The Emperors’ New Clothes

A guest post from Labour activist Ewan Gibbs, co-written with Cailean Gallagher

“We will not wear nationalist clothes – but we will rip from the nationalists the threadbare garments they dress in to appear to believe in equality.”
                     Johann Lamont, Speech to Scottish Labour Conference, March 2014

In their latest contribution to Bella Caledonia, James Foley and Peter Ramand suggest that in an independent Scotland “the SNP leadership plans… to swap British laissez-faire capitalism for Nordic social democracy” in order to make Scotland a more egalitarian and economically prosperous society. But short of developing a whole new level of retail politics – where the people will be able to hand in one historically contingent ideological system in exchange for a better one – why do Foley and Ramand believe Scotland would adopt this new garb? And what would be the limits of their second-hand ‘Nordic model’ even if Scotland managed to fit into it?

First, on the temptations of the model, the authors conclude that:

“The Nordic model matters because it demonstrates that Scotland can do better. Leveraged as it is on the financial services industry and cheap retail labour, British capitalism is structurally weak. An independent Scotland shouldn’t aim to simply imitate Scandinavian social democracy. It should adopt its best features – strong public and industrial infrastructures, low levels of inequality, a first rate educate system – and adapt them to specific Scottish needs. Then Scotland should aim to set precedents of its own.”

In other words, an independent Scotland should adopt good things. It goes without saying that we all want better infrastructure, industry, less inequality and a better education system. But in adopting the best features of the Scandinavian model and adapting them to Scottish needs, are Foley and Ramand demanding anything more than a change in Scotland’s appearance? Certainly a few new features make a difference to self-confidence, but not to what is underneath. This is just as true in national contexts as individual ones.

Even if it were desirable to ‘go Borgen’ there seems to be very little foundation to the argument that Scotland can simply imitate or improve an existing, and arguably declining, Scandinavian model. Foley and Ramand cite the vague comments made by the omnipotent SNP in support of the Common Weal and Nordic Horizons, but don’t recognise the contradictions between their commitments to a state-interventionist economy and the White Paper’s outline for further cuts to corporation tax and a “business friendly” environment.

Perhaps these are not contradictions, but rather mutually reconcilable interests? After all, behind the SNP’s interests lie the interests of everyone in Scotland – the essence of modern or civic nationalism – helpfully spelled out by the Nordicists as ‘all of us first’. Their appealing case is that the Nordic model offends nobody’s interests. Thus the other evidence they marshal in their support is Wilkinson and Pickett’s The Spirit Level, which makes a utilitarian case for the broad benefits more equal societies attain in a broad range of areas from economic growth to social trust and cohesion – everyone benefits: businesses and churches, the poor and the middle classes.

In many ways it is a reflection of the defeats and setbacks the left has suffered in recent decades that the current state of Scandinavian societies is held up as an example to be followed. Historically Sweden in particular was cited by right-wing social democrats within the British labour movement as an example of a society where capitalism had been adapted to the needs of social equality, and where welfare policies rather than large-scale state interventionism in the workings of the economy had furthered society towards socialism. In the early 1960s Perry Anderson responded to those on the right of the Labour Party around Anthony Crosland who held these views by emphasising that Sweden fundamentally remained a class society marked by inequalities in not just wealth but in power over economic resources. [1]

The SNP may believe that “Scandinavian policies would generate greater equality and faster growth, balancing private enterprise with a social safety net”. But whether these are in the interests of working people, and of those who suffer poverty, is contentious. Poverty and powerlessness in Scotland remain endemic crises, embedded by falling real wages, a decline in full-time employee jobs and rapidly increasing underemployment. This would not be solved but salved by the free childcare and social wages handed out by a future SNP government. Kneading poverty out of society with certain state-directed policies does not amount to empowerment for working people.

Even if it were desirable, the authors make no robust case as to why, or whether, Scotland will be able to change into the Nordic model. The Common Weal and others have cited the ‘Varieties of Capitalism’ literature that examines similarities between national political economies, suggesting there is ample scope for transition from one model to another. But the Common Wealers fail to address the historically evolved, ‘locked-in’ nature of national varieties of capitalism, which is stressed in the literature. [2] They imply that Scotland will shed its current model of capitalism by escaping the constraints of “structurally weak” British capitalism, but provide no argument as to why an independent Scotland wouldn’t continue to have an economy dominated by cheap, under-unionised labour. Given the Scottish Government’s focus on sectors like financial service, oil, electronics and call centres, we can expect that it will be.

