Chapter 9 CPO2002 Lecture

Developed Countries & the
Good Society
Chapter Nine

Pearson Publishing 2011

• Sweden, the U.S., and Germany represent different types of
political models found among affluent democracies.
• Political model: countries that share similar institutions, politics,
and policies. Certain types cluster.
• Ex: Democracies in which social democratic parties are dominant
(politics) also tend to have proportional representation electoral
systems (institutions) and be high welfare state spenders (policy).
• Select group of affluent countries: France, Germany and Britain,
the U.S. and Canada, Japan, Australia and New Zealand.
• All democracies that are fairly wealthy and have higher per
capita GDP; have moved the furthest along the postindustrial
occupational structure (growth of white-collar, service,
professional, and managerial sector jobs)

Developed Countries & the Good
Society

• Three primary models found among
Western countries:
1. Social democratic – Sweden example
2. Extreme market – U.S.
3. Christian democratic political – Germany

Developed Countries & the Good
Society

• First emerged in the 19th century to represent the political interests of
a growing and newly-enfranchised working class.
• Many had Marxist origins
• Many shed these ideas in favor of socialism, which could be achieved via
the ballot box and a working class majority.
• Parties dropped revolutionary rhetoric and proposed reforms and
incremental improvements that would lessen the worst aspects of
capitalism.

• Social democratic model best exemplified by Scandinavian countries
of Denmark, Norway, and Sweden.
• Strong working class; thoroughly capitalist.
• But public sector employment is high, with over 20 percent of the
workforce employed by the state; they deliver an array of welfare state
services.

Social Democracy

Social democratic welfare state is
distinctive in many respects:

Critics contend that social democracy
needs to be rethought because of:

•

Eligibility for welfare state
programs is universal.

•

•

The welfare state is
comprehensive; cradle to grave.

•

It is a generous system.

•
•

•

Also provides an extensive array
of services such as health care, day
care, elder care, job training and
after-school programs.

•

Redistributive: reduces inequality
between the rich and the poor.

•

Impact of these: detach a citizen’s
quality of life from their job.

Social Democracy

•

High taxes, large welfare states,
deficit spending.
Undermine the work ethic.
High taxes punish entrepreneurial
risk-taking.
Decline of unions and industry
subverts the working class base of
the party.

• Social democracy has been resilient in response to changes.
•

Economists do not find lack of capital or competitiveness or skilled people in these
countries.
• Benefits: allow large workforce of women.
• Highest labor force participation rates among all affluent societies.
• Less fearful of economic change as costs are shared across society not only on
certain workers.
• So less resistant to technological innovation and moving resources from
declining sectors to rising new industries in response to shifting markets.
• Welfare state helps moderate wage demands by offering compensating benefits in
place of higher wages that might hurt competitiveness, and active labor market
policies that offer retraining, job placement, and relocation assistance to unemployed
workers.
• RESULT: highly competitive economies alongside large and redistributive welfare
states.
•

In 2009, the World Economic Forum, a group of world business and political leaders, ranked
Sweden fourth, Denmark fifth, and Norway the fourteenth most competitive economies in the
world.

Social Democracy

• Sweden has 9
million people
• 1 million more
than the
population of New
York City
• Country is about
the size of
California

•

Mainstream press has lampooned
Sweden as the country of sex,
suicide, socialism, and spirits.
Working class most successfully
organized.

•
•

•
•

Labor unions; Swedish Social Democratic
Party (SAP)

Industrialization did not begin 1880s,
but it was speedy.
Democracy also got a late start; not
until the end of WWI.

Sweden: Historical Background

• Lijphart categorizes Sweden as a “consensual
democracy”
• Political institutions promote “inclusiveness, bargaining and
compromise.”
• Sharing of power – coalition governments are the norm & inclusiveness
of the policy-making process.
• Role of interest groups; views of nongovernmental parties.
• Proportional representation electoral rules ensure that parties with only
modest support win some parliamentary seats.

• Sweden is a parliamentary democracy.
• Riksdag – unicameral legislature; elections every four years (unless
parliament is dissolved, which is rare) – 29 multimember election
districts.
• Strong committee system; strong oversight
• Parliamentary Ombudsman: investigates state agencies for malfeasance.

Sweden: The State

• The executive branch dominates policy-making in Sweden, as
it does in all parliamentary democracies.
• Process more inclusive and permeable.
• Tempered by limited form of judicial review.

