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A New Progressive Alliance

A New Progressive Alliance

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Published by Zack Beauchamp
A report on ideas for trans-Atlantic progressive solidarity.
A report on ideas for trans-Atlantic progressive solidarity.

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Published by: Zack Beauchamp on Apr 11, 2013
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A New Progressive Alliance

The Case for Traffic-Light Coalitions Or How a fusion of social democratic, liberal, and green politics can help build a new progressive consensus
Matt Browne, John Halpin, and Ruy Teixeira  April 2013


A New Progressive Alliance
The Case for Traffic-Light Coalitions Or How a fusion of social democratic, liberal, and green politics can help build a new progressive consensus
Matt Browne, John Halpin, and Ruy Teixeira  April 2013
This report was originally circulated at Global Progress conferences on “The US and Europe: Where Next for Progressive Politics?” (London, November 15, 2012) and “Campaigning for the Future & The Future of Campaigning” (Washington, D.C., March 5–6, 2013). Thanks to the conference participants for their comments.

COVER PHOTO European trade unionists protest outside the EU Commission headquarters in Brussels on Wednesday, Nov. 14, 2012. With rampant unemployment spreading misery in southern Europe and companies shutting factories across the continent, workers around the European Union sought to unite in a string of strikes and demonstrations on Wednesday. AP PHOTO/GEERT VANDEN WIJNGAERT

Progressives of the world unite: You have nothing to lose but your ideological chains and a world to gain.


1 Introduction and summary 6 Demographic change, 21st-century values, and the rise of progressive competitors 11 The challenge of growth 23 The coalition challenge 27 Conclusion: Back to the future 29 About the authors and acknowledgements 30 Endnotes

Introduction and summary
When the global economic crisis first hit with gale force in the fall of 2008, progressives across the globe thought that conservative economics would be decisively discredited, leaving the field open for those who had consistently argued against excessive reliance on the market. Despite initial public support for the immediate crisis measures introduced—the stimulus package and the financialmarket bailouts—voters ultimately were not impressed with the progressive alternative. Beguiled by conservative attacks on the “profligate state,” with its focus on the evils of budget deficits and government debt, voters in many countries became convinced as the crisis dragged on that we instead needed an economic agenda that called for unremitting austerity. Today, however, there is increasing awareness that austerity has not delivered what it promised. A resolution to the ongoing Euro crisis still seems a long way off. In countries such as the United Kingdom and Spain, drastic austerity measures have driven the economies back into recession, further exacerbating public debts and deficits. The International Monetary Fund continually downgrades its global growth forecasts and now acknowledges that previous forecasts underestimated the likely impact of public-spending cuts in lowering growth. The rising public protests against austerity measures that are taking place in Europe clearly indicate that the public is looking for change. Across Europe and North America, there is newfound hope that progressive politics are on the verge of a revival. The victories of Prime Minister Helle Thorning-Schmidt in Denmark, President Francois Hollande in France, and Prime Minister Algirdas Butkevičius’s social democrats in Lithuania—as well as President Barack Obama’s re-election in the United States—have all provided cause for progressive optimism. In the Netherlands Diederik Samsom, the Leader of the Dutch Labour Party, spearheaded a remarkable political revival, returning the party to the governing coalition. Elsewhere, progressives lead in the polls. The U.K. Labour Party has a double-digit poll lead over the Conservative and Liberal coalition government. The combined parliamentary

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power of the New Democrat and Liberal Party votes in Canada indicates twothirds majority support for a latent progressive coalition. Yet this recent electoral progressive revival is being challenged by the emergence of populism in the developed democracies. The results of the Italian election last month and the remarkable performance of Beppe Grillo’s Five Star Movement in securing more than 25 percent of the vote are the most striking illustrations of a growing frustration among many citizens with mainstream politics. Dissatisfaction with a political elite that too often appears distant and unconcerned by the troubles of everyday citizens is now increasingly widespread. While the Five Star Movement is the latest populist success story, the Tea Party in the United States, the People’s Party in Denmark, the Dutch Freedom Party, or PVV, in the Netherlands, the National Front in France, the True Finns in Finland, and the U.K. Independence Party, or UKIP, in the United Kingdom have all gained significant footholds and are reshaping the parameters of their respective national political debates. The Swiss People’s Party, or SVP, is now a serious challenger for public office in Switzerland, while in Hungary Fidesz’s record in government since elected in a two-thirds majority to Parliament in 2010 points to the threat that these movements present should they gain power. It would, then, be unwise to read too much into recent electoral victories for progressives. While the financial crisis and recession of the past five years exposed flaws in the existing neoliberal economic approach, it also exposed the paucity of modern progressive economic alternatives. It is perhaps not surprising that populist alternatives are thriving in this vacuum. To forge a new progressive economic agenda, progressives in Europe and the United States will need to go beyond both a simplistic rejection of austerity and an unquestioning defense of the state and public services. As Center for American Progress Chair John Podesta argued in a recent lecture in Amsterdam,1 progressives must be antiausterity but also pro-reform. Our electorates sense that something is wrong with the way things are. So, while voters may be open to an economic agenda that is led by investment, we also need to accept the fundamental truth that progressive parties will only be given permission to pursue this strategy if they have a credible program for reform. In our 2009 report, “The European Paradox,”2 we argued that to respond to the crisis of neoliberalism, progressives needed to present a new growth model, build new political coalitions, and respond to the legitimacy crisis facing many

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large institutions, including political parties, by adopting a new organizational model. We believe that these arguments are as valid now as they were three to four years ago. In this paper we develop these arguments further. In particular, we assert that while a new progressive approach to growth must be informed both by the postwar Keynesian economic model that persisted until the 1970s and by the knowledge, technology, and human-capital-driven revival of progressive politics upon which the third way was built in the 1990s, it must also provide a fundamental alternative to both neoclassical economics and traditional Keynesian policies. This requires debunking the idea that markets are an end unto themselves and showing that employment is actually a driver and not simply a derivative of growth. It will also require admitting that redistribution has reached—and possibly already surpassed—its limits, that public-service delivery needs to become more efficient and effective, and that the state must now experiment with new policies designed to create markets capable of delivering social goods. To be in a position to implement this agenda, however, it will need to be crafted in a way that crystalizes a stable political coalition for the future. Building on the arguments that we made in “The European Paradox,” we assert that progressives’ policy agendas and political strategies now need to become inextricably interwoven and self-reinforcing. For today’s social democratic and labor parties, that means responding to both emerging demographic groups and the presence of new political competitors. Over the past three decades, the social fabric and demographic composition of industrialized nations have evolved dramatically. The traditional blue-collar working class has shrunk severely and is now unreliable in its progressive inclinations. Meanwhile, emerging progressive constituencies, such as professionals, the highly educated, the younger generation, the unmarried—especially women—immigrants, and minorities, fragment their vote among a multiplicity of red, green, and yellow, or social liberal, parties. These new social groups are often much more concerned with postindustrial challenges such as climate change and cultural and social diversity than they are with traditional social democratic objectives relating to economic security. Rather than viewing this new environment as a threat, we propose an approach that embraces these new concerns as the route to both a dynamic new progressive growth strategy that focuses on opportunity, mobility, and sustainable middle-class jobs, as well as a new progressive coalition that can translate into majority dominance over time.

