Social Democracy

Social democracy ideology

Social democracy is an ideology that is rooted in Socialism and as such it agrees on many of the key principles, especially ideas of Common Humanity and Equality (Socialism). But it has also developed its own ideas, particularly in the mid-1900s when it shifted towards the humanisation of capitalism. . While there has been diversity within the movement, there are three key policies that social democrats support:

• A mixed economic model. This means some key strategic industries being state-owned with the rest of industry being private. For example, utilities.

• Keynesianism as an economic strategy.

• The welfare state as a means of redistributing wealth, usually funded through progressive taxation. They often call this social justice.

It is through these policies, social democrats argue, that society can achieve greater equality and achieve social justice. However, these key ideas and policies tend to clash with some forms of socialism, especially communism.

Social democracy and communism

Two of the biggest and most opposing sides of Socialism are social democracy and Communism. While they share some similarities, mainly around their ideas of Common Humanity, there are also significant differences.

The two most important differences between social democracy and Communism are their view on capitalism and their plan for social change. Social democrats tend to view capitalism as a necessary evil that can be 'humanised' through government regulation. Whereas communists tend to think that capitalism is just evil and needs to be replaced with a centrally planned collectivised economy.

Social democrats also think that social change should happen gradually, legally, and peacefully. Whereas communists think that in order to transform society the proletariat must rise up in a revolution, even a violent one if necessary.

These are the main differences between social democracy and communism, but you can see in the table below that there are many more differences which set the two ideologies apart.

^{Table 1 – Differences between Social Democracy and Communism.}

Examples of Social Democracy

Social democracy has inspired different models of government throughout history, the most influential being in Europe, more specifically in the Scandinavian countries. In fact, from social democracy came the so-called "Nordic model", which is the type of political model that Scandinavian countries have adopted

Here is a short list of some countries with well-represented social democratic parties:

• Brazil: Brazilian Social Democracy Party.

• Chile: Social Democratic Radical Party.

• Costa Rica: National Liberation Party.

• Denmark: Social Democratic Party.

• Spain: Spanish Social Democratic Union.

• Finland: Social Democratic Party of Finland.

• Norway: Labour Party.

• Sweden: Social Democratic Party of Sweden.

Countries practising social democracy

As stated earlier, the Nordic model is perhaps the most well-known example of social democracy being practised in modern countries. As such, Denmark and Finland are excellent examples of social democracy and how it has been implemented today.

Denmark and social democracy

Since 2019, Denmark has had a minority government in which all parties are Social Democrats. Denmark is one of the most famous social democracies, in fact, some argue that they were the first. This is perhaps best illustrated in their robust welfare system. All Danish citizens and residents have access to the Students Grant and Loan Scheme, free healthcare, and family subsidy benefits, regardless of income. There is also accessible childcare and the cost of this is based on income. Denmark also spends the most money on social services in the European Union.

Fig. 2 Front page of the newspaper for Social-Demokraten; the Social Democrat Party of Denmark.

Denmark also has high levels of government spending, with one in every third worker being employed by the government. They also have key industries that are state-owned, with financial assets worth 130% of their GDP and 52.% for the value of state-owned enterprises.

Finland and social democracy

Finland is another famous social democracy that utilises the 'Nordic Model. Finnish social security is based on the idea of everyone having a minimum income. As such, benefits such as child support, childcare, and pensions are available to all Finish residents and benefits are available to ensure income for the unemployed and disabled.

Finland also shows characteristics of a mixed economy. For example, there are 64 state-owned enterprises, such as the major Finnish airline Finnair. They have a progressive state income tax, as well as high tax rates for corporate, and capital gains. After benefits are taken into account Finland had the second highest tax rates in the OECD in 2022.