The Democracy Business:

Clichés of Freedom Disguise a Corporatist Reality.

‘Alas, poor Democracy! We thought we knew it well!’ And yet, what a strange beast it has turned out to be. How does something which promised such a grand future - the ‘end of history’ even - turn out to be something which looks more like the end of civilization?

We are used to thinking of democracy as the best of all systems of government. To find that best, we may look to its historic origins. Whether in ancient Athens, or Rome, or medieval England, democratic institutions were born of a desire to limit the exercise of political power and to oppose tyranny.¹ They were brought into political life to defend the vulnerable from assault and exploitation. In this way, democracy ‘protected human life from being perverted by the tyranny of a person, or fixed by the tyranny of an idea.’² These attempts to protect the vulnerable were imperfect - as all attempts must be. ‘Utopia’ is Greek for no-place.

As the rights of others became recognized in law - and in society and conduct generally - the spirit of democracy enabled, encouraged, perhaps even created a new habit of mind: the habit of assessing the interests of humanity as one. The habit is now familiar, and we - or at least the civilized and humanitarian among us - are accustomed to assessing new developments such as technology or globalization by their effects on humanity as a whole. ‘Democracy’ in its best sense means we wish to defend the rights and freedoms of others as if they were our own.³

It is this notion which has made well-meaning citizens enthusiastic, or at least compliant, when governments claim they are trying to spread democracy and freedom in the world. However, it is becoming increasingly obvious that what they are actually doing is something rather different. Instead of democracy, we seem to be creating either anarchy, or tyranny, or governments compliant to Western interests. In place of freedom, we see the power of corporations, the destruction of traditional ways of life, a spread of a culture of unparalleled shallowness and a globalized consumerism that is destroying the planet.

The first question I want to look at is, are these developments the inevitable result of democracy; or has our enthusiasm for democracy somehow gone astray or been taken advantage of?

Today, ‘democracy’ is a sacred word, to be uttered whenever the speaker wishes to reassure us he or she is a good guy. It is the gospel and credo of our age. People who are otherwise utterly opposed to each other - for instance George Bush and Noam Chomsky - both claim they want ‘more democracy’. Absurdities abound on both sides. For instance, the Bush government supports repulsive dictators like Karimov of Uzbekistan for ‘strategic’ reasons. On the other side, John Pilger calls US attempts to destabilize Chavez a ‘war on democracy’ just while Chavez is assuming dictatorial powers.

And yet - what we are used to calling ‘democracy’ is not really democracy at all. The system we call ‘democracy’ is in fact electoral representation. Aristotle, speaking for the Greeks (who invented democracy) stated explicitly that electoral representation is not a democratic form of government, but a form of oligarchy, of ‘rule by the few’. ‘When the people in general do not partake of the deliberative power, but certain persons chosen for that purpose, this… is an oligarchy’⁴. We should not be surprised, then, when electoral representation is managed by an elite; it is the nature of the beast to be managed thus. What electoral representation has done, is has changed the nature of the elite that presides over us.

We are so used to calling electoral representation ‘democracy’ that it is hard to separate out the two in our minds. So what is true democracy? As developed by the Athenians, the democratic system was to fill political offices by lot, much as a jury is convened today. Politicians were not elected to represent the people; they were sampled from among the people. They served short terms, at the end of which they returned to ordinary life.

The system had three important characteristics absent from a system of electoral representation. First, the deliberative assembly consisted of ordinary people, not professional power-hunters. Secondly, these ordinary people have time to concentrate and deliberate properly, unlike voters, who have neither time nor information to make informed decisions. Thirdly, each legislative proposal was considered separately by ordinary citizens, whereas under our system citizens vote infrequently on a raft of generalized proposals.

Electoral representation developed as a political procedure in the Roman Republic⁵. The story goes that in 494 BCE the people - the plebs - went on strike and camped on a hill outside Rome until the Roman nobles agreed to the formation of a people’s assembly. This assembly was for the plebs to make laws for themselves, and its officers were empowered to protect citizens against arbitrary arrest and injustice. Later, in 287, the same people’s assembly gained complete legislative power - in other words, Rome became a ‘democracy’ as we use the word today (although voting was heavily weighted in favour of the rich). In practice, however, the nobility continued to monopolize power, though they were forced to admit rich commoners to their ranks. So electoral representation gave the people a sense of participation, and a veto against rank injustice and exploitation, while power stayed with the elite.

