The Third Way: an Epitaph

The last half-century has seen the end of ideological politics in much of the world. First came the apocalyptic collapse of fascism as Hitler took Germany with him into a collective suicide. Fascism's demise was followed by the more gradual disintegration of communism after Stalin's death and Khrushchev's revelations of Stalin's crimes. The failed revolutions in Hungary in 1956 and in Czechoslovakia in 1968 foreshadowed the eventual failure of the Soviet empire in 1989.

While these pseudo-religions collapsed, a benevolent ideology of social democracy dominated much of Europe. Its core was the belief that the state could provide both stable economic growth and social welfare to cushion the negative side effects of free markets. Not everyone subscribed to this theory, but it was the West's strongest political force for several decades. Christian Democrats, and even conservative parties, adopted its tenets.

But by the early 1980's social democracy had exhausted itself. It had simply been too successful to remain a force for change. Moreover, it had brought about new rigidities, notably bureaucratization and that deadly phenomenon of the 1970's, stagflation - economic stagnation and high unemployment coupled with galloping inflation.