Democracy in Crisis
Throughout the world, democracies are failing. Governments are finding it impossible to satisfy the irreconcilable differences between their citizens. Brexit in the UK, Abortion in USA, The Voice in Australia.
Everyone wants their opinion heard and legislated. Those in the minority are obliged to accept laws and regulations which they regard as anathema. Wide-spread discontent ensues.
Moreover, people on opposite sides of key issues regard their opponents with contempt. This is not a sound basis for a good society.
During the Great Financial Crisis, we worried that businesses had become too big to fail. Meg Wheatley thought they had become too big to manage. See The Fortunate p.129.
Maybe states have become too big to govern. Maybe this is why there is renewed interest in secession. Could secession be the way to live in amity?
In early March 2023, my wife and I spent a week at the Adelaide Writers’ Festival.
It is a great event. It is free. It is held in the open air. There are multiple simultaneous sessions to choose from. The fiction is excellent, the non-fiction selective, with a plainly left-wing bias. It is not the place to go if you want to hear from Geoffrey Blainey, Henry Ergas, or Suri Ratnapala; or views on Climate Change from Steven Koonin or Michael Shellenberger; or on The Voice from Jacinta Nampijinpa Price or Warren Mundine. The Director, Louise Adler, knows her audience. As did her predecessor Jo Dyer.
Mornings began at 8:00 am at The Star Kitchen & Bar where we joined Tom Wright for Breakfast with Papers as he interviewed journalists and writers about the news of the day. The panels seemed preoccupied with criticising the Murdoch press, although you sensed that neither they nor the audience read The Australian, nor the freely provided Adelaide Advertiser. On the fourth day, Mr Wright, claimed that the interruption to Sydney trains the previous day was an example of market failure and disproved the whole Hayekian narrative. Neither his panellists nor his audience felt a need to challenge this assertion. I kept my head below the parapet.
Every one of the 119 sessions began with an Acknowledgement of Country, often twice, once from the chair and once from the writer. Meanwhile unconcerned Aborigines congregated amiably in nearby North Terrace.
The festival held much of interest. There were local writers such as Alex Miller, Richard Fidler, Chloe Hooper, and Jane Harper. Bill Browder told us about Putin and Ben Macintyre about spies. Simon Armitage read us some of his poems. Walid Aly and Scott Stephens talked about how contempt is corroding democracy. Grace Tame spoke about the fight for the survivors of sexual abuse and Inala Cooper (daughter of Mick Dodson) about the fight for reconciliation. Simon Holmes a Court gave credit to Cathy McGowan for revitalising community politics. Ross Garnaut was enthusiastic about saving the planet with timely energy transition.
But the highlight was the wickedly funny Jewish-American satirist Shalom Auslander. When he signed his book Mother for Dinner for me - a book about whether a family of twelve Cannibal-Americans can retain their cultural heritage in the modern world - he wrote “To Peter - keep laughing, just to piss them off.”
Jill and I had travelled to Adelaide by car. We enjoy car trips. We can relax and appreciate the beauty of the countryside, with sheep grazing, crops flourishing, and eucalypts framing the highway. The long sight distance is therapeutic. It frees the mind for thought. I had been contemplating the problems of majoritarian democracy and been wondering if secession might be the answer.
At the festival, the erudite Bob Carr chaired a group discussion asking, “As America has turned inwards and its exceptionalism engendered skepticism, what are the ramifications?”. At one point, he turned to Auslander and asked, “What is it going to be like returning to such a dysfunctional country?”. “Oh, I am not going back”, came the quick reply. “I am looking for an apartment in Adelaide.”
I did not expect to find material on secession in a satirical novel on Cannibal-Americans. But there it was on page 8 of Mother for Dinner.
“We’re a tribal creature, Seventh, he said. Division is the way of man. And woman. It’s in our blood. Have you ever looked at a map of human migration? We began in Africa, as one, and got the hell out as soon as we could, braving storms, oceans, beasts, famine. Why? Wanderlust? To see Paris in the springtime? No – because we could not stomach each other, not for one more minute.
Hell is other people. Sartre said that, but early man would have said it sooner if he had developed language. Or she.
Someday, Seventh Seltzer, mark my words, everyone will have a nation of their own. Not every people – every person. It’s the only way he’ll be satisfied. Or she. Seltzerland. Rosenbloom Village. Abdullaville. Hernandez Town. One-foot-by-one-foot squares, evenly divided, all over the globe, surrounded by walls ten foot high, topped by razor wire and colourful flags, everyone in their own square singing rousing marches about how their square is Number One, how God chose their square over all other squares, how this square foot is their square foot and God help the person who tries to take it away from them.
