This article in Foreign Affairs describes how the acceptance of neo-liberalism in society caused social democrats in the US, UK and Germany to promote a "third way" that accommodated market friendly neo-liberalism in their politics. The move to the center helped Clinton, Blair and Schroeder to win elections, but it blurred their distinction from their competitors. Moreover, competitors like Angel Markel in Germany adapted her party's programs in order to recapture the political center.
The Social Democrats were unable to capitalize on the financial crisis because the electorates believed that they were partially responsible for creating the opportunity for the crisis by their embrace of neo-liberalism. They need to provide a clear vision of the good society which will combine prosperity with social justice. They can't do that by using focus groups to give the public what they say that they want. Their vision should capture the imagination of a public that is fully aware of our problems but has not been presented with a viable alternative. It would be a mistake to base electoral success on telling the public that they are the less of two evils.
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