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Two different ideas of democracy Samuel Brittan The Financial Times 01/04/05 I want to start this column with a personal reminiscence. I used to be invited to chair an annual public discussion in Brussels of the latest European Commission economic forecast. On one occasion, when I was not in the chair, I asked if it would be possible to have the European Union without the "social partners", which normally means unions and employers acting in concert with government. Nearly everybody on the platform was shocked and people came up to me telling me how anti-democratic my question was. It may be coincidence that the run of invitations afterwards stopped, but I have my suspicions. I have recently been reflecting on this experience. There are at least two different concepts of democracy. One is that it is a balancing of interest groups. On this basis you need to bring together farmers, industrial workers, merchants, capitalists and all the other main actors in the economic game. Into this interest group conception "Social Europe" fits very well. The other conception of democracy focuses on the general interest. This need not mean the idea of Rousseau that there is some kind of superior general will over and above the will of individual citizens. What I have in mind is more specific. It is possible to have a "fair" balance between all the different interest groups and yet leave the consumer and the voter worse off. The difference between these two conceptions cuts across national differences. The mainstream tradition of American political theory puts the emphasis on reconciling different interests. Economists, on the other hand, put more emphasis on the national welfare, defined roughly as the long-run welfare of individual citizens but not necessarily in the exact posts they occupy at present. The EU embodies the interest group or corporatist aspect, despite the valiant efforts of those in Brussels concerned with promoting competition and the internal market. In recent decades the English-speaking countries have emphasised more the general interest approach, despite many backslidings. On balance, recent US and British administrations have been less devoted to the corporatist approach than continental Europeans. A British commentator cannot help being influenced by the decades of futile negotiation between government, employers and unions in the vain hope of achieving an incomes policy. In its last budget of 1978 the Callaghan/Healey government contemplated modest alleviations in the very high rate of marginal taxation then prevailing, but quickly backtracked when it was warned by the unions that any such moves would jeopardise their co-operation in achieving pay restraint - which in any case came to an end in the "winter of discontent". There is often a conflict between the long and the short-term. A defender of the corporatist model can say that people in affluent societies attach more importance to their role as producers than as consumers or citizens. But if we look at the problems facing Europe, the option of enjoying a high but static standard of living on the European social model may not survive. There are two main obvious threats. One is that the increase in longevity combined with the fall in birth rates, known as the baby blip, will be increasing the dependency ratio, that is, of old people to those of a working age. This means that policies to improve economic performance are not an optional extra. The other threat comes from the challenge of the emerging countries that can produce an increasing number of American and European products at lower costs. At the very least there is pressure developing on the living standards of less skilled workers. It will be easier either to retrain them for other purposes or to redistribute income to them from the rest of the population with a more prosperous and - to use the jargon - more "flexible" European economy. The specific part of the proposed Constitutional Treaty which causes me most concern in this connection is the so-called Charter of Fundamental Rights. There already was a perfectly respectable (Strasbourg) European Convention for the Protection of Human Rights, established by the Council of Europe - which long preceded the EU - and which I was delighted to see the British government incorporate into law. This new EU charter adds to normal civil rights what it regards as social rights (Title Four: Solidarity). It entrenches collective bargaining and the social partnership as pillars of the Union. It does not really matter whether these labour market provisions are new or simply codify where the EU has already arrived. They underline the extent to which the EU has come to incorporate a corporatist model. The first step on the road back would be a rejection by the voters of a key country of the Treaty - so we could think again where the EU is heading.
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