Why the Third Way Failed

Liberal patriotism can remedy that failure and lead to a rebirth of the center-left

President Joe Biden and top officials in his administration are touting the benefits of their first major accomplishment: the latest coronavirus relief package. But depending how the administration takes on contentious issues such as immigration, climate change, and infrastructure, the American Rescue Plan Act could end up being Biden’s one and only achievement because of the country’s deep political divisions and dysfunction. 

Though Biden won in 2020 by more than 7 million votes, the margins in Congress are razor thin and down ballot results reinforced the gridlock that has plagued the nation for nearly a decade. Dig deeper into America’s political landscape, and you’ll see a dynamic that part of a broader global phenomenon: the cratering of support for mainstream center-left parties over the past decade, particularly in Europe. There are exceptions, like New Zealand’s Labour Party, led by Jacinda Ardern, but the overall pattern is quite striking.

Case in point: look at the results from yesterday’s national elections in the Netherlands. The traditional parties of the left continued to lose ground—the Green Left, the Socialist Party and the historically important social democratic Party of Labour. The latter is but a shadow of its former self, barely clearing 5 percent of the vote and only a nose ahead of the Party for the Animals, which is just what it says it is. The big winner was the social-liberal party D66, which favors the environmental and cultural concerns of urbanized professionals, but even there D66’s seat total is no better than the seat total held by the right wing populist parties Party for Freedom (PVV) and Forum for Democracy and lags far behind the traditional conservative party, Mark Rutte’s People’s Party for Freedom and Democracy (VVD).

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Look ahead to next week’s elections in Israel and you will see echoes of this same trend–parties on the left, including the once-dominant Labor Party, will continue to fight for their political survival and relevance in a political landscape that has been unkind to their visions. Like other center-left parties around the world, Labor has been overtaken by events in the country and the world but still clings to the past.

These trends cutting across several democracies are very much linked to the collapse of the Third Way, a political movement associated with former U.S. President Bill Clinton, former British Prime Minister Tony Blair, and others.  The Third Way was born during the immediate post-Cold War period when more people viewed globalization favorably than they do today.

The central idea was reimagining the role of government as a middle position between free market conservativism and the old liberal ideas of the New Deal and Great Society.  The Third Way tried to split the difference between these two polar opposites, and for a time it proved politically successful. But when the global and political landscape changed in the first two decades of the 21st Century, the Third Way found itself behind the times.

Britain’s Labour Party provides the most vivid example of the Third Way’s collapse, particularly the surprising rise and swift fall of party leader Jeremy Corbyn from 2015 to 2019. Corbyn put forward a more extreme left vision that sought to reverse austerity cuts to public services and renationalize the commanding heights of the economy – coupled with a more pacifist and less interventionist military policy. Adopted as the center of gravity in British politics shifted in important ways to the right, this formula performed poorly at the polls – particularly around the earthquake of the 2016 Brexit vote, an decision that still reverberates inside British and European politics.

But the collapse in support for Third Way-style parties on the center-left is global: beyond the UK, the Netherlands, and Israel, historic parties like Germany’s Social Democratic Party (SPD) and France’s Socialist Party have seen their previously large shares of the national vote dwindle. The SPD’s share of the vote in Germany’s national elections, for instance, collapsed from 38.5 percent in 2002 – when Third Way SPD leader Gerhard Schroeder was re-elected chancellor – to just 20.5 percent in 2017.

Why has this happened, and what can be done going forward?

First, it is important to note that national politics each of these countries remain idiosyncratic–they very much march to the beat of their own drums. Israel faces a unique security landscape born out of where it is located geographically, for example, and Germany’s political dynamics are shaped by domestic, international, and historical forces with different from those that exist in the Netherlands, France, or Portugal. 

But one main trend seems common to most of these countries: the complete failure of center-left parties to keep working class voters as part of their base by providing a robust social safety net, especially health care, education and training to help workers compete. Closely related to this trend is another important ingredient: center-left parties have been increasingly captured by highly-educated professionals who view politics as a way to advance boutique left-wing advocacy issues centered on their own cultural concerns.

The electoral fallout from this trend is indisputable. After what seemed a promising start in the 1990s, by the mid-2000s it became apparent that the Third Way had manifestly failed to re-establish center-left hegemony and provide a sustainable basis for progressive governance. The failure become too glaring to ignore after the Global Financial Crisis of 2008-09, which instead of leading to a wave of left victories led instead to a surge of right-wing populism in many of the world’s richest countries.

How did the center-left get it so wrong? Start with the theoretical analysis of capitalism that lay behind the Third Way. The Third Way posited that the structure of capitalist societies was changing and that the traditional working class was becoming less important. That much is unobjectionable. But the analysis typically went little beyond banal observations on the white collarization of work and the assertion that the left was best-served by leaving capitalism alone to generate riches that could be redistributed and repurposed. The former view showed only a crude understanding of the depth of the social transformation affecting Western industrial societies, while the latter was simply wrong as an assessment of contemporary capitalism’s ability to function well without proper guidance and regulation. That much was apparent even before the Global Financial Crisis, after which its inadequacy was completely exposed.

