Social democracy in the light of capitalist crises
The case of British Labour
in European social democracy during the global economic crisis
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The Labour Party showed little understanding of how the City was bereft of policies for dealing with British financial institutions until after the collapse of the second minority Labour government in 1931. Planning was Labour's central economic idea and it remained so until the 1960s, resurfacing again in the 1970s and early 1980s. As D. Ritschel pointed out, 'the new concept was suddenly embraced by nearly the entire Labour movement as the missing collectivist key to the transition from capitalism to socialism'. New Labour clearly believed that Britain's comparative economic advantage lay in flexible markets, an open economy, low taxes and light regulation of business. The golden age saw an unprecedented period of full employment. It was not a time of social democratic success in government for most of Western Europe and welfare reforms in the period, including some of the more generous, were often introduced by centre-right parties.

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