We met over a weekend which happened to coincide with a similar gathering in Florence, to discuss the Third Way, its underlying concepts, its resonance in other countries and its implications for the EU.
We tried to decide whether it was an ideology with a single set of principles which determined policies on all issues. Supporters preferred a more neutral term. It was described as a project relevant to its time and place. Its time was after the Reagan and Thatcher reforms in the USA and Britain and its place, doubters suggested, was in the mid-Atlantic. The language in which it was expressed was that of modern market consultancy. Grand ideas and visions were eschewed. Defenders of the Third Way pointed out that Mr Blair himself claimed what he had called the Third Way was, in reality, “modernised social democracy”. It was a broad inclusive concept going beyond neo-liberalism and socialism. It was driven by globalisation and was a response to the pace of change in modern economies and societies. Many other countries were experiencing the same challenges. They would face them in differing ways in line with their national traditions. But to deny the need for change risked being overwhelmed by it. There was no guarantee which parties might benefit. In future, parties of the centre right could move back onto the ground claimed by the Third Way and profit electorally. Those more critical of the concept failed to detect anything novel in it. It could mean whatever Mr Blair claimed. The economic underpinning was no more than a recognition of the supply side reforms which had preceded it. It floated on a rising tide of prosperity. When the recession came it would be discredited.
Against that background the Third Way was examined in detail for reflections of the three great ideas of the French Revolution – Liberty, Equality, and Fraternity (Solidarity). Some claimed to detect in the Third Way an illiberal attitude to the citizen in the insistence that rights depended on responsibilities, in particular work. Drug testing for all criminals whatever their crime and the removal of the right to silence were cited as aspects of this authoritarian approach. The counter argument was that, on inner city estates, order and security were the dominant concerns of the majority and it was up to Government to respond to this.
A recurrent thread in our discussion was the importance to “Third Wayers” of outcomes, preferably those that could be measured. It was, however, argued that abstract concepts like equality were important. For example, the view you took on equality could condition your attitude to the National Health Service. Challenged, one participant said that he would prefer a health Service which gave equal access to all. Even though partial private finance could, in aggregate, provide a larger pool of health care, it would be divisive because it would rest on the principle of unequal access for rich and poor. This part of the discussion concluded with a warning that if those who advocated the Third Way in Britain did not embark on a public discussion of its underlying principles and values they would risk not only losing the election after next, they could also fail to counter the danger of a rising generation who were uninterested in politics, individualistic, materialist and indifferent to the common good. Globalisation was increasing the pull to the right.
From time to time the experienced politicians among us sounded a warning that too much intellectual analysis ran the danger of overlooking the realities of democratic politics. Electability was a key consideration. “Powerlessness corrupts and absolute powerlessness corrupts absolutely”. Whatever one thought about the Third Way as a concept, its rhetoric undoubtedly appealed to the voters. Affordability was also an important issue, hence the insistence in the Third Way on balanced budgets and sound public finance. Within the EU where budgets were now limited by the Maastricht criteria, the parties of the Centre Left were constrained in a way in which they had not been before in pursuing their social security goals.
We looked at the attitudes of the UK’s major European partners to the Third Way ideas emanating from London. In Germany, it was claimed, the policy advisers around Chancellor Schröder understood the need for a broad programme of reform. With this in mind they negotiated what became the Blair/Schröder paper. They had, however, failed to take fully into account concern in the party about the possible consequences of change and the deep-seated desire among the German people for security. Germany had not experienced major economic failure except perhaps in the Eastern Länder, nor were the current pressures from globalisation sufficient to generate momentum for wide-scale reform. The Blair/Schröder project had therefore been sidelined and the authentic voice of German corporatism had come through in the Chancellor’s attitude to the hostile bid for Mannesmann by Vodafone. We debated whether the biggest difference between attitudes in the two countries was the ability of the British proponents of the Third Way to generate optimism about the opportunities inherent in the process of change. This required a culture which accepted risk as a challenge and not just a danger. There was a profound difference between those who saw security through change and not security against change.
In France, we were told, the timing of the signature of the Blair/Schröder paper had not been opportune. The language had also been difficult for a French Socialist Government in coalition with Communists. In France there was also a strong strain of extreme Left intellectual thought which was hostile to the USA and which would never accept Anglo-Saxon slogans. However, as far as the substance was concerned, the French had effectively been “Third Wayers” from the time in 1983 when Mitterand linked the franc to the Deutsche Mark, and began to modernise social democracy in France in his own way. Jospin might need to express himself differently but his actions were not so very far apart from Blair’s. Jospin talked left but acted right. To which a participant added, that when account was taken of the social security and employment legislation introduced by the Labour Government, Blair talked right but acted left. Others commented that in most countries in Europe, including Italy with its long tradition of State support for employment and pensions, the same pressures were now being addressed. The problem lay in finding the right language to explain this to the various electorates. There would be political dangers for those parties and politicians whose rhetoric was too far apart from their policies.
