Dark Continent: Europe's Twentieth Century (56 page)

It was the same story with privatization. Neo-liberalism was stimulated by financial deregulation (London’s “Big Bang” of 1986 triggered off minor explosions in Paris, Stockholm, Vienna, Rome and elsewhere), by EC trade liberalization (culminating in 1992’s single market), by the need to combat high government debt and by the weakening of state monopolies as a result of technological change or intensified international competition. Even so, countries were slow to follow Britain’s lead in selling off major nationalized industries; they doubted whether this would necessarily lead to greater competitiveness and feared the damage to national interests. Across the Channel, national sovereignty usually trumped British chancellor Geoffrey Howe’s “consumer sovereignty.” Outside France, denationalization was not carried far and popular capitalism remained limited by the small size of domestic equity markets.
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Many sympathized with the need to cut back bureaucracy—Portugal, for instance, declared a “National Day for Debureaucratization” in 1990, while in Italy the “Movement for the Defence of the Citizen” formed in 1987 to protest against “bureaucratic micro-persecution.” But none of this led very far and no one equalled the British cuts in civil-service employment. The British mania for exposing the public sector to a “management revolution,” which rapidly produced a plethora of monitoring and auditing bodies, contrasted with continental caution; so too did the impact of “contracting out,” the rise of the quango (
qu
asi
a
utonomous
n
on-
g
overnmental
o
rganization) and the consequent blurring of public- and private-sector values.
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If, then, the so-called “conservative revolution” starts looking like a rather self-deluded Anglocentric view of events after 1973, perhaps the collapse of the Left which so worried British commentators needs
to be viewed in the same light too. Labour’s defeat in the UK was followed by that of Germany’s SPD in 1982. The two oil crises ushered in a stream of gloomy predictions: Eric Hobsbawm warned that “the forward march of Labour” had been halted. Dahrendorf heralded the “end of the social democrat century.” Marxists, liberals and conservatives all agreed that social democracy had had its day. Commentators warned that the entire political spectrum had shifted to the Right during the 1970s and 1980s. But even if this was true, did it necessarily imply the decline of the Left?

THE LEFT IN DECLINE?

As ever, it was largely a matter of perspective. Left-wing parties suffered in north-west Europe, but held their ground in Scandinavia and prospered in southern Europe: Mitterrand, Craxi, Gonzáles and Papandreou, for instance, all held power during the 1980s. At the beginning of the 1990s, eleven of sixteen west European social democratic parties were in power—more than at any time since 1945. Overall, there was no decline in social democracy electorally; if anything, concluded the author of a searching examination of the subject, what required explanation was “the striking stability of the social democratic vote.”
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In retrospect, the “crisis” of social democracy in the 1980s reflected other factors. Electorates tended to punish whoever had been in government in the late 1970s: Kohl and Thatcher profited on the Right, but equally so did Mitterrand and Papandreou. The second was that the policy environment
had
changed, and become far less favourable to traditional Keynesian state-led national recovery plans: Mitterrand and Papandreou both tried this and were forced back into “austerity” and “rigueur.” Hence socialists and social democrats had to find new approaches to their traditional goals of social equity and workers’ rights; for many, these would lead to Brussels. As a result, some would argue that Leftists in government in the 1980s were not really pursuing socialism. It is certainly true that Mitterrand was indeed implementing a state-led “socialism without workers,” while in Spain and Greece, the socialists won because they offered the prospect of full-scale social renewal and national reconciliation after authoritarian
rule and civil war. In all three countries, the Left adopted a national mission and avoided being labelled as a labourist movement. But this was not only a reflection of the specific political pasts they faced: it was also because the workers were disappearing as a class. Across western Europe the old, organized working class was following the peasantry into history. This was where the real crisis was taking place.