We’ll want stories. Tales! Legends! About our square’s suffering and oppression, about our desperate journeys, about our founder’s valiant struggle to make our square the Number One it is, and about the evil enemies that to this very day try to take our square away from us. In Seltzerland they’ll tell stories about the dirty Rosenblooms; in Rosenbloom Village, they’ll dream of wiping the Abdullahs off the map; and Abdullah will peep over his wall, watch Hernandez move into the square beside him, and think. ‘There goes my property value.’ We’re obsessed with our squares, with our people, with our pasts. That’s why mankind has no future. Or womankind.”
Last year, I published an anthology of economic essays entitled The Fortunate which documented how much life has improved for humanity over the past two hundred years. The ideas that changed the world, the contributions of Western Civilization to mankind. In Australia, we are more prosperous, healthier, safer, better educated, doing less physically arduous jobs and having more time for leisure than ever. Yet despite living in the freest and most affluent society in the history of mankind we are an anxious society.
Our politicians say that they know “Everyone is doing it tough.” Really? I saw a journalist the other day interviewing a housewife standing at a 5-metre marble bench with a gas range and a huge refrigerator behind her. She was bemoaning having to pay $4 for an iceberg lettuce. When Josh Frydenberg announced the halving of fuel excise, he said, with a straight face, that it “would be of great benefit to households with two cars”!
We are concerned that the good life is ephemeral and insufficient, frightened that our good fortune might suddenly disappear or be taken from us.
Recently it was. During Covid, arbitrary regulations took away our liberties. We accepted this without a whimper as necessary to protect our health and that of our fellow citizens. Subsequently, we read The Great Barrington Declaration, Scott Atlas’ A Plague Upon Our House and many other analyses and learned that the regulations were unnecessary. Now we want our freedoms back. We do not want to be bossed around by politicians and bureaucrats with their false, self-serving propositions.
Driving through the vineyards near Padthaway, I was contemplating what might be done to improve things. It seemed to me that some of the changes we have made to our society over the past two generations, though made with the best intentions, have been counterproductive.
Three things stand out. Firstly, individual responsibility: we have lost the sense that we should be responsible for our own actions; that we should respect the rights of others; and that we should accept that we are not entitled to anything we have not earned.
Secondly, the role of the family has been diminished: children can no longer rely on having a mother and a father around to love them, support them and nurture them; parents can no longer depend on their children to care for them in their old age; the state has usurped the roles that families used to play.
Thirdly, economic decisions have been transferred from the private and business spheres to the political sphere. Politicians and bureaucrats now make the decisions on energy, on education, on health, on transport, and on our work and private relationships. Moreover, they interfere in judicial processes: fundamental concepts such as the rule-of-law and innocent-until-proven-guilty are violated. And they are so sanctimoniously self-righteous about everything. Mediocre men, and women, control our lives. Midwits.
As the rows and rows of healthy vineyards passed by, I wondered if perhaps the solution to all this was subsidiarity. It is a strange but important concept. Its proponents are as diverse as G.K. Chesterton, Alexis de Tocqueville, Pope John-Paul II, Ludwig von Mises, Noel Pearson and me.
Subsidiarity is the principle of devolving decisions to the lowest practical level, that what individuals can do, society should not take over, and what smaller societies can do, larger societies should not take over.
Subsidiarity facilitates a wider range of solutions, quicker and more informed decision-making, and the personal involvement of more citizens.
We do whatever we can ourselves, with our family, friends and neighbours.
We form voluntary organizations – businesses, clubs and societies – so that like-minded citizens can achieve their common objectives.
We keep government activity as local as possible, jointly funding only those activities that the group agrees to be valuable, keeping citizens closely involved in what is relevant to them.
Because there is a diversity of solutions there is less chance of one bad decision causing a systemic failure. Because there is more responsibility for one’s actions there is less opportunity for moral hazard.
As Pope John-Paul II explained in Centesimus Annus:
“… the principle of subsidiarity must be respected: a community of a higher order should not interfere in the internal life of a community of lower order, depriving the latter of its functions, but rather should support it in case of need and help to coordinate its activity with the activities of the rest of society, always with a view to the common good.
