Formally, those large business and a representative democracies are very different, but if you look at how they work, there are many similarities. The central one is “the people at the top make all the decisions and have big incomes and privileges”.
Look at this:
The average yearly increase in the net worth of ordinary Americans was 3.7% from 2004 to 2012.
US politicians had an average increase in their net worth of 15.4% every year; over the same period; this is over 4 times the increase for average Americans.
But it gets even more interesting if you look at the dollars. The average net worth of members of the US Congress was $1,008,767.00 in 2012. In the same year, the net worth of the average American was about 12 times less.
As time passes it looks more like “government of the rich, by the rich for the rich”.
You may find different figures but the trend and facts make it clear; US politicians, at least at the federal level, belong to clearly higher social and economic class than ordinary Americans, even relatively prosperous Americans.
Such politicians, even if they have the best intentions will find it very difficult to identify and represent ordinary Americans; they do not have much in common with them.
It you also take into account that those politicians, to get elected or re-elected, need a lot of money to run their campaigns, and that the people who supply most of the money are corporations, professional associations and assorted lobbies, it becomes practically impossible for such politicians to defend the interests of ordinary citizens.
No wonder political campaigns look like an exercise in how to use the money of the big donors to persuade voters that those they elect will represent their interests and not the interests of the donors.
The political orientation matters only in that some donors give more to progressive candidates, others give more to conservatives ones, but in both cases the big donors have great influence over the elected politician, and also over the ones that lose the election. Big donors often give to all candidates so that they do not lose, no matter who wins.
How can such government with such people (legislative and executive) be “government of the people, by the people, for the people” ?
If you look at large business the situation is similar; how can executives be interested in, or understand, ordinary employees in the companies they run, even in the shareholders when executives make, 10, 20, 100, 200 times more money than the average?; they can’t.
Their compensation packages make it worse; the income of most executives is tied to current profits; they often change companies too, why should they care much about long-term investments that will pay off long after the executive is gone? No wonder most American companies are losing know-how and competitiveness.
Something similar happens in a number of other nations.
The same phenomena happens in politics; politicians in representative democracies are concerned about “now and the next election”, not about the long-term future of thr country.
This is why we need direct democracy; ordinary people are not under the direct influence of donors, therefore they can focus on the interest of the whole country and also on the future of the children of ordinary people; it is a very different perspective. That is why Switzerland is the best governed country in the World. It is because of direct democracy.
Current politicians and executives of public companies seem to have moremuch in common with the bishops and the nobility of pre-revolutionary France. It is those privileges and money who drove the impoverished French people to make the bloody French Revolution…
The political parties fight very hard to win elections, but no party can really represents the interests of ordinary people because of what I just said. The situation has deteriorated so much that a billionaire, Donald Trump, emerged as the “defender of ordinary Americans”; it is grotesque.
Many large companies also have flashy policies about corporate responsibility; it does not seem to include their own employees and most shareholders.
In other representative democracies, the contrasts may not be as glaring as in the US, but the differences are also creating growing disillusionment, and even anger, towards politicians and executives
In what is essentially a direct democracy, Switzerland, the gross income of federal politicians is approximately 35% higher than the average income of Swiss citizens. The difference is that the Swiss people have the mechanisms to directly tackle those issues, including executive pay, the rest of us do not, but we should.
In Switzerland, the mechanisms of direct democracy empower Swiss citizens to stop any law or government policy.
The Swiss do that with the initiatives and the referendums. The Swiss people have the power to set the process of change in motion; they do not need to convince politicians that change is necessary, they do the changing themselves, even if the executive and the legislative bodies oppose the change,
No wonder 80% of the Swiss trust their government; the Swiss system does not allow politicians to forget the people because the people can take matters into their own hands.
Giving the dynamics of political campaigns, and the power of politicians in representative democracies, the most practical reform such democracies need is to adopt direct democracy, at least to the level of the Swiss, to ensure “government of the people, by the people, for the people”, otherwise such government is impossible.
The politicians, and the executives, in representative democracies should remember that the French Revolution, but also the Communist Revolution in Russia, the American Revolution, the Cuban Revolution, were triggered by money. Some revolutions end up being far worse than the “ancient regime”, but angry people want to get rid of the current oppressors, they have no way of knowing the new oppressors might be worse.
It is obvious the average voter in a representative democracy has no more leverage over the politician he or she votes for, than the average shareholder or employee has over the executives who run any public company; no wonder elected politicians and executives have emerged as a privileged class.
How can such system be called democracy? Democracy means “rule by the people”, not “rule by the representatives of the people”.
To learn more about these issues you can go to Opensecrets.org and Ballotpedia.org. They have plenty of information on the subject of incomes of politicians in the US, etc.
To learn more about income disparities in business, just enter “differences between worker pay and executive pay”.
To learn more about direct democracy, enter “direct democracy around the World”, or similar terms.
Victor Lopez
