Don’t Blame Democracy for Europe’s Ills

by Preston Manning*

July 14, 2010

A recent opinion piece in The Globe and Mail by Neil Reynolds (“The disintegration of the European welfare state,” July 12,  2010<!--[if !supportFootnotes]-->[1]<!--[endif]-->) blames democracy for the recent debt crisis in Europe, especially Italy. As its primary authority it cites a recent book by two Italian economists linking democracy to debt and disorder.

But the argument employed is flawed on at least four counts and deserves deeper examination, lest readers jump to the simplistic and erroneous conclusion that the best way to do away with the debt crisis and its threat to European standards of living is to do away with democracy itself.

First, statements like “democracies produced Nazi Germany and Fascist Italy” and “democracy assembled the welfare state” are gross over-simplifications if not distortions of the facts. The welfare state was conceived and propagated largely by academics and public policy makers who convinced themselves that the welfare institutions traditionally relied upon by the people (the demos) – the family, the church, and the community – were inadequate to the task and needed to be replaced by state programs and institutions. Historians with a broader grasp of the origins of fascism (such as Fritz Stern in The Politics of Cultural Despair) attribute its emergence much more to authoritarian and anti-democratic traditions and literature, especially in 19th century Europe, than they do to early 20th century democratic institutions. One might be able to say that unhealthy democracies contributed to the emergence of fascism in Germany and Italy, and that unhealthy democracies can lead to financial excesses. But if that is the case then the antidote is to restore democracy to health rather than to disparage and abandon it.

Second, Reynolds and the Italian economists assume but do not (cannot?) prove a direct causal link between democracy and the present fiscal difficulties in Europe. The Roman Republic, the French monarchy, the Soviet empire – all collapsed under crushing loads of debt and taxes and descended into economic chaos – and none of these were democratic regimes, in fact all were anti-democratic. And while the alleged greed of the masses for welfare-state benefits offered by politicians is rightly a matter of concern and needs to be constrained where it exists, surely it pales in comparison to the greed of the irresponsible financial speculators and institutions who played an even greater and more direct role in creating the recent financial crisis.

Third, it is regrettable that Reynolds completely ignores the fact that democracies, more than any other form of public governance, provide opportunities and tools for correcting their own excesses, including their fiscal excesses. It was democracies which, for a whole generation after the war, elected mainly high-spending, welfare-state-oriented politicians to office. But it was also democracies which in due course elected and supported the administrations of Ronald Reagan in the United States and Margaret Thatcher in Britain – politicians advocating spending controls, balanced budgets, and debt and tax reductions. And in Canada, much of the original pressure in the 1990s to get our own financial house in order came from the bottom up, not the top down. I myself was democratically elected to a democratic assembly on a pledge to constrain public spending and save taxpayers’ dollars rather than spend more of them – as were 51 of my Reform Party colleagues, as was Gary Filmon’s government in Manitoba, as was Ralph Klein’s government in Alberta, as was Mike Harris’s government in Ontario. The freedoms and tools of democracy can be used to address and correct the very problems Reynolds attributes to democracy, if there is the freedom and will to do so.

Fourth, even if one accepted the proposition that granting people democratic freedoms and democratic institutions runs the risk of fostering unreasonable demands leading to financial excesses, what alternative form of government would Reynolds and the Italian economists put in its place? If democracy were to be replaced by a more authoritarian form of government, one which curbed political freedoms in the name of fiscal responsibility, how long would the economic freedoms (so strongly supported by Reynolds and others in the pages of the Globe’s Report on Business and required for wealth creation) last? In pointing out the alleged weaknesses of democracies, Reynolds cites Socrates, Machiavelli, and Friedman. In identifying the strengths of democracy and the means of further strengthening it I cite Jefferson: “I know of no safe depository of the ultimate powers of society but the people themselves, and [anticipating the age-old criticism of democracy by academic and economic elites] if we think them [the people] not enlightened enough to exercise control with a wholesome discretion, the remedy is not to take it from them, but to inform their discretion.”

*Preston Manning is President and CEO of the Manning Centre for Building Democracy (www.manningcentre.ca).