Disdaining democracy

Universal Male Suffrage in France - A bad day for economic efficiency

All those years ago – you know, way back when John Key wasn’t the Prime Minister – the populace, so we found out, was getting restless.

Its main complaint about the government of the day was that it was ‘off the leash’ and ‘out of touch’ – doing things that ordinary New Zealanders didn’t want done: The repeal of Section 59; decriminalising prostitution; legislating for civil unions; replacing the Privy Council with the Supreme Court; ‘banning’ food from school tuck shops; suggesting regulating for energy-efficient light bulbs; suggesting regulations on shower-heads, etc..

Yes, the ‘bad old days’ when government didn’t care what ordinary kiwis wanted and just pushed through what some small, ‘non-ordinary’ clique wanted.

I’m tempted to say that it’s “déjà vu all over again“, but that’s not quite right.

This time – with this government – public opinion is being over-ridden not for ‘social’ and ‘environmental’ reasons (e.g., protecting children, human rights, national sovereignty, public health, lower energy use, etc.) but for ‘rational’ economic reasons (e.g., economic efficiency, foreign investment, reducing debt, etc.).

I guess someone needs to ‘keep their head’, assert a bit of economic rationality and ‘make the tough decisions’ (1984 redux anyone?). Here’s some of those tough decisions.

According to a TV3 Reid poll, 72% of New Zealanders don’t like the ‘pokies for Convention Centre’ deal. But, apparently, we just don’t understand that the economic benefits outweigh the social costs – presumably because we’re ‘ill informed’ or economically irrational.

Well, at least Phil O’Reilly of Business New Zealand implies as much when he points out that:

the Sky City deal is “reasonable… from a New Zealand public taxpayer perspective”, with no public funds required for the centre’s construction.

A bit sad – and strangely paradoxical – that so many New Zealand taxpayers seem unable to adopt the “public taxpayer perspective”.

New Zealanders also oppose the ‘mixed ownership’ version of state asset sales by at least two to one.

Our irrationality, according to John Key, is dissipating on the issue and, by the time the full float of Mighty River Power happens we’ll “feel more comfortable with it” – a fait accompli tends to have that affect, of course.

The rise in support for the sell-off from 26% to 30% (from the previous tvnz poll) Key sees as evidence that we are “starting to ‘think through the issue’“.

That’s fortunate. We’re starting to get rational – just in time, though possibly not quite fast enough for John Key’s liking. Imagine what an immense mistake we’d be making if we had a referendum on it – luckily our Prime Minister is dead against that.

Sadly, however, Maori seem particularly reluctant to “think through the issue”. An extremely disappointing 88% of Maori haven’t put a lot of thought into this important issue.

The bad news for the economic rationality of the public keeps coming.

Despite an admittedly small sample, a New Zealand Herald Digipoll found 64% in favour of the Michael Fay-led consortium’s bid to buy the Crafar Farms – despite it being a full $40m less than the Shanghai Pengxin deal (and that was after the government’s latest decision – perhaps the public will “feel more comfortable with it” once the new owners take possession?).

Fran O’Sullivan has pointed out that:

What is interesting about this latest OIO decision summary is a clause noting it will advance the NZ Inc China Strategy (a significant government strategy), one of the aims of which is to “increase bilateral investment to levels that reflect New Zealand’s growing commercial relationship with China”.

For those New Zealanders who aren’t au fait with the government’s “significant” ‘China strategy’, O’Sullivan sees an opportune moment to relieve New Zealanders of their xenophobic economic irrationality. In fact, according to O’Sullivan, the “political management” has already begun:

the time is ripe for a domestic sales pitch to support increased foreign direct investment (FDI) in New Zealand. Some thought is obviously going into the political management of the issue.

Unlike in January, when the ministers had little support from influential players for their initial approval for Shanghai Pengxin to buy the farms, this time round Federated Farmers and various business voices have supported their decision.

We might be irrational, but at least help is on its way.

Then, of course, there’s the Christchurch rebuild and the ‘people’s plan’ for the Central City. As new Central City Development Unit head, Warwick Isaacs concisely puts it:

At the end of the day, the plan was always going to be the minister’s. They [the Christchurch City Council] understand the role now for the minister is to decide what he likes and what he doesn’t.

As I argued previously, the Central City rebuild is just too important for the potentially economically irrational and ill-informed people of Christchurch to determine the outcome.

The pattern is plain: This government thinks that the New Zealand public is too economically illiterate for its own good. En masse, New Zealanders just don’t know what’s good for them when it comes to economics.