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In this way, a new progressive alliance—a traffic-light coalition—can be forged that is not only stronger but that also delivers more than what reds, greens, or yellows can offer on their own. We believe that this coalition, which is both values driven and demographically rooted, will be the future of progressive politics in the 21st century. To build such coalitions, however, progressive parties will also need to meet a crucial legitimacy challenge and change their approach to doing politics. On the one hand, this will require modernizing political parties to open them up to new social groups and a younger generation while combating the populist challenge at the local level. On the other hand, it will require creating spaces outside of the party’s direct control—spaces in which collaboration with others that share similar values, be they parties or political movements, can flourish. This means that, starting with social democrats, who are still the leading and mostnumerous element of today’s center left, different progressive groups must learn to act as friendly competitors instead of as adversaries and collaborate more effectively to achieve shared goals. That does not mean that social democrats should immediately go out and negotiate formal electoral coalitions with all comers— though sometimes, of course, these will be appropriate. But it does mean that strategic alliances with other center-left forces, both party and nonparty, are now a central task of the social democratic movement. From this standpoint, making the transition to a new energy economy and combating climate change, nurturing and supporting diversity and immigration, and pushing serious reform of the welfare state are all strategically smart political moves. They will help social democratic and labor parties both appeal to citizens who prioritize these issues and build objective-driven coalitions with social liberals, greens, and extraparty movements. It should be stressed, however, that these policies are not just smart in political terms. They are also the foundation of a better growth strategy, without which the center left in general and social democrats in particular will accomplish little. A successful new growth strategy, however, is unlikely to emanate from social democrats alone. By dint of history and institutional culture, they are still far too often strongly tied to defense of the welfare state as a prime objective, which makes it difficult to adopt and promulgate policies that are sufficiently strong and innovative in areas such as reforming the welfare state and greening the economy. Breaking up this logjam through a renewal of the social democratic approach will

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be essential to providing the basis for collaboration and cross-fertilization with other center-left parties and movements. Equally, such collaboration and crossfertilization with social democrats provides a way for greens, yellows, and extraparty movements to see past their own institutional concerns and histories to the necessities for social justice, practical effectiveness, and job creation. While the challenges of developing new agendas, building new coalitions, and renewing our approach to political organization are significant, we remain confident that if they can be met, a new progressive era is within our grasp in the near future.

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Demographic change, 21stcentury values, and the rise of progressive competitors
To understand the potential and the necessity of this emerging coalition, we first have to understand the broad structural shift away from a manufacturing economy and toward a postindustrial knowledge-based economy. This shift has had profound consequences for European social democratic and labor parties. Across all countries, the size of the traditional or blue-collar working class is declining sharply,3 as employment in the industrial sector is rapidly being replaced by employment in the service sector.4 At the same time, union membership has also been dropping steadily.5 Since labor and social democratic parties were built around unionized blue-collar workers in industry, the occurrence of these trends together signals a dramatic undercutting of the traditional voting base of these parties. The problem of the declining working class is even more severe than what is suggested by the declining raw numbers. As the ranks of the traditional working class have thinned, they have also become less supportive of social democrats in many countries,6 due in large part to the fact that many working-class voters have felt neglected or marginalized by the social democratic and labor parties. There is considerable variation in the parties as to which blue-collar workers are choosing to move their support from the populist and traditional right to the populist left. For some, the politics of multiculturalism practiced by continental European social democratic parties is alienating.7 For others, it is more a failure to support traditional industries and manufacturing in the face of what they perceive to be unfair global competition. But whatever the origins of disaffection, it is real and pervasive. It is widely accepted that labor and social democratic parties need to stop bleeding their traditional working-class vote and gain back at least some of their lost ground. This will not, however, be sufficient to deliver a progressive majority. To achieve that goal, progressives must simultaneously increase their appeal to growing and increasingly diverse new demographic groups whose priorities differ from those of the traditional working class. These groups and their political inclinations are discussed below.

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Rise of progressive diversity
The decline of the traditional working class reflects a broad structural shift away from manufacturing and toward a postindustrial knowledge-based society embedded in a global economy. Accompanying this shift have been changes in both family and values norms sometimes collectively referred to as the second demographic transition—lower fertility rates, diversity in types of families, a rise in postmaterial values, and a decline of traditional religion. These changes have together given rise to an explosion of progressive diversity. In occupational terms, the decline in the traditional working class has led to an increase of white-collar and professional workers—sometimes lumped in with shopkeepers and the self-employed and referred to by the catch-all phrase “middle class.”Closely related to the rise of this newfound middle class is a rise in educational levels. Across the countries in the Organisation for Economic Co-operation and Development, or OECD, there has been a sharp decline in the ranks of those with the lowest levels of education and a rapid increase in those with the highest levels of education—college and advanced degrees.8 These are changes with profound implications for progressives. Simply at the level of numbers, the sheer size of the white-collar population means that social democratic parties have become far more dependent on white-collar votes for electoral success than they were in the past.9 Perhaps the most progressive element of the burgeoning white-collar population is professionals, who have the highest educational levels. A rapid rise in the highly educated population is good news for social democrats. Unfortunately, professionals and the highly educated, while progressive, do not necessarily choose the social democrats when they vote progressive. Instead, they frequently turn to social democrats’ competitors on the center left, especially liberals and greens.10 Of course, this dynamic varies by country and is influenced by the nature of the party system, among other things. Generally speaking, the closer to a two-party system, the more likely the main left party can capture these constituencies, and the more robust the multiparty system, the less likely the main left party will dominate these constituencies.11 To capture these voters, social democratic and labor parties will need to show not only a clear commitment to their liberal and environmental values but also a growing concern about the quality of public services and reform of the welfare state.

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Similarly, over the past few decades, the immigrant and minority population has increased substantially across countries and is continuing to increase in most of them.12 The general tendency is for immigrant/minority voters to vote left and, especially, to vote for social democrats due to their strong support for the provision of social services to minority populations.13 There are several nuances to this trend, however, that complicate this positive story. One is that the political effects of immigration, especially in terms of national elections, tend to be blunted by the noncitizen status of many immigrants. Second, the immigrant/minority population typically starts from a small base, so even a fairly rapid increase in their numbers will have limited political effects, at least compared to the United States. Third, in many European countries, immigrants are less likely to vote than other citizens. In addition, reactions to immigration are very complicated and can send traditional working-class voters away from social democrats and toward the right. Among progressive, culturally tolerant constituencies, social democrats may also find themselves losing votes to parties such as the greens and liberals, both of which have a stronger focus on diversity and an open society. On the economic and social front, the key for the social democrats will be to improve legal channels for immigration, thus ensuring that immigrants can contribute constructively to the economic good while at the same time making sure that public services are robust and flexible enough to cope with migration trends. Politically, aggressively canvassing and targeting immigrant and minority communities for support and embedding this support in a concerted get-out-the-vote operation will be important, as was illustrated by the minority vote in French President Francois Hollande’s campaign last year. The traditional family is declining across Europe, and we are seeing many more single-person households.14 By and large, single voters are more likely to support the left than married voters, and among single voters, divorced/separated voters are even more likely than never-married voters to do so. But, as with professionals and the highly educated, these benefits may flow less to social democrats than to their center-left competitors in multiparty systems.15 Improving the quality of public services, as well as designing new ones to meet the needs of modern families, should help engender a greater affinity between these groups and social democrats, creating employment opportunities in this field and increasing the flexibility of the labor market. Perhaps the most important new group to emerge during the past three decades is the Millennial generation, defined here as those born between 1978 and 2000.

