Guardian: Europe's left has seen how capitalism can bite back

13/1/2014

By Leo Panitch

Social democrats wrongly thought the reforms they won were won for good. In Greece, the lesson has been learned by Syriza

For most of the 20th century, the word "reform" was commonly associated with securing state protections against the chaotic effects of capitalist market competition. Today, it is most commonly used to refer to the undoing of those protections.

This is not merely a matter of the appropriation of the term by those in the EU and international lending agencies who are using it as code for demands that Greece, for instance, make further cuts in public sector jobs and services. It is also the way the word has become increasingly used by the parties of the centre left. Thus, the newly elected leader of Italy's Democratic party (the successor to what was western Europe's largest communist party), Matteo Renzi, has called for the government to be even more determined in implementing its economic reform package. The package involves reducing public expenditure and changing regulations to make labour markets more flexible and attract foreign investment.

In pointing out how many European countries are now "furiously dismantling workplace protections in a bid to reduce the cost of labour", a recent New York Times article actually located the roots of this in the "efforts to improve competitiveness" by the social democratic government in Germany in the early noughties. This was done in a way that "further eroded worker protections, fuelling a boom in low-paid, short-term 'mini-jobs' that today account for more than a fifth of German employment".

There is an old debate on the left about reform v revolution. But it has become outmoded, not only because of the extremely limited prospects and forces for revolutionary change. The current meaning of the word "reform" contrasts sharply with the way it was used by Europe's social democrats around a century ago. Whether or not the incremental reforms that went under the rubric of gradualism would achieve social transformation without subjecting society to the pain of revolution, they were designed to promote social solidarity against the market.

Perhaps the greatest illusion of 20th-century social democrats was their belief that once reforms were won they would be won for good. In fact, we can now see how far the old reforms were subject to erosion by expanding capitalist competition on a global scale. They have been so undermined by the logic of competitiveness that it now seems very difficult to see how state protections against markets could be secured in our time without additional measures that would be seen as revolutionary.

The idea that doing anything to undermine private investment is unacceptable has become incredibly powerful. It is precisely this that makes social democratic politicians so timid in our time. And there can be little doubt that to sustain reforms in the old progressive meaning of the word, today a government would need to implement extensive controls to prevent an outflow of capital, and probably have to socialise financial institutions in order to get the necessary room for manoeuvre.

Syriza in Greece is the one left party that has achieved great electoral success in the European crisis by rejecting the way reform has come to be redefined. A central plank in its political programme, moreover, involves bringing "the banking system under public ownership and control, through the radical conversion of its functioning … ". Indeed, what makes European elites most uncomfortable with Greece taking its allotted turn in occupying the EU presidency for the next six months is that a new political crisis leading to a general election might, with Syriza currently leading in the polls, make its leader, Alexis Tsipras, the prime minister of Greece.

What was especially impressive about the political programme of "radical reform" that Syriza passed at its congress last July was that it concluded with these words: "The state we are in today calls for something more than a complete programme formed democratically and collectively. It calls for the creation and expression of the widest possible, militant and catalytic political movement … Only such a movement can lead a government of the left, and only such movement can safeguard the course of such a government."

Yet the party's leaders cannot but be aware that unless a shift in the balance of forces in other countries occurs to allow a Syriza government the space to implement progressive reforms, the people of Greece would suffer even further by being economically penalised and isolated. This is no doubt why, when Tsipras was nominated last month by the small contingent of "far left" parties in the European parliament to replace José Manuel Barroso next May as president of the European commission, he spoke in terms of the "historic opportunity" that now exists for a left alternative to the current capitalist "European model".

This brings us back to the other side of the reform v revolution debate of a century ago, reminding us of what happened when the hope that a revolution on the periphery of Europe would trigger revolutions in the stronger capitalist countries was not realised.

The left used to beat itself up, sometimes quite literally, with debates over reform v revolution, parliamentarianism v extra-parliamentarianism, party v movement – as if one ruled out the other. The question for the 21st century is not reform v revolution, but rather what kinds of reforms, with what kinds of popular movements behind them engaging in the kinds of mobilisations that can inspire similar developments elsewhere, can prove revolutionary enough to withstand the pressures of capitalism.

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