Enough of the sarcasm and satire (well, not quite – more coming below).

The view that ‘the masses’ are irrational has a long intellectual history. The reason Plato placed ‘democracy’ only just above ‘anarchy’ (at the bottom of the table) as a desirable form of government was because of a lack of trust in the capacity of the demos to “think through the issues”. The problem with democracy, to put it bluntly, is that it is government by the people, and people are ignorant:

Democratic self-government does not work, according to Plato, because ordinary people have not learned how to run the ship of state. They are not familiar enough with such things as economics, military strategy, conditions in other countries, or the confusing intricacies of law and ethics. They are also not inclined to acquire such knowledge. The effort and self-discipline required for serious study is not something most people enjoy. In their ignorance they tend to vote for politicians who beguile them with appearances and nebulous talk, and they inevitably find themselves at the mercy of administrations and conditions over which they have no control because they do not understand what is happening around them.

Millenia later, discussions around the formation of the United States – at the Constitutional Convention in Philadelphia in 1787 – revealed the same concerns about ‘the people’. Michael Parenti’s description of some of the discussions and comments is instructive:

“To secure the public good and private rights against the danger of such a faction [i.e., the “propertyless multitude”],” wrote James Madison in Federalist No. 10, “and at the same time preserve the spirit and form of popular government is then the great object to which our inquiries are directed.” … The framers of the Constitution could agree with Madison when he wrote also in Federalist No. 10 that “the most common and durable source of faction has been the various and unequal distribution of property. Those who hold and those who are without property have ever formed distinct interests in society” and “the first object of government” is “the protection of different and unequal faculties of acquiring property” (that is, acquiring wealth).

The framers were of the opinion that democracy was “the worst of all political evils,” as Elbridge Gerry put it. For Edmund Randolph, the country’s problems were caused by “the turbulence and follies of democracy.” Roger Sherman concurred, “The people should have as little to do as may be about the Government.” According to Alexander Hamilton, “All communities divide themselves into the few and the many. The first are the rich and the wellborn, the other the mass of the people. . . . The people are turbulent and changing; they seldom judge or determine right.”

It’s an old idea, then, that, because of our general ignorance, we can’t be trusted to make significant decisions in a rationally ordered society.

Times have changed, but it seems that this same attitude continues – though obviously how it is expressed requires some ‘updating’. A good example of this approach was a recent editorial in The Press concerning the proposed Local Government reforms, especially as they will affect votes on amalgamation.

The trigger for the editorial was a vote by ratepayers in both the Nelson and Tasman local authorities. The Tasman electors voted against amalgamation. Irrespective of the arguments over the rights or wrongs of amalgamation it is interesting to examine the rhetoric used.

The editorial concedes that the outcome of this vote “maintained a New Zealand tradition” of opposing amalgamations. Apart from the vote to amalgamate Banks Peninsula with Christchurch City “Voters are disinclined to let their councils be absorbed into bigger entities“.

Apparently, this has always been so in New Zealand which is why, the editorial explains, central government has ‘had’ to repeatedly intervene and reform local government:

Almost all this change was brought about by instructions from Wellington rather than by local initiatives. Regional fiefdoms had to be forced to suspend their operations.

It’s that time again, ‘it seems’:

It seems that the Government will have to again exercise its authority if local bodies and their constituents are to embrace the needed reforms. The regularly occurring inadequacies are showing but, if Nelson’s example is anything to go by, voters are not interested in removing them. It is therefore welcome that the Minister of Local Government, David Carter, is progressing change.

Once again, the voters just don’t understand what has to be done. So how will what ‘has to be done’ get done?

Proposed is a lowering of the hurdle that amalgamation must jump. Councils will be able to join if a majority of their combined electorates agree, rather than, as is the case now, a majority in both electorates being needed. This will prevent a veto being exercised in the fashion of Tasman voters at the weekend.

Notice that ‘amalgamation’ – the poor soul – is having ‘hurdles’ – aka ‘red tape’ and regulation – put in front of it.

And what is the ‘hurdle’?

It amounts to having those affected by it, agree to the amalgamation. When you start to look around I bet you’ll find all sorts of these ‘hurdles’ in modern democracies. Makes you wonder why we put up with them.

Despite the obvious risk with these sorts of ‘hurdles’, “The Government is keeping a large dose of democracy in its plan by still allowing amalgamations to go to the ballot“. The Editor, however, is well aware of the risk and sternly notes that “more forceful measures will be necessary if boundary change continues to be rejected“.

And what, at base, is the Editor’s objection to democratic ‘hurdles’ (i.e., the affected voters) and also the reason for recommending “more forceful measures“?