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The Millenials compose essentially all of those voters between 18 and 34 years old, and it will continue to do so for another five years, after which a new generation will start entering the electorate. Members of the Millennial generation are vessels of modernity in that they embody all of the social trends enumerated in this section. Millennial women in particular have an outlook that is notably cosmopolitan, tolerant, and open-minded compared to the outlook of previous generations. They are also, of course, a generation whose access to economic mobility bears a vexed relationship to the welfare state and to older voters, who are its chief beneficiaries. The good news for progressives is that this generation appears to lean left in most countries. It is difficult at this stage to disentangle the effects of age from cohort— that is, the extent to which young voters may be leaning left simply because they’re young as opposed to being part of an unusually progressive cohort. But there are certainly indications in the United States that the Millennial generation is distinctively progressive as a whole. The same can be said of other countries such as France, Sweden, Australia, and Germany. The bad news is that, especially when compared to that in the United States, the Millennial generation elsewhere around the world is relatively small. In most advanced countries, declining fertility has led and will continue to lead to an older societal age structure, in which the relative weight of the young declines and that of the elderly increases.16 Additionally, progressive Millennial voters in many countries are looking past the main left parties to greens and liberals. This appears to be a universal problem—except, of course, in the United States, where the system does not permit this kind of party competition.17 The relative unattractiveness of social democrats to younger voters in their countries is resulting in the rapid aging of the support base for these parties.18 Betting on older voters to keep social democrats politically viable is a risky strategy, but it is, in effect, where many social democratic parties are currently placing their bets. Out of economic and political necessity, social democrats and labor parties will now need to devote far more attention to younger voters. Mass unemployment in southern Europe, declining youth-employment opportunity across the continent, and burgeoning retirement and health care costs from the baby boomers all imply that the social democrats’ key historical achievement—the welfare state—will need radical reform if it is to gain support from this new generation. Moreover, as the younger generation is less deferential and more cosmopolitan in outlook, social democrats will also need to pay far greater attention to not only issues such as the environment and civil liberties but also to the way in which they actually

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organize themselves politically.19 Each of these actions will require social democrats to rethink their politics to the core. The rise of progressive diversity has, therefore, not been too kind to mainstream left parties in multiparty systems. Indeed, mainstream left parties are caught in a kind of electoral pincers movement. On the one hand, the traditional working class is declining as a share of the electorate and has been giving less of its support to social democrats over time. On the other hand, social democrats are not getting their fair share, as it were, of emerging progressive constituencies, with much of that support going to their center-left competitors. These trends point overwhelmingly to a stark fact: The era of social democratic dominance in Europe is over. That does not mean that social democracy is in a state of terminal decline; in all likelihood, these parties will continue to play leading roles on the center left. But a return to their electoral dominance of the 1960s and 1970s is unlikely. The world has changed too much, and their center-left competitors are too strong. This means that progressives in advanced countries face a coalitional challenge. They must knit together the disparate progressive forces of different countries into dominant electoral and governing forces. Only in this way can the power of rising progressive diversity be harnessed.

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The challenge of growth
But how can we actually knit together this coalition? To put it as simply as possible, we must meet the challenge of slow growth head on. This has been done before, and it can be done again. Conversely, if that is not done—if the current era of slow growth and high inequality continues—the emerging progressive coalition will come together only fitfully and will be unstable when it does. To address the challenge of growth successfully, we must learn the correct lessons from history. A recent leader article in The Economist,20 drawing comparisons between today and the “Gilded Age” of globalization at the end of the 19th century, argued that a new progressivism was more urgent than ever. The late 19th century was, of course, a period characterized by technological revolution and profound economic integration similar to that which we are experiencing today. It was also an age of “conspicuous consumption” and enormous inequality, through which the top of society amassed huge wealth. As historians have illustrated, the growing gap between rich and poor became increasingly unsustainable socially, economically, and politically, and it gave rise to a wave of reforms on both sides of Atlantic Ocean. Think of former U.S. President Theodore Roosevelt’s trust busting, Lloyd George’s People’s Budget, and Otto von Bismarck’s first steps towards a welfare state.21 The central objective of all of these reforms was to produce a fairer society that remained economically vibrant. Following World War II, these progressive reforms provided the foundations for the achievement of postwar social democracy in Europe and the Golden Age of American liberalism. During this period the creation of the mixed economy and a strong welfare state helped harness the best aspects of capitalism and protected the people from its worst aspects. This model varied across nations, of course, but all of them employed similar theoretical and practical models—Keynesian demand management, the provision of public goods, social-security measures, and cooperative labor and management structures. The combination of sustained economic growth, full employment policies, and social provisions generated unprecedented prosperity. Growth financed redistribution, which in turn encour-

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aged consumption, which in turn stimulated faster growth. This approach produced a virtuous cycle that helped raise living standards for hundreds of millions of people, improved life chances and equality of opportunity, and helped narrow the gap between rich and poor. Starting in the 1970s, however, it became increasingly difficult to manage tradeoffs between unemployment and inflation, as the complications of a globalizing economy—including increased competition and the growth of the labor force— started to bite and technological innovation began to transform the product market and workplace. These trends began to undermine the stable international economic relationships of the postwar Bretton Woods system, which included fixed exchange rates and the capacity to maintain full employment. The coup de grâce was administered by the OPEC oil-price shock of 1973. Inflationary pressures that had been building up inside the advanced countries could no longer be contained, producing high inflation rates that could not be brought down by high unemployment. Progressives at that time were unprepared with either an alternative to or an extension of the postwar Keynesian system to fix this problem, and the entrenching of “stagflation” brought an end to the Keynesian consensus.

Conservative counterrevolution
Conservatives were quicker to respond politically to this crisis, setting in place a counterrevolution, which began in earnest during the 1980s and was spearheaded by U.S. President Ronald Reagan and U.K. Prime Minister Margaret Thatcher. Conservatives had never been happy with the Keynesian consensus: Ideologically, they were opposed to the idea that the unregulated market had intrinsic flaws that only government could correct. So when the Keynesian system stalled, conservatives seized the opportunity to reinstate their views and discredit government’s role. They succeeded beyond their wildest dreams, replacing the Keynesian consensus with an economic program that emphasized the unregulated workings of the market—especially in the financial sector—a decreased role for social spending, and a commitment to price stability over full employment. The results of the conservative economic regime have not been not good, and they weren’t good even before the global financial crash in 2008 and the Great Recession that followed it. In every important way, conservative economic results are far inferior to those of the Keynesian era. Living standards have grown more slowly since the mid-1970s, and inequality has risen, most spectacularly in the

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United States and the United Kingdom. Moreover, the post-1973 period compares poorly to the Keynesian era in terms of overall growth. In other words, it’s not just that post-1973 growth has been poorly distributed; there has also been less of it. Compared to the Keynesian era, the annual growth rate in the conservative era has been around 2.5 percentage points less in European countries and 1 percentage point less in America.22 A similar slowdown can be observed in real per-capita growth in gross domestic product, or GDP, which has been down 2 points a year in Europe and half a point a year in America since the early 1970s. Over several decades these slow growth rates have produced massive shortfalls in national wealth and have severely cramped growth in living standards. The statistics on inequality are even more revealing. From World War II until 1980, the bottom 90 percent in the United States took home 65 percent of national income. The top 10 percent took home 35 percent, and the top 1 percent took home 9 percent. As former President Bill Clinton has noted, that was “enough inequality to reward talent, hard work, creativity, and good ideas.”23 Since 1980, however, the bottom 90 percent’s share of national income has dropped from 65 percent to 52 percent, according to the OECD. The top 10 percent’s share has risen from 35 percent to 48 percent of total national income, and the top 1 percent has increased its share of national income from 9 percent to 22 percent. Furthermore, social mobility has fallen dramatically. Though inequality in Europe hasn’t seen such a staggering shift, it has still grown significantly. According to the OECD, the Gini coefficient—which measures inequality—in many European countries rose from 0.25 in 1985 to between 0.3 and 0.35 in 2008. In northern European countries such as Germany, the Netherlands, Sweden, and Finland, the average income growth of the top 10 percent in these 23 years was between 1.6 percent in Germany and 2.4 percent in Sweden, while the bottom 10 percent grew much more slowly at an average rate of 0.4 percent across these countries. These results do not yet take into account the effects of the economic crisis. While many in the higher income bracket remain unaffected, youth unemployment in some southern European countries has skyrocketed to around 50 percent, causing social unrest and unprecedented intergenerational inequality.24 The levels of inequality currently present in the industrialized world would be familiar to former U.S. President Roosevelt, Lloyd George, and Otto von Bismarck.