By intervening directly and depriving society of its responsibility, The Social Assistance State leads to a loss of human energies and an inordinate increase of public agencies, which are dominated more by bureaucratic ways of thinking than by concern for serving their clients, and which are accompanied by an enormous increase in spending.
In fact, it would appear that needs are best understood and satisfied by people who are closest to them and who act as neighbours to those in need.
It should be added that certain kinds of demands often call for a response which is not simply material but which is capable of perceiving the deeper human need. One thinks of the condition of refugees, immigrants, the elderly, the sick, and all those in circumstances which call for assistance, such as drug abusers; all these people can be helped effectively only by those who offer them genuine fraternal support, in addition to the necessary care”.
The more the state provides for us, the more it will want to control us.
If the state provides health care, then it will want to legislate to restrict behaviours that endanger our health – not only hard drugs but also alcohol, tobacco and sugar.
During Covid it also mandated vaccination, restricting access to employment and social gatherings for the unvaccinated, famously stopping world tennis champion Novak Djokovic from competing in the Australian Open.
If the state provides education, then it will want to ensure that its own ideology dominates, that its curriculum is taught.
If it supports the media, then it will want to ensure that information is not misleading – that only its views are presented. Satire will be verboten.
If it supports the arts, then it will want to control the exhibition of pictures and plays, determining which are pornographic, obscene or blasphemous.
If it supports sport, then it will want to influence which games are played, where they are played, and the quality of the facilities.
This is the reality of modern democracy. Societies are ruled from afar by an elite clerisy. Citizens with influence use the state to impose their views and preferences on their fellow man. Sometimes they gain financial favours in return for political support.
Are we brave enough to risk freeing ourselves from the government controls that constrain us? Are we brave enough to give our citizens the autonomy to make decisions themselves? If we are, then we can release the energy that will deliver an era of prosperity and liberty and create a moral society.
Back home in East Melbourne I began to ponder whether subsidiarity was feasible or whether our democracy had constraints that made such a change impossible.
I read Hans-Hermann Hoppe’s Democracy: The God that Failed. Hoppe explains the reasons that majoritarian democracy fails and how it leads to an ever-larger role for the state and an ever-increasing proportion of productive output being usurped in tax. Hoppe, too, is unlikely to be invited to the Adelaide Writers’ Festival.
A major feature of democracy is that the winning party must assemble cohorts of supporters who in total exceed 50% of the vote. In the social democratic welfare state this is achieved by promising and delivering special favours to the sectors one wishes to court. At every election, more promises must be made and none of the old ones rescinded. Consequently government spending increases and so does the bureaucracy that supports it.
Once more than half of the citizens in a modern democracy are net beneficiaries of government largesse then it becomes practically impossible to change prodigal policies.
Yuval Levin explained the consequences in Beyond the Welfare State:
“Moreover, because all citizens – not only the poor – become recipients of benefits, people in the middle class come to approach their government as claimants, not as self-governing citizens, and to approach the social safety net not as a great majority of givers eager to make sure that a small minority of recipients are spared from devastating poverty, but as a mass of dependents demanding what they are owed. It is hard to imagine an ethic better suited to undermining the moral basis of a free society.”
Robert Menzies had expressed similar sentiments in 1942 in his essay The Forgotten People.
“The great vice of democracy ... is that for a generation we have been getting ourselves on to the list of beneficiaries and removing ourselves from the list of contributors, as if somewhere there was somebody else’s wealth and somebody else’s effort on which we could thrive.”
Most people like receiving gifts. They do not like paying tax. Consequently, governments give more in benefits than they take in taxation. This leads to another pernicious political consequence – inflation. Journalists and politicians will often portray the cause of inflation as businesses increasing their prices. In fact, inflation is the expansion of the money supply. Governments do this through their central banks. They call it quantitative easing. How Orwell would have loved that phrase!
Instead of taxing more, governments pay for their largesse by printing money. This makes money worth less in relation to the goods and services it may be used to buy. So prices rise. To illustrate: over the last hundred years the price of gold has risen from US$20 to US$2000 per ounce. The value of gold is unchanged; the value of money has decreased one hundred-fold.
In the October 2023 edition of Quadrant, emeritus professor Wolfgang Kasper gives us an Australian example:
“Australians have so far not had the opportunity to learn the lessons of inflation with clarity, as the experience has been of the ‘frog-on-slow-boil’ variety: too slow to expose the real dangers, but persistent enough to do damage.