Well, it turns out that the Editor is merely performing the next, predictable iteration of that age old pattern I’ve pointed out:

Inefficient local government is too costly an imposition on national and regional economies to be sustained by voters with a sentimental attachment to their councils.

It’s those irrational, sentimental, economically illiterate voters again.

Will they (aka ‘we’) never learn?


Epilogue: The push for amalgamation is one of those forces that is bound to succeed – not least because of the apparent determination of those with influence and power to over-ride the objections of ‘voters’.

Those who know about these complex things (i.e., the ‘experts’ on the economy, local government, etc.) can’t afford to waste time persuading and ‘educating’ the population, it appears. The issue is just too urgent to wait for the voters to understand.

There was, for example, no referendum on the ‘Super-City’ amalgamation in Auckland – though those less well informed citizens organised their own “People’s Referendum” on it.

The issue in the Christchurch region is the same. As the same editorial concludes:

Christchurch, Mid-Canterbury and Central Canterbury are approaching a test of these issues. The city’s natural boundary is steadily expanding into Selwyn and Waimakariri as the suburbs expand – a process increased by the spill of population caused by the earthquakes. Local-government boundaries will soon have to be altered to encompass the changes. It is a necessity that will provide a useful chance to consider the future of Environment Canterbury and the possibility of Canterbury unitary government.

I think it’s important to realise that many – though possibly not all – of the people who are pushing for these and other ‘economically rational’ policies and ‘reforms’ believe that it is not a political matter. Many of them see it as a ‘merely technical’ matter, which is why they are frustrated by the recalcitrance of the voting public. I’m sure that, for them, it is a frustration that such technical economic matters currently rely on democratic processes.

Why might they think this way?

In his book Questioning Technology, Andrew Feenberg makes some pertinent comments about this question when he focuses on the notion  of economic ‘efficiency’ in discussing ‘cognitive-instrumental rationality’.

 In his essay on Weber, Marcuse argues that the apparent neutrality of the cognitive-instrumental sphere is a special kind of ideological illusion (Marcuse, 1968). He concedes that technical principles can be formulated in abstraction from any content, that is to say, in abstraction from any interest or ideology. However, as such, they are merely abstractions. As soon as they enter reality, they take on a socially specific content

Efficiency, to take a particularly important example, is defined formally as the ratio of inputs to outputs. This definition would apply in a communist or a capitalist society, or even in an Amazonian tribe. It seems, therefore, to transcend the particularity of the social. However, concretely, when one actually gets down to applying the notion of efficiency, one must decide what kinds of things can serve as inputs and outputs, who can offer and acquire them and on what terms, what counts as discommodities, waste, and hazards, and so on. These are all socially specific, and so, therefore, is the concept of efficiency in any actual application. And insofar as the social is biased by a system of domination, so will be its efficient workings. As a general rule, formally rational systems must be practically contextualized in order to be used, and as soon as they are contextualized in a capitalist society, they incorporate capitalist values.

In other words, any actual, real world, practical ‘calculation’ of efficiency – or inefficiency – is inherently political.

More generally, whenever they are applied, the abstract theories and principles of economics and economic analysis are also irreducibly political – no matter how ‘merely technical’ they might appear.

I think the same is true of science, in general – hence the title of my blog.

I think that members of this government, business ‘leaders’ and, if the editorial discussed above is any indication, ‘opinion leaders’ in the media in New Zealand either hold to this idea that the economic sphere is simply a technical sphere (i.e.,  is just a matter of ‘cognitive-instrumental rationality’); or, rather cynically, adopt the rhetoric of the ‘technical’ to persuade the rest of us to fall in line with policies that simply serve their interests.

Either way, democracy comes to be disdained*.

Finally, and returning to my opening comment, I suspect that the reason people were less willing to go along with having their ‘will’ overridden by the Labour-led government than they appear to be by the current one, is that they, then, held to the belief that they did, indeed, have sufficient knowledge and intellectual capacities to be the ones who should decide over child discipline, the desirability of civil unions, the legal status of prostitution, etc.. Talk of ‘experts’ in these areas simply irritated people.

By contrast, economics hides behind the arcane veil of numbers, which, for many people, immediately makes them feel less sure of their opinions on economic matters. So, while the majority may oppose measures such as city amalgamations, selling assets, selling land to foreign investors, etc. opposition to those policies is not – at the ‘ordinary kiwi’ level – as indignant as it was pre-2008.

Just a thought.

*The title of this post is a take off of Chomsky’s book ‘Deterring Democracy’.

