The United States: “Flawed Democracy”

This post The United States: “Flawed Democracy” appeared first on Daily Reckoning.

The annual edition of The Economist’s Intelligence Unit Democracy Index is out.

Across several democratic categories nations are ranked. These include but are not limited to:

Civil liberties…  the functioning of government… political participation… electoral process… pluralism… and political culture.

Where does the United States rank among the nations of the Earth?

Is it the most democratic? Perhaps the fifth? Or the eighth?

Answer shortly…

We admit it at the outset — we find the spectacle of democracy vastly amusing, grand and gorgeous.

The charming fraud, the innocent delusion… the mushy-headedness of it all.

The “people” give the orders in democracy say the civics books.

But did anyone ask you — for example — if invading Iraq was a grand idea?

Or if your tax dollars should bail out Wall Street in 2008?

Or if your government should bury itself under $22 trillion of debt?

At the community level the business is not necessarily improved.

Consider this case:

A red light camera was recently installed outside our Baltimore office. It presently mounts watch over the intersection of St. Paul and Madison Streets.

But were residents asked if we wished to be so deeply and elaborately policed?

What do you suppose would have been the answer if we were?

Yet the camera is on duty… hooking every felonious automobilist who crosses under one-billionth of one second too late.

Somehow it all seems beyond democratic agency, beyond all control.

It is simply the way the political machinery operates, a fellow concludes.

He may cluck-cluck his opposition to it… but he is largely a man resigned.

And if “the people own the government,” as the democratic gospel singers tell us, we suggest you put the theory to this test:

Approach the guardhouse at the nearest military installation. Demand immediate entrance, asserting your rights of property.

The ownership theory hinges upon the reaction you receive.

But to return to our question…

Where is the United States’ democratic ranking among the nations?

Is it first… third… sixth… perhaps — heaven forfend — ninth?

The answer, says The Economist’s Intelligence Unit Democracy Index, is…

Twenty-fifth — the United States is the 25th most democratic nation on Earth.

It finds itself sandwiched between Estonia and the Jeffersonian paradise known otherwise as Cabo Verde.

Thus America is sorted into the category of “flawed democracies,” coming beneath the “full democracies” of the world.

Listed here are the world’s top 10 “full democracies,” seriatim:

Norway, Iceland, Sweden, New Zealand, Denmark, Canada, Ireland, Finland, Australia… and Switzerland.

Of course, we recommend you take it all with requisite dose of table salt.

The Economist is globalist to the very tips of its fingers.

Unsurprisingly, the report labels Trump a unique menace to American democracy:

[President Donald] Trump has repeatedly called into question the independence and competence of the U.S. judicial system with regard to the ongoing federal investigation, led by Robert Mueller, into potential ties between Mr. Trump’s presidential campaign and Russia, and various courts’ efforts to block some of his policy orders, particularly regarding immigration… As a result, the score for political culture declined in the 2018 index.

Be it so.

But is democracy the gold standard of government?

Under our system We the People delegate the business of governing to officials we elect.

Should these officials execute their office to the dissatisfaction of voters, they are ousted from office.

Others come in.

But time often reveals the replacement is a scalawag on par with the original — if not worse.

It is easy to indict the politician as a whole. But if we haul the politician into the dock… We The People must go with him.

We perpetually holler about ‘them rascally, no-good, lyin’ politicians’…

Them silver-tongued, glad-handing, baby-smooching mugs who babble one thing to get elected — but do another once in office.

Kick the bums out is the eternal bellow.

But we contend the politicians act as they do… because We the People act as We do.

We demand a shining military machine with every bell and whistle… heaping doses of Social Security… Medicare… a Rolls-Royce education… a million gaudy baubles.

But we do not wish to pay for it all.

Hand it over, we bark out one corner of our mouth. But don’t dare raise our taxes, we belch out the other.

Many of us say we’re heart and soul for limited government

But We are heart and soul for limited government… as long as it’s the other fellow’s heart and soul feeling the blade.

Give me that tax break, says the one. No, give it to me, says the other.

You can both go scratching, says the third. I deserve it more.

A fourth files a claim of his own.

Meantime, the hard-luck farmer wants his back scratched. The hard-pressed businessman wants his belly rubbed. The overlabored teacher wants her apple.

And millions more are hard at the business…

All trying to work the angles, to get a bucket in the stream, to get a snout in the trough… to catch a penny.

It is the evil of “special interests” when the other fellow gets his.

But it is “democracy in action” when it butters our own parsnips.

We do not exempt ourself from criticism. We are out for No.1 as much as anybody.

Let the politician take an honest man’s attitude before the American public 

Let him tell us we can have either A. Or B. But not A and B — and certainly not A, B and C.

Not without paying for it, that is.

