The left has more than once heard calls for a “third way”. In decades gone by, people talked about a “third way” between Communism and capitalism, which was social democracy. Now that both the Communism of that period and the social democratic alternative have both more or less died, we’re beginning to hear about a new “third way”. The main exponent of this new alternative is the British Prime Minister, Tony Blair. But there’s talk of a “third way” partnership between Blair and Clinton, or even a troika with the man who may become the next Chancellor of Germany, the German Social-Democratic Party’s Gerhard Schroder.
MR readers know all about Clinton’s third way. The best that can be said about it is that it’s completely empty of principle—which is a generous assessment of a program that reproduces the essential principles of right-wing neoliberalism. But since one of us has been in London this summer, we can look at this from the British perspective for a minute, just to get the benefit of a different angle of vision.
It has to be said, first, that, to judge by the British press, no one has been able to get a firm grip on what Blair’s third way means. There’s vague talk about finding a middle course between “market capitalism” (what other kind is there, by the way?) and old-style socialism (read old-style social democracy), based on a free market economy but with a dose of social justice. But for the most part, at least until this summer, there hasn’t been much evidence of any significant departures from the first way, the Thatcherite way, since the Labour government committed itself at the outset not to exceed the Tories’ public spending limits and showed little inclination completely to reverse even the Tories’ assault on organized labor.
In July, the finance minister, Chancellor of the Exchequer Gordon Brown, issued a major three year plan. At first glance, it looked as if the government was finally doing what it was elected to do, providing substantial increases in public spending, in particular for education and health care. But on closer inspection, things looked very different.
Take the National Health Service. The NHS, often called the flag-ship of Britain’s welfare state, has been celebrating its 50th anniversary this year. Whatever people may have heard about it during the futile debates about health care in the United States, it has been one of the most civilized institutions in the capitalist world. For all its faults, it has generally provided first-rate health care to everyone, regardless of income. And it has created a culture among health care providers that would be totally unrecognizable in the United States. Medical care is still treated as—and still feels like—a public service, not, as in the United States, a profitable business designed to line the pockets of HMOs, insurance companies, and doctors. The Thatcher regime did what it could to destroy the NHS but was never able to go the whole distance because this is such a deeply popular institution in the United Kingdom.
So the Labour government inherited an NHS still alive but seriously wounded. In fact, the promise to improve the health service was one of Labour’s strongest cards in the last election, and Gordon Brown’s budget statement looked like a fulfillment of that promise. But what was really going on?
Brown has found extra money (though, given earlier cuts, less than it appears) in part by what the government calls the “private finance initiative” (PFI). Put simply, this means that various projects, like the building of hospitals (as well as roads, prisons, and schools), instead of being funded by the public purse, will be undertaken by private enterprise, apparently leaving the government with more money to allocate to the improvement of services.
The real result, though, may be the opposite—in ways that people in the United States will find all too familiar: not only will the projects be more expensive, partly because private investors have to borrow money at commercial rates, but, of course, services will suffer in order to provide the massive profits such investors demand. A journalist in the British paper, the Guardian, in an article called “Cuckoos in our NHS” (July 16, 1998), reports that in one health district the result of the PFI will be a loss of nearly 1000 doctors, nurses, and clerical staff, or 20 per cent of its workforce, and by 2003, acute-care beds in that district will be 45 per cent fewer than in 1989. The results in other parts of the service will be comparable or worse, more than wiping out the apparent gains offered by the government.
The NHS is one of the best things, if not the best, that the welfare state has managed to produce—unlike anything in the United States. What’s happening to it now is a perfect example of how vulnerable such institutions are in a capitalist system, where all social goods are inevitably subordinated to private profit. In the long run, there’s really no reliable and stable way of humanizing capitalism, so there’s really no alternative to socialism. But in the meantime, there has to be constant and militant struggle to achieve and preserve whatever social goods the capitalist system does allow.
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