The European left has traditionally advocated social protection, labor rights, and expansive welfare states. Not yet Virginia Crespi de Baldaura and Gianmarco Pifi The left has also played a key role in maintaining and forming neoliberalism.
In recent years, there has been increasing interest in Europe about the rise of right-wing forces. Such attention has often overshadowed significant changes within the European left. This stems from more general debates in political economy, which have often seen progressives as marginalized victims of the so-called neoliberal era and globalization more broadly.
An in-depth analysis of left-wing groups in Europe reveals their key role in actively shaping European integration and economic policy decisions. Addressing these issues is essential for future reflections on the trajectory of progressive politics in Europe. This is also important for understanding the electoral decline of social democratic parties across Europe. Many explanations involve supporting this centrist economic stance.
Did the left create neoliberalism?
Traditionally, left-wing parties in Europe have advocated social protection, labor rights, and expansive welfare states. However, as discussed in this recently published paper, a notable ideological shift occurred in the late 1970s and 1980s, when left-wing parties in France, Italy, and Spain began to adopt and justify liberal economic policies. This shift represents a departure from Keynesian economic principles toward embracing elements of market liberalism, such as austerity policies and labor market deregulation.
Evidence shows that this was the result of the active adaptation of left-wing parties to the changing global and European situation. For example, in France, socialist leaders led by François Mitterrand initially attempted broad social reforms but soon changed course and adopted austerity measures and market-friendly policies to combat inflation and stabilize the economy. They presented these changes as a necessary step to maintain levels of social protection and address broader economic issues.
In Italy, the change equally consisted of a conscious choice in the face of the failure of Keynesian policies. that italian communist party (PCI) shifted from advocating radical economic reform to supporting policies such as wage restraint, fiscal discipline, and labor flexibility. This ideological shift was partly driven by a desire to ensure Italy’s competitiveness in European markets and align with European integration goals. In Spain, the Spanish Socialist Workers’ Party (PSOE) embraced labor market reforms and austerity policies to stabilize the new post-Franco democratic regime, making such changes crucial to the country’s future modernization.
The major trade unions in the countries analyzed showed similar approaches to policy liberalization and austerity. For example, France’s Confédération Française Démocratique du Travail (CFDT) actively advocated labor market deregulation as a means to expand employment, while Spain’s Unión General de Trabajadores (UGT) initially sought to increase private sector investment. Supported wage relief as a means to an end. And job creation.
progressive neoliberalism
These developments can be framed through the concept of “progressive neoliberalism.” Left parties began to see neoliberal policies as tools to achieve progressive goals, rather than as a betrayal of basic values. For example, labor market flexibility was framed as a means to enhance employment opportunities and integrate disadvantaged groups into the workforce, rather than as an end in itself.
It was suggested that reform was necessary to increase employment and secure economic competitiveness, which was seen as a key means of making the welfare state sustainable. It was therefore conceived as a new policy tool to achieve existing social democratic goals such as equality and social protection. This approach helped normalize neoliberal policies across the political spectrum and provided the basis for leftist support for market liberalism.
In highlighting these factors, our study reveals the unexpected role of the left in maintaining the resilience of neoliberalism. Contrary to the prevailing view in the media and academia, left-wing political parties and trade unions were not simply passive victims of the right-wing neoliberal wave. Instead, they played an active role in shaping and legitimizing neoliberal policies. This is important for understanding how policies often described as regressive became entrenched across Europe, not only through right-wing advocacy but also left-wing acceptance and implementation.
The left’s “sanitary border” to protect Europe?
Supporting the aforementioned findings, a recent paper shows the increasing role of center-left forces in opposition to traditional progressive proposals (e.g. counterproductive forms of social protection and public spending). This paper shows how these groups continue to refer to the EU as a benchmark to define possible and desirable policy areas.
The anti-populist stance adopted by such parties has been defined and redefined through the lens of what is seen as necessary for European integration. In many cases, this has entailed advocating more market liberal policy positions than political opponents on both the left and the right.
In the early 2000s, Italy’s center-left party, the Democratic Party (PD), used the term to contrast the unproductive use of spending by Berlusconi’s government and the M5S-League coalition. Similar rhetoric can be found in Spain’s PSOE, which has applied the term to its far-left challenger Podemos, which it says is economically irresponsible in contrast to the PSOE’s Europeanization and modernization project (before forming a coalition government with it in 2019) .
But as European support for austerity measures has waned, the centre-left’s definition of populism has narrowed. Recently, the PD has started using the term almost exclusively as a synonym for right-wing extremism. In the area of economic policy, this appears to have opened the door for the Social Democrats to again adopt more left-leaning policy positions, at least for electoral purposes. Examples of this include the PSOE-Podemos coalition in Spain in 2019 and the PSOE-Sumar coalition in 2023, and the emergence of the New Popular Front in the 2024 French legislative elections.
This does not mean that “progressive neoliberalism” has been relegated forever. As the new von der Leyen Commission continues to favor market liberal solutions such as the Capital Markets Union to address Europe’s competitiveness problems, some figures on the left have emerged as staunch supporters of these policies, while others have emerged as staunch supporters of such policies as taxes and wages. More interventionist ideas were advocated. Harmonization at European level. It therefore remains to be seen whether the left will return to a more interventionist policy stance, or whether it will continue to justify liberalizing policies on “progressive” grounds.
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Note: This article gives the views of the author and not the position of EUROPP (European Politics and Policy) or the London School of Economics. Featured image source: Shutterstock.com