The Republic lasted for over four hundred years. In the words of Finer, ‘For the greater part of its existence, the central political process in the Republic was the one by which the nobility tried to lead, court or manipulate the Assemblies.’⁶ The republic came to an end in unrest and civil war. After that, the diverse and independent powers of state were all invested in one man, and Rome became an empire. Ironically, Finer says, Rome did not even pretend it was a democracy until democracy had slipped away altogether, and even the people’s assembly had become an irrelevance. ‘Glorified in word, it (democracy) had become emptied in content; the two processes marched in tandem.’⁷

When, over a thousand years later, pressure built up in the monarchies of Europe for popular participation in government, the Roman model rather than the Greek was followed, giving us the pseudo-democracies we are familiar with today.

The idea behind electoral representation as it developed in England over three hundred years was unashamedly oligarchic - or elitist as it would be called today: we should elect our betters, who would make sensible decisions on our behalf. But what kind of ‘better’? Better-educated, better-informed, better-born? More intelligent, more conscientious, more thoughtful - or more ruthless? This, of course, would depend upon the inclinations of the electorate. Opponents of the widening franchise feared that gullible voters would elect people worse than themselves: in particular, the kind of scoundrels who offer to hand out other taxpayers’ money to win votes.

The result has been a mixture of the various expectations, with some surprise ingredients thrown in. Most significant of these is the dominance of the great political parties.

It is normally said that the winning party represents a majority. Usually, however, less than a third of the total electorate has voted for the winning party⁸. This means that electoral representation may result in a diverse two-thirds being dominated by a one-third who have all agreed on something. Sometimes what the winning third agrees on is unpleasant in the extreme, as when a malevolent faction discards the traditional restraints of courtesy, law, morality and religion, and sets about exterminating a rival minority.⁹

However, this tyranny by a minority is not the usual outcome of elections in settled or ‘mature’ democracies. Although political parties start off by representing the interests of different groups, as time goes by there is less and less difference between them. To win, a party needs to chase the middle ground of opinion. Whoever most convincingly offers to represent the interests of the middle wins the election. In other words: whoever wins, the result is a victory for the middle. This middle ground that is so assiduously chased by both parties may indeed be looked upon as a majority; but the majority can also act tyrannically. The historian Lord Acton observed in 1877: ‘It is bad to be oppressed by a minority, but it is worse to be oppressed by a majority… from the absolute will of an entire people there is no appeal, no redemption, no refuge but treason.’

Perhaps the most alarming feature of this ‘tyranny of the middle’ is how governments take it upon themselves as their most important task, the maximizing of economic growth. The promise that can be relied upon to interest most voters is of more money in the pocket. Other issues - social policy, foreign policy, war - are usually contentious, but not many people say ‘no’ to a pay rise. As a result, governments don’t let up for a moment on their promises and efforts to give us more. Nature, civilization, individuality, education, truth, beauty, honor, law, freedom, art, religion and justice are alike relegated or subverted to the cause of economic growth. In this way, our system of electoral representation becomes not a method of government, not a limited rule of law, but a management program for the destruction of the world.

2. Freedom.

Perhaps the second most misused word in the English language is ‘freedom’. Like ‘democracy’ it carries with it an instant good feeling. Surely we all know what we mean by freedom, and spreading it in the world must be a good thing. So the word ‘freedom’, too, gets taken up and used in inappropriate ways. The Nazis promised ‘Arbeit macht frei’ - ‘work makes free’ - when the reality was not work but slavery, not freedom but death. The American/British invasion of Iraq promised the Iraqi people freedom, but gave it robbery, chaos and slaughter before returning it to sectarian rule, heavily in debt to its ‘liberators’.

The word ‘freedom’ derives from the Greek ‘eleutheria,’ which was originally used to describe the sense of elation felt when drunk. It was an attribute of wildness, of homo sapiens before he domesticated himself. Nowadays, we are not only domesticated, we are also civilized. The feeling of being free, for us, is most easy to identify with being let out of confinement - of prison or school, or from a week at work.

But spreading freedom in the world doesn’t imply emptying prisons, closing schools, abolishing jobs - nor even getting everyone drunk. So - what is the freedom we want to spread? Not freedoms that destroy freedom for others - to keep slaves or to kill, for instance. Another set of so-called ‘freedoms’ are not freedoms at all but rights: ‘freedom from want’, ‘freedom from pain’, ‘freedom to reproduce’. Enforcing these ‘freedoms’ requires a huge state apparatus to monitor, assess, appropriate and distribute resources. The result is a loss of freedom all round: even the beneficiaries find their freedom replaced by dependence on the state. However wonderful these rights may be, they are not freedoms.

The freedoms we wish to establish politically are usually listed as three: of speech, of association, and of movement. True, these freedoms need continual defense. But they are overrated. A beggar in the street has all three: he may shout his opinions to the world, he may huddle with others and stomp the streets. But if he wants the freedom to eat, he needs money.