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Third way successes
Conservatives would like to believe, of course, that these socioeconomic transformations and the hollowing out of the middle class are the consequences of inexorable global integration and technological trends that cannot be countered by public policy. Economists such as Tyler Cowen, for example, have observed that the financial gains from technological innovation accrue disproportionately to those at the top.25 The research done by Shoshana Zuboff at Harvard Business School also illustrates that each technological advance leads to a loss of low-skilled jobs elsewhere in the labor market.26 Despite these general arguments, however, historical evidence points to the fact that policy does still matter and can indeed mitigate or reverse these trends, even in a globalized high-tech era. Consider, for example, what former President Clinton’s record of progressive economics produced.27 Under the eight years of the Clinton administration, the following occurred: • 23.1 million new jobs were created, 10 times more jobs than were created under former President George W. Bush prior to the economic collapse in 2008. • The economy grew by 35 percent, twice as fast as under President Clinton’s successor. • Wages increased significantly, while they actually declined under former President Bush. • One hundred times more people were raised out of poverty than during the two Reagan terms and two Bush terms combined. • The budget was balanced, our debt was paid down, and the United States was on a path to be debt free by 2013. Progressive economics also worked in the United Kingdom under New Labour leadership. As Liam Byrne notes, during New Labour’s period in office prior to the 2008 economic crisis, the governments led by former Prime Ministers Tony Blair and Gordon Brown delivered a number of major achievements, including:28

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• Record consistent economic growth and productivity gains • Record high employment, with 2.8 million more people working • 500,000 fewer children living in poverty • The poverty rate of pensioners down by a third • A doubling in the annual growth rate of income for the poorest 20 percent Progressive economics also delivered results in the Netherlands under former Prime Minister Wim Kok, and former Chancellor Gerhard Schroeder in Germany. Thanks to Prime Minister Kok’s “Purple Cabinets” between 1994 and 2001, Dutch unemployment declined from 7.5 percent in 1996 to 3.5 percent in 2001, while government debt shrunk from 75 percent of GDP in 1994 to around 50 percent of GDP by 2001. The German economy has profited from Agenda 2010 and the Hartz labor-market reforms that Schroeder implemented in 2003. Though it first caused a small increase in unemployment, the resulting increase in German competitiveness has helped Germany retain one of Europe’s strongest exportdriven economies and its lowest unemployment rates. She probably won’t admit it publicly, but current Chancellor Angela Merkel’s Germany wouldn’t be doing so well—and she wouldn’t be standing so tall—had former Chancellor Schroeder not decided to put country over politics when he pushed through Agenda 2010. Of course, the third way’s approach to growth differed from the Keynesian consensus. While the latter was premised on a macroeconomic policy focused on managing aggregate demand in national economies, the third way focused on mesoeconomic and microeconomic supply-side measures that enabled and empowered individuals through education, skills, and retraining and firms through investment in research and development. It was an approach that sought to endow everyone, regardless of the circumstances of their birth, with the skills and resources that they needed to achieve their ambitions and realize their hopes, even in the face of strong economic forces that sometimes seemed daunting. Unfortunately, the global financial crisis exacerbated all of the worst trends of the past three decades, compounding the challenges facing the middle class. To respond effectively to the current crisis and the profound challenges facing today’s middle class, progressives will need to promote a growth strategy that both draws

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on the lessons of the Keynesian consensus and the third way and offers a fundamental alternative to the premises of neoclassical economics.

A new progressive growth strategy
This new growth strategy should be built around the following five central pillars: • Investing in education, science and technology, and modernized infrastructure • Reforming financial markets so that moral hazard is reduced and access to finance for start-ups and small- and medium-sized enterprises is improved • Nurturing employment growth in the “caring” sector, which is labor-absorbing and employment intensive • Designing a fairer tax code that rewards innovation and supports growth but also provides for a more equitable (pre)distribution of the benefits • Creating easier paths to legal immigration and supporting the growth and participation of more women in the workforce This is a positive and confident agenda that uses government investments and incentives to build and shape new markets rather than simply regulating market failings and excesses—although this will, of course, still be necessary. It is an agenda that focuses on enabling citizens and the private sector to thrive in a globalized world, as well as creating new market opportunities. It is also an agenda that seeks to harness the efficiency gains delivered by the more dynamic sectors of the economy to ensure that employment growth occurs in labor-intensive sectors, for which Wendy Carlin, professor at a university in London, has argued.29 Finally, and perhaps most importantly, it is an agenda that provides significant potential for the creation of new middle-class employment opportunities in knowledgeintensive industries and the fight to combat climate change. As Robert Pollin and Jeannette Wick-Lim of the University of MassachusettsAmherst have illustrated,30 fighting global warming and transforming America into a green economy is a massive challenge, “the work of a generation and specifically, the work of millions of people, performing the jobs needed to build the green economy.” Research by Kate Gordon, Louis Soares, and Stephen Steigleder of the

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Center for American Progress shows that millions are already employed across the globe in the production of clean energy, with millions of jobs still to come.31 Perhaps more interesting is that these “green jobs” span industries and occupations and provide opportunities for low-, middle-, and highly skilled workers alike. Employment growth is also taking place in innovation-driven sectors such as the “app” economy. Indeed, servicing applications for mobile devices, whether through design of the application itself or via help-desks, is already a significant growth sector in the United States. In his research for the Progressive Policy Institute, Michael Mandel estimated that nearly half a million people were employed in the U.S. app economy in 2012.32 Interestingly, these jobs are not only located in California’s Silicon Valley but are also spread across the nation, including in greater New York, Texas, Washington state, and Illinois. We would not wish to claim that the app industry is the future of the American economy. Indeed, growth in this area depends on future developments in social media, cloud computing, and legislation on privacy currently being discussed in Europe. It does, however, illustrate that new sectors can arise that offer large employment opportunities in hitherto nonexistent sectors. Similarly, there is reason to be optimistic about more traditional sectors such as manufacturing. In its study “Made in America, Again,” the Boston Consultancy Group provokingly predicts that 20 million new jobs could be created in the American manufacturing industry by 2020. During the past two years, almost 500,000 new manufacturing jobs have been created, and the United States still accounts for 19.4 percent of global manufacturing—not far behind China’s 19.8 percent.33 According to the study, rising Chinese wages, higher U.S. productivity, cheap new domestic energy sources, a weaker dollar, and rising transportation costs will close the gap between the United States and China on many goods, particularly those that are not labor intensive. As for “labour-absorbing services,” a recent study by Fundación IDEAS points to the potential for growth in this sector too. Over the next two to three decades, it predicts that a growth in social services, particularly those connected with an aging society and the care and education of infants, will help dynamize the labor market as part of a new pattern of growth.34 Indeed, increased care for the elderly and a growing demand for preschool education over the next two decades may potentially add between 0.5 percent and 1.5 percent to GDP growth, according to the study. This could result in a 3 percent growth in the overall labor market.