We looked at State expenditure to see if it gave any pointers to the economic content of the Third Way. The ideal was described as a Californian economy combined with a Swedish Social Security system. Currently 30% of US GNP was state expenditure, in the UK it was about 40% and about 50% was the norm in most other EU member states. Perhaps this reflected an important policy difference between these countries. It might also be true that those countries whose economies were more service-oriented were more flexible and could respond more rapidly to changes in the market than those countries where industry accounted for a much higher percentage of GNP and jobs. This elicited the comment that all advanced economies were in the business of change. Fukuyama had highlighted something fundamental. It would no longer be possible to have distinct French, German, Italian etc models, all would have to be involved in change and, from a political perspective, if social democrats were not in the forefront of that process, they would be marginalised.
We also looked at the implications of the Third Way discussions in Europe on relations with the USA and the central European countries which had applied to join the EU. We noted that the term, The Third Way, had first been used in its present context by President Clinton. It had served as a useful device for reconciling strong economic growth with policies, like the working family tax credit, which sought to give disadvantaged sectors of society an opportunity to share in the general prosperity. The comment was made that equality of opportunity, not equality of outcome was the guiding principle. Looking ahead, however, some of us thought that if the next President of the USA was a Republican there could be strains in British/US relations. While a Republican President might not pursue radically different policies, the language in which they might be expressed could be very different.
As far as the candidate members of the EU were concerned it was claimed that there was a rising feeling of disillusionment. It was not clear to these countries what values Europe really stood for. The Third Way did not apparently offer solutions to this problem. We argued that the EU had a moral obligation to keep its promises to such countries about future membership and to help them achieve the prosperity which we claimed was associated with our free market economies and free choice democracies. The EU countries also had practical reasons for trying to ensure that problems of instability did not arise from a long-term deferral of membership leading to deep-seated alienation from the West.
We ended the conference in the belief that we might have been able to go more deeply into some of the underlying issues than might have been possible at the more illustrious gathering in Florence and promising ourselves the undoubted pleasure of reading their communiqués to see if this had in fact been the case.
This report reflects the Director’s personal impressions of the conference. No participant is in any way committed to its content or expression.
Chairman: The Lord Dahrendorf KBE FBA
Life Peer (Liberal Democrat)
Mr Andrew Coyne
National Affairs Columnist, The National Post
Mr Jeremy K B Kinsman
Ambassador Canada to Italy
The Hon Robert K Rae QC
Partner, Goodman Phillips and Vineberg; Leader of the New Democrats Party of Ontario
Maître de conférences in Political Science, University of Lille II
Herr Thomas L Kielinger OBE
UK Correspondent, Die Welt
The Rt Hon Paul East QC
New Zealand High Commissioner to the Court of St James’s
Sir Samuel Brittan
Principal economics commentator, The Financial Times
Mr Sebastian Cody
Dr Stephen Driver
Senior Lecturer in Sociology and Social Policy, Roehampton Institute
Mr Michael Gapes MP
Member of Parliament (Labour/Co-operative), Ilford South
Mr David Goodhart
Professor John Kay FBA
Director, London Economics Limited
Mr John Lloyd
Correspondent, New Statesman
Mr Donald Macintyre
Chief Political Commentator, The Independent
Dr Geoffrey Mulgan
Prime Minister’s Policy Unit
Mr Perri 6
Senior Research Fellow, Department of Government , University of Strathclyde
Professor Alan Ryan
Warden, New College, Oxford
Mr Siôn Simon
Associate Editor, The Spectator
Mr Wilf Stevenson
Director, The Smith Institute
Mr Matthew Taylor
Director, Institute for Public Policy Research
Mr David Willetts MP
Member of Parliament (Conservative) Havant
UNITED STATES OF AMERICA
Professor Norman Birnbaum
Georgetown University Law Center
Dr John E Brandl
Dean, Hubert H Humphrey Institute of Public Affairs, University of Minnesota
Professor James Burk
Professor of Sociology, Texas A & M University
Ms April Wahlestedt
Director of Communications, Council on Foreign Relations