What is required is a renewed sense of being on the side of the future, not stuck in the dugouts of the past. We must admit that the old forms of the welfare state proved insufficient. But we must stubbornly defend the principles on which it was founded – redistribution, egalitarianism, collective provision, democratic accountability and participation, the right to education and healthcare – and find new ways in which they can be institutionalised and expressed.

The purely legal formal definition of ‘rights’ clearly belongs to the liberal tradition. The distinctive socialist contribution to the question of rights lies precisely in the recognition that the distribution of power in society reflects not only legal relationships, but also the uneven distribution of wealth. The great achievement of liberalism was the proposition that all are equal before the law. The great project of socialism was the construction of an economic system which made real equality possible. Without fully employment, this project inevitably faced insurmountable obstacles.

Though it failed to offer a credible political alternative, the student movement expressed a global and radical critique of society and its institutions which could not be so easily dismissed. Such a critique had, of course, previously been expressed by individual theorists, writers and artists. What was new in the 1960s was that this was voiced, more or less spontaneously, by a mass movement.

Its cultural underpinnings were virtually ignored by the traditional Left, partly because socialist parties had little understanding of cultural politics, partly because it involved concepts which were outside the socialist tradition. What was this cultural substructure? Social theorists have described it as ‘post-materialist’, an expression which suggests the search for the politics appropriate to an an age of abundance. Socialist and capitalist politics, in spite of their differences, shared a common terrain: if resources were scarce, the question was how to distribute them. For post-materialists this assumption did not hold. In an era of abundance, politics must, inevitably, acquire a different form.

Politicians of the Left (and the Right) could fairly retort that the assumption that a post-scarcity age had been reached could only be entertained by privileged students, temporarily removed from the world of gainful employment, detached from its competitive ethos and unencumbered by family responsibilities. The real electorate had mortgages or rent to pay, children to feed and clothe, jobs to obtain or preserve. The student radicals arrogantly or childishly ignored these fundamental truths. They were right, however, when they held that human dignity should not be satisfied merely with the riches available on the shelves of supermarkets and department stores; they were wrong when they believed themselves to be the first to hold these views.

Socialist parties were thus in an impasse. They aspired to redistribute power away from the impersonal forces of the market towards ordinary people. They sought to help the poor, establish economic and social justice, expand opportunities for those who could not obtain them through the market. Little of this could be done without accepting economic growth - in other words, capitalism growth - as the overarching priority. The constraints of democratic electoral politics compelled them to do so.

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.

Pricing mechanisms in a very unequal society operate not by allocating resources to those who will get the most value from them, but by allocating them to those who have the most money. Left neoliberals will argue that this problem is one of inequality, not of pricing; but, unless inequality is dealt with first, it amounts to the same thing. In economically unequal societies, imposing pricing schemes on things like parking, congestion, and carbon emissions just puts greater burdens on poor people or prices them out of some goods altogether.

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.