Sunday, June 7, 2009

Across Europe, Left-Leaning Parties See Clout Faltering

Across Europe, Left-Leaning Parties See Clout Faltering

(Source Wall Street Journal)
PARIS -- The economic recession should have meant easy votes for Europe's left-wing movements, longtime critics of unchecked capitalism.

Yet as Europe goes to the polls, left-leaning parties across the continent are looking likely to falter. That's true both for those in government, such as in the U.K. and Spain, and in the opposition -- such as France, Germany and Italy.

France's Socialist Party is trying hard to rally voters ahead of Sunday's European parliamentary elections. "Let's unite with all the French who contest free market, unfair policies that aim at deregulating everything," party leader Martine Aubry urged at a pre-election rally.

Yet less than 20% of voters say they plan to cast their ballot for the Socialist Party, according to recent surveys. That would be a weak performance considering France's main opposition party got 29% of the votes in the last European parliamentary elections.

In Germany, the Social Democrats are expected to get only around 26% on Sunday, consistent with their low opinion-poll ratings ahead of Germany's national elections in September. Italy's center-left Partito Democratico is expected to get a similar percentage.

One reason is that as Europe tipped into recession, the right moved left -- appropriating some of the left's long-standing economic policies, including nationalizations and bailouts.

French conservative President Nicolas Sarkozy, for example, helped recapitalize French banks, earmarked six billion euros for the auto sector and lashed out at "rascal bosses" with huge pay packages.

In Germany, Chancellor Angela Merkel has planted her conservative camp firmly in the political center. Ms. Merkel has largely given up her former program of market-oriented reforms, and has gradually approved various kinds of state intervention to protect workers during the current recession, from bailing out carmaker Opel to subsidizing payrolls at companies whose export orders have collapsed.

Even before that, right-wing parties across the continent began offering more pragmatic approaches to policy than they had traditionally done. In the past decade, conservative parties introduced competition or privatized some public services in France, Germany and Italy -- but they refrained from dismantling the health-care and public transport services cherished by voters.

In the past, there was a clear fault line between Europe's left-wing and right-wing parties. The left called for more social welfare programs and public spending. The right wanted the state not to interfere in market forces.

Globalization helped change that. With nations and companies vying on a global scale, it has become difficult for a country to separate the effects of public spending and budget deficits from its labor costs and capacity to compete in export markets. The key moment came as far back as 1994, some political analysts say, when the World Trade Organization was created and much of the world began shifting to a more free-market economy.

"The WTO marked the triumph of the market economy," says Dominique Reynié, head of Paris-based Foundation for Political Innovation. "Since then, the left has been unable to propose another route."

The U.K.'s Labour Party stood as an exception when, under Tony Blair, it tried to shape a middle road. But Mr. Blair had inherited a deeply deregulated economy from the hands of previous conservative leaders, state coffers swelled during an economic boom, and he "had room to increase public spending and hire state workers," Mr. Reynié said. His successor, Prime Minister Gordon Brown, has struggled to find a similar compromise way amid Europe's falling financial fortunes. Read Article...
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