Ingolfur Blühdorn, Uwe Jun, eds. Economic Efficiency--Democratic Empowerment: Contested Modernization in Britain and Germany. Lanham: Lexington Books, 2007. x + 335 pp. $39.95 (paper), ISBN 978-0-7391-1211-3.

Reviewed by Ulf Zimmermann (Department of Political Science and International Affairs, Kennesaw State University)
Published on H-German (January, 2008)

Efficiency versus Democracy

Governments today are pressured simultaneously to become more efficient and economical as well as more democratic and participatory. These two goals are usually considered irreconcilable, as explained by Arthur Okun in Economy and Efficiency: The Big Trade-Off (1975), but the debate continues in the United States as in Europe, as the September/October 2007 issue of the Public Administration Review attests. This collection of essays by British and German scholars reviews attempts in these areas in the recent reform agendas pursued by Britain's Labour Party and Germany's Social Democratic Party (SPD). These reform efforts are responses to sluggish economic growth, higher unemployment, and tighter budgets that are themselves the result of economic globalization, demographic shifts, and the simultaneous regionalization and internationalization of politics, all of which have produced widespread dissatisfaction with government. While the book focuses on attempts to deal with these issues politically, it also touches on the debate between traditional public administration and the "new public management," in which the former is criticized for not being sufficiently attuned to citizens' needs and the latter for being too reliant on markets. The "third way" that has been pursued involves variable networks or partnerships between the various stakeholders--public, private for-profit, nonprofit--which have not proven all too successful either economically or politically.

The volume consists of twelve chapters in five sections: one an introduction, two chapters on "Contexts and Concepts," five on "Structures and Strategies," three on "Actors," and a concluding one on "Prospects." In the introductory piece, "Reform Gridlock and Hyper-Innovation: Germany, Britain, and the Project of Social Modernization," the coeditors adeptly map the general terrain. Politics in Britain is more adversarial and more or less centralized while Germany's is more consensual and federal. While Britain under Tony Blair's Labour administration "hyper-innovated," Germany, despite Gerhard Schröder's efforts, remained "gridlocked" in the "Modell Deutschland" that once worked for Helmut Kohl.

In the "Contexts and Concepts" section, Uwe Jun ponders "Radical Reformers--Defiant Electorates?" and shows that Blair's "third way" achieved more economic than social success, while Schröder's effort to pursue the same path simply ran into a dead end on the persistent (party and popular) demand to retain the universalistic welfare state. Ingolfur Blühdorn similarly finds that promising-sounding third way concepts like "ecological efficiency" quickly reveal themselves (as our power companies profusely illustrate) to amount to mere economic efficiency.

The five chapters of the "Structures and Strategies" section begin with Lewis Baston's contention that, since Thatcher turned away from the British adaptation of the Modell Deutschland, the United Kingdom has been practicing "elective dictatorship" under the all-too-widespread belief that dictatorship is more efficient than democracy. The sclerotic performances of the dictatorships we have seen, as most palpably exposed in the GDR, belies that belief. And although Blair's reign was benevolent, his successes were limited to such constitutional reforms (radical in their context) as replacing hereditary with mere life peerages.

Like Baston, Frank Decker depicts rule by parliamentary majorities, to the exclusion of other elements, as more or less similarly illegitimate. More importantly, there has been a plebiscite transformation in that the voters elect only a given leader, and this development has led to more executive power. A similar centralization has taken place in Germany's "consensus" or "negotiation" democracy, given the relative powerlessness of its federal states (compared to those of the United States).

Sven Jochem traces a different path toward centralization. Tripartite (business, government, labor) social or employment pacts, like the Alliance for Jobs, were seen as Germany's new politics of the center to overcome gridlock. But with the failure of the Alliance, the Red-Green coalition quickly resorted to commissions, most prominently the one led by Volkswagen personnel manager Peter Hartz. The only reform that finally did go through, via Hartz IV, was to increase the retirement age--gradually--beginning in 2007. These new commissions have, by introducing new actors, somewhat deflated the power of the old corporatist ones, but this process has been neither more efficient nor more democratic. Perhaps its best consequence, though, is that it has sparked public debate, which enhances government legitimacy.

Reviewing the trade-off between efficiency and accountability, Matthew Flinders finds that New Labour's efforts to achieve more efficiency and overcome the traditional "Left-Right" dichotomy via more public-private partnerships put more emphasis on efficiency than on accountability and/or democracy. He also rediscovers, as demonstrated by the Chunnel case, that the private sector doesn't necessarily do things more efficiently; indeed, it frequently adds another layer of complexity that keeps democratic representatives (MPs) further removed from oversight. The push for participation met with similarly contrary results: when local populations were asked to take more responsibility for their community hospital, far fewer than New Labour hoped for were interested in participating.