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4 Responses to Disdaining democracy

  1. You have the material for four or five individual posts here.
    I’ll restrict myself to commenting on local government reform, for the moment, because I am trying to write a post on it myself. Without much success.
    In essence my thoughts are that amalgamation is the antithesis of what is required in New Zealand. One of the fundamental behind the 1989 reforms was a drive for homogeneity in the size of local government areas. The commissioners tried to balance communities with a common interest with size that would create efficiencies – more on that later. In terms of having a reasonably even population the reforms were reasonably successful. There were exceptions like Kawerau, which is tiny, and Auckland, which, until it got much larger, was very large.
    Auckland is a funny place, with three NPC rugby teams (North Harbour, Auckland, and Counties – does it include parts of the Northland NPC team catchment, too?), three DHBs, three policing districts, three free phone calling areas, goodness knows how many MPs and one local authority.
    I agree that local government needs a good shake up, but it should be done with the aim of increasing the level of democracy, rather than improving some hypothetical and immeasurable beast like efficiency. That would involve asking people if they are happy with their local council, and whether they would prefer a bigger one that was possibly more efficient (via amalgamation), or a smaller one that was more democratic (via de-amalgamation).
    It’s always seemed to me that NZ is missing a layer of government. A replacement for the monarchy had never really appealed. [extensive explanation of thoughts relating to the British royal family redacted] – I think it might be that we need stronger regional government.
    On efficiency at local authorities, it has been my privilege to work with many of the local authorities around New Zealand over the last twenty years or so, and observe how they operate. I’ve worked with the very small ones (about ten thousand population – not Kawerau) to the largest of the large (including Auckland City and Auckland Regional Councils). Below a certain size, councils find it difficult to operate because their ability to fund major projects, or control their operational budgets; they are too small. But they sure do know how to get value for money – they can be stunningly innovative (and that’s not a word associated with local government).
    As size increases, so does the amount of what is sometimes lovingly referred to as “fat”. At one particular council it was commonly remarked that no one would take a pee for less than $10k. That is not efficiency.
    Thing is, local government is, nominally, a democratic institution. Its prime objective should be to be, wait for it, democratic. Not efficient. That’s not to say efficiency is not desirable, I support the idea that inefficiency should be minimised, right up to (and not beyond) the point that it impinges on democracy.
    The level of community engagement, in my experience, increases as the population size decreases. I was mesmerised by the mayor in a smaller district who knew the names of every one of his staff, and who walked down the main street at lunchtime and talked to anyone who cared to engage him in conversation. Needless to say the main street was not called Queen Street and the mayor was not named Brown, Banks, Fletcher or Mills.
    So, I agree with a lot of what you have said. Amalgamation seems inevitable, and in that sense it will succeed. In terms of supporting democracy, it is doomed to failure. In terms of increasing efficiency it will also almost certainly fail, and if it does appear to succeed it will be through either clever statistics or good luck. Or both.
    Local government is for people, at a local level. There is no good argument for imposing central government’s model, people should be able to make decisions at a local level on how to govern themselves at a local level.

    • An addendum – I am often horrified at how regularly people fail to distinguish between acting rationally and acting ethically. While at first glance it might seem obvious that the two must be the same thing, they are not. Henry Kissinger was, if I recall correctly, very big on both efficiency, and on rational methods, so of which were extremely unethical. And, subjected to a bit of scrutiny, he was not particularly good at achieving what he set out to, and covered up with the mask of being a “statesman”.
      I must read up on the subject again, so I can make a more substantive and informed comment.

    • Puddleglum says:

      Hi Armchair Critic,

      Thanks for the detailed comment (from someone who’s obviously had on the ground experience of local government!).

      Local government seems to me to be one of the likely places that – with some structural changes – more or less ‘ordinary’ people can become, and will be motivated to become, politically involved and active. So I agree with you that the democratic nature of local government is what needs the most work, not so much the ‘efficiency’. I imagine, in fact, that the ‘efficiency’ issues will be pretty rapidly dealt with once more participation happens (people aren’t generally careless when they have a closer say over how their money is spent).

      An encouraging development that my wife mentioned to me tonight is happening in Lyttelton (she read about it in Avenues magazine, of all places). Apparently, not only are they developing a community cooperative to buy out and run ‘Lyttel Piko’ but they are also setting up a community trust to buy land to ‘free people from the tyranny of mortgages’. Makes me want to move back to Lyttelton (we lived there for 6.5 years). I’ll have to read about it myself and have a think.

      Thanks again for the detailed comment!

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