Social Democracy to the Fore

Close on the heels of the victory of the Syriza party in Greece comes the landslide victory of the Aam Aadmi Party (AAP) in the Delhi State Elections and there is every possibility of the Podemos in Spain too coming to power in the forthcoming elections there if current opinion polls are to be believed. Does this herald the revival of social democratic politics in mature liberal democracies and the beginning of the end for neo-liberalism which has so devastated the poor and the environment across the world over the past three decades or so? That is what needs to be analysed.

Marx's prediction of a proletarian revolution taking place in capitalist societies was proved wrong as these societies which were also mature liberal democracies never proved a fertile ground for revolutionary parties but rather gave rise to social democratic ones. However much Marxists may criticise the content of the democracy in liberal democratic States and shout themselves hoarse that these States are controlled by Capitalists through their funding of political parties, the right to vote parties to power through relatively free and fair elections has a greater appeal for the masses than the seizure of power through a violent revolution to create a proletarian State. Especially since the few proletarian States that were in existence for some time did not themselves actualise the Marxist vision of an exploitation and oppression free society in which the common people had a say in the running of those societies.

The right to vote gives the electorate a limited power to control how political parties will act and so puts some rein on the behaviour of the latter. Thus, even while Marx was writing his dire predictions of the eclipse of Capitalism, liberal democracies in the West were evolving into more equitable societies with the development of the rule of law and social welfare nets. Social democratic parties came into being from popular movements which redistributed more and more of the social surplus that was appropriated by the Capitalists by taxing them and subsidising social services with the revenue so garnered instead of just subsidising capital accumulation by ensuring the right to property and developing infrastructure to facilitate such accumulation.

This trend gained tremendously after the global recession of the 1930s when it became clear that laissez faire Capitalism invariably shrinks macro-economic demand by immiserising the masses to the point where they are not able to participate in the markets and also by promoting speculative rather than productive economic activity and this combination brings on economic recession. So social democratic parties came to the fore in all the western liberal democracies and social welfare spending increased considerably and strict laws were put in place to curb speculative activities. These processes were enhanced following the second World War as the Capitalist countries realised that unrestricted rapacity would lead to disaster especially as there was a counter pole of geo-political influence in the socialist countries led by Russia which provided an alternative for the oppressed classes in their own countries and also for the countries newly emerging from the shadow of colonialism. So for four decades from the end of the second World War to the mid 1980s was the golden era of social democracy when it flourished not only in the western world, where even communist parties jettisoned revolutionary politics to participate in parliamentary politics, but also in the developing world where there were stable liberal democracies as in India where too communist parties pursued parliamentary politics except for the Maoists who remained as the only peripheral revolutionary parties.

However, by the early 1980s technological development reached a stage where it became possible to outsource manufacturing to the peripheries of the world and enable real time flows of finances and information. The environmental movement also gained in strength in the developed countries at this time leading to strict environmental laws which acted as a further push factor for outsourcing industries towards the periphery. Earlier in 1971 the USA had terminated the arrangement whereby the US dollar which had been established as the global reserve currency after the second World War could be exchanged for a fixed amount of gold by those countries who held dollar reserves. This made the dollar float freely in the market and gave unlimited power to the USA to print money which would effectively be valid throughout the world regardless of the state of the US economy. Secondly, after the oil price hike of 1973 the huge funds that the oil producing middle eastern countries began to accumulate as surpluses were held in dollars in the US and  European banks thus further expanding the power of financial capital and its ability to transfer production out from the centre towards the periphery where both labour and environmental laws were lax.

Thus, the stage was set for the neo-liberal onslaught of cutting taxes and rolling back the social services as the power of trade unions to stall production was considerably reduced with the new technology which enabled outsourcing from the early 1980s. Matters became easier when the actually existing socialist economies, which were nothing but state capitalist in nature, collapsed or transformed into fully capitalist economies in the late 1980s and neo-liberalism became the dominant ideology globally. India too followed suit and began cutting down on its already meagre social expenditure and further weakening its poor labour and environmental security measures. Thus, worldwide the working and living conditions of the working classes deteriorated and inequality increased phenomenally. The USA during this period substantially increased its military expenditure and funded it through printing money and through the debt that was provided by foreign governments who purchased US bonds. This had a two fold effect of fuelling the US economy and also keeping the global might of the USA intact for supporting the profit making by its corporations.

