The second half of the 1990s was marked by the ‘magical return’ of social democracy in several countries in Western Europe after a period of relative ly marginal ity political importance in several countries in Western Europe , during which political agendas were dominated by neo-liberal policies aimed at welfare state retrenchment, privatisation privatization, and deregulation. The renewed presence of social democratic parties in European governments at the end of the twentieth century was built on a programmatic and strategic reorientation, which resulted, among other things, in a change of their position on globalization.

Anthony Giddens, auctor intellectualis of the ‘ “third way ’, ” emphasized that globalization requires the rethinking of classical social democratic precepts, involving a more positive attitude towards global markets. The It is argu ment is ed that social democrats should strive for the establishment and strengthening of regional and global regulatory institutions alongside , as an addition to global market processes.

Overall, social democracy has adopted taken in a fundamentally reformist position vis-à-vis the current international political-economic system. Globalization is not normally rejected, but some of the system’s features are felt to be in a dire need of a form of governance that would guard against the excessive concentration of wealth in certain parts of the world and the marginalization of other parts. The neo-liberal desire to further liberalize trade and capital markets is generally questioned and the need to regulate international markets in order to avoid undesirable and unjust outcomes is emphasized.

Certain r Recent developments may be destabilizing the global political-economic system and therefore increase may result in support for social democratic reformism. At the same time, however, the social democratic position on globalization seems to suffer from several weaknesses. First, the reliance on governance and institution-building at the international level makes the social democratic project vulnerable to non-cooperative behavior on the part of by important states. Secondly, there may be quite a difference between the establishment of international institutions, which is the hallmark of social democracy, and the realization of desired policy outcomes. Thirdly, the social democratic emphasis o f n institutional arrangements may receive little support from those required others, who are necessary to achieve a majority for certain policy proposals, as social democracy is likely to continue operating from a minority position. Fourthly, the policies advocated by social democrats – for instance, regarding welfare state reform – may result in declining electoral support and thereby indirectly lead to the replacement of social democrats in power by more conservative forces who are intent on discarding social democracy’s policy heritage. Finally, social democrats may be unable to change the direction of policy making in certain issue areas because of the entrenched hegemony of neo-liberal policy precepts.