Lezzee now, Social Democracy, where has it been a success? Well now let’s start by listing some of the political parties that fall under that rubric that have endured, contributed, and participated in the postwar miracle recovery of Europe since 1945:
Ausserparliamentarische Opposition-West Germany
Confederation of British Industry
Social Democratic Party-Great Britain
Christlich-Demokratische Union-Germany
Centre d’etudes, et rescherches et d’education socialiste- France
Confederation Francaise et Democratique du Travail-France
Confederation of Italian Labour-Italy
Christlich-Soziale Union-Germany
Deutscher Gewerrkschaftsbund-Germany
Freie Demokratische Partei-Germany
Landsorganisationen-Denmark and Sweden
Oswterreichischer Gewerkschaftsbund-Austria
Parti Socialiste-France
Parti Socialiste Belg-Belgium
Partij van der Arbeid-Netherlands
Svenska Arbetsgivareforeningen-Sweden
Socialdemokratiet- Denmark
Sozialdemokratische Partei Deutschlands-West Germany

This listing is only partial, but the basic answer is that Social Democracy is a hybrid political tradition composed of elements from both socialism and liberalism. Keep in mind, we are talking about a parliamentary system here with a multiplicity of political groupings.

Social Democracy is a Hegelian synthesis that has taken place in the socialist tradition seeking to realize socialist ideals within the institutions of liberal capitalistic society (social democrats) and those who remain outside those institutions with the objective of replacing them through revolutionary force (communists).

Social democratic parties have wide variations of ideology, but they have in common a commitment to participation in the electoral process and parliamentary democracy, hence the other name for this movement “parliamentary socialism.”

The historical genesis of this movement was in 1875, with the formation of SPD by a mobilization of German industrial workers bound together by their common experience. Their strength lay in the ability to mobilize the working class to improve conditions of life and labor in capitalistic industrial society.

As this movement matured over the next one hundred years, it was to be the guiding element on the post 1945 rebuilding and recovery of Europe in every country of Western Europe—Soviet dominated countries being the exception because Social Democratic parties were not allowed.

The Second World War caused enormous ravages and froze economic activity in all of Europe. French and Belgian industries in 1946 were running at only 25% of their prewar levels, and Germany was even less. It was under the leadership of the Social Democratic parties that the 50’s and the boost of the Marshall Plan caused and economic miracle that saw European production jump to double pre-war production levels by the sinish of the Korean war. The Korean war slowed the flow of American dollars that had fed this expansion dwindled. This was offset by the political agreements that integrated the conflicting customs barriers and liberalized trade under the Schuman Plan.

Under the influence and direction of Social Democratic policies Europe entered into the extended period of prosperity where today employment is no longer a major issue. According to Walter Laqueur the yearly growth in the gross domestic product of the main European countries whose political spectrum was dominated the Social Democracy was:

Austria 5.8 Italy 6.0
Belgium 3.2 Norway 3.5
Denmark 3.6 Sweden 3.4
France 4.6 Switzerland 3.4
Germany 7.6 UK 2.5
Holland 4.7

The Nixon recession of 1967 slowed German production and impacted all of Europe. The oil dominated recession of 1973 caused a further crisis and gave rise to the ascendant Christian Democratic Party. By the Reagan years the Social Democratic parties influence went into decline and their influence waned. In the parliamentary system Christian Democrats are still important for coalition building however. The impact of post-industrialism with the drop in employment, especially in Spain and Italy has given rise to right wing groups whose ideologies maintain that foreign workers deprive local workers from work, housing and other services. With the 80’s the general realization became one in which automation, post-industrial intellectual products, etc. mean unemployment would be a fact of life the old mobilization of labor tactics of Social Democratic parties were not equipped to handle. New parties with new ideas, such as work sharing and shorter work weeks had to have their say..Social Democratic parties will have to evolve in to today’s realities to regain their relevance.

All of this is to answer Tom’s question as to where Social Democratic has been a success. The short answer would have been all of Europe. Without details, I intuit this would not have been acceptable.

As to question number two, Tom asked about capitalism divorced from democracy. This is easier and lends itself to a short answer—all of Central and most of Latin America (exceptions to be made for Belize and Costa Rica). Latin America is controlled by oligarchic military regimes, trained by the US, some of which have been put in place by our CIA. Wonderful examples abound such as the case of Honduras where, as counsel for Chiquita Banana Co. out of New Orleans, the democratically elected government was ousted by the CIA and a controllable puppet installed. Or Chile where the democratically elected president was suicided by shooting himself 32 times and could be replaced by a capital friendly military junta.

Most of Latin America is governed by right ring military oligarchies, US trained and supplied, and their prime function is to “protect American property and interests.” The part in quotes is from William Howard Taft who enunciated a policy stating the justification to use US military to guarantee “the capitals and markets” of US businesses. Thus, in toto, Latin America has been kept a largely non-democratic, oligarchic capitalistic resource for the US capitalism.

This is an attempt to answer some interesting questions. Sometimes the answers are neither easy, nor brief---this is an example:

Capitalism and democracy are at odds when it comes their assumptions about the right distribution of power. Democracies have a problem with rising economic inequality precisely because they believe in political equality---one person, one vote.

Capitalism has a hard time defending the inequalities that it generates with a contrary set of beliefs as to why those inequalities are right and fair. Capitalism argues the economic process is fair, but it has to be agnostic about the “rightness” and “fairness” of any specific outcome. The survival-of-the-fittest capitalism of the Ayn Rand sort, postulate those at the bottom of the economic system both deserve to be there and cannot be helped because of their personal inadequacies.

Survival-of-the-fittest capitalism for any extended period of time in the modern era is something not tried-And this was the substance of the complaint in Rand’s, Capitalism: the Unknown Ideal. Hong Kong is often cited as a good example but it misses by a mile. The Hong Kong government owns all the land under the city an leases it to capitalists for development. One third of the population lives in public housing projects.

The free market economies that existed in the 1920’s imploded and gave us the Great Depression and had society had to be reconstructed by government. The social welfare state was put in play by wild-eyed leftists. For this we have to thank enlightened aristocratic conservatives (Bismark, Chrchill, Roosevelt) who all adopted social welfare policies to SAVE, not destroy capitalism by protecting the middle class.