Then observe the fleets of rotting eggs and tomatoes raining upon his head.

Ten times of the 10, our honest Abe is licked by the silver tongue who tickles our ears with false but catchy jingles.

This is the man who wins our franchise when we enter the vote booth.

But still the circus goes on, entertaining as ever, paraded out daily in a dozen rings…

The great warfare of factions, the thundering collision of interests… each fellow trying to get it over on the next.

Pity the poor politician who has to referee and score the bout.

He cannot please us all. Yet he tries.

So today we lift our modest hymn of sympathy for the poor, fimble-fambling politician.

He is a man in an impossible fix.

Stow your objection that the nation is nearly $22 trillion in debt largely because the election-minded politician has thrown the Treasury doors wide open.

We will not listen!

Under what alternate type of government would you be so royally entertained?

A dictatorship, for example, offers no comparable entertainment. All oars pull in one direction. And the fantastic combats of democracy are unknown.

We will occasionally find ourself out of joint for one reason or the other.

But we always take solace in the pleasant fact that we are quartered under the democratic folds of the stars and stripes.

Yes, we concede that “democracies have ever been spectacles of turbulence and contention,” as James Madison notes in Federalist No. 10.

We further grant his point that democracies:

“Have ever been found incompatible with personal security or the rights of property; and have in general been as short in their lives as they have been violent in their deaths.”

All true and more.

We even admit the possibility that American democracy is closer to the end of the chapter than the beginning.

But this you cannot deny:

What a show while it lasts…


Brian Maher
Managing editor, The Daily Reckoning

The post The United States: “Flawed Democracy” appeared first on Daily Reckoning.

Democracy: The God That Failed

This post Democracy: The God That Failed appeared first on Daily Reckoning.

Today we trample sacred ground… trumpet a message of heresy… and offend the wrathful gods.

In 2001, academic Hans-Hermann Hoppe scribbled a book bearing the soaring title Democracy: The God That Failed. Hoppe’s work is a sharpened spear levelled against that holiest of secular divinities.

Hoppe’s primary tort against democracy?

It wastes. It exhausts its capital. It forever takes the short view. Hoppe uses the economic concept of time preference to nail his point through.

A Jill with low time preference delays her gratification until the future. She is disciplined. She is willing to have her cake later — only after she has seen to her business.

But a Jack with high time preference orients toward present consumption. He wants his cake now — and the future can go scratching.

Democracy, in Hoppe’s regard, “wants it now.” It is a spendthrift; a profligate; a child at large in a candy store.

As the drunkard cannot see beyond the next drink… democracy cannot see past the next election.

The problem, says Hoppe, is that democratic leaders do not own the machinery of government. It is theirs on temporary loan. Thus the democratic politician is a mere placeholder.

But is that not our system’s cardinal virtue — that power is not permanently lodged in a single vessel? A rotating roster of rogues is far superior to one alone, you counter.

Otherwise the American Revolution was a vast swindle and the Fourth of July is a blackguard’s holiday.

But because a leader under democracy does not own the government apparatus, argues Hoppe, he has no incentive to maximize its value. Instead, he tends to deplete it. His limited time horizon forces him toward immediate gratification.

That is, he must get while the getting is there to be gotten.

Consider the aspiring democratic official who seeks the franchise of a demanding public. He may feel the tug of fiscal conscience. But should he fail to gratify the crowd’s clamorings, he knows the other fellow will. And our democratic aspirant will lose his election.

So he offers up the requisite sweets.

If Social Security benefits must increase to sweep him into office, they will increase. Will it take more Medicare benefits, more unemployment insurance, more welfare? Then these you will see.

His election represents a pre-arranged raid upon the Treasury. If the national purse is thin, if the burden cannot be met from existing stocks, then let it go upon the credit card.

Is the business sordid? Might it eventually throw the Republic into bankruptcy?

Well, eventually is a long way off, he says. Let it fall into the next fellow’s lap. Besides, we’ll simply grow our way out of it.

This is the office seeker under modern democracy.

Compare, for a moment, democratic government with a rented automobile

The renter does not own the auto. He therefore has no regard for its long-term health. So he overaccelerates the engine. He pummels the brakes. Down its gullet he pours the lowest-test gasoline. Would he ever check the oil?

And who, may we inquire, has ever run a rental through a wash?

Here Hoppe applies the theory to democratic government:

It must be regarded as unavoidable that public-government ownership results in continual capital consumption. Instead of maintaining or even enhancing the value of the government estate, as a king would do, a president (the government’s temporary caretaker or trustee) will use up as much of the government resources as quickly as possible, for what he does not consume now, he may never be able to consume… For a president, unlike for a king, moderation offers only disadvantages.

Hoppe speaks of a king.