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When it comes to immigration and diversity, these ongoing structural changes also appear to be drivers of growth. As studies by Harvard University illustrate,35 immigration is a significant factor in enhancing America’s economic competitiveness. Twice as many immigrants as U.S. citizens apply for patents. Overall, immigrants are responsible for 25 percent of all U.S. patents and are more likely to start businesses. First-generation immigrants started 52 percent of the new businesses in Silicon Valley in the 1990s, and they now own half of the small businesses in New York City. As the sociologist Richard Florida has argued,36 creating diverse and tolerant communities is also crucial to nurturing creativity and innovation. According to Florida, a truly creative community can no longer be achieved simply by recruiting more companies through such things as tax incentives. While a solid business climate is clearly important, having an effective people climate is even more essential, as is remaining open to diversity and actively working to cultivate it. In concrete policy terms, progressives should consider a broad sweep of initiatives to help drive the new growth strategy, including: • Establishing infrastructure banks or bonds—in Europe possibly at the European Union level—to allow states and local governments to help finance critical projects that boost economic growth and to lower the risk rating of these projects, thereby making it easier to leverage private capital into them. • Improving access to capital for small- and medium-sized enterprises at preferential rates and creating more apprenticeships to encourage and support more skilled workers entering the industrial workforce. • Supporting the transition to a new energy economy by promoting programs to help households improve the energy efficiency of their homes, establishing energy-efficiency standards for all household products and vehicles, and investing in and subsidizing research and development in clean energy production, distribution, and storage. • Implementing a social-investment agenda to improve the quality and accessibility of education in future economic sectors and expanding preschool education for young workers and training for current workers.

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• Increasing the security and vibrancy of the middle class by offering improved basic services such as health services and care for the elderly and experimenting with new savings accounts designed to help individuals prepare for and fund their future public-service needs. To successfully implement such initiatives and build necessary political support, however, two reform fronts have to be opened. The first is reforming government. The second is reforming the global system. Without these changes, the new growth strategy is likely to fail both politically and operationally.

Reforming government
In terms of government reform, progressives will need an approach that goes beyond defending the welfare state. This is both a question of restoring the state’s fiscal credibility and reimagining the core identity of progressive politics. When it comes to the fiscal credibility of the state, a key issue for progressives will be to improve the resilience of the tax base. On the domestic front, this will require refocusing taxation away from salaries and incomes and toward capital and property. Proposals to adopt a financial-transaction tax in Europe—which will both mitigate the most excessive swings of the financial markets and provide the European Union with funds to invest in infrastructure—are also worthy of consideration. Beyond this, however, progressives will need to tackle the legitimacy crisis mentioned earlier in this paper and show that the state is both efficient and effective. That is to say, we will need to ensure that citizens are getting value for their money. At the Center for American Progress, we call this focusing on “Doing What Works.” In this regard, we place an emphasis on ideas that: • Protect “growth oriented” public finances such as investment in human capital, infrastructure, innovation, and research and development. • Eliminate or reform misguided spending programs. • Boost government productivity by streamlining management and strengthening operational supports.

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• Build a foundation for smarter decision making by enhancing performance assessment and transparency. Clearly, in an era when there are fewer resources available, distinguishing between monies invested in future human, technological, and physical assets from those committed to short-term spending becomes ever more critical. Progressives need to experiment with an evolution of the “Golden Rule,” which states that government will borrow only to invest and not to fund current spending. This idea has taken hold in France, Germany, Italy, and Spain, as well as in the United Kingdom. In order to promote intergenerational discipline, we must also explore further the idea that the day-to-day spending that benefits today’s taxpayers should always be paid for with today’s taxes, not leveraged investment. Similarly, progressives should investigate whether the establishment of a “delivery unit” similar to that created within the U.K. prime minister’s office in 2001 under Tony Blair can help ensure that money is being well spent and can provide a knowledge base for smarter decision making. The U.K. prime minister’s delivery unit tracked the performance of public-service reforms against a set of targets to ensure that progress was being made and that money was being well spent. As more data became available, it also allowed public servants to evaluate whether experiments and innovations were working and to generalize them across the system. These and other ideas, such as CAP’s proposal to reorganize government to help promote competitiveness, are worthy of further examination by progressives everywhere. Finally, progressives should also experiment with the use of new information technology in the delivery of services and the role that market mechanisms can play in helping people finance their own social services throughout their lifecycles. People will, of course, always need insurance and a social safety net. But because expectations have risen beyond this, progressives cannot seek to endlessly expand state provision. To create an opportunity society in which those who can take greater responsibility for their own care and education do so, we need to work with financial-services providers and cooperatives to help people build the resources that they need to cope with different stages of their lives. As demand for preschool education, elderly care, and lifelong learning increases, progressives should explore innovations in public-private savings schemes that are designed to fund the services needed at particular stages of life.37

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Combined, these ideas for economic and government reform should help shift the debate away from a narrow opposition to austerity or growth, and focus our attention on the need to structurally reform government and steer our economies toward the industries and services of the future. As with the postwar era, however, domestic policy alone will not be sufficient. We will need a global economic architecture that reinforces and compliments our domestic goals. In short, a new New Deal at home will require agreement on a global New Deal abroad.

Reforming the global system
In November 2008, when then-President George W. Bush convened the firstever meeting of the G20 nations at the level of heads of state and government to address the global financial crisis, 38 many felt that a new era of global governance may be in the making. While it was in part an implicit recognition that the G7/8 nations were no longer a sufficient group to manage profound economic challenges, there was also optimism that this moment would be a golden opportunity to overhaul global financial governance. Indeed, in the two following summits in London and Pittsburgh, Pennsylvania—chaired by U.K. Prime Minister Gordon Brown and President Barack Obama, respectively—there seemed to be agreement to protect employment and support growth, as well as a sense of urgency that the global community should act in concert. By the time the Toronto summit happened in mid-2010, however, that energy had dissipated, as had the agreement about the direction that global policy should take.39 Ironically, while the global institutions such as the World Bank and the International Monetary Fund became increasingly concerned with aggregate demand, inequality, and employment, the G20 focused less and less on addressing these issues. It is now clear that a shift in global governance will not be achieved without significant political effort. As a consequence, at last year’s Global Progress conference in Madrid, the Center for American Progress and Fundación IDEAS asked leaders from Europe, Africa, and the Americas to sign a declaration calling for a greater focus in international policymaking forums. Signed by the now-President of France Francois Hollande, leaders of progressive parties across Europe, the South African Finance Minister, and former Brazilian President Luiz Inacio Lula da Silva the statement called on the G20 to:

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• Agree on a new global growth pact, following the recommendations of the Pittsburgh and London summit agreements. • Link growth and employment creation to the fight against climate change and environmental policies. • Make the creation of good jobs a direct goal, not a side effect of other policy initiatives. • Promote investment and support for small- and medium-sized enterprises to create more jobs. • Agree to increase investment in research, development, and innovation to help create the industries of the future. In the months and years to come, progressives must continue to advocate and aggressively fight for the adoption of these principles. Earlier this year in Stockholm, participants at the Anne Lindh international seminar were focused precisely on how to regain the initiative in this field. Conceptualizing the challenge as rebalancing the negative and positive dimensions of global economic integration, participants argued in favor of reordering the hierarchy of economic institutions. Specific measures proposed included increasing the relative weight of the International Labour Organization and requiring the multilateral institutions and the G20 to work together to develop a concrete multiyear plan to support a global growth strategy that places good job creation and environmental sustainability at the center of global discussions.40 The general consensus coming out of the meeting was clear: It is now crucial for progressives to ensure that the Bretton Woods institutions once again support and nurture growth and employment. Moreover, future international agreements must also reflect and promote our core values, including labor rights and environmental standards. While reform of the international architecture in this vein will not be easy, it is indispensable for the future of progressives around the world.