Whereas the evidence for a political “revolution” in western Europe after 1973 is at best patchy, there can be no disputing the scale of the changes which were taking place in society and the economy. Preeminent among these were the related phenomena of de-industrialization and the declining power of organized labour. De-industrialization hit the headlines in the UK with the decimation of British manufacturing in the first three years of Mrs Thatcher’s government, when no fewer than one million manufacturing jobs were lost. To a large extent this drop was the product of astonishing economic mismanagement, and in particular of an overvalued exchange rate. Nevertheless, a longer-term secular decline in the relative importance of the industrial sector was taking place more widely.

From the late 1960s the absolute size of the industrial workforce started to decline in western Europe. Between 1960 and 1985 it fell as a proportion of the total labour force from 47.7 per cent to 32.3 per cent in the UK, from 47 per cent to 41 per cent in the FDR, from 40 per cent to 26.5 per cent in the Netherlands. Southern Europe followed suit about a decade later: from 36.1 per cent to 31.8 per cent between 1980 and 1985 in Spain, for instance. Industrial output fell as a proportion of GDP. European output was also falling over this period as a proportion of world industrial output, indicating the difficulty countries faced in keeping up with international levels of competitiveness, especially against Asian newcomers.

Many of the great centres of European industrialization fell into decline: coal and textiles were among the first industries to be hit, followed by shipbuilding, steel and car production. Not surprisingly, social theorists—in an ironic echo of Mrs Thatcher herself—were quick to spot the onset of “post-industrial” society, sometimes overlooking the vital role industry and manufacturing in particular continued to play in the economy. For while some traditional heavy industries suffered “restructuring,” others such as electronics and
pharmaceuticals prospered. The drop in industrial value added was far less than in
employment
. Long-term economic well-being continued to depend on such factors as the level of investment in training, research and development. Nevertheless, the overall decline of industry sent shock-waves through society.
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In the first place, it radically altered the nature of union power, shifting the balance away from the old centres of working-class activism—the mines, docks and railways—towards white-collar, technical and especially public-sector unions. Unionization rates fell in some countries—France and Spain (where they had traditionally been low, anyway), the Netherlands and the UK—but not everywhere: they remained high, for example, in Sweden, Denmark, Norway and Belgium where corporatist pay bargaining continued.

Mass unemployment reduced the effectiveness of strike action. In the 1980s there were only sporadic strikes on a large scale, and their outcomes tended to be at best ambiguous (the I. G. Metall strike in West Germany), at worst clear defeats (the NUM in the UK in 1984). When the great Fiat strike unfolded in Turin in 1980 shortly after the Solidarity movement emerged in Poland, the limits of industrial action in the West became obvious: unlike Solidarity, the Fiat workers found that their popularity was constrained by internal division and the sense that they were fighting for their own interests, not those of the nation. Fiat managers mounted a successful counter-demonstration, and the disillusioned strikers were forced back to work. “Have you seen what they’ve managed to do in Poland since they’ve got the backing of all the workers?” exclaimed one. “We know that in Italy, in a country like Italy, we can never have the backing, and above all the physical and moral participation of all the workers; within the working class today there are conflicting interests.”
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Thus labour’s share of income fell from the mid-1970s onwards, and most union leaders realized that this could not be reversed. Their continued influence depended not merely upon their own actions, but also upon the willingness of employers and government to accept them as partners.

These trends were connected with broader shifts in labour patterns and the very meaning of work. Large corporations promising long-term employment to a largely male workforce were gradually
replaced by smaller companies with short-term contracts, employing an increasingly female staff. “Flexibilization” and the rise of part-time work, the growth of unregulated “black economies,” together with the destruction of the old blue-collar labour aristocracy, led some commentators to mourn the passing of the working class. “Did the working class ever exist at all?” asked Blackwell and Seabrook in their 1996 study of changing work practices. Certainly it was no longer the heroic protagonist at the heart of European politics that it had been for a century, much less the vanguard of revolution. Collective working-class rituals such as the May Day festival were petering out; a study of the sales figures for May Day badges in Sweden showed figures rising from the 1960s until the early 1980s and then declining precipitously. Elsewhere the decline set in even earlier.
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Work itself was assuming a different significance in people’s lives. As we have seen, for both communism and fascism work had occupied a central place, both as right and as duty, in their claim to have superseded liberal democracy: work was redemption from uselessness and an entry-ticket into the community, an idea parodied even on the gate into Auschwitz with its mocking slogan “Arbeit macht frei.” Post-war liberal democracy had responded to the challenge by itself guaranteeing the right to work, a commitment enshrined in the UN Declaration of Human Rights and realized in the full-employment policies of the post-war years.

