Last night PES President Poul Nyrup Rasmussen spoke at the Café Crossfire debate at the Bibliotèque Solvay in Brussels. The event was organised by the Friends of Europe and the Foundation for European Progressive Studies, and asked the question “Beating the recession – does the Left have the answers?

”The crux of the evening’s debate was an article published in the Economist in December which suggested that socialism in Europe risked being the major loser from globalisation and, in particular, the financial crisis. The event brought Poul Nyrup Rasmussen together the author of the article, David Rennie. Also present were Anna Diamantopoulou, former EU Commissioner and Member of the Hellenic Parliament, and Luis Rego, European Correspondent for the Portuguese newspaper Diário Económico.

After a brief introduction by moderators Giles Merritt, Secretary General of Friends of Europe, and Ernst Stetter, FEPS Secretary General, the opening remarks were made by Poul Nyrup Rasmussen, who talked about the PES manifesto and the Left’s attitude to the crisis, placing the blame for the current economic situation firmly with neo-liberal support for unfettered markets. Our vision of a stakeholder economy, he argued, puts the Left at the forefront of the current debate about the recovery.

The floor was then given to David Rennie, who defended his criticism of the PES manifesto. He claimed the document is symptomatic of calls for the state to reign in markets, and explained that he believed that this is unsustainable in the context of globalisation, going on to criticise the Left for the differences of opinion that it encapsulates. However, he did reserve praise for Rasmussen’s policy of flexicurity. “More for the ‘flex-’ or the –‘curity’?”, one wondered…

Anna Diamantopolou then stepped forward in defence of European social democracy, noting that rather than being less effective in the context of greater competition, the values of the Left allow it to lead the way in developing a fairer form of globalization and better global governance. As such, she maintained, socialist concerns such as workers rights and financial regulation have to be incorporated into the remit of the WTO. Luis Rego agreed, adding that the crisis has proven that self-regulation does not work and praising Rasmussen for pushing for better regulation of private equity. The Left, he argued, needs more than ever to distinguish itself from the Right.

The floor was opened up and questions were asked about the politicisation of the European Parliament and the risk of extremism.

Poul Nyrup Rasmussen started by responding to David Rennie, noting that the Right has a tendency to appropriate the language of the Left, for example, in the case of Sarkozy, talking about flexicurity whilst only legislating for flexibility. He agreed that the Parliament is becoming more ‘political’, adding that this is a good thing. Rennie then spoke, repeating his opinion that the shift in balance from labour to capital accompanying globalisation makes the European Social Model unsustainable.

Rasmussen went on to question what we mean when we talk about a ‘successful economy’ – Germany for example exports more than any other country in the world, Scandinavia is another good case. He defined the difference between a Social Market Economy and a Market Economy; the former is based on a strong public sector, a welfare state and knowledge-based employment, the latter has nettle of no place for the public sector. Diamantopoulou drew the debate to an end by explaining that the Left has a tradition firmly built on values and that it must remain faithful to these whilst adapting to new circumstances.

The panelists succeeded in adding a new perspectives to the political implications of the crisis, and Poul Nyrup Rasmussen soundly rebutted the criticisms made by the Economist, delivering a convincing defense of the values of the Left and the Social Market Economy.

The event was transmitted on Twitter, allowing activists and members of the public from across Europe to follow the arguments and opinions expressed. The PES is planning on reporting from events across the continent in this way over the course of the campaign.