The debt crisis has also dramatically shifted the political orientation of center-left parties across the European periphery. This mirrors the “New Labour” shift to the center, steered by Tony Blair in Britain in the mid-1990s, and before that in the social-democratic parties in Germany, the Netherlands, and Scandinavia.
Traditional socialist parties in Southern Europe – PASOK in Greece or the Socialists in Spain and Portugal – are today espousing a far more limited and sustainable vision of the welfare state than before the crisis.
Political differences will of course remain, but the earlier experience from Northern Europe suggests that the centrist shift is a lasting political realignment that facilitates broad national consensus for sustainable fiscal and economic policies.