As financial capital gained in clout it succeeded in getting Governments in the capitalist countries to repeal the laws that had been put in place in the 1930s to prevent banks which accepted deposits and advanced loans from participating in trading of securities so as to prevent the kind of massive speculation that can lead to market collapses and recession. Thus, the huge profits being earned through the greater exploitation of labour and natural resources began to be channelised into unbridled speculation leading to periodic financial crises culminating with the financial meltdown of 2008. Consequently as in the 1930s, so also by 2010 a situation had been created where rapacious and unbridled capitalism feeding on the neo-liberal paradigm had created unbearable situations for the common people the world over and protests movements have begun against this and in some places they have even begun coalescing into new political parties espousing a return to the social democratic paradigm of taxation of the rich to provide subsidies to the poor. However, given the much greater technological, financial, military and ideological power of Capitalism now as compared to what it was in the 1930s, it remains to be seen whether this new social democratic upsurge can build up into a more lasting phenomenon. Especially troubling is the control that the Capitalists have on the media and the academia and the extent to which consumerism has spread its tentacles among the masses. The Syriza in Greece for instance started off as a radical left cum anarchist formation in the new millennium but gradually it included the social democrats also and currently it is the latter who have become dominant within the party. So much so that just prior to the recent elections they jettisoned the demands for leaving the Eurozone and of dishonoring the public debt. With the threat from Germany that it would not bear the Greek debt burden if Syriza began rolling back austerity measures there has been further moderation of its radicalism. This goes to show how tight the neo-liberal control of the global economy is.

In the Indian context, the emergence of the AAP can be seen as part of this new global trend of incipient revival of social democracy on the back of a backlash from the immiserised masses against the depredations wrought by neo-liberalism over the past three decades or so. However, Arvind Kejriwal must be credited with being able to channelise this pent up anger into a credible political force that can win elections. India has been the home of many high impact mass movements since the 1980s but none of them were able to make an electoral impact beyond winning a seat or two. The principle problem was that these mass movements could never mobilise the kind of funds required to win elections on a large enough scale. Voters do not like to see their votes go waste and so are disinclined to vote for a party that is clearly not going to win power at the state or national level. This is where Kejriwal made a big difference with his innovative method of crowd sourcing funding and massive volunteer support from across the country and the world in sufficient amount to be able to carry out a mass campaign that could convince people that his party would come to power.

Within the space of a decade he single mindedly pursued the goal of bringing about a change in governance to make it clean and pro-poor. He toured the country assiduously to build up a popular movement for better governance and he did it like a common man as seen in the picture below where he is sleeping on a railway station platform along with his co worker in this mass mobilisation, Manish Sisodia. 

He succeeded as a result in channelising the rising frustrations among the poor and the middle classes to first launch a massive mass movement and then morph it into a political party and finally deliver a landslide victory in the recent elections in Delhi. This was achieved against the heavily funded neo-liberal campaign of the Bharatiya Janata Party orchestrated by the Prime Minister Narendra Modi himself. The crucial element in this was the dour way in which the party held out over the past year against all attempts by the BJP to buy off its MLAs and form a government as it has done immediately after winning the elections in Jharkhand and is trying to do in Bihar. During this time the party campaigned hard among the masses convincing them that if voted to power for a full term with a clear majority it would bring about a definitive change in governance. The AAP victory is certainly a decisive blow to the neo-liberal consolidation that was taking place with election after election over the past year being won by the BJP.

There is a need to proceed with caution, however, and recognise that this victory of AAP is within the reformist contours of social democracy within a globally dominant neo-liberal capitalist framework which is unlikely to tolerate revolutionary programmes. Especially in the case of the Delhi Government there are severe constraints in terms of financial resources and lack of control of the crucial resources of land and water and the crucial service of the police. While the sight of a Chief Minister sleeping it out in the bitter cold in the high security region of Delhi for all of two nights in a sit in, where normally people can't even enter to protest and if they do are whisked away in a jiffy, as Kejriwal did as shown in the picture below may gladden the hearts of die hard anarchists, but it is not going to make much headway against a neo-liberal state machinery as umpteen grassroots activists can vouch. 

Instead it would be better for the AAP government to use the opportunity that has been gained to improve governance within the current limited framework and leave the mass struggle for full Statehood in Delhi to the mass organisations of the party. Similarly while huge populist promises have been made with regard to the free or cheap provision of various services, it would be more practical to first evaluate the meagre resources that can be mobilised before launching into fulfilling some of those promises as otherwise the AAP will quickly find itself caught between the Devil of the BJP ruling at the centre and in the municipal corporations on the one hand and the deep blue sea of the ire of the disappointed masses who have voted it into power on the other!!!
The need is to sustain this stint in power and use it to further expand the base of the party into other states so as to mount a stronger challenge to neo-liberalism.