Worse however was the political analysis that was twinned with the economic analysis. It was one thing to observe, correctly, that the potential constituencies of the center-left were evolving and that progressive coalitional politics must evolve along with these changes. That was a matter of the simple arithmetic entailed in building a majority. The mistake was in assuming these new constituencies were sort of “free money” for the center-left. If progressives were able to incorporate growing constituencies like professionals, urban liberals, nonwhites, left-trending women and younger generations and simply hold share among the shrinking traditional working class, the numbers looked good.

But it turned out holding share among the working class was very difficult indeed. As more culturally liberal and outsider constituencies increased their influence on the left, working class concerns became ever less central to the left’s program. Working class voters across the western world started to see established center-left parties as more for “them” than “us,” a cultural alienation that was enhanced by the tendency of professionals and activists in these parties to treat the traditional working class as foes of modernity and progress who were unaccountably standing in the way of better and more open societies. This had a toxic interaction with a very strong sense among many of these voters that their communities and indeed entire way of life was being shunted aside by globalization and galloping economic change that appeared to benefit mostly those in higher class positions.

The message received by wide swathes of working class voters was, to put it bluntly “we don’t care”. If you’re not progressive and with the program and adhering to the new values embraced by the left, we don’t need you. Go somewhere else. So they did.

The net result is that gains from the rise of new constituencies have been more than counterbalanced by hemorrhaging votes from the traditional working class. In retrospect, this is the Great Lesson for the left in the early 21st century. It is simply not possible to build sustainable progressive majorities while continuing to bleed working class votes. The numbers just aren’t there. Just look at the campaigns of Bernie Sanders and Elizabeth Warren in the 2020 presidential primary as just two recent examples of this flawed political strategy

The further implication is that the rise of these new, culturally liberal constituencies is not free money. There is a cost for allowing these constituencies to hegemonize the left and define its values. Until and unless the left tacks back to the center on cultural issues and promulgates a unifying, patriotic, economically uplifting message that working class voters find serious and not condescending, it seems likely the working class will continue to keep its distance from the left and that the fissure driven in the left by the Third Way will remain in force.

Is such a reformation within the center-left possible? We believe it is though it will not be easy. Start with the question of identity. The fascination of the left with slicing and dicing national populations into ever-smaller identity groups, which all then have their place in a hierarchy of oppression (or privilege) must be jettisoned. It is toxic to a majoritarian and sustainable progressivism.

The better alternative has three key ingredients:

1. A values reset focused on inclusive patriotism and liberalism.  Instead of engaging in a narrow version of identity politics from the left to compete with the “us versus them” mentality that has dominated the right, liberals should advance a vision grounded in pluralism that’s focused on the common good and the ties that bind all citizens together. This view is antithetical to the old Third Way laissez-faire attitude toward globalization and immigration, which saw any and all popular concerns about these developments as reactionary and an indicator of potential bigotry. 

What does this mean in practice? Liberal patriots should advance a more practical vision on immigration, one that doesn’t retreat to a “gated community” mentality that simply seeks to wall America off from the rest of the world – but it should also avoid the other extreme that is easily caricatured as favoring open borders with weak or no enforcement. 

2. A new approach to economic recovery that puts a strong focus on the social safety net and public investments needed to compete in the world. A reset on values is closely tied to center-left tasks on the economy. Polling makes it absolutely clear that Democrats in the United States and center-left parties around the world have to above all solve the twin crises of the pandemic and economic chaos—the very essence of a common good problem. All else is secondary to that; succeed and the stock of the center-left goes up dramatically, but fail and the slow collapse of the center-left will drag on indefinitely.

Fortunately, President Biden and Democrats seem to have gotten the memo. Aided by the radical decline of deficit phobia which undermined previous Democratic administrations, this administration seems prepared to make the investments necessary to solve the twin crises and promote an era of national redevelopment that could unify the country. One hopes that the American Rescue Plan is merely the opening bid – but that depends on how unified Democrats remain and whether any Republicans join efforts to boost America’s social safety net and make public investments in infrastructure and research and development to compete with the likes of China. 

3. The need to protect the country from security threats.  Another important part of the equation, often forgotten on the left in many open democracies, is the need to protect people from security threats, both old and new. 

This may seem straightforward, national security policy and politics are much more complicated today than they were twenty years ago. In addition, the actual threat landscape has evolved.  An additional reason why the old Third Way collapsed politically, particularly in America and the UK, is its link to the 2003 Iraq war and other post-9/11.  The center-left of Clinton and Blair was politically discredited in part by the long and inconclusive wars that cost too much in terms of lives, money, and time.

But at the same time, the center-left has been damaged by its own inability to mount coherent or compelling responses to continued threats. For example, the rise of the Islamic State in Iraq and Syria in 2013-2014, particularly the brutal atrocities committed against many including Western hostages, had a negative impact politically in the 2014 midterm elections.  Beyond terrorism, there are new types of threats including cyberattacks that raise deep concerns among ordinary voters who are looking for reassurance that those in charge have a plan to protect the nation.

These three fundamentals, advancing a new, inclusive national identity, putting forward a smarter economic plan to lift everyone up in society, and maintaining a balanced focus on protecting the country from threats old and new, are key ingredients for building a more stable political foundation for the center-left.