Money is an enabler of freedom. With money, we live: we eat, we enjoy shelter and security, we purchase enjoyments, we initiate enterprise. We also buy the labour of other people and its produce, so money is double-edged: it carries with it the ‘dark side’ of freedom, which is power. There is no doubt about the relationship between freedom and money: freedom is maximized when money is widely and equitably distributed and when great concentrations of it are discouraged. Freedom is minimized when one person (or the State) owns everything. The laws and institutions of property express and determine the extent of a nation’s ability to enjoy freedom in this respect, and it is a proper concern of a compassionate government to bear this in mind.

An equitable diffusion of money in a society where all adults manage to find work signifies one happy state of human affairs: we work, our work is valued, and as a result we are able to enjoy our leisure time. But this ideal points to another fact: financial freedom is not all we need. We need to contribute, because we are (as Darwin points out) sociable animals with moral instincts. Like all sociable animals, our highest satisfaction comes from contributing to the welfare of others.¹⁰ People who care nothing about the consequences of what they do, or who chooses to do others down, are regarded as mentally ill or evil.

In the light of this, the most important freedom we can have is the freedom to do what we believe is right, subject to the rule of law. This liberty, or moral freedom, is the freedom which many have died for, and which inspires us to defend it for others as if it were our own. We do not lose when others gain it: on the contrary, the world becomes a better place for all. Of course it means the freedom to make mistakes, to make wrong choices, so it will not please those who are ambitious for social control - or those who wish to believe some sort of utopia is just around the corner.

Moral freedom is our most important freedom. Without it, our individual lives are at worst squalid, at best a non-event. With it, we create worlds of culture, small and large, within our common world, and the freedom to move between these worlds. The political whole in which we live - state, nation, federation - becomes a moral universe in which we and others may prosper. The various communities, in their own self-interest, will be peaceable so long as the government is not factional in its exercise of power. Of course, freedom brings with it possibilities of mistakes and conflict; and in a complex society there will be always be negotiation over the line between communal idiosyncrasies and the overall rule of law. But when government involves itself in factionalism (at home or abroad) then the ground is prepared for war of all against all, in competition for favour, influence and power¹¹.

Moral freedom intricates individuals into communities. As sociable animals, we arrive in the world with a moral instinct, but the development of a moral faculty is dependent on those around us: on our families, on our wider community, on those who educate us. Communities prosper by shared bonds of trust and habit and mutual understanding. The traditions of a community constitute an understanding of the world which is also an understanding of the individual’s place in the world and of how he or she may act in it with a good conscience.

When, on the other hand, moral freedom is taken away by an overbearing power such as the state or the business corporation, there is a corresponding loss of community. The result is a widespread sense of atomization, which has been remarked on under many names by many commentators - anomie, alienation, fragmentation and the rest. And yet, in our system of electoral representation, we see the huge powers of government and corporations growing consistently stronger. Why should this be?

The answer is that moral freedom is a burden that many people would gladly give to someone else. The poet Pushkin, wrote (in Russia in 1823):

To sow freedom in the wilderness

I went out early, before the morning star.

Into furrows of enslavement,

From hands pure and guileless,

I flung my seed of liberty and life.

But I was merely wasting time,

And goodness of heart, and labour.

Fat in pasture, lands of peace,

The call of honor wakens no one.

Herds are deaf to the gift of freedom,

They wait to be shorn or slaughtered:

Their heritage down the generations?

The yoke with jingles, and the whip.

The Russian people, notorious for their endurance though not for their traditions of freedom, has voted back ‘the yoke with jingles’ - if not the whip. But what of us in the West? Efforts of governments to replace human responsibilities and the ties of community with social programs have been massively damaging. Books by William Julius Wilson and Sudhir Venkatesh bear witness to how ‘welfare’ programs turn conservative and moral communities into neighborhoods of crack cocaine, gang warfare and murder. In Britain, more affluent than ever before in its history, with the government managing charity, streets are now awash with the homeless, the desperate, the cast-out.

Voters in the West have by-and-large dumped the burden of moral freedom and devoted their lives to chasing the freedoms that money can buy. In true biblical style, this desertion of our old God/s in favour of Mammon has brought terrible consequences. And it is not only governments that have encouraged this desertion. Just as active in the process is another human invention, the business corporation.

