Sunday, August 20, 2017
Photo of Kenneth Rogoff

The idea that somehow any decision reached anytime by majority rule is necessarily “democratic” is a perversion of the term.

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Britain’s Democratic Failure

CAMBRIDGE – The real lunacy of the United Kingdom’s vote to leave the European Union was not that British leaders dared to ask their populace to weigh the benefits of membership against the immigration pressures it presents. Rather, it was the absurdly low bar for exit, requiring only a simple majority. Given voter turnout of 70%, this meant that the leave campaign won with only 36% of eligible voters backing it.

This isn’t democracy; it is Russian roulette for republics. A decision of enormous consequence – far greater even than amending a country’s constitution (of course, the United Kingdom lacks a written one) – has been made without any appropriate checks and balances.

Does the vote have to be repeated after a year to be sure? No. Does a majority in Parliament have to support Brexit? Apparently not. Did the UK’s population really know what they were voting on? Absolutely not. Indeed, no one has any idea of the consequences, both for the UK in the global trading system, or the effect on domestic political stability. I am afraid it is not going to be a pretty picture.

Mind you, citizens of the West are blessed to live in a time of peace: changing circumstances and priorities can be addressed through democratic processes instead of foreign and civil wars. But what, exactly, is a fair, democratic process for making irreversible, nation-defining decisions? Is it really enough to get 52% to vote for breakup on a rainy day?

In terms of durability and conviction of preferences, most societies place greater hurdles in the way of a couple seeking a divorce than Prime Minister David Cameron’s government did on the decision to leave the EU. Brexiteers did not invent this game; there is ample precedent, including Scotland in 2014 and Quebec in 1995. But, until now, the gun’s cylinder never stopped on the bullet. Now that it has, it is time to rethink the rules of the game.

The idea that somehow any decision reached anytime by majority rule is necessarily “democratic” is a perversion of the term. Modern democracies have evolved systems of checks and balances to protect the interests of minorities and to avoid making uninformed decisions with catastrophic consequences. The greater and more lasting the decision, the higher the hurdles.

That’s why enacting, say, a constitutional amendment generally requires clearing far higher hurdles than passing a spending bill. Yet the current international standard for breaking up a country is arguably less demanding than a vote for lowering the drinking age.

With Europe now facing the risk of a slew of further breakup votes, an urgent question is whether there is a better way to make these decisions. I polled several leading political scientists to see whether there is any academic consensus; unfortunately, the short answer is no.

For one thing, the Brexit decision may have looked simple on the ballot, but in truth no one knows what comes next after a leave vote. What we do know is that, in practice, most countries require a “supermajority” for nation-defining decisions, not a mere 51%. There is no universal figure like 60%, but the general principle is that, at a bare minimum, the majority ought to be demonstrably stable. A country should not be making fundamental, irreversible changes based on a razor-thin minority that might prevail only during a brief window of emotion. Even if the UK economy does not fall into outright recession after this vote (the pound’s decline might cushion the initial blow), there is every chance that the resulting economic and political disorder will give some who voted to leave “buyers’ remorse.”

Since ancient times, philosophers have tried to devise systems to try to balance the strengths of majority rule against the need to ensure that informed parties get a larger say in critical decisions, not to mention that minority voices are heard. In the Spartan assemblies of ancient Greece, votes were cast by acclamation. People could modulate their voice to reflect the intensity of their preferences, with a presiding officer carefully listening and then declaring the outcome. It was imperfect, but maybe better than what just happened in the UK.

By some accounts, Sparta’s sister state, Athens, had implemented the purest historical example of democracy. All classes were given equal votes (albeit only males). Ultimately, though, after some catastrophic war decisions, Athenians saw a need to give more power to independent bodies.

What should the UK have done if the question of EU membership had to be asked (which by the way, it didn’t)? Surely, the hurdle should have been a lot higher; for example, Brexit should have required, say, two popular votes spaced out over at least two years, followed by a 60% vote in the House of Commons. If Brexit still prevailed, at least we could know it was not just a one-time snapshot of a fragment of the population.