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The coalition challenge
By embracing a new progressive growth strategy, social democratic parties can strengthen their appeal to new cohorts of voters and lay the foundations for a values-driven, policy-focused progressive coalition with other parties. To seize this historic opportunity, however, progressive parties must not only renew their agenda but also reinvent the way that they do politics. In this regard, a variety of strategic choices must be made. First, the coalitional challenge must be faced head on. Social democrats must pay far more attention to how they can work together with green and yellow parties— and even left socialist parties, where these parties are committed to a responsible political path—to form common electoral fronts around shared policy objectives. Former U.K. Prime Minister Tony Blair once argued that the greatest tragedy of 20th-century politics in Britain was that the progressive traditions of the Liberal and Labour parties were separated, allowing the Conservative Party to emerge as the natural party of government.41 As the disappointments surrounding the formation of the conservative and liberal coalition illustrate, this should not wait until after election results are in but rather should be pursued as an ongoing part of political-electoral strategy. In Germany, for example, the social democrats have created a joint think tank—Neuses Denken, which when translated means New Thinking—to help strengthen such a dialogue. Other parties should watch this development closely. Second, progressive parties need to look beyond party structures to find more collaborative ways of engaging with interest groups, charities, and others that share their objectives.42 In the United Kingdom, for example, the Labour Party effectively partnered with the Make Poverty History campaign and worked in partnership with churches across the nation. Hungary’s Together 14, spearheaded by former Prime Minister Gordon Bajnai, is working to unite opposition

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forces against Fidesz and includes members of political parties, civil society groups, and citizens who share progressive values.43 Third, as outlined in a recent CAP report, “Wii, The People,” progressives will need to invest in a broader set of institutions outside the party. In the United States a series of strategic long-term investments were made from 2004 onward in new think tanks, media organizations, training institutes, and campaign laboratories. These now contribute to what people in Washington, D.C., call the progressive infrastructure. This infrastructure provided the foundation upon which the American revival of progressive politics was built, creating the space for a resurgence of movement politics the type of which we have never seen before. Fourth, political parties and campaigns need to open up in unprecedented ways. Parties need to be open to the new ideas generated by outside groups and become more open to new talent nurtured and supported by nonparty organizations. The primary election process in the United States and Europe, which provides for an open and transparent election of the candidates and leadership, provides both an avenue for “new blood” to enter the party and a path to democratizing the party structure. Fifth, progressives need to embrace innovations in political communicating and organizing techniques. They must do so, however, in strategically intelligent ways. Following our 2008 presidential election, many progressive strategists and organizers made a pilgrimage to the United States to learn the latest innovations in political organizing and communicating. The vast majority of them came to study online communications and social media, hoping that they would find a new “silver bullet” that would help them modernize and re-energize their movements. On reflection, however, the following three lessons stand out organizationally from President Obama’s historic victories in 2008 and 2012: • Metrics: When you look at the success of the Obama campaign, it was clearly metrics driven. Numbers drove the choices made on every level, from the people who the campaign called to the effectiveness of its organization building to which email was sent to whom. • Inclusive accountability: The Obama campaign was both incredibly open and incredibly disciplined. The campaign provided multiple points of entry for volunteers and worked strategically to move volunteers up a “ladder of engagement” designed to increase the amount of time they would contribute to the

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cause. Yet despite this openness, the campaign’s structure and resources were targeted to very specific goals, and everyone in the campaign, from directors down to volunteers, was held accountable for those goals. • Integration of online and offline organizing: The Obama campaign embraced digital campaigning in a smart, relationship-building way. Too often progressive parties think that just by building social-media tools or having a Twitter account, they have embraced technology. They almost assume technology is the campaign. The truth is, however, that online and offline organizing must be integrated. Technology should serve the campaign goals, not define or drive them. Of course, the Obama campaign worked to raise millions of dollars, engage millions of supporters, and target voters in new and innovative ways. Perhaps more importantly, however, they designed a strategy, built tools, and trained staff and volunteers to integrate the use of these tools into their everyday organizing offline as well. In many political cultures, of course, there is resistance to such change from both party elites and rank-and-file members. Change is often disruptive. Yet resistance to change is a risky strategy. Many young people no longer view organized politics as the best route to changing society. Mainstream political parties appear unwelcoming and sclerotic to a generation that is less deferential to power. A new generation that wants to actively engage—more often on their own terms than not—is unlikely to wait long. Those who are offered the opportunity to participate can be encouraged to become more involved. Those who are excluded will find other channels for their energy. For progressive parties, the organizing challenge of the future will be how to attract or work in concert with those who hold common values and share similar goals but who do not hold the same, or indeed any, institutional affiliation. Parties that succeed will help build a movement for the future. Parties that fail will become monuments to the past. Finally, progressives need to renew their international structures. None of the projects outlined in this paper—the new thinking, organizing, and campaigning—will be possible without the creation of new structures to build and sustain a progressive majority. Here, as in previous eras, the role of international collaboration and organization will be crucial.

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During the 1990s the emergence of the progressive governance network, founded by former Prime Minister Blair, former President Clinton, and like-minded European leaders such as former Prime Minister Wim Kok, former Chancellor Gerhard Schroder, and former Prime Ministers Giuliano Amato and Goran Persson, played a crucial role in refining the arguments of the third way, helping identify best practices in policymaking and legitimizing sometimes-contentious political reforms by embedding them within a larger international movement. With the inclusion over time of Jean Chretien and Paul Martin—Canadian prime ministers from the progressive-centrist Liberal Party—the network also extended international discussions beyond the traditional progressive family for the first time ever. While today’s challenges differ from those of the past, progressives can learn from the successes and shortcomings of this network. For one, the opening up of debate to include more think tanks and nontraditional progressive partners must be continued. A new progressive internationalism must be more inclusive in this regard. Traditionally, of course, these discussions have focused on policy. These issue-focused meetings must now be complemented with a razor-sharp focus on electioneering—party reform, progressive infrastructure, and organizing. This is also the case with conservative international networks. As in the past, leaders struggling to promote this new kind of politics will benefit from shared experience and from embedding their attempts at reform within a revised and renewed progressive internationalism. The road to the new politics will not be an easy one, but it will be far more difficult without effective international collaboration. The time is right to start building a new progressive international that embodies the progressive diversity of the 21st century and reflects the need for a new openness in our approach to doing politics.44

