Hello EU, haven’t you seen the relationship between democracy and debt?

Image (c) http://www.flickr.com/photos/dnnya/

2011 has been a strange year.

A year full of strange words nobody wants to hear such as ‘debt crisis’. ‘Greece‘ is no longer a beautiful country with white-sand beaches, blue Mediterranean Sea and great sunny weather. In 2011, ‘Greece’ has become the synonym for a country where the only thing that still grows is its debt. During all the intellectual discussions made around the debt crisis not only in Greece, but also in the whole European Union and as well in the US, it is fascinating how politicians find all kinds of causes but never question probably the biggest reason for debt: themselves and democracy.

To be exact, the lack of direct democracy in a state.

I’ve always been a fan of direct democracy because I believe that the mass is always more intelligent than a few elected intellectuals. James Surowiecki is of the same opinion and has illustrated this pretty impressively in his book ‘The Wisdom of Crowds’. Also, it is much more difficult and expensive for lobby groups to bribe a whole society than influencing some politicians in order for a favorable vote. Another convincing argument is that in a representative democracy a few decide on spending the tax money of all. Spending money you have never earned yourself inevitably leads to waste and the more you get used to it to debt.

In a direct democracy the society has the ultimate veto right, which leads to a more reasonable way of spending tax payers’ money and as a consequence less debt. Now a great, recent extensive study by Patricia Funk and Christina Gathmann revealed that there is in fact a relationship between direct democracy and government spending. Who is interested can download the complete study here (PDF).

Basically, the study revealed that the more direct the mass in a direct democracy can exercise its veto right towards spending, the more reasonable is government spending as a whole and the ‘leaner’ or less ‘bloated’ is government itself. That is bad news for the European Union bureaucracy beast. Politicians keep thinking they are indispensable and try to resolve the debt crisis with more government. The contrary should be done. And while the masses will realize the validity and importance of this study and would reasonably act and apply it, we will have to wait a long time until EU politicians will accept this truth. They will neglect any relation in order not to lose their power or influence. Their individual motivation will be more important to them than the good for the community.

And there is it once again. The lack of direct democracy harms us all.

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2 thoughts on “Hello EU, haven’t you seen the relationship between democracy and debt?

  1. It’s a pity you don’t have a donate button! I’d certainly donate to this outstanding blog! I suppose for now i’ll settle for bookmarking and adding your RSS feed to my Google account. I look forward to brand new updates and will share this site with my Facebook group. Talk soon!

  2. Hello! This post could not be written any better! Reading this post reminds me of my good old room mate! He always kept talking about this. I will forward this page to him. Pretty sure he will have a good read. Many thanks for sharing!

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