Proponents of a “third way” between free-market policies and socialism must still define the path forward but the United Nations has joined in the debate on the new political buzz word.

The “third way” is credited with boosting the political fortunes of Europe’s resurgent social democratic parties as well as those of U.S. President Bill Clinton. On Tuesday, the Second Committee of the U.N. General Assembly – which focuses on economic and social affairs – took a look at the new phenomenon.

Proponents of third-way politics, including the concept’s primary architect, London School of Economics Director Anthony Giddens debated, what Giddens argued, the central question: “How do you make capitalism work?”

What became clear, Giddens told IPS, is that both “market fundamentalism” and “Keynesian socialism” have failed, and that voters demand alternative policies. Beyond that, he conceded, the concept of a third way is “an ongoing debate rather than a set of positions”.

Yet third-way politicians – among them, British Prime Minister Tony Blair, German Chancellor Gerhard Schroder and Clinton – have been vague at best about what type of alternative they intend to create.

Blair, Clinton, Bulgarian President Petar Stoyanov and former Italian Prime Minister Romano Prodi could not even come up with a common definition of a third way during a September forum at New York University on the topic.

Giddens suggested a number of common rallying points upon which social democratic parties could agree, including striking a balance between government regulation and the market; a focus on ecological concerns; the creation of regulatory controls on financial speculation; and a push toward global governance.

Governments, he argued, had committed two major errors in recent decades as the world has undergone globalisation: They had regarded globalisation as simply an economic phenomenon and they had developed only national challenges to the problems it posed.

“People have voted against that,” he noted. Now, Giddens argued, political will was growing to re-examine the global financial system and to push for more regulation at the global level – perhaps for the first time since the World Bank and International Monetary Fund (IMF) were created following World War II.

“There is a movement of economic integration in the world,” added Jacques Baudot, director of the Copenhagen Seminar on Social Policy, but, he argued, no similar political integration to balance it. “A global market is not a global international community,” he contended.

The problems of unrestrained global markets become particularly clear following the Asian economic crisis and ther subsequent economic woes of Russia and Latin America, some third- way proponents argued.

The eruption of the financial crises last year – and the popularity of European social democratic parties in recent elections, notably in Britain, France and Germany – boosted attention to the idea of a third way, said Kwame Pianim, chief executive officer of Ghana’s New World Investment Ltd. Many political parties were wondering, “Do we have the means to regulate the flow of speculative capital?” he added

Nor is the push for global regulation confined to the industrialised world. “Those (developing nations) who have suffered from structural adjustment programmes have said that there must be some sort of alternative,” Pianim said.

As the third-way concept developed, it must embrace the idea of “public management” or ways to ensure that the public sector runs efficiently, possibly by “borrowing” the methods of the private sector in providing certain benefits, argued Albrecht Horn, of the U.N. Department of Economic and Social Affairs.

In practice, however, third-way politics has proved to be a more elusive concept.

Clinton – elected in 1992 as a ‘New Democrat’ looking to change the welfare-state policies that his party had upheld since Franklin D. Roosevelt’s 1933-45 presidency – at times has seemed little different to his right-wing Republican opponents.

Clinton has pursued fiscal austerity measures to balance the U.S. budget, scrapped federal welfare guarantees and favoured sweeping free-trade accords with only small amendments to deal with labour and environmental concerns. At the same time, beyond a failed effort to devise a national health-insurance policy, the U.S. president has taken few initiatives that could spell out what he means by third-way politics.

In a recent editorial, the leftist British magazine The New Statesman joked that Clinton’s vague comments about the Monica Lewinsky scandal defined a “third way” between adultery and faithfulness.

Third-way theorists are wary of making overly broad claims for their concept.

“One of the lessons of the current (economic) crisis is that a certain element of humility is needed,” Baudot said. As a result, the effort to define the third way should include a caution “not to be too systematic, not to be too certain.”