Uwe Jun asks to what extent pressures for efficiency and professionalism in communication undermine the idea of a democratic membership party. Given their ubiquity today, if the media do not take up a party's policy issues, it might as well not have raised them. Thus, politicians have become finely intertwined with the media, which makes individual politicians less dependent on their parties. The SPD's new special media center has not had much success, partly because it continued to speak out of the two mouths of the Red-Green coalition partners. The New Labour communications machine has been more effective, but it seems to be perpetually campaigning, which has led to it being criticized for too much "spin."

Gauging efficiency versus democracy in the SPD, Elmar Wiesendahl notes that by 2003 party leadership was pretty much agreed that labor markets really needed to be made more efficient--not only did economists all seem to agree on this, the media echoed it as well, calling for the party to play a larger role. Accordingly, the SPD put forth labor reform proposals but the public remained unconvinced, media agreement notwithstanding; public opinion continued to be firmly wedded to the social welfare state. Communication failed because it was one-way--the party had not listened to voter preferences. This failure was reflected in the changing leadership style: where in his first term Schröder had been "presidential," in his second, he became "executive-authoritative," much like Blair.

Examining the viability of German trade unions, Josef Schmid and Christian Steffen find that, although still more powerful than Britain's, German unions are in trouble--it has been downhill ever since market conditions began their slide in the 1970s, and fewer young people are joining today. "German engineering" alone is not enough to carry all the unions and their workers. And there are vast discrepancies even across industries--while Porsche is making record profits, Opel is barely surviving at all. Though the authors fail to note it, this is hardly the unions' or labor's fault--it is a problem of management and its reading of the market. Looking at the political impact of the new genetics, Ian Welsh stresses the increasing prominence of networks and actors at all levels from local to global that are generated by something as enormously consequential as genetic science. He questions if this new genetics will lead to a social movement like that mobilized by nuclear power in Germany previously, which gave rise to the Greens. In genetics, as with the atomic bomb and numerous other technological advances, the science seems too far ahead of our "ethicopolitical and will formation" (p. 282). The public is not ready to decide, for example, whether to terminate pregnancies in which severe disabilities in the fetus can be diagnosed in advance.

In the concluding section, "Prospects," Ingolfur Blühdorn titles his chapter "The Third Transformation of Democracy." Changes in the global economy bring about commensurate changes in politics and policymaking as well as in democracy. In this politico-economic stew, he sees a politics of "simulation," which involves a mixture of democratic performance and the "metaphysics of efficiency." Today he does not see any single cause large enough to politicize people collectively to form social identities. Everyone is too obsessed with individualized identity construction, accomplished through the consumption of an ever greater and more differentiated, although less meaningful, variety of consumer goods, which really just legitimates global consumer capitalism. For him, this development signifies the end of the "emancipatory-progressive" project.

Blühdorn contends that politicization--which takes place through issues, people, and institutions--has diminished. Issues are reduced to negotiable codes, such as markets (like pollution trade-offs); people withdraw into their private pursuits; and institutions, similarly, focus on their core business (professionalization, pragmatism, best practices) and stress efficiency rather than any values. At the same time, though, a participatory politics with lots of local activity is still going on; it is not sufficiently meaningful, however, to sustain a notion of the self as an autonomous subject. The people's "simulated" politics mirrors the parties that are abandoning their "ideologies." His summation: "In the sense that the dissolution of the autonomous Self and its immersion into the consumer market is the distinctive and defining criterion of late or denucleated modernity, simulative democracy is the form" (p. 322). His is one of those perennial "decline of the West" stories that assumes there once was some sort of "authentic" participatory democracy or self-governance. Perhaps people have not cared more about politics than they do today, except in crises in which a basis of perceived deprivation or dissatisfaction coincided with the presence of effective leadership (Solidarity and Lech Walesa may suffice to illustrate a host of such cases. While we are perhaps overly preoccupied with the incommensurable excess of choice of consumer goods available to us, people in the past were preoccupied with more fundamental needs, as they still are in non-modernized countries. Perhaps it is undemocratic of Blühdorn to demand that people who have recently achieved the necessary level of income to become consumers share his post-materialist views.

The rest of the volume's essays are more empirical and descriptively and analytically detailed and sound. If the findings articulated in them sound somewhat dour, it may be because the scholars measured the actual results of these reform efforts against the parties' wishful rhetoric. That is as it should be, and there is a positive undertone: the people have sufficiently voiced their dissatisfactions and the parties have listened and adjusted accordingly, which is perhaps the best we can expect as long as politics remains the art of the possible.

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Citation: Ulf Zimmermann. Review of Blühdorn, Ingolfur; Jun, Uwe, eds., Economic Efficiency--Democratic Empowerment: Contested Modernization in Britain and Germany. H-German, H-Net Reviews. January, 2008.
URL: http://www.h-net.org/reviews/showrev.php?id=14089

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