Social policy for the “somewheres”

_ Alexander Neumeyer, spokesman, expert committee “Labour, social Affairs and old age security”, AfD Bavaria. Munich, 4 August 2022.

Two camps

The last elections in Germany have shown that the AfD has temporarily lost some its attractiveness among voters. The various analytical explanations vary widely, ranging from personal accusations that one or that higher party official is to blame, to obscure election fraud myths.

There is only one point that almost everyone agrees on: the blue party finally need a clear strategy. The solution in this policy note makes social policy one of the central building blocks. However, any social policy that really deserves the name cannot be successfully pursued without a sensible economic policy.

It is well known that in the blue party two groups are fighting violently. Superficially it’s about people, but in reality, it’s about two schools of thought. One group wants a strong welfare state and is suspected of socialism, the other group wants an economy that is hardly regulated by the state, which earns them the accusation of encouraging brutal Manchester capitalism.

First it must be defined what is meant by socialism and capitalism. Socialism ostensibly values ​​the collective spirit and solidarity among the members of a society far more highly than the individual development of the individual members of this society. Capitalism relies precisely on this individual development as the highest good.

Historical trend towards individualization

The course of history over the last two and a half thousand years has produced a clear trend – individualization. This is not surprising either, because those who were out and about as hunters and gatherers and did not enjoy the protection of a horde were doomed to die. The price he paid for this protection was clear, he had to submit himself completely to the collective.

With the beginning of state formation, the state in question took over that protection and the scope for individual “extra hours” gradually increased. The philosophers of antiquity, with their divergent views, would have been lost without their democratically constituted states, which largely tolerated their individual beliefs. It is thus evident that every free individual development requires the protection of the state and that no cultural progress of mankind is possible without individual development.

Here, however, the emphasis is on culture, which includes humanism, because pure technical progress also took place when individualism was not yet an issue. Think, for example, of the invention of the wheel, of agriculture, and of the cultivation of plants. Traditional Chinese conformism has also produced astounding technical innovations throughout history.

The first conclusion that can be drawn is that the individualization of a society with the possibility of free development for its members promotes culture and humanism but is not essential for technical progress.

Justice and wealth distribution

However, technical progress alone provides the basis for improving the economic living conditions of the members of a state. As has been shown historically, it is not absolutely necessary for individuals to develop freely.

The next step is how this increase/improvement in the range of goods achieved through technical progress is distributed among the members of a society. And this is where the big argument begins.

The concept of justice now comes into play. Those who benefited more than others from an increased/improved range of goods usually defend this as fair, whereas the economically disadvantaged regularly brand this distribution as unfair.

It is by no means objectively possible to decide which distribution is really fair. This was recognized for the first time by the economist Vilfredo Pareto, who is no coincidence an engineer by profession and not a philosopher. This finding went down in economic history as the so-called Pareto optimum. The concept of justice therefore contains no objective solution to this problem.

The term justice is a cultural phenomenon, and its definition varies from society to society. There is even a clever field test for this. The following experiment was thought up: A sum of money of one hundred units is to be divided between two people. One of the two subjects is allowed to determine the distribution. The second subject can accept or reject this division. If she rejects the division, both participants get nothing. It was found among members of developed Western societies that allocations made at the expense of the second test subject were overwhelmingly rejected by the second test subject, knowing full well that they themselves would get nothing from this. The conditions among the natives of Australia and Brazil are different. The second test subject also accepted divisions that turned out to be very unfavourable to them.

It is therefore not surprising that the concept of justice takes on an ever more central and controversial motif as society progresses towards individualization.

It is therefore entirely in line with the Pareto Optimum if the economy is largely given a free hand in pursuing the goal of maximizing profits. Because every company management will then try to use its resources as economically and efficiently as possible in order to achieve maximum profit. This ensures that the resources of labour, land and capital are not wasted, but are used where and how they promise the greatest profit. This is the famous “invisible hand” of the market. Anyone who believes that the economic situation of a society can be improved through central management of the economy by state organs should have been taught a lesson by historical examples: Soviet Union, Cuba, North Korea, Maoist China and so on.