The UK vote has thrown Europe into turmoil. A lot will depend on how the world reacts and how the UK government manages to reconstitute itself. It is important to take stock not just of the outcome, though, but of the process. Any action to redefine a long-standing arrangement on a country’s borders ought to require a lot more than a simple majority in a one-time vote. The current international norm of simple majority rule is, as we have just seen, a formula for chaos.


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Photo of Martin Feldstein

While voters chose Leave for a variety of reasons, many were concerned with the extent to which EU leaders have exceeded their original mandate, creating an ever larger and more invasive organization.

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How EU Overreach Pushed Britain Out

CAMBRIDGE – A thoughtful British friend of mine said to me a few days before the United Kingdom’s “Brexit” referendum that he would vote for Remain because of his concern about the economic uncertainty that would follow if the UK left the European Union. But he added that he would not have favored Britain’s decision to join the EU back in 1973 had he known then how the EU would evolve.

While voters chose Leave for a variety of reasons, many were concerned with the extent to which EU leaders have exceeded their original mandate, creating an ever larger and more invasive organization.

Jean Monnet’s dream of a United States of Europe was not what the British wanted when they joined the EU 40 years ago. Nor were they seeking a European counterweight to the United States, as Konrad Adenauer, Germany’s first post-war chancellor, had once advocated. Britain simply wanted the advantages of increased trade and labor-market integration with countries across the English Channel.

The EU began as an agreement among six countries to achieve free trade in goods and capital and to eliminate barriers to labor mobility. When EU leaders sought to reinforce a sense of European solidarity by establishing a monetary union, Britain was fortunately able to opt out and keep the pound – and control over its monetary policy. But the opt-out has left Britain a relative outsider within the EU.

As the EU expanded from six countries to 28, Britain could not permanently limit entry to its labor market by workers from the new member states. As a result, the number of foreign-born workers in Britain has doubled since 1993, to more than six million, or 10% of the labor force, with most now coming from low-wage countries that were not among the EU’s other original members.

Although pro-Brexit voters worry about the resulting pressure on UK wages, they generally do not reject the original goals of increased trade and capital flows that are the essence of globalization. Some Brexit defenders could point to the example of the successful US free-trade agreement with Canada and Mexico, which contains no provision for labor mobility.

Unlike Britain, the other EU countries, led by France and Germany, wanted more than free trade and an enlarged labor market. From the start, European leaders were determined to expand the “European project” to achieve what the Treaty of Rome called an “ever closer union.” Advocates of shifting authority to EU institutions have justified this with the notion of “shared sovereignty,” according to which British sovereignty could be eroded by EU decisions, without any formal agreement from the UK’s government or people.

The “Stability and Growth Pact” of 1998 imposed a limit on member countries’ annual deficits and required that debt-to-GDP ratios shrink toward a maximum of 60%. When the global financial crisis began in 2008, German Chancellor Angela Merkel saw an opportunity to strengthen the EU even further, by enforcing a new “fiscal compact” authorizing the European Commission to oversee members’ annual budgets and impose fines for violating budget and debt targets (though no fines have been levied). Germany also led the move to establish a European “banking union” with a single regulatory framework and a binding resolution mechanism for troubled financial institutions.

Not all of these policies directly affected the UK; nonetheless, they widened the intellectual and political gap between Britain and the EU’s eurozone members. That reinforced the fundamental difference between market-oriented British governments and those of many EU countries, with their traditions of socialism, government planning, and heavy regulation.

The division of powers between the EU bureaucracy and member states is governed by the ambiguous principle – borrowed from Catholic social teaching – of “subsidiarity”: decisions should be made at the “lowest” or least centralized level of “competent authority.” In practice, that did not limit the rulemaking in Brussels and Strasbourg. Subsidiarity provides much less protection for EU member governments than the Tenth Amendment of the US Constitution – which denies to the federal government any powers not delegated to it by the Constitution – does for US states.

