The Paradox of Social Democracy

The problem for social democracy is that over time it subverts the democracy and trust that it purports to uphold. The large national projects that it assumes must be undertaken on a national basis necessitate government cooperation with the large corporations that have the know how and capital to undertake large projects. Large numbers of employees must be hired using public funds that by definition are extracted from the private economy.

Because of these two elements of social democracy over time it subverts both democracy and trust. The first in that it inherently creates projects and partnerships with large corporations that are "too big to fail." In other words, the project or agency or fund or whatever, must ultimately be backed by public money because it becomes so large a part of the economy that its failure would destroy that entire economy. The choice of funding or defunding is taken away from Congress, the democratically elected representatives and place in the hands of unelected agencies, thus subverting democracy. And trust is diminished by social democracy because it tends to turn government into a faction. Government ceases to become the arbitrator of society but increasingly becomes the employer of last resort in the economy. Government and those it employs become the ends in themselves, not the brokers among interest groups but an interest group with the force of law behind it incessantly grasping, grabbing and griping for a bigger portion of a diminishing economic pie that it plays no role in expanding. This faction of government by its nature creates an atmosphere of us versus them. Government ceases to become an agent of the People and a trusted arbitrator and regulator. It becomes a group competing for the succor and sustenance of a declining pool.

Listen to the words of Ben Franklin writing in 1774 about the dangers of allowing the Colonies to be more closely controlled by London,

"I cannot but apprehend more mischief than benefit from a closer Union; their(the British ruling class) wide-wasting prodigality and profusion is a gulf that will swallow up every aid we may distress ourselves to afford them. Here (London) numberless and needless places, enormous salaries, pensions, perquisites, bribes, false accounts and jobs devour all revenue and produce continual necessity in the midst of natural plenty. I apprehend, therefore, that to unite us intimately will only corrupt and poison us also."

Can we not say in our own time we see some of the same elements in our own government? Can we not see the breakdown of Democracy and Trust that in the 1770s led to a revolution?

Social Democracy

The argument for social democracy rests upon the premise of the idea of "public goods". This is an idea taken as self evident by social democrats and most America "progressives" today. The idea is that there are some goods and services, for instance railways and education, that are simply impossible to do exclusively in private economic ways. The state must, if these goods and services are to exist, must fund these activities.

If these goods and services do not exist then, so the theory goes, there is simply no nation. (so this progressive idea ironically accepts the idea of nationalism or a strong nation, supposedly a conservative idea) So, for the progressive social democrat, the existence of the nation itself depends upon some form of social democracy.

Another idea upon which social democracy rests is that of the corrosive effect of inequality. Where inequality is rampant any democratic government is at best dysfunctional, at worst impossible. This is because democratic government depends upon the trustful bonds of citizens to one another. This idea was first introduce in the 13 century by Ibn Khaldun, the Arab political philosopher. His idea of "Asabiya", societal trust, was considered to be the bond under which society thrived. With the diminishing of asabiya comes the decline of society. For the social democrat "rampant free markets" diminish trust or asabiya and thus lead to social decline