• Swedish Federalism
• Unitary state, with political power concentrated at the national
level.
• Cabinet appoints the governor to each of the 24 regional,
provincial units.
• Recently the autonomy of regional and local governments has
increased.
• More decentralization

Sweden: The State

• Following democratization, the
SAP emerged as the single largest
party in the 1920s.
•

•
•

No significant success until it
dropped the image of a worker’s
party and moved to the “people’s
home”
No to socializing production but
rather to socialize distribution.
This brought success and dominance
for a significant period of time with
some fluctuations.

• Today the Social Democratic vote
fluctuates around 40%
•
•

Concentrated among women, public
sector employees, and a declining
blue collar proletariat.
Must depend on the cooperation of
other parties to govern.

• Most of the change within the
Swedish party system has
occurred among the non-socialist
or right-wing bloc of parties.
•
•

Agrarian Party > Centre Party
Rising fortunes of the Moderate
(critic of tax and spend) and
Christian Democratic Parties
(defends family values)

• Change without change.
•
•
•
•

Emergence of new parties, loss of
support to Social Democrats and
Centre Parties.
Class voting has declined.
Party system no longer defined by
the traditional left-right cleavage of
class divisions.
Social Democrats still dominant
although they had their worst
showing in the 2006 election.

Sweden: The State & Society

Table 9.1

• Swedish Culture: individualism and statism are respected
and perceived as augmenting each other.
• No serfdom in history thus the belief that individualism,
democracy and freedom are birthrights.
• Legacies can only be achieved through the state, not against it.
• State creates an egalitarian community that protects its members
from the injustice of social inequality and liberates them from
degrading ties of dependency.

• Equalitarian: Swedes less tolerant of wage differentials
between high and low earners than citizens in other countries.
Also approve of government’s efforts to reduce it.
• Value consensus and pragmatism
• Considered a high trust society
• Issues that are emerging: “minority culture of distrust”

Sweden: Political Culture

• About 50% of all Swedish citizens are said to derive their income from
the state as either:
• Clients who depend on welfare state programs, or
• Public sector workers who deliver them.
• This gives many an incentive to vote for the Social Democrats; protect their
benefits or their jobs.

• Welfare state originally designed in 1930s to eliminate poverty.
• Transformed in the 1960s to “provide a lifelong middle class standard of
living for all” and redistribute income.
• 1990s Sweden experienced the sharpest recession in its history.
• Economy contracted by 6 percent, unemployment soared from 2 to 12
percent, with the result of a severe budget deficit.
• Required state to trim; became less redistributive.
• More privatization and markets introduced; school choice.

Sweden: Political Economy

• Economy is thoroughly capitalist even though it supports a large
welfare state.
• Means of production privately owned and the market rules.
• Model of capitalism based on three precepts:
• Full employment
• Centralized wage bargaining
• Wage solidarity

• This model fell on hard times in the 1990s: major recessionadjustments such as sector level bargaining
• Current Swedish Model may only be a shadow of itself, but it
produces very similar results.

Sweden: Political Economy

• Found in former British colonies of Canada, Ireland and the United
States.
• Politically left-wing parties are either completely absent or have been
outsiders in the political process.
• Class identification is very weak; socialist parties have not fared well
due to this.
• Other cleavages in these societies crosscut and weaken class
identification.
• Business has been politically dominant.
• Electoral system is afflicted with low voter turnout (working class
dropped out leaving core of wealthy voters).
• Politicians appeal to this core and ignore the demands of peripheral,
working-class voters.

Extreme Market Democracy

• The politics of extreme market democracies distinguishes them from
other Anglo-American democracies such as Britain, Australia, and
New Zealand.

• Share a similar policy profile, but these other countries have
viable Labour Parties that are absent in extreme market
democracies; class is a more significant cleavage.
• Price of a cup of coffee: $3 in Sweden; $1.50 in the U.S. or
less because higher taxes and wages make a cup of coffee
cost more in Sweden than in the U.S.
• However, cost of affordable coffee comes in the form of a
lower standard of living for coffee servers and fewer public
services in the U.S.


• More likely to leave the production and allocation of goods to
the market more so than other affluent democracies.
• Public sector relatively small.
• Rank low in terms of welfare effort – spend less than 20% of
GDP.
• Targeted at poor.
• Relatively stingy benefit levels.
• Have some institutional variety.
• Federal and unitary systems.
• Interest group structure is similar.
• Union density is low.


• Nowhere else
is the gap
between the
power of
businesses
versus labor
as large.

• Why? Host of factors:
•
•
•
•

•

Success of American capitalism
seduced workers.
Ethnic and racial tensions
divided workers.
Capitalist values of competition
and individualism distracted
them.
Repression intimidated them.