Ordoliberal state

So in the field of economic policy, the state’s main task is to create suitable legal framework conditions – in the sense of Walter Eucken’s economic theory and its supplementation by Alfred Müller-Armack – that prevent individual market participants from being fooled by unfair fraudulent practices harm other market participants or put other market participants at a severe disadvantage through excessive concentration of power, such as through the formation of monopolies or financially powerful lobbying.

Thus, if it is now established that an economy without central government control achieves better economic results, we can move on to the next step, the distribution of the wealth produced in a developed society. After what was said above about justice, it should be clear to everyone that there are no objective standards available for this, as there are for maximizing profits.

A state is basically financed by taxes and duties. It uses it to pay its employees, civil servants, judges and soldiers, who guarantee the citizen security in all possible situations – from the registration of property in the land register to the legal execution of marriages – and at the same time protect him from unfair methods of individual fellow citizens.

After deducting these state personnel costs, a certain sum usually remains, which parliaments decide on how to use in democracies. And their size/distribution is now guided solely by different interests. As a rule, someone who is wealthy will advocate that, in addition to financing the necessary “costs” of the state, this remaining sum should be kept as small as possible and then used primarily for infrastructure measures that are also useful to him, such as road construction. A relatively poor citizen thinks quite differently. He likes to plead for higher taxes, because he knows that the wealthier people have to pay most of these taxes and that the higher social benefits of the state mainly benefit him. This conflict cannot be resolved objectively. It is always decided as a question of power.

Social policy for the average Joe

The old parties in Germany, regardless of whether they are CDU/CSU, SPD, Greens or FDP, have now converged enormously and only differ in nuances. They agree that the nation state is outdated, that a globalized economy promises greater prosperity and that the individual rights of minority groups (not citizens) must be protected by the state. How can the AfD successfully position itself against this?

To do this, the effects of the above policies of the old parties must be taken into account. A free globalized economy can actually increase the efficiency of the economy in the sense of Pareto and thus lead to an increase and cheaper of the goods produced. But the question immediately arises as to how this greater prosperity is distributed.

Since a globalized and denationalized world is extremely fragmented and a sense of community can only develop in outwardly delimited units, this world is completely at the mercy of the interests of the strongest, i.e. the super-rich and technocratic corporations. As a result, this globalized prosperity will inevitably be distributed very unequally.

But a locally rooted poorer citizen doesn’t really care whether he has little in a globalized world or in a nation state. Consequently, a party can only position the majority of voters against globalization (or an EU superstate) if it can convince them that they will benefit more economically from a social nation state.

The German urban academically educated middle class, on the other hand, is adamant that this globalization will benefit them economically, moreover, global thinking gives them a sense of of something new. Therefore, a party that advocates the preservation of the nation state will not be able to win over these voters.

The emphasis on the rights of minorities is also a consequence of the individualization of Western societies. But the interests of the majority of the normal, average working population are left behind.

A long-term successful AfD, if one defines success in such a way that the party receives so many percentages in elections that it gains significant political influence, must therefore appeal to the large neglected groups of voters in Germany – rural middle and lower classes, urban non-academic lower middle class and working class as well as small tradesmen in the country and in the cities, i.e. the so-called “somewheres”, and make them a political offer that is attractive to them. What does this offer look like?

  • The hard-working, normal working citizen in Germany needs a nation state, because only the nation state can enforce generous social security for them, which also provides the citizen with good and reliable financial support in difficult situations.
  • We do not make a distinction between a citizen with or without a migration background if he works diligently. At the same time, however, legislative measures by the state must prevent immigration from being misused to depress the wages of ordinary workers.
  • Our state should not finance its social benefits from high taxes on the economy, insofar as their profits are mainly used for domestic investments, and from the many average-earning employees and small self-employed people. The AfD rightly emphasizes that personal diligence/performance should be financially worthwhile again.
  • Capital transactions must be regulated by the state in such a way that companies based in Germany and international groups that sell goods and services in Germany cannot transfer their profits abroad, largely untaxed.
  • Every citizen living in Germany is allowed to shape his private life as he pleases, as long as he does not lastingly impair the rights of other citizens.

In summary, this policy offer could be summed up in the following three keywords:

  • Social security for all citizens
  • National solidarity
  • Live in freedom and dignity

In my opinion, with such an agenda, the AfD could rise to become the strongest party in Germany and form a powerful counterpoint to all globalization fanatics.

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