The British public is of course not alone in its discomfort with the EU. A recent poll conducted in EU countries by the Pew Foundation found that a majority of voters in three of the largest countries – Britain, France, and Spain – view the EU unfavorably. In Germany, the public was split 50-50. In Italy, a clear majority say that they have benefited from EU membership; and yet the populist Five Star Movement, which recently won mayoral elections in 19 of the 20 cities it contested (including 70% of the vote in Rome), has promised a referendum on leaving the eurozone if it wins the parliamentary election later this year.

Although many officials and experts predict that Brexit will have dire economic consequences, this certainly is not inevitable. Much now depends on the terms of the future relationship between the EU and Britain.

The UK is also now in a better position to negotiate a more favorable trade and investment treaty with the US. Although the proposed US-EU Transatlantic Trade and Investment Partnership (TTIP) is bogged down, a British government outside the EU could negotiate a deal with the US far more easily. The US would be negotiating with one country, not 28 — many of which do not share Britain’s pro-market policies.

The question of Britain’s EU membership has been decided. Now its economic future depends on what it does with its new independence.


Brexit: A Democratic Victory?

Read Comments (11)
  1. Comment Commented

    I take issue with Mr. Rogoff's statement "The idea that somehow any decision reached anytime by majority rules is necessarily "democratic" is a perversion of the term."

    Democracy, or democratic government, is "a system of government in which all the people of a state or polity ... are involved in making decisions about its affairs, typically by voting to elect representatives to a parliament or similar assembly", as defined by the Oxford English Dictionary. Democracy is further defined as (a:) "government by the people; especially : rule of the majority (b:) "a government in which the supreme power is vested in the people and exercised by them directly or indirectly through a system of representation usually involving periodically held free elections."

    Politicos and the parties they represent routinely and intentionally misstate or understate both the problem(s) and their purported solution(s). That in turn makes it imperative that the people make the effort to get informed on the issues and subsequently vote. The fact that less than 100% of eligible voters participated doesn't make the process less democratic, just more vulnerable to poor outcomes. Read more

  2. Comment Commented

    Mr Rogoff shows little research in his reasoning and that is why, like most of those on the Remain side, he has very little idea why the result went the way it did.

    Two critical points missed in this article:

    1. 52% vote for change is actually huge. Referenda give the status quo a significant (circa 5-10%) inbuilt advantage and typically this shows up in the last few days and the polls did narrow in favour of Remain, especially after the terrible death of an MP. More people voted for Brexit on the 23rd of June than have ever voted for anything in the history of the United Kingdom. The result was pretty emphatic.

    2. The main reason the Remain voters voted to remain was worry about tail risk, a negative reason. Only 9% of the 48% feel positively towards the EU. That means 81% accept the Brexit argument to an extent but were not compelled enough to vote for it. Contrary to most media commentators opinions the largest reason cited was not immigration but “the principle that decisions about the UK should be taken in the UK”.

    We do not have compulsory voting in the UK so a decision not to vote, either because you think it won’t affect you, don’t care or do not feel compelled by either side’s argument is a valid personal choice.

    A conclusion that the UK isn’t democratic suggests a ‘sour grapes’ opinion was the point of this piece from the start, fine but no actual information from real people has been brought to bear so why does it deserve to be taken seriously? Read more

  3. Comment Commented

    Many more popularist surprises await the like of Rogoff. These establishment figures who pontificate that they and their elk know best are the exact reason why Briexit occurred. Reality for a steadily growing proportion of the population of the UK and US is that their standard of living has declined and their future not so rosy. The like of Rogoff have through their central planning blighted the western economies. Briext could well be the catalyst that starts the next economic crises, of which Rogoff and his elk are entirely responsible for, not the voters who protest vote change as the current system has failed them. Read more

  4. Comment Commented

    As to Varoufakis his idolatry of the Euro and of the EU - despite tactical differences - led his country to humiliation. Many British people were appalled both by the bullying of Germany towards Greece and the failure of Varoufakis to do the right thing: to put Greece before the interests of the EU. German domi9nance of the EU and its arrogant and un-friendly treatment of Greece played into the British Brexit vote. Ever closer union with such people has been correctly rejected. Read more

