The End of Democratic Socialism in Europe?

The current financial crisis may be the beginning of the end of social democracy in Europe. Social democracy is a hybrid of Capitalism plus a welfare state with a commitment to the redistribution of wealth. It is Marxism Lite: Marxist theory with an inconsistent and grudging acceptance of the on-going necessity of the market if there is to be any wealth to redistribute. It is philosophically incoherent and inherently unstable.

Marxist materialism has been embraced by Europeans at the level of philosophy, law and politics and the result is relativism and a thin utilitarianism. The embrace of the hedonism and individualism of the sexual revolution is justified by Marxist-inspired theories of the inherent oppressiveness of marriage and family. But at the level of economics the market has been allowed to function, abeit under the heavy hand of government regulation.

Now, however, the social democratic chickens are coming home to roost. When you tell people that they justifiably can vote themselves as big a piece of the pie as they like, it is ridiculous to be surprised when they vote themselves such a big piece that government cannot pay for all the entitlement programs without raising taxes to such a level that the market is depressed, unemployment soars and tax revenue falls. The day of reckoning has been delayed over and over again by the superstitious faith in the possibility of infinite government debt.

Instead of balancing their budgets, governments have done what the voters have ordered them to and increased the size of the welfare state and they have done what the market demands that they do and keep taxes from going through the roof. The method by which they reconcile these irreconcilable demands is deficit financing; not a temporary deficit as a result of being in one phase of the business cycle but long-term, structural debt that can never be repaid. The only hope is that an increasing level of debt can be carried indefinitely, which is logically impossible. But the logical impossibility of this strategy takes considerable time to work itself out.

Now, too many raids on the piggy bank and too many entitlements have brought the EU to the point of fiscal crisis. Today it is Greece, tomorrow it is Portugal, Spain, Italy and Ireland and the day after that it will be the UK. Germany cannot stand alone as the ATM for 26 other countries. The only solution is to abolish democracy. This is the sense in which social democracy cannot endure. Let me explain.

The EU today features governance by unelected bureaucrats. This has been tolerated because it has been, up until recently, merely an infrastructure for economic cooperation. But there has been a push toward full political union all along and the adoption of the Euro was a brilliant strategy, which is only now becoming visible with the crisis in Greece. Greece does not have its own currency, so it cannot devalue its currency to deal with the debt crisis. So it has to be bailed out by the EU. But Germany and other solvent countries will not hand over endless amounts of money and leave Greece with its political sovereignty intact - reality just does not work that way. Loss of control of one's finances leads to loss of political sovereignty.

But the people of Greece, having grown used to the gravy train, will now accept outside control of their political institutions in order to maintain the welfare state. The major countries of the EU, faced with the need to control political policy in order to protect the financial viability of the EU as a whole, including their own countries, will impose that centralized control of member states in order to maintain stability. And so the soft totalitarianism of Brussels comes to the EU and political union follows economic union.

The centralization of political and economic power in a largely unelected bureaucracy will enable the government to make the tough economic decisions necessary to preserve the EU from economic collapse - decisions that the member states would never make democratically, given their belief in the socialist gravy train. Like the satellite states of the old USSR, the member states of the EU will grow gradually poorer and poorer as the bureaucracy acts self-confidently to manage the economy rationally. Once the central bureaucracy gains power, it will not limit itself any more than the people voluntarily limited their appetites for goods and services free of charge from the State. Given a choice between ditching socialism and ditching democracy, people indoctrinated into a materialistic philosophy will inevitably choose to give up freedom and democracy.

The only alternative to totalitarian rule from above is for a people to limit their appetites voluntarily by embracing virtue. But the only sufficient motivation for doing so is religious: specifically, Christianity. Only a Christian people can preserve their freedom. Only the worship of God saves a people from State worship and socialism is essentially a system in which people are trained to look to the State for salvation. As Dostoevsky shows in his The Brothers Karamazov, the choice is between Jesus Christ and the Grand Inquisitor, between the soft totalitarianism of the all-powerful State or faith in God.

Democratic socialism is an inherent contradiction waiting for a crisis in which to unravel. It must either become less socialist or less democratic; it is just a question which way it falls. Given the seductive power of the welfare state to sap individual initiative, reduce self-reliance and undermine the family structure, the danger is very high that it will be democracy that disappears before socialism. Only after socialism has run its bloody and failure-ridden course and there is a revival of religious faith can a society turn away from socialism and embrace the ideals of the West again. The tragedy of Eastern Europe is that it threw off the shackles of Communism without a genuine religious revival of faith. Without a revival of faith, Western Europe is fated to embrace the totalitarianism that the East abandoned.

At the most fundamental level, modern Western history is not really a struggle between Socialism and Capitalism; it is actually a struggle between Christianity and Post-Christian, Pagan Totalitarianism. The future of Europe hangs in the balance. Social Democracy is so 20th century. The question is: "What will replace it?"

UPDATE: (May 19, 10:50 pm)
As if on cue a story appeared in the Times Online tonight with the headline: "Euro in danger: Germans trigger panic over future of single currency." The markets went south today and Merkel is warning that without swift action the Euro is in danger. But what action? The money quote in the article is:

European finance ministers, who have just hammered out a massive rescue plan for Greece, will hear controversial calls from Germany at a meeting tomorrow for changes to the Lisbon treaty to give Brussels powers to co-ordinate national budgets.

Greater power for the EU central government in an area crucial to national sovereignty is what she is demanding. This is the price for Germany bailing out everyone else. To make sure that their money is not going down the drain, Germany is demanding that countries like Greece and Italy not be allowed to run deficits that are too high for safety. These decisions need to be pulled out of the hands of voters because only the experts can manage important things like money. We are witnessing a crucial step in the development of the new European super-state. It will be socialist, but will it be democratic?