Democracy is thrown aside in the Eurozone

Marc Sidwell
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THERE is not one elected official in Italy’s new government, but it’s apparently very bad form to mention it. Democratic government has been suspended on the fringes of the Eurozone with barely a whisper. News reports mention in passing that “technocrats” have been ushered in to make sure Greece and Italy reform their economies as Germany and France desire. How quickly freedom’s demise gets buried in jargon.

Technocrat comes from the Greek, tekne, which means “the skill of achievement”. A democrat rules by consent of the people, the demos. In theory, technocrats rule by dint of their skill at achieving goals. That’s certainly the hope here. The technocrats will get Italy and Greece to enforce their desperately needed austerity programmes. But it is a disastrous policy. As Douglas Carswell pointed out in 2005 in Direct Democracy: “The idea that administration should be in the hands of disinterested officials rather than clamorous politicians has been a characteristic of every dictatorial regime from Bonaparte’s onward.”

Democracy is a good in itself, recognising citizens’ natural right to self-rule by acknowledging any administration requires the consent of those governed. But it is also, despite its superficial rambunctiousness, an efficient system too. By allowing a plurality of views to be openly debated, a democratic system is open to self-correction. Rule by so-called experts has no such flexibility. One can only pray that they are right.

Yet there is little reason to assume that they will be. Although the idea of “leaving it to the experts” is a tempting one, without any mechanism for feedback and dissent experts rapidly become a self-serving interest group divorced from the original goals. Worse still, despite our sometimes magical belief in their objectivity, work in the 1970s by Amos Tversky and Daniel Kahneman showed that experts too are prey to cognitive bias and error. And organisational theory indicates that the information needed to make expert judgements is restricted by a top-down system. In 1966, Kenneth Boulding wrote that: “The larger and more authoritarian the organisation, the better the chance that its top decision-makers will be operating in purely imaginary worlds.” Which certainly sounds like the Eurozone.

Mario Monti and George Papademos may be brilliant men. But the economist Friedrich Hayek said in The Constitution of Liberty that “compared with the totality of knowledge which is continually utilised in the evolution of a dynamic civilisation, the difference between the knowledge that the wisest and that which the most ignorant individual can deliberately employ is comparatively insignificant.” Why settle for benevolent planners of genius when even they know so much less than the free marketplace of ideas?

Hayek also argued, in The Road to Serfdom, that planners would turn to populist dictators to bring their ideas to fruition. It has been sixty-five years since Italy had a dictator, and thirty-eight years for Greece. The current crop of technocrats shows no signs of brutal authoritarianism. But that presents a problem as well. The austerity measures both countries need will be unpopular, and while undemocratic leaders may prevent squabbling at the top, dictators without teeth could find it hard to keep the rioting demos in step. Once freedom is discarded, rulers travel lightly down the road to darker incursions on individual liberty.

Marc Sidwell is the business features editor for City A.M.