Social democratic thinking still too often seems stuck in the 20th century tax and spend paradigm. It does not currently recognise the need to fundamentally change the ownership and nature of economic activity in order to narrow the gap between rich and poor and address questions of global warming and sustainability. As The Spirit Level, by Richard Wilkinson and Kate Pickett, comprehensively demonstrates it is greater income equality that is the essential pre-condition for a better and more sustainable society. Income differences arise in the workplace and that is where they should be addressed.
Whilst every re-distributive tax and benefit must continue to be defended, this alone cannot provide a vision of the good society. To remain relevant and to avoid subsiding into a wholly backward-looking and defensive set of ideas social democracy in the 21st century must embrace economic democracy at its core. We need to set about transforming our economy rather than promulgating a set of policies for accommodating whatever form capitalism comes up with next. Progressives must now campaign for the competitive economy to be replaced by the co-operative economy – that can be the vision social democracy currently lacks.