Unlike democracy, Hoppe contends, monarchy takes the long view. The monarch owns the apparatus of government. As will his heirs. So he naturally inclines to policies that increase the value of his property over time.

If Social Security, Medicare and the rest begin to deplete the government’s stocks, the monarch will announce a halt to them.

“It’s welfare you want, subject? I understand the church runs a charity.”

“Social Security, you seek? I suggest you begin planning early for your retirement. And remember to save against the rainy day.”

“You say you want health care. I hope you don’t smoke or drink too much. And let me mention it now — sugar is a far-from-healthful substance. Besides, there are private insurers. I can refer you to several if you wish.”

Is such a system undemocratic? Certainly.

Callous, perhaps? Well, perhaps it is.

But is it fiscally stable? Yes.

Would it incur massive debts it could never repay? Unlikely.

In brief, monarchy is better with money than democracy. It is a superior steward of wealth — at least by this theory.

Once again, Hoppe:

While a king is by no means opposed to debt, he is constrained in this “natural” inclination by the fact that as the government’s private owner, he and his heirs are considered personally liable for the payment of all government debts (he can literally go bankrupt, or be forced by creditors to liquidate government assets).

Consider, as one example:

In 1392 England’s King Henry III was in arrears to the Pope in Rome… and required 1,000 pounds towards satisfaction of his debt. He did not have it.

So Old Hank was forced to appear before the citizens of London with an open hat.

Moreover, they refused him.

Can you imagine a president of the United States upon his knees before the citizens of Washington?

And these citizens being allowed to refuse him his money?

Freeman Tilden, from his neglected 1936 masterwork, A World in Debt:

Kings had power enough to contract debts, but found it much more difficult to take advantage of that power than the legally curbed monarchs [that followed later]. The feudal system, with its insecurity and constant clash of petty divisions, was not calculated to invite credit.

In distinct contrast, Hoppe argues, we find the democratic president:

A presidential government caretaker is not held liable for debts incurred during his tenure of office. Rather, his debts are considered “public,” to be repaid by future (equally nonliable) governments.

Perhaps this explains — at least in part — why the national debt of the United States runs to some $22 trillion?

It is a capital fact beyond all dispute:

Most democratic nations groan beneath bloated government… extortionate taxation… and Himalayan levels of debt.

How does this lovely, lovely state compare with the barbarous age of monarchs, Mr. Hoppe?

During the entire monarchical age until the second half of the 19th century… the tax burden rarely exceeded 5% of national product. Since then it has increased constantly. In Western Europe it stood at 15–20% of national product after World War I, and in the meantime it has risen to around 50%.

Government spending ran to roughly 10% of GDP prior to World War I. It currently nears 50% in many democratic countries.

Total government spending in this Land of the Free amounts to 36% of GDP — nearly 40%.

Perhaps in retrospect the world might have been made safe for monarchy in 1917.

And maybe our Colonial forefathers should have left old King George alone in 1775. His tax bite was so light… it failed to break the skin.

Our researches reveal that American Colonial taxation ran to about 1% of total income — 1%.

And between 1764 and 1775, claims political scientist Alvin Rabushka:

The nearly 2 million white Colonists in America paid on the order of about 1% of the annual taxes levied on the roughly 8.5 million residents of Britain, or 1/25th, in per capita terms…

As traitorous as it may appear, we are half-tempted to disinter King George’s innocent bones and throw them a much overdue parade.

But let us entertain no more thoughts of heresy.

Hoppe’s book is actually no call for monarchy. As the author himself states at the onset — “I am not a monarchist and the following is not a defense of monarchy.”

His primary purpose is to diagnose an illness — not to prescribe a cure.

Hoppe’s sins against democracy are nonetheless of the mortal variety. And mainstream academics put him under the excommunication for his blasphemies.

But to repeat, Hoppe does not call for monarchy. Nor do we.

Beneath our seditious motley beats the heart of an American patriot… and our blood runs true under red, white and blue.

Besides, a king could be every inch the scoundrel as an American president. And since he faces no election, how could we possibly count upon him to say amusing and idiotic things?

Let us therefore not discount the comedic value of democratic government.

In addition, monarchy is certainly no guarantee against bankruptcy — as history records well. More than a few ne’er do well kings have driven their realms to rack and ruin. Who can dispute it?

But it is due more to incompetent kingmanship than kingmanship itself. A Henry VIII can inherit a throne as easily as a Solomon. Regardless, it matters little…

Hoppe’s monarchic utopia will never be — not in today’s age of mass democracy.

But does it soften his case?

Winston Churchill famously quipped that democracy was the worst form of government except for the rest.

But upon further reflection, maybe monarchy is the worst form of government… except for the rest…


Brian Maher
Managing editor, The Daily Reckoning

The post Democracy: The God That Failed appeared first on Daily Reckoning.