European Social Model(s)?

1
European Social Model(s)?

• Vojtech Kopp
• Petra Kutálková
• Alena Habltová
• 03/10/2008

2
Welfare State and European Social Model(s)

• Evolution of the European Social Model (ESM)
• Defenitions of the ESM
• Core values of the ESM
• 4 in 1
• Possible solutions
• Conclusion
• Sources

3
Evolution of the ESM

• After WW2 opposite powers to fascism?LEFT
  (Social democrats, Trade unions), RIGHT
  (Christian democrats, Gaullists) both rejected
  dictatorship
• Under US nuclear shield way for Welfare state
  development (on a national basis), EC-common
  market
• Anglo-American counter revolution?Neoliberals
  (Reagan, Thatcher) vs. Rhineland
  capitalism?first appearance of the ESM
• 1987 Single European Act (regional
  inequalities)

4
Evolution of the ESM

• 1989 Social Charter
• 1993 Maastricht?common market but social
  policies still differ state to state?so does
  taxation
• Common marketglobalisation?Social dumping (Race
  to the Bottom)
• Economic integration (EMU, liberalisation of
  markets) great success but lack of positive
  integration (integration of social models)
• Disappearance of the ESM because of european
  economic integration and globalisation?

5
Definitions of the ESM

• Comparison with the US..
• Social citizenship welfare is strictly
  european?part of political citizenship (is
  enforcable), pricehigher taxes?Europeans more
  entangled in state than Americans
• Economic citizenship not just workersrights but
  also involvement in the companys management
  (Mitbestimmung), trendy in US but not a right
• Employment rights European labour market more
  regulated than the one in US

6
Definitions of the ESM

• Employment working time welfare assures that
  Europeans valuate leisure more, gender
  childbearing?in Europe mostly part of welfare (in
  US market driven)
• Income inequality in Europe more equal than in
  US, in US best universities but higher iliteracy,
  in US more prisoners?tolerated (individualism,
  politics)
• General good for Europeans means that
  something cannot be assured by market
  forces?social inclusion, social cohesion

7
The ESM - Unity of values diversity in systems

• Preservation of peace
• Social justice
• Equality
• Solidarity
• Promotion of freedom and democracy
• Respect for human rights
• Values implemented in different ways
• AIM of ESM to attain a balance based on active
  interdependence between economic growth and
  social solidarity

8
Recent challenges Reasons for reform(s)

• Challenges
• Demographic changes,
• technological developments,
• Globalization
• The emergence of new industrial economies and
  pressure on public expenditure
• ?Urgent reform of the social systems to ensure
  they play a productive role in EU economy is
  needed (EP 2005)

9
ESM x ESMs (Sapir 2005)

• Notion of European social model is misleading.
• In EU systems of economic governance, certain
  policies are decided
• at the national level
• at EU level
• Labour market and social policies are matter for
  the MS not for the EU
• (Nonetheless some benefits to coordinate reforms
  exists.)
• Some suggestions
• ?Two handed strategy combining reforms at EU and
  national level would be the best
• ?Models that are not efficient are not
  sustainable and must be reformed

10
Four European Social models

• Nordic countries (Denmark, Finland, Sweden, the
  Netherlands)
• Anglo-Saxon countries (Ireland, UK)
• Continental countries (Austria, Belgium, France,
  Germany, Luxemburg)
• Mediterranean countries (Greece, Italy, Portugal,
  Spain)

11
Comparative analysis

• Comparison in terms of meeting three objectives
  of social policy
• Reduction of income inequality and poverty
• Protection against uninsurable labour market
  risks
• Reward to labour market provisions
• Criteria Efficiency and equity
• Efficiency providing sufficient incentive to
  work ?generates relatively high employment rates
• Equity risk of poverty is relatively low

12
Outcomes

• Source Sapir 200511

13
Sapirs conclusion

• There is strong necessity to reform social models
  of Mediterranean and continental countries
• Reasons
• Welfare state system in M and C countries is not
  efficient
• The GDP of MC countries (9) account for 2/3 that
  entire EU-25 and 90 of 12 member of eurozone

14
Possible solutions

• Closer cooperation between member states
• Reform
• Open Method of Coordination (OMC)

15
Reform

• Probably the best solution is to combine reform
  at EU and national level
• Essence of the reform
• To deliver economic growth and prosperity with a
  better quality of life
• A key reform strategy - flexicurity (flexible
  labour market combined with high levels of
  employee security and social protection)
• But
• Flexicurity is characterisitic for Nordic model
• Is not possible import or export economic or
  social model, it almost never works (actual shape
  is a result of a long historical process)
• Is the reform the right strategy?
• Is the EU able to implement successful reform?
  (Lisabon Strategy rapidly failing)

16
Characteristic of Open Method of Coordination
(OMC)

• OMC was created as part of employment policy and
  the Luxembourg process and has been defined as an
  instrument of the Lisbon strategy
• Tries to improve effective policy choices at the
  national level through promoting common
  objectives and common indicators through
  comparative evaluations of national policy
  performance
• Policy choices remain at the nation level and
  European legislation is explicitly excluded
• Coordination depends on voluntary cooperation and
  there are no formal sanction against member
  states whose performance does not match
  agreed-upon standards
• OMC never takes the form of directives,
  regulations or decisions. The OMC requires the
  Member States to draw up national reform plans
  and to forward them to the Commission.

17
Summary

• The solution is not importing foreign social
  models or looking for a single-country model at
  all
• It is necessary to find the best practice
  wherever, not only in one state or model
• The solutions must have the character of European
  law

18
General questions

• Does some solution for creation of one uniform
  and sunstainable ESM exist ?
• Isnt it late for creation of the ESM?
• (At the beginning of European integration the
  original six member states represented similar
  type of social model but now there are
  represented four diferent types of social models
  by the member states.)

19
Sources

• Basic Literature
• 1. Giddens, A., Time to Transform Europes
  Welfare, E-Sharp, November 2006
• 2. Münchau, W. , Why Europe is Asking the Wrong
  Question, E-Sharp, January 2006
• 3. The Economist, Admire the Best, Forget the
  Rest, The Economist, September 9th 2006
• 4. De Rossa, P., Building Blocks, Parliament
  Magazine, May 15th 2006

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Sources

• Further Literature
• European Parliament, Report on a European Social
  Model for the Future, 2005 http//www.europarl.eur
  opa.eu/sides/getDoc.do?pubRef-//EP//NONSGMLREPOR
  TA6-2006-02380DOCPDFV0//ENlanguageEN
• Sapir, A., Globalisation and the Reform of
  European Social Models, Bruegel, 2005
• http//www.bruegel.org/Files/media/PDF/Publi
  cations/Papers/EN_SapirPaper
• 080905.pdf
• Scharpf, F. W., The European Social Model Coping
  with the Challenges of Diversity, MPIfG Working
  Paper, 2002
• http//www.mpi-fg-koeln.mpg.de/pu/workpap/w
  p02-8/wp02-8.html
• Wickham, J., The End of the European Social
  Model Before it Began?, National Forum on
  Europe, 2002
• http//www.tcd.ie/ERC/observatorydownloads/
  Social20Model.pdf