Some success for workers:
•

New Deal

United States: Historical Background

• U.S. has a federal system with power divided vertically
between national and state governments.
• The Constitution also divides power horizontally among the
executive, legislative, and judicial branches to create a system
of checks and balances.
• Founders believed in democracy, but wanted to avoid what
they regarded as its egalitarian consequences: endangerment of
property owners to preserve their property and use it as they
please (Dahl).
• Majority rule difficult when in order to control government a
group must win three different contests: nationally at the
presidential level, at the level of the states in the Senate, and
by district based on population in the House of
Representatives.

United States: The State

• President is the “energy center” of the federal government,
setting its agenda and providing leadership to it.
• Have two roles: head of state and head of government.
• Must deal with Congress, interest groups

• Congress: bicameral
• House of Representatives – # districts in state based on population; serve
two year terms
• Senate – 2 from each state; six year terms
• Policy process very involved; many veto-points at which bills can be
defeated.

• Judiciary
• Must depend on the other branches to implement their decisions
• But very influential. Federal judges serve for lifetime tenure; insulated
from political pressure; power of judicial review (gives them authority to
nullify and overturn laws as incompatible with the Constitution).

United States: The State

• New Deal made the Democratic
Party into the majority.
•

• Republican Party gained
momentum and changed direction

•

•
•

• Medicare added
• Unions grew

•

Was the ruling party from 1932 to
1994.
Welfare state matured

•

Through the 1960s, worker’s
standards of living rose and
inequality declined.

• New Deal began to unravel in the
1960s
•
•
•

Civil rights
Cultural issues: abortion, feminism
Policy failure: did not deal with
unemployment and inflation

Turned right and moved south
First evident at the presidential
level
1994 congressional elections

• Unclear whether Democratic
sweep of 2008 means a new
period of Democratic Party rule
•

May simply reflect the failed
policies of Republican President
George W. Bush

United States: The State & Society

• The two parties are almost equal in strength, but their
differences are profound.
• They have become internally more cohesive; very limited
differences among members within the party, BUT
• Externally, they are very polarized. This means the
differences between the two major parties are stark.
• The moderate center has disappeared.

• Consequently, American politics is more ideological,
with more party discipline, and it is now harder to forge
bipartisan compromises.


Table 9.2

• The American state was designed by people who were deeply
suspicious and skeptical of it.
• Created fragmented government with checks and balances to
produce limited government.
• Liberal capitalism was unchallenged because the U.S. never had a
feudal past that nourished alternatives such as socialism and
fascism.

• In the U.S. there is consensus over the liberal democratic
model, so basic principles rarely compete.
• Arguments do arise over the interpretation of common liberal
democratic values.
• Americans are strong individualists.
• Independence and self-reliance; responsible for own life
• Political equality and democracy

United States: Political Culture

• Class differences in political participation are greater in the U.S. than
in other affluent democracies.
• Playing field of politics very tilted in the favor of those with means.
• Reflected in public policy: collects less in taxes and spends less as a
proportion of GDP than almost any other rich democracy.
• Business enjoys autonomy in U.S. compared to other western
democracies
• Less collective bargaining; state regulations governing the workplace are
minimal and not vigorously enforced.

• Letting markets rule has encouraged innovation and wealth.
• Negative result is that there is more inequality and greater volatility than
in other affluent democracies.

United States: Political Economy

• Austria, Belgium, the Netherlands, and Germany are countries that follow the
Christian democratic model.

• Christian democratic parties often largest though not dominant party; size
and location in the middle of the political spectrum make them frequent
partners in any ruling coalition.
•
•
•
•

First arose in the 19th century when state attempted to take over education and
family policy that churches believed properly belonged to them.
Today not so linked to churches. Mostly secular parties and present themselves
more as defenders of Christian values more than Church dogma.
Seek to moderate class cleavages at the same time they defend class
differences.
Safeguard strength of the family and moral authority of the Church from threats
posed to them by divisive class conflict, an intrusive market and an
encroaching state.


• Christian democracy
believes in capitalism but
does not like its inegalitarian
effects.
• Supports welfare state and
unions.
• Tend to be high tax and
spend states due to their
welfare support.
• Do not offer the array of
collective services that
social democrats do.
• Rather they provide transfer
payments in order to
provide income security to
families.
• Distrustful of too much state
intervention.