Since the launch of the ‘Kangaroo Dollar’ in 1966, it has on annual average been allowed to lose about 5 per cent of its value. Consequently, the dollar has now lost 94 percent of its original purchasing power! Who remembers that a litre of milk cost $0.19 in 1966, a litre of petrol $0.07, and a Holden $2,000?”
Politicians often describe their spending on welfare as compassionate. There is another word Orwell would have loved! But if it is paid for by quantitative easing, then the unemployed, the single mothers, the disabled, and the elderly pensioners are disadvantaged compared to those who own property, shares in productive companies, works of art, or gold. Inflation adversely affects the middle class, the working poor, retirees, and non-entrepreneurial investors. It benefits the asset rich: assets rise in price, but borrowings don’t.
As Hoppe explains in Democracy: The God that Failed:
“…the very problem that the redistribution was supposed to cure will have grown even bigger. Accordingly, the cost of maintaining the existing level of welfare distribution will be higher now than before, and in order to finance it, even higher taxes and more wealth confiscation must be imposed on the remaining producers.”
So, what should we do?
The larger a society is the more heterogeneous it is. Citizens will have different views many of which cannot be reconciled by consensus. More and more of the matters dealt with by government are in this category. The results are binary. All or nothing. Only one view can prevail. The minority – and it could be a 49% minority – lose out and become disaffected. This is the problem in America that Bob Carr alluded to.
What if our societies were much smaller? More homogenous. What if we applied the principle of subsidiarity? What if we did as much as possible ourselves and with our friends and neighbours? What if we got things done by forming contractual relationships with our fellow citizens and their clubs and businesses rather than asking what the government was going to do about it? What if like-minded citizens seceded and formed their own society?
Impossible you say? Not so. The number of sovereign states in the world has tripled in the past eighty years. Many of them have done very well. Think of Israel, South Korea, India, Czechia, Estonia, Lithuania, Botswana, and Algeria. Also, secession is an active consideration in many places including Scotland, Catalonia, Flanders, Quebec, Orkney, Khalistan and California. Even Western Australians and the citizens of New England in northern New South Wales, flirt with the idea from time to time. In the Basque country they never stop thinking about it.
As Ludwig von Mises wrote in Liberalism, it is a universal right.
“Whenever the inhabitants of a particular territory, whether it be a single village, a whole district, or a series of adjacent districts, make it known, by a freely conducted plebiscite, that they no longer wish to remain united to the state to which they belong at the time, but wish either to form an independent state or to attach themselves to some other state, their wishes are to be respected and complied with.”
Our Canberra-based democracy is not working well for us. So let us contemplate something different – an Australia comprising a new set of states, voluntarily chosen, in a loose federation. The arbitrary state boundaries of the nineteenth century would disappear and we might end up with twenty to thirty small states, even some city-states, representing the specific interests of culturally homogenous groups.
The new states would need to work together sensibly and cooperatively. They would need to form a federation for external matters such as defence, foreign affairs, and immigration. They would need to form voluntary agreements to maintain consistent systems to facilitate commercial activities. A common currency would make sense - ideally gold, but that is a story for another day.
Trade between the states would need to be free. Services such as power, water, sewerage, waste removal, public transport, education and hospitals could be developed and owned by businesses in one state and sold to others – much as Denmark buys power from France and Sweden.
Welfare services would more likely be provided by charities than by government bureaucracies. This would fit John-Paul II’s criteria “that needs are best understood and satisfied by people who are closest to them and who act as neighbours to those in need.”
There would need to be open borders so that citizens could move freely for business and pleasure. Citizens would need to be free to choose in which state they lived and in which states they established their businesses, and to change those choices from time to time so that they lived and worked in states that aligned with their values.
Once a year, each state could organise its own writers’ festival. Some might even find it worthwhile to invite discussion from David Kemp on Australian Liberalism, his five-volume history of Australia; Vaclav Smil on How the World Really Works, the fundamentals of our prosperity; Edward Chancellor on The Price of Time, the real story of interest rates; Greg Sheridan on Christians, reminding us of the relevance of Christianity; and Hans-Hermann Hoppe on Democracy: The God that Failed.
Australians could live in amity as Captain Arthur Phillip intended.
Other speakers at the conference included Greg Sheridan, Veronika Winkels, Karl Schmude and Michael Mendieta.
For a video of all the speeches, click here.
If you would like to know more about secession, read Ryan McMaken's 2022 book Breaking Away: The case for secesion, radical decentralization and smaller polities.