The new revisionism, by demoting the importance of ownership, downgraded that of nationalisation. State property no longer constituted the main road to socialism. The only remaining rationale for nationalisation had to be couched entirely in practical terms; for example, that it abolished a private monopoly, protected employment, permitted greater investment, guaranteed essential services or supplies - all reasons which had been used by non-socialists. The consequence of this was that socialist revisionism quite deliberately obliterated the painstakingly established border between socialist and non-socialist thought.

It was believed that the loss in doctrinal purity would be more than amply compensated by greater strategic flexibility, increased electoral appeal and, for parties operating in circumstances which made coalitions necessary, a better chance of finding allies. The new revisionism prided itself on its pragmatism and realism while being, at the same time, deeply ethical: it constantly referred to the values of socialism and particularly to the struggle against inequality and poverty. This ‘ethical pragmatism’ (ethical ends and pragmatic means) deliberately rejected Marxism, its theoretical intransigence and its apparent disregard for the ethical dimension.

On average the amount redistributed to the poor actually decreases as welfare states become more targeted. Any increase in redistribution from an increase in targeting is clearly outweighed by the smaller expenditure that is associated with the lower willingness to pay of targeted welfare states. This confirms the hypothesis that strategies of targeting result in welfare states that do less redistribution to the poorest than strategies of universalism.

Social democrats believe in a well regulated, efficient market-­based economy aimed at sustainable growth. We also believe in strong social and fiscal policies aimed at achieving greater equality.

But what do we mean by equality? This is a critical point of difference between liberals and social democrats. The liberal concept of equality emphasizes political and civil rights. Such rights include the right to vote, the right to stand for office, freedom from discrimination and equality before the law. These rights are fundamental, and social democrats support them and fight for them, but they are not enough.

When social democrats speak of equality, we also speak of social and economic rights, of substantive equality. These are rights like the right to medical care, to education, to retirement and to freedom from poverty. We believe in a society that distributes wealth and income more evenly. Social democrats reject unfettered markets because unfettered markets produce the unfair distribution of wealth we are experiencing today. Only by combining progressive taxation with social rights, removing appropriate goods and services entirely from market criteria, can we ensure a fair degree of real equality.

Socialism never took root in America because the poor see themselves not as an exploited proletariat, but as temporarily embarrassed millionaires.