective countries. This reality is that the majority of people are wage earners who have a wide range of common interests because of their socio-economic positions. A modern social democratic party has a future if it succeeds to develop class consciousness and political alternatives and manages to represent them authoritatively in the public sphere. They will have to do without the applause of the representatives of the profit addicts, but who is interested in applause? What we want from social democracy are social democratic policies.


Paul Steinhardt is the co-editor of Makroskop (together with Heiner Flassbeck) and doctor of economics. He is primarily interested in monetary theory, financial markets and the regulation of banks.

Kai Tschauder is intern at Makroskop. He is interested in monetary theory and leftist politics.