Suddenly there were no longer jobs for all. It began to look as though full employment had been nothing but what Göran Therborn called “a strange experience in the history of capitalism.”
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Mass unemployment and the rise of social-security spending meant that work and income were less directly connected than ever before in modern history. In the UK, for example, income from work as a proportion of gross household income fell from more than 80 per cent of the total in the mid-1970s to 73 per cent by 1982.
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The spread of higher education and the pressure to take early retirement, combined with increasing longevity and longer paid holidays, meant that an ever-larger portion of people’s lives was spent outside paid work (unpaid housework remained inescapable for many women). Sociologists observed a waning work ethic as people sought satisfaction and fulfilment outside work rather than inside it, and tried
to husband their energies for their free time. Polls indicated that in 1962 only 33 per cent of Germans preferred leisure over work; by 1979 the figure had risen to 48 per cent. German newspapers became alarmed: “We are
not
idle,” ran a headline in
Bild Zeitung
. Such attitudes reflected the fact that on average even those in work spent as much time in a year outside the workplace as at it. But they also showed the great contrast between the rapidity of economic change and the persistence of deeply rooted ethical traditions which associated idleness and leisure with moral deficiency.
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Mass unemployment emerged in the mid-1970s and remained a major social problem in the following decade, despite economic recovery and the creation of jobs in the service sector. By the early 1990s, unemployment averaged 11–12 per cent in the EU, and totalled some eighteen million people. Yet this figure, unimaginable to most people twenty years earlier, was accompanied by very little serious unrest. Certainly there was no parallel to events in the early 1930s, and no fundamental challenge to the political order. That this was so must surely be attributed to the continued resilience of the welfare state in cushioning society, even—or perhaps especially—after the ending of the post-war boom.

LOSING OUT

Compared with two decades earlier, however, people had come to accept high levels of poverty and inequality. Over forty-five million people—some 14 per cent of the population—were living in poverty in the EU by the late 1980s, 17 per cent by 1993—a figure comparable with the situation in the USA, and a striking contrast with the egalitarian “tiger economies” of East Asia. In the UK, thanks to monetarism and tax breaks for the rich, the rise was particularly glaring—Mrs Thatcher had urged people to “glory in inequality”—reversing nearly half a century’s trend the other way. As Gilmour put it acidly, “trickle down” policies had actually produced “an upward trickle.” The leading British scholar of income distribution stated bluntly that “the 1980s have seen a departure from the historical trend, with a definite rise in inequality.” By the 1990s the UK was the most unequal society in the Western world, with around fourteen million living in
poverty, including over four million children, but other west European countries were heading in the same direction.
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It was not long before the poor were—as in the past—being blamed for their misfortune: declining faith in social engineering naturally encouraged more moralistic and individualistic explanations of poverty. During the inter-war slump, conservative eugenicists had talked of the “social problem group.” Now the idea reappeared in a new guise: the “underclass.” According to the American Charles Murray, the leading propagandist for the term, this identified not the degree but a type of poverty. Single mothers—an increasingly impoverished group—were attacked for scrounging off the welfare state, and the unemployed were accused—despite scholarly evidence refuting the idea—of preferring generous handouts to proper work at low wages. Such accusations helped justify cuts in child allowances and supplementary benefits, as well as schemes which tied welfare entitlements to workfare. Another growing section of the “new poor”—the elderly—were suffering, first in Britain, later elsewhere, from the fall in the real value of state pensions. For those who most needed it, the welfare safety net was looking threadbare, inadequate and unfocused in the benefits it offered.