  5. Comment Commented

    This was a revolt for democracy against an autocracy slavishly supported by an elite which has benefited from the EU and the free movement of labour. Cheap Polish plumbers are great for the middle classes in London - and terrible if you are a British plumber anywhere else. No-one was listening to the majority whilst that majority was fractured by the party system. The moment that constrain was lifted the majority view could be expressed in the referendum. I add: were it not for the murder of an MP by a fanatic the vote to leave would have been bigger. As to the error of making this a 50%+1 vote this was the same system used in the Welsh devolution referendum. I was one of the leaders of the opposition to devolution to Wales. We lost by 0.7% in a million votes - far closer than the Brexit vote. We accepted the result as a mandate for change. I note in passing that the very area of Wales that voted heaviest for devolution and which receives significant EU funding has voted against the EU as have 70% of all constituencies with a Labour MP. Democrats should be jubilant. Those that are not are not democrats but pro EU ideologues. I have no objection to their views: 52% of the country did. Read more

  6. Comment Commented

    I agree with Rogoiff. 36% of the voting population is not a mandate. Cameron was a lazy fool. He should have hedged the bet with a higher bar but bigger prize. That is 60% of the voting public and a legal commitment to leave. Nation defining changes need a strong mandate. And there quite simply isn't one. Read more

  7. Comment Commented

    The problem seems to be that the highest levels of decision-making in the EU are insulated from direct democratic control. Voters compensate by acting at the levels at which they are allowed to act, as in Britain. But such protest votes are more likely to aggravate problems than to solve them.

    Varoufakis had an excellent comment on the problem last week in which he recommended a stance "in" the EU, but "against" the undemocratic character of its governing institutions. The EU needs to develop means for direct democratic control of its highest decision-making bodies. Otherwise voters will act through whatever avenues they can find. Read more

  8. Comment Commented

    I kind of agree with Rogoff, go figure, I don't like referendums, I think they are the tool for tyrany, because they are usually manipulated by the rulling party, which wasn't the case.

    I think Cameron after his election should have started the process of Brexit, that was the majority of the will of the people then, and it is now. Read more

  9. Comment Commented

    I agree with what Curtis Carpenter said below that we must give the British people, who bothered to vote on this issue, credit for knowing exactly what they were doing. As I commented elsewhere, the Brexit vote is more than just against immigration by the British people but it is an anger vote by those disenfranchised by the effects of globalization (represented by EU) and by the British political and economic elites who mismanaged the ill effects of globalization on those vulnerable.

    In some sense, one might say that the EU establishment and Prime Minister Cameron may have mismanaged the resolution of this issue. But I believe that Prime Minister Cameron, privately at least, wanted to send Brexit as a wake up message to EU.

    The real question to be asked is "What next ?" for both Britain and for EU. Maybe it is time for those cooler heads of state to step in and interfere with the EU bureaucrats. Read more

  10. Comment Commented

    Rogoiff discredits his argument in his first sentence, I think, when he reduces the UK voter's concerns to the single dimension of "immigration pressures." Couldn't it be possible that those voters (on both sides of the issue) deserve more credit that he feels comfortable in affording them, given his distaste for the result?

    And anyway, does the electorate really have any iron-clad guarantees about the outcomes that will result from _any_ exercise of the democratic process? As when, for example, they vote for a particular president or a prime minister? Does the fact that the democratic process engenders uncertainties and, God knows, a really bad result from time to time, justify throwing the process out altogether? Or attempting to fine tune (some would say "manipulate") it? Who is to decide what the threshold of decision is to be when a vote is taken on a given issue?

    Cameron and the UK -- for all the wrong reasons perhaps, and with a potentially tragic outcome -- have once again given the world an object lesson in democracy, and I think we should respect and value that for what it is. Calling it a failure is a slur against a majority of the people of the UK -- that bothered to vote, anyway. Read more

      Comment Commented

      Rogoff is one of the 'experts' Michael Gove must have been talking about. He has a strong opinion but it is not based on data.

      The biggest single reason for wanting to leave the EU was “the principle that decisions about the UK should be taken in the UK”.

      It's a shame so many of these pundits don't do any research before spewing out their opinions. Read more