Academic journal article Capital & Class

Twenty-First Century Breakdown: Negotiating New Regulatory Regimes in the Nordic Lands

Academic journal article Capital & Class

Twenty-First Century Breakdown: Negotiating New Regulatory Regimes in the Nordic Lands

Article excerpt

Introduction

While a great source of misery for the common man, the global financial crisis has been something of an opportunity for regulation theorists: liberalism as a regulatory guiding principle has run out of steam, yet national policy-makers vary enormously in their repudiation of the liberal paradigm. In countries such as Britain, the touchstones of liberalism-government and financial market deregulation, slashes in social spending have persisted in the face of insurmountable evidence against them. Social upheaval and political action in the wake of the crisis have been guided by the right in a campaign against big government and regulation, even though the unrestricted growth of finance capitalism drove nations to the brink of ruin in the first place. In the Nordic countries, by comparison, the crisis prompted a resurgence of governmental controls, coordinated efforts by the social partners to manage the economic malaise, and a redirection of investment into emergent green technologies. (1)

Perhaps this national divergence is not surprising, since Scandinavia has been something of an outlier in the past quarter-century of liberalism. Despite some disorganisation among workers and some penetration of neoliberal ideology, continuing high levels of labour market coordination prevented the soaring rise in inequality that was so ubiquitous among other advanced countries, and strongly organised social partners have negotiated comparatively solidaristic pacts in response to the challenges of globalisation and deindustrialisation (Martin 2004; Munck 2007). Yet after the crisis, countries faced a different set of challenges, such as the reduction of global linkages and the decline of major service sectors, and it was not certain a priori that the recipe for success before the crisis would be equally attractive or deliver felicitous outcomes thereafter.

The mystery of these alternative cross-national responses invokes a broader question about how regulatory regimes evolve: how (and whether) countries adopt new organising principles in response to fundamental economic transformations, and how new regulatory systems are invented. Following the path-breaking work of Antonio Gramsci, regulation theorists have recently pondered the role of ideas in transforming the regulatory landscape, and these insights help us to understand why transformations sometimes fail to occur (Dannreuther and Petit 2006; Jessop, this issue). While changes in the regimes of accumulation are driven, at the core, by technological change, ideological change is necessary to complete the move to a new regulatory regime. Ideas do not land in a desert, and the institutions structuring class relations provide the landscape for the contested terrain in which the new organising principles evolve (Coates 2001).

This essay delves into the institutional structures that underpin the social relations of production, shape class conflict and cooperation, and enable the shift in dialogue leading to a new regulatory organising principle. I suggest that institutions defining the social relations of production regulate class caordination within the political sphere as well as class conflictwithin the domain of economic production. Variations in the capacities for class coordination have a critical impact on the ability of nations to adjust their regulatory regimes in response to major economic transformations. This observation has bearing on the Nordic countries' responses to the crisis. The institutional capacity to renegotiate the regulatory system in Scandinavia has permitted new commitments to social partnership to be forged in the heat of the crisis. Certainly path dependencies of the social democratic model eased the task of responding to the financial crisis and led policy-makers away from a resurgence of liberalism; but in addition, the dynamic processes of negotiation embedded in the social relations of production helped to enable the Nordic countries to correct more easily some of the excesses of liberalism. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.