With a Scottish Government that has tied its hands with currency and labour market plans, it is perhaps better to regard their Nordic imitation less as a sincere attempt at social reform, and more like the highest form of flattery of social-nationalist designers. The centre-left Nordic utopians are certainly easily flattered. And flattery is best defined as excessive and insincere praise, offered especially to further one’s own interests. The SNP’s interests are to win cross-society support for their independence project. Imitating the Nordic model does not harm the interests of those who see in an independent Scotland the opportunity to fashion their own designs; not the Nordicists, but those who actually control the wealth means to change society – the powerful rich.

The Nordic model’s benefits seem even more dubious given the trajectory of nations which have followed it. In practice Swedish progress towards socialism was abruptly halted in the 1970s. When the socialist economist Rudolf Meidner proposed dealing with wage restraint through the allocation of shares by large companies to workers’ pension funds in an effort to gradually allow the socialisation of big business, the plan was met with “the fierce opposition of all non-socialist parties and business organizations [which] forced the labour movement to make repeated retreat.” In the face of a threat to its power the Swedish ruling class responded aggressively. Meidner concluded that through the ‘Swedish model’, “the strong Swedish labour movement had proved its inability to encroach upon private ownership, the very core of the capitalist system.” [3] He noted that in the years since then the labour movement had been forced onto the back foot as unemployment grew and universal welfare was eroded.

To their credit, Foley and Ramand provide statistics indicating that these regressive trends have continued in Sweden in the decades since. This confirms that both the limitations of an ideological commitment to managing capitalism, and the dynamics of shifting balances of class power, are as relevant in determining political outcomes in Sweden as any other society. They also recognise that to approach Scandanavian societies with “uncritical enthusiasm” would be dangerous and cite examples including last year’s riots in Stockholm and Denmark’s involvement in the occupation of Afghanistan as example of failings. However, these were not merely protests against changing national trends, but symptoms of the fundamental contradictions contained within the Nordic models. They are the smoke but not the fuel of class dynamics that have shaped and reshaped the model they extol.

It becomes apparent that Scandanavian societies are not redoubts of resistance to neo-liberalism but societies that went through similar processes to Britain. The results of class conflict are not historically guaranteed. It goes without saying the British labour movement suffered a greater setback and the societal effects have been deeper and more negative than in Scandanavia. Thus, the positive aspects Foley and Ramand cite are ointment for a nation, applied across the class divides. The negative aspects are not simple blemishes, but are reflective of the fundamental tensions at the heart of those societies. These tensions remain in our society, in a tighter and more straining form.

So even if we wanted to ‘go Borgen’, Scotland cannot hope to simply lift the historically specific positive garments of Nordic societies over our heads, and slip them on. Even if it is seductive, whether we could even reach such circumstances will be the outcome of an active political struggle. The most concerning aspect of Foley and Ramand’s article is that it does not mention that this would be necessary. In any case, the model is a sham, because without a politics that is fundamentally driven by an understanding of social conflict that places at its core the empowerment of working people to create their own conditions, and the redistribution of wealth and power that are the means to do this, we will have none of the prerequisites to create something better for Scotland. This goes for a yes or a no vote in September, and is a reality that the Scottish Left must be preparing for. Otherwise we will be left as naked the emperor.

Ewan Gibbs

Cailean Gallagher

 

[1] Perry Anderson, ‘Sweden: Mr Crossland’s Dreamland (Part 1)’, New Left Review vol.1 (7)(1961) Perry Anderson, ‘Sweden: Study in Social Democracy (Part 2)’, New Left Review vol.1 (9) (1961)

[2] See Varieties of Capitalism: the institutional foundations of comparative advantage ed.by Peter A. Hall, David Soskice (Oxford: Oxford University Press, 2001) especially introductory chapter.

[3] Rudolf Meidner, ‘Why did the Swedish Model Fail?’, Socialist Register vol.29 (1993) p.225.