• Parliamentary democracies
• Some variation among the states: Netherlands has
no judicial review; Belgium and Austria only mild
forms of it.
• German Federal Constitutional Court can nullify
laws it finds unconstitutional
• Germany is a federal sate in which powers are
reserved to the lander, or states, which elect their
own officials and raise their own revenue. Belgium
also high degree of federalism.
• Corporatism is most important feature:
• Groups are organized into a limited number of
hierarchical associations and recognized by the
state and participate in the policy making
process.

• Volatile history
• Span of 100 years:
victory, defeat,
scarcity, prosperity,
fascism, communist
party dictatorship, and
parliamentary
democracy.
• Borders in flux
• Now biggest country in
Europe
• 82 million people
• Fourth largest economy

• Late start politically: Otto Von Bismarck united
small independent principalities into modern
German state in 1871.
• Agrarian feudal society
• Rapid transformation
• WWI = defeat in greatest mass slaughter
brought an end to the Second Reich
• Weimer Republican – first democracy but a
troubled one
•
•

•

Political and economic problems
Nazi Party; Hitler, 1932

WWII – German armies invaded Poland in 1939
•
•
•
•

At first success – occupied much of Europe
May 1945 – Russian, Britain and America forced surrender
Occupation of the Allies; four zones; reduced to two during
Cold War
East and West Germany

Germany: Historical Background

Table 9.3

• Semi-sovereign character attributed to:
• Federal character in which authority is divided between the central
government and 16 federal states, or lander.
• The states raise their own taxes and elect their own governments but select
members to the Bundesrat, the upper house of the national legislature,
which has veto powers over bills that affect their jurisdictions.

• European Union has some authority in some policy arenas
• Trade, environmental policy, and border controls
• European Central Bank
•

Monetary policy

• Fiscal policy constrained by EU agreements
• Laws are subject to judicial review by the European Court of Justice

• Role of interest groups as constraints
• Role of bicameralism
• Bundesrat, upper chamber; Bundestag, lower chamber, selects government
• Divided government becoming more prevalent
• Ruling coalitions less stable and predictable

Germany: The State

• Elections to the Bundestag occur every four years.
• Early elections can occur following no-confidence votes.
• Citizens cast two ballots in electing deputies to the lower house.
•
•

One for party they favor and one for candidate of the party they favor among a
list of choices.
Proportional representation; must win at least 5 % of the vote before being
awarded representation.

• Head of state is the president
• Ceremonial functions and selects a party leader to form a government.

• Head of government is the chancellor
• Commands majority support in the Bundestag
• Most powerful position in the German political system; but less powerful than
other chief executives; powers are limited by coalition treaties they negotiate
with their partners in government and by ministers they appoint.

• Generally stable
• Has problems: immigration, balancing the budget, reviving the economy
• May be difficult to attain consensus and incremental solutions

Germany: The State

• East Germany versus West Germany
• Planned economy and communism versus capitalist democracy

• SPD Social Democratic Party
• Rise to power

• Unification – East Germany incorporated into FRG as five new
federal states.
• Accelerated dealignment of the party system; new party
emerged: Party of Democratic Socialism (PDS), to attract voters
from disgruntled East Germans
• 1998- CDU-FDP ruling government led by H. Kohl was defeated
by a coalition of the SDP and the Greens.
• Chancellor Gerhard Schroeder (1998-2005)

• 2005 close race between CDU and SPD
• Angela Merkel of CDU became Chancellor – allied with FDP to
form government

Germany: The State & Society

• Reconstructed culture after a past that had
glorified militarism, nationalism and antiSemitism.
• Contrition
• Imposition
• Based on new principles: demilitarization,
post-nationalistic, supporters of European
unity, pro-democracy, unification, immigration

Germany: Political Culture

• Post-WWII revival steady and fast economic
growth
• High wages; low inflation and generous welfare
benefits
• Renowned as a producer of high-quality manufactured
goods; until recent economic global downturn,
Germany exported more goods on a per capita basis
than any country in the world.
• MODEL: social market economy
• As little state intervention as possible and as much
state intervention as necessary
• Role of government: to promote cooperation among its
different actors.

Germany: Political Economy

• German Model of the social market economy delivered it
all: high quality products, high wages, high fringe
benefits, high levels of worker representation, and high
levels of time off work.
• Model rested upon consensus and coordination of well organized
and powerful private actors, including employer associations,
unions, and banks that the state helped bring together.
• Growth rates began to decline in 1980s and 1990s. Almost no
growth since 2000.
• Created labor market issues.

• Models advantages now considered part of problem – erosion of
support for the model.

