The Danish Flexicurity Model in Distress: The Audacity of Austerity

The paper explores how the protracted multi-layered crisis has affected the Danish model in the past decades and focuses on the policy options and institutional responses in the attempt of adjusting the economy to the demands of neoliberalism and globalization while moderating and/or managing the impact on social and labor market conditions. More specifically, it offers an analysis of the collective agreements, income support, and wage negotiations and specifically on the strength/weaknesses of organized labor as a collective partner in the workings of the corporatist model. The first part questions the mainstream explanations of the crisis and strategies offered as a way out of the crisis. It also introduces the conceptual framework embedded in the “social structure of accumulation” for understanding the essence of the crisis and not only its symptoms. The second is devoted to a reconstruction of the historical background behind the shift from the corporatist welfare state (the so-called Danish model) to the corporatist competition state leading up to the crises of the private sector in the United States and Europe. The third part proposes a brief re-reading of the Danish welfare state while the fourth part offers an analysis of the impact of the crises on the labor market regulation model of flexicurity in Denmark. The fifth section discusses the options and limits of the Left under the current crisis while the last part presents some concluding remarks.