by Domenico Ummarino
I draw inspiration from the last Italian election, or rather from the last elections held in several democratic countries to make some considerations on the meaning of democracy, populism as democracy’s main feature, and the potential effects of the democratic order on the advance of civilization.
Let’s start with the basics, by checking a good dictionary to be sure of what we mean by using the word democracy. Democracy (from late Latin: democratia, from Greek: δημοκρατία dēmokratía, literally “rule of the people”) is defined as follows:
“Government by the people; a form of government in which the power resides in the people and is exercised by them either directly or by means of elected representatives; a form of society which favours equal rights, the ignoring of hereditary class distinctions, and tolerance of minority views.”
Democracy is sometimes referred to as “rule of the majority.”
Without daring to face the many definitions and the major contemporary justifications of democracy, I just wish to draw the readers’ attention on the objectives that should be implied by the definition of democracy, or I would rather say, the targets that should be pursued by this form of government, that is to say the favouring of equal rights, the ignoring of hereditary class distinctions and tolerance of minority.
I immediately state, without any hesitation whatsoever, that all the above-mentioned targets are impossible to be achieved. As a matter of fact, the application of the majority principle per se leads to the rule of the majority over the minority and, as a consequence, to something that is in sheer contrast to any basic principle of equal rights, freedom or tolerance.
In my humble opinion, even in very general terms, Ludwig von Mises would have never used the reported definitions. Mises maintained that, rather than majority, democracy meant literally “self-determination, self-government, self-rule.” Drawing inspiration from Mises’ view, it is also possible to contend that a democratic government, as a voluntary membership organization, should recognize the unconstrained right to secession to its members.
What is more, even though, under democracy no personal privileges exist, privileges, discrimination and protectionism do not disappear as if by magic. It is a fact that rulers and ruled are not one and the same person, as it is an indisputable fact that, even if democratic rulers do not own the country, as it was the case with monarchs, as long as they are in office, they can use it to their advantage.
But let’s take a step back to grasp the failure of the democratic process in delivering freedom, tolerance and equal rights, these latter to be meant as equal starting conditions.
Under democracy, anyone can become a member of the ruling class. Prime ministers, presidents, ministers are not selected for their proven efficiency and moral qualities, but for their ability to captivate voters during free political competition and selection. Politicians, noted H.L. Mencken,
“are chosen normally for quite different reasons, the chief of which is simply their power to impress and enchant the intellectually underprivileged …. They will all promise every man, woman and child in the country whatever he, she or it wants. They’ll be roving the land looking for chances to make the rich poor, to remedy the irremediable, to succour the unsuccorable, to unscramble the unscrambleable, to dephlogisticate the undephlogisticable. They will all be curing warts by saying words over them, paying off the national debt with money that no one will have to earn … The winner will be whoever promises the most with the least probability of delivering anything.”
It is at this point that it seems appropriate to introduce the concept of populism. In general, populism is referred to as political philosophy or movement that mobilizes the population against an institution, government, a privileged elite, usually, but not always, supporting the rights and power of the lower classes. The term has also been used as a label for new parties whose classifications are unclear. However, the term populism is also used more loosely by confusing it with demagogy and “catch-all” politics.
Regardless of the meaning we want to give to the term, it is quite evident that populism can be counted among those strategies or techniques to captivate voters and rise to power. As a matter of fact, the democratic ruler, whether to secure his position or advance to a better one, must reward or promise to reward rights and privileges to several and ample groups of people, so promising to take from haves (e.g. elites or rulers in charge) in order to redistribute to have-nots or underdogs, who are always of a greater number. Unhappily, it is crystalline clear that this is the logical and spontaneous outcome of any ordinary political competition in a democratic system. Populism, demagogy, “catch-all politics” and the most advanced psychological techniques or tricks that, based on the profiles and personal data of people, are used to influence, persuade and ensnare voters, are absolutely in line with a democratic system and, therefore, should not outrage deceived supporters of democratic orders.
In this regard, readers could claim that a democratic order should not be based on unacceptable tricks and deceitful behaviours, whatever that means, of the contenders, but unfortunately facts tell a different story and, as far as I know, there is no law that prevents telling fairy tales during electoral campaigns, and, from my humble point of view, this is enough to allow me to state that deceit in selling one’s ability to distribute future particular benefits is implicit in any democratic mechanism.
As I previously stated, it is a fact that democratic rulers do not own government resources or the whole country, but they can use the government apparatus and its resources to their personal advantage. Because they only own the current use of said resources, democratic rulers are only interested in maximizing their current income, that is to say in draining as much of the resources at their disposal as quickly as possible. They are not interested in retaining or increasing the capital value of government resources, as privates would normally do with their own estates, but they are rather interested in consuming now what they may not be able to consume later, when they will have to step down from their offices as rulers.
In particular, with the benefit and through the powerful means of public law – that is to say the rules of organization of government that time has expanded so as to encompass special purpose rules or even “special commands or permissions by administrative agencies” and believed to serve general welfare – which is displacing private law – that is to say “rules of just conduct” or “end-independent rules which serve the formation of a spontaneous order” – democratic rulers chiefly employ their legislative power with the purpose of redistributing income within civil society at their will, and in so doing, they build the precondition to conquer, retain and expand their ruling position.
Accordingly, this redistributive power and the overall democratic process leads to permanently rising taxes, debts, public employment, legislation, regulation, welfare dependency, short-sightedness, parasitism and negligence.
The higher the redistributive power, which implies, inter alia, higher taxes, higher expenditures on social, public and national security, the more individual properties are expropriated, confiscated and eroded, depriving people of their personal independence and private wealth, which is the real catalyst of any economic and social progress. Additionally, the more legislation is produced by displacing rules of “just conduct” and creating Babel of laws to satisfy particular interests of both key electorates and rulers, the more legal uncertainty and moral hazard is created.
Taking into consideration time-preference ideas of Böhm-Bawerk, that is to say the decision to choose between the immediate consumption of income (i.e. high time-preference rate) and the saving of income for present and future satisfaction (low time-preference rate), it is not difficult to figure out that the violations of property rights and, in general, any institutional or governmental interference raise uncertainty and time-preference rates.