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Conclusion: Back to the future
Two decades ago Francis Fukuyama’s seminal article, “The End of History,” captured the zeitgeist of the post-Cold War world.45 This was a period characterized by profound optimism, one in which the principles of liberal democracy appeared to have triumphed once and for all and globalization promised not just extended peace but also greater shared prosperity. It was in this context that the third way produced a revival of progressive politics first in the United States and then in the United Kingdom and continental Europe. But just as September 11, 2001, shattered that optimism and dramatically increased global insecurity and collective fear, so too has the global financial crisis undermined people’s hope for their own economic futures and the opportunities available to their children. In an era where inequality is on the rise and the middle class is being hollowed out, Fukuyama has once again captured the contemporary zeitgeist. In “The Future of History,” Fukuyama now argues that there is an urgent need for a progressive narrative capable of fostering hope for the middle class in developed democracies.46 In this contribution to that debate, we have argued that to develop this narrative, the traditional advocates of progressive policy—the social democratic and labor parties—must now respond to the concerns of emerging demographic groups and the presence of new political competitors that appeal to them. These new social groups are often much more concerned with the challenges of climate change, cultural and social diversity, and the hollowing out of middle-class opportunity than they are with the issues that are traditionally labeled as social democratic. Rather than viewing this new environment as a threat, however, we have proposed an approach to progressive revival that embraces these new concerns as a route to meeting the challenge of growth. Making the transition to a new energy economy and combating climate change or nurturing and supporting diversity and immigration—both of which are demands of politically important social cleavages—are strategically smart political moves.

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It helps social democrats and labor parties appeal to citizens who prioritize these issues and build objective-driven coalitions with social liberals and green parties, with whom they will likely have to govern in the future. It is also the foundation of a better growth strategy and thus the right thing to do in policy terms. We have argued that a new progressive alliance—a traffic-light coalition made up of red, yellow, and green parties—can be forged, one that is not only stronger politically but that also delivers more than what reds, greens, or yellows can offer on their own. Today, then, our policy agendas and political strategies have become inextricably interwoven and self-reinforcing. We believe that this coalition, which is both values driven and demographically rooted, can and must be the future of progressive politics in the 21st century. To develop such an agenda, we further argued the need for a three-pronged policy agenda focused on economic investments to support the middle class, a structural reform of government and entitlements to make sure that public services are delivered more efficiently and effectively, and a new global economic architecture that complements and supports this domestic reform program. We also argued, however, that policy reform alone will not be enough and that progressives must now embrace a new form of politics, one that is more open to collaboration and coalition building with other progressive parties and nonparty movements. We remain optimistic that if progressives embrace such an agenda, they will once again be a politically viable force, one that will be able to restore hope for today’s middle classes and convince them that they and their children still have brighter days ahead.

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About the authors
Matt Browne, John Halpin and Ruy Teixeira are Senior Fellows at the Center for American Progress.

The authors dedicate this paper to Olivier Ferrand, founder of the French think tank Terra Nova, from whom we learned a great deal, and with whom we shared a common perspective on the future of progressive political strategy.

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1 John D. Podesta, “The New Progressive Challenge,” Amsterdam, BKB Campaign Watch, September 27, 2012, available at http://bkbcampaignwatch.nl/bkb-lezingjohn-podesta/. 2 Matt Browne, John Halpin, and Ruy Teixeira, “The European Paradox” (Washington: Center for American Progress, 2009), available at http://www.americanprogress.org/wp-content/uploads/issues/2009/10/pdf/ europeanparadox.pdf. 3 In Germany, for example, the proportion of blue-collar workers in the workforce has been cut in half since the late 1950’s, making up just more than one quarter of the workforce today, while the proportion of whitecollar workers has nearly tripled to 57 percent. Similarly, in Sweden the proportion of blue-collar workers has been cut in half to one quarter of the workforce just since the mid-1970’s. Data drawn from Matt Browne, John Halpin, and Ruy Teixeira, “From Welfare State to Opportunity State: How Progressives Should Respond to Demographic Change” (Washington: Center for American Progress, 2011), available at http://www. americanprogress.org/wp-content/uploads/issues/2011/04/pdf/synthesis_report.pdf. 4 In Germany, for example, the industrial sector has declined from 55 percent of employment in 1950 to just 26 percent today. Similarly, in the Netherlands industrial employment dropped from 40 percent to 20 percent of the workforce between 1950 and 2003. It dropped from 47 percent to 24 percent in the United Kingdom over the same period. See: Browne, Halpin, and Teixeira, “From Welfare State to Opportunity State.” 5 In the Netherlands, for example, union membership dropped from 32 percent to 24 percent of the workforce between 1970 and 2009. Union membership in Australia has been cut in half just since 1990, declining from 41 percent to 20 percent of workforce. See: Ibid. 6 See: Gerassimos Maschonas, “Lower Classes or Middle Classes?: Socialism and its Changing Constituencies in Great Britain, Sweden and Denmark,” Presentation to the Council for European Studies, March 5, 2008; Anthony Painter, “The New Pluralist Imperative in Britain” (Washington: Center for American Progress, 2011), available at http://www.americanprogress.org/ wp-content/uploads/issues/2011/04/pdf/uk_report. pdf. 7 Rene Cuperus, “The Populist Deficiency of Social Democracy.” In Matt Browne and Patrick Diamond Edition: The Renewal of Social Democracy,Politico’s 2004 8 In the Netherlands, for example, the proportioned highly educated rose 15 points between 1985 and 2009. In France this proportion rose 14 points between 1982 and 2006. The highly educated group is expected to continue its rapid growth in the future. 9 As political scientist Gerassimos Moschonas has shown, as the traditional working class declined in size and reduced its support for social democrats, these parties did manage to compensate—at least partially—by attracting white-collar votes, frequently at higher rates than they did in earlier decades.As a result, the weight of white-collar voters among the social democratic electorate has increased dramatically. In Sweden, for example, 67 percent of social democratic voters were blue collar in 1976, compared to just 27 percent who were white collar. By 2006 the blue-collar proportion had dropped to 40 percent while the white-collar share had risen to 49 percent. See: Browne, Halpin, and Teixeira, “From Welfare State to Opportunity State.” 10 In an analysis of 2006 data on 12 European countries— Austria; Belgium; Denmark; Finland; France; Germany; Ireland; the Netherlands; Norway; Sweden; Switzerland; and the United Kingdom—social democrats underperformed across countries by 2 points among the college educated and by 1 percentage point among professionals, while the rest of the center left overperformed by 6 points among the college educated and by 8 points among professionals. In the 2009 election in Germany, social democrats did 5 points worse among professionals than among nonprofessionals and 7 points worse among the college educated than the noncollege educated, while the greens did 8 points better among professionals and 9 points better among the college educated than among those without these characteristics. See: Ibid. 11 The United States provides a limiting case—essentially a pure two-party system—and the Democrats do indeed dominate the professional vote. The other side of the equation is shown by countries such as the Netherlands and Germany, where liberal and green parties drain away progressive professionals to the clear detriment of the social democrats. This contrast is neatly illustrated within one country, Australia. In the Australian system, the primary vote is a voter’s first choice among all parties, and the two-party preferred vote is, in essence, which of the two main parties—the Labor Party or National Coalition—the voter prefers. In 2007 professionals x the Labor Party 43 percent of their first preference vote—2 points under the overall electorate—but gave it 58 percent of their two-party preferred vote—4 points more than the overall electorate. The difference was an unusually high primary vote for the greens among this group, which then translated into Labor support on the two-party preferred vote. See: The Chiffley Research Center, “Reclaiming Progressive Australia: Demographic Change and Progressive Political Strategy in Australia” (2011). 12 In the United Kingdom the nonwhite—black, Asian, and minority ethnic, or BAME—population, is projected to reach 20 percent of the population by 2031, compared to making up just 13 percent of the population in 2001. In the Netherlands the migrant population share is projected to reach 26 percent by 2040. In Spain the immigrant population has grown from 200,000 to just under 6 million since 1981. Around 150,000 newly naturalized citizens are being added to the election rolls every year in France, which could mean 750,000 newly naturalized citizens participating as first-time voters in that country’s 2012 presidential elections. See: Browne, Halpin, and Teixeira, “From Welfare State to Opportunity State.” 13 There are differences, however, by country of origin. In Germany, for example, migrants from Turkey are particularly likely to vote social democratic, while migrants from the former Soviet Union are least likely to do so. In France migrants of African origin and their children are most supportive of the left. In the United Kingdom those of Caribbean origin are most supportive of the Labour Party, although all BAME subgroups display much higher support rates for Labour than the rest of the population. Regardless of variation, however, the overall tendency is clear and unambiguous. The rising immigrant/minority population is a boost for progressives in general and social democrats in particular. See: Ibid.