• More assertive in foreign policy, but economic problems
have weakened the “soft power” it might have wielded.

Germany : Political Economy

Problem

Methods and Hypothesis

• Why did the unions create
leftist parties in Britain, want
nothing to do with them in the
United States (using picket
lines rather than the ballot
box), and get radicalized
(unions and socialism) by them
in Germany?

• Marks goes back to the late 19th
and early 20th century to
compare union strategies at the
national level in these three
states.
• Hypothesizes that unions that
could control their labor
market would choose
collective bargaining over
electoral activity and unions
that faced hostile legal
environments would be
radicalized by it.

Comparative Political Analysis:
Why do Unions Pursue Different Strategies in Response to Similar
Challenges?

Operationalization

Results

•
•

• Marks found that skilled unions in
the AFL pursued their interest
through collective bargaining.
• Where the labor market included
unskilled workers as well as
unskilled workers in large voting
blocs, unions would instead try to
make gains through politics – British
Unions did through the Labour
Party.
• Unions in a hostile legal
environment that constrained
organizing adopted a socialist
orientation as they did in Germany.

Dependent variable is union strategy.
Influenced by two independent
variables: organizational strength of
unions (how encompassing they
were) and the legal framework
(regulatory legislation of union
activity and workers’ political rights
to strike, and voting rights) in which
they operate.

Comparative Political Analysis:
Why do Unions Pursue Different Strategies in Response to Similar
Challenges?

Physical Well-being

Informed-Decision Making

• Poverty rates will provide a better,
more discriminating and accurate
measure.
• Poverty line for family in four in
2008 in the U.S. was $22,025 –
adjust measure for comparison.
• Sweden and Germany perform
better than the U.S.
• Only measuring income; do not
include public services or welfare
benefits, which are greater in
Sweden and Germany.

• Literacy rates are 99 percent in each
of the three states.
• Use International Adult Literacy
Survey as a more discerning
measure.
•

Five levels with III, IV, and V being the
higher literacy levels.

• Proportion of citizens whose
average scores placed them in level
one or two, which are the lowest
levels.
• Sweden had far fewer citizens (only
23%) in the lower levels than the
U.S. and Germany, whose
percentages in the lower literacy
levels were relatively close and
roughly double that of Sweden.

Comparing Capabilities Among Sweden, the U.S. & Germany: A
more difficult task needing more subtle measures

Table 9.4

Table 9.5

Safety

Civil/Political Rights

• Sweden, the U.S. and
Germany do not suffer from
political violence and civil
war.
• But physical safety is still
an issue.
• Homicide rate data show
that Germany and Sweden
perform similarly and the
U.S. clearly performed
worst according to this
measure.

• Need to examine the quality
of rights given they all have
these rights.
• Measuring the quality of
democracy is difficult.
• U.N. Human Development
Report: 5 criteria
• On four no difference found
among our case studies; only
difference on Voice and
Accountability
• Sweden, Germany, then U.S.

Democracy, Authoritarianism, & the Good Society:
How do they compare on capabilities?

Table 9.6

Table 9.7

• Some political models are better able to create conditions
that enhance the capability of their citizens more than
others.
• Social democracy, in the form of Sweden, generally
performed better than the other models.
• Christian democracy did better at meeting the physical
needs of their citizens.
• Extreme market democracies came in last according to
the author’s criteria and tests utilized.

Conclusion: Political Models & the Good
Society

• How would you operationalize the four criteria we
use to assess regime performance? Using your
measures, which countries enhance the capabilities
of their citizens most and come closest to the
standard of the Good Society?
• Do you think the different regimes among western
democracies are converging, becoming more alike, in
any of the areas we investigated: politics, political
institutions, political culture, or political economy?
Or have their differences in all of these arenas
remained profound?

Critical Thinking Questions

• What would have had to be different for the United
States to end up like Germany or Sweden?
• What do you believe is the greatest challenge social
democratic, liberal democratic, and Christian
democratic regimes face today? In what respect are
their challenges similar to each other or specific to
each model?
• What do you see as the strengths and weaknesses of
each political model?

Critical Thinking Questions

Chapter 9 CPO2002 Lecture

Recommended

Recommended

More Related Content

What's hot

What's hot (17)

Viewers also liked

Viewers also liked (18)

Similar to Chapter 9 CPO2002 Lecture

Similar to Chapter 9 CPO2002 Lecture (20)

More from PoliSciDep

More from PoliSciDep (20)

Recently uploaded

Recently uploaded (20)

Chapter 9 CPO2002 Lecture