Class Politics and the Social Investment Welfare State

Abstract

The author argues that it is increasingly difficult to maintain the old social democratic synthesis, as the globalisation of the economy, the decline of the organised industrial working class, and the growing dominance of neoliberal ideas were shifting the balance of power against those forces on which social democracy depended. ‘Third Way’ social democracy responded by longer regarding capitalism and corporate power as problematic and reshaping their programme around them. Such a stance involved overlooking several major problems. This, however, is to ignore the power of the business corporation, which has reached deeply into public services and is not necessarily to be identified with the free market. Crouch argues that the corporation must be regulated and advocates the ‘social investment welfare state’ practised as an alternative formula. He also believes that, given the weakness of political parties, social movements may be a better way to realise social democratic goals, confronting corporate power directly.