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14 In the United Kingdom the number of single-person households rose by 73 percent between 1981 and 2008. In the Netherlands, the proportion of unmarried voters between 20 and 65 years of age increased from 26 percent to 36 percent in just the 12 years from 1998 to 2010. In Australia between 1991 and 2006, the proportion of never-married or divorced women among women 25 to 29 years old rose by 14 points from 25 percent to 39 percent. See: Ibid. 15 Never married and never in a civil partnership. See: Ibid. 16 In the Netherlands in 1950, for example, just 8 percent of the population was above 65 years of age, but by 2040 that number is expected to reach 27 percent. It’s worth noting, however, that by 2040 the Millennials will be between the ages of 40 and 62 and on the cusp of dominating the ranks of seniors. This could over time mitigate any conservative effects of a seniorvoter bulge. In addition, by that year the generation following the Millennials—those born between 2001 and 2020—will be fully in the electorate. This is a generation that should be even more affected by the modernizing trends that have shaped the Millennials, and depending on their politics, this new generation could, in tandem with the Millennials, make the longterm conservative political effects of societal aging far less daunting then they now appear. Still, it is undeniable that the relatively low population weight of the Millennials will limit their progressive political impact for now. See: Ibid. 17 In 2009 social democrats in Germany did 8 points worse among Millennials than among the earliest generation of voters, while the greens did 15 points better among Millennials than the oldest voters. In the same 12 European countries mentioned earlier, social democrats underperformed across countries by 4 points among Millennials, while the rest of the center left overperformed by 9 points among these voters. Most shockingly, in Hungary social democrats’ current support among the Millennial generation is so low that it is not significantly different from zero in a statistical sense. See: Ibid. 18 In the Netherlands, for example, half of the Labour Party’s supporters in the 2010 election were more than 50 years old, while just 17 percent were between the ages of 18 and 34. In Sweden every successive generation has had a smaller proportion of social democratic supporters, inexorably driving the average age of party supporters upwards. See: Ibid. 19 For a discussion of the last point, see: Matt Browne and Michiel Emmelkamp, “Wii, the People” (Washington: Center for American Progress and WardiBeckmaann Stiftung, 2012 20 The Economist, “True Progressivism,”, October 13th, 2012, available at http://www.economist.com/ node/21564556. 21 Karl Polanyi, The Great Transformation: The Political and Economic Origins of Our Time (Boston: Beacon Press, 2001). 22 Ruy Teixeira and John Halpin, “The Origins and Evolution of Progressive Economics” (Washington: Center for American Progress, 2011), available at http://www. americanprogress.org/issues/progressive-movement/ report/2011/03/14/9311/the-origins-and-evolution-ofprogressive-economics/. 23 Bill Clinton, Back to Work: Why We Need Smart Government for a Strong Economy (New York: Knopf, 2011).

24 BBC, “Spain unemployment rate hit a record: youth rate at 55%,” January 24, 2013, available at www.bbc.co.uk/ news/business-21180371. 25 Tyler Cowen, The Great Stagnation: How America Ate All the Low-Hanging Fruit of Modern History, Got Sick, and Will (Eventually) Feel Better (New York: Penguin Group, 2011). 26 Soshana Zuboff, In the Age Of the Smart Machine: The Future Of Work and Power (New York: Basic Books, 1989). 27 Clinton Foundation, “Clinton-Gore Economics: Understanding the Lessons of the 1990s,” October 28, 2011, Georgetown University, Washington, D.C. 28 Liam Byrne, “The new centre-ground: how can progressives win a majority?” Progress and Center for American Progress, 2012) 29 Wendy Carlin, “A Progressive Economic Strategy: Innovation redistribution and labour-absorbing services.” Working Paper (Policy Network., 2012). 30 Robert Pollin and Jeannette Wick-Lim, “Job Opportunities for the Green Economy” (Amherst, MA: Political Economy Research Institute, 2008). 31 Kate Gordon, Louis Soares, and Stephen Steigleider, “Preparing America’s Workforce for Jobs in the Green Economy: A Case for Technical Literacy” (Washington: Center for American Progress, 2012). 32 Michael Mandel, Technet (2012). Where the jobs are: the App Economy, Progressive Policy Institute 33 Harold L. Sirkin, Michael Zinger, and Douglas Hohner, “Made in America, Again: Why Manufacturing Will Return to the US” (Boston: Boston Consulting Group, 2011). 34 Gustavo Nombela Merchan, “Ideas for a New Economy” (CITY: Fundación IDEAS, 2010) 35 US Immigration, “America’s Immigration Policies Hurting Its Future,” available at http://www.usimmigration. com/immigration-policies-hurting-future.html (last accessed April 2013). 36 Richard Florida, “The Flight of the Creative Class: The New Global Competition for Talent” (New York: Harper Collins, 2010). 37 Kitty Usshe, “What is per-distribution?” (London: Policy Network, 2012). 38 Will Straw and others, “The Case for Leadership: Strengthening the Group of 20 to Tackle Key Global Crises” (Washington, Center for American Progress, 2009), available at http://www.americanprogress.org/ issues/economy/report/2009/03/31/5758/the-case-forleadership/. 39 Matt J. Browne, “Where next for the special relationship?”, Politico, July 20, 2010, available at http://www. politico.com/news/stories/0710/39947.html. 40 For further discussion, see: Richard Samans, “Transitioning to a New U.S. International Economic Policy: Toward a ‘Global Deal’ to Revive and Broaden the Benefits of Growth (Washington: Center for American Progress, 2008), available at http://www.americanprogress.org/ wp-content/uploads/issues/2008/12/pdf/global_deal. pdf.

31  Center for American Progress  |  A New Progressive Alliance

41 Tony Blair, “The Third Way: New Politics for a New Century” (London: Fabian Society, 1998). 42 Browne and Emmelkamp, Wii, The People.” 43 Haza és Haladás, available at http://www.hazaeshaladas.hu/ (last accessed April 2013). 44 For a further discussion of this point, see: Matt Browne, “After Cape Town: Where Now for Progressive Politics,” a “non-paper” distributed to international secretaries attending the Socialist International Congress, September 2012.

45 Francis Fukuyama, The End of History (Princeton, NJ: Princeton University Press, 1992). 46 Francis Fukuyama, “The Future of History: Can Liberal Democracy Survive the Decline of the Middle Class?”, Foreign Affairs, January/February 2012.

32  Center for American Progress  |  A New Progressive Alliance

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