3. The Corporation.

Many people assume the business corporation is something that exists by natural right, as an extension of simple market activity. But this is not so: the corporation only achieved its legal identity after fierce political and legal battles throughout the nineteenth century. Conservatives, judges, businessmen all lined up against; in favour were newly-affluent middle classes, who wanted easy money from their investments without the normal responsibilities that come with ownership. Adam Smith had already pointed out the unreasonable nature of limited liability (without which the corporation is a non-starter): ‘to exempt a particular set of dealers from the laws which take place in regard to all of their neighbors, merely because they might be capable of thriving if they had such an exemption, would certainly not be reasonable’. Initial battles were fought in England, in Germany, and in America. Once the corporation had won these, its success as a business instrument led most Western countries to pass similar enabling legislation.

The corporation is able to exist because it has been granted the legal status of a human person. By this fiction a powerful monster was brought into existence which had no motive of its own. It needed to be assigned a purpose in law, otherwise it was vulnerable to predation by all associated with it: anyone identified with it could steal chunks off it, as hyenas take bites from a running cow. So it was legally assigned a purpose, called an ‘object’ in law.

The legally-recognized ‘object’ of a corporation is to fulfill the purposes set down by those who formed the corporation. All those who work within the corporation are obliged to work towards this object. The object is sometimes charitable, but in the case of a commercial corporation it is to make as much money as possible for those who own the corporation - for what is called the ‘corporate benefit’. Recent attempts to introduce other considerations (such as care for the environment) have proved impossible to enforce, because they introduce conflicts that cannot be resolved by the logic of argument. So, to tame the beast and curtail its excesses, masses of regulations have been introduced.

The old ideal of Adam Smith, that government should be as little involved in business as possible, is now an impossibility. Negotiating the intricacies of corporate law to protect shareholders, consumers, workers and the ‘environment’ has brought governments and corporations into an interlocked and often unholy relationship. Demands made by corporations for government subsidy and help in export markets, and sometimes for back-up by state violence covert or open, have created an extensive gray area of mixed interests. Politicians are all too keen to be close to big money; and voters are reluctant to put too much restraint on activities that will increase their own spending power.

One of the most extraordinary outcomes of the collusion between business and government is the huge debt contracted by government on behalf of American tax-payers, who now owe trillions to the mostly non-tax-paying American plutocracy. The Iraq war is making Bush and his coterie a great deal richer, while heaping more debt on the taxpayer. ‘Real rich people figure out how to dodge taxes,’ Bush recently acknowledged. The public debt is far larger for the average tax-payer than his or her mortgage. Most of the capital created by this debt has gone abroad and become part of the floating world of offshore money, which moves here and there, not benefiting the tax-payer who works long hours to pay the interest. Thus tax-payers have ended up with the same burden that lies heavy on third world countries: a huge debt, contracted by an oligarchic government, that enserfs them to outside interests.

The ‘he-who-must-be-read’ of corporate history is Alfred Chandler. Chandler’s most celebrated observation is that corporations succeed because they have replaced Adam Smith’s ‘invisible hand’ (of Providence) with the ‘visible hand of management’. Much of the grotesqueness of the modern world is contained in this substitution. Smith’s ‘invisible hand’ was a providential mechanism whereby the greed and self-interest of the merchant profited the general welfare in a free market society. An example of its continued existence would be Bill Gates’ kleptocratic monopolism benefiting the consumer, who can use almost any computer world-wide with ease and facility. The ‘visible hand of management’, on the other hand, is an improvident mechanism which extracts maximum profit for a group of people - shareholders - who neither work for their money, nor bear financial or moral responsibility for the results of their actions.

The important thing about a corporation is that moral freedom in the workplace is destroyed. Human moral inclinations such as making a good product, telling the truth, restraint, even ‘preferring the support of domestic to foreign industry’ (Adam Smith) are suppressed to satisfy the requirement of making as much money as possible. As a result, most of us are faced with a choice: either to forget about the moral consequences of our work and to serve a great corporate power, or to live outside the system and in poverty. The self-respect that used to pervade our society (despite all its injustices) is gone. Of course, the world of business has always had its scoundrels; but with the dominance of corporations we might say that scoundrelism has been globalized, made official and compulsory. As countless films and books remind us, this does not sit well with the ordinary person, who is at heart a moral animal.

The corporate world is a victory of collective power, supported in law. Looking for ideas in opposition to this power, there is no point looking to the left, who would put an even greater collective power in the control of an even more heartless beast - the State. Nor can we look to today’s neo-conservatives, who worship the corporate beast more thoroughly than they worship the Book of Revelation. To find a way forward we must look back: as a tracker returns to pick up a scent he has lost, we must retrieve and develop ideas from the tradition of moral freedom and responsibility that came of age in the conservative revolutionism of the founding fathers. They were aware that true democracy and freedom are hard to achieve and never the easiest of bedfellows, and that preserving them from the normal abuses of power - as well as from ‘the impostures of pretended patriotism’ - would be a task for the generations.