Author: victor

I ended my last post saying that the American government, pressed by US auto industry executives, US business experts and the unions, threatened the Japanese manufacturers with tariffs if they did not manufacture cars in the US.

You might recall from my previous posts that the reasoning to pressure the Japanese was; “the Japanese are killing is because they have cheap labour, docile unions and diligent workers, once we force them to set up car factories here they will lose those advantages, and we will kill them because we have the better managers, trained in the best business schools in the World”.

So the Japanese did what they had to do and manufactured cars in the US.

But cars were not the only US industry defeated by the Japanese, earlier, the Japanese TV fellows did the same thing  to the US TV industry. American TV manufacturers did not receive as much attention, because in terms of jobs and economic value the car industry is much bigger.

Let us go back to the car industry.

The indisputable proof of the superiority of Japanese management over US management is what Toyota did, and still does.

In the 80s, pressured to make cars in the US, Toyota took over an existing car plant GM owned, in Freemont, California.

Toyota did that, instead of building a new car plant, because at the time they were not sure their management practices were superior to American practices. To minimise the costs and the risk, they figured it was better to speak to an American car manufacturer and reopen one of the many American car plants shut down because they could not compete with the Japanese factories.

GM agreed to let Toyota take over the Freemont car plant. This factory was one of the worse factories GM had; it was bad in quality, in productivity, in worker absenteeism, in labour relations and work days lost to strikes. Some say GM let Toyota take it over so that Toyota would fail.

In my next post I will tell you how Toyota, with the same workers, the same unions, the same wages, the same machinery, turned around this terrible factory and its “terrible workers” (according to GM executives), in the best car plant in all of North America, not just among GM plants, in terms of quality, productivity, low absenteeism and harmonious labour relations.

This showed that US management had fallen behind, and not just a little.

But not only US manufacturing management has fallen behind; remember that even the, also Harvard-trained executives of US banks, ran them into the ground in 2008. This is even worse than tha car plants; the banks did all by themselves, without serious competition from Japan or anywhere else.

Sure, the US still has some outstanding business, many related to computer software, and area in which the US, still has the lead in innovation. I do not know it that lead is shrinking but if their top aim is also to maximise profits; not the workers, not quality, not R&D, not the shareholders, not the communities in which they operate, not even the environment (although many talk a good environmental game) the Googles, the Facebooks, the Twitters, may go the way of GM. GM as you know, had to be rescued by the US government; this, in “free enterprise America”.

The US still has other important US manufacturers, like in pharmaceuticals, etc. What I do not know is if their lead is because of the lead the US has had in university research for decades, not related to management. This means that as the lead the US has in research shrinks, even these industries will suffer.

There is also another factor that helps mask the weakness in US management; many US companies have shifted their manufacturing to low cost countries. Instead of competing in quality and features, US companies compete with factories in low wage countries because they are unable to compete from the US. “Surprisingly”, German and Japanese manufacturers continue to be competitive with products manufactured in Germany and Japan. They do it often with higher wages than the US because they produce better products, more advanced products. But to do that you need better management able to produce better-trained employees, better R&D and, also better trained managers.

Yes, better trained managers; the Japanese and the Germans companies show, time and again, that their in-house management training is superior to US business school training. It has to be, the most German and Japanese companies do not believe an MBA degree qualifies people to manage anything, it is just another university degree, mostly concepts and theory, not about real world management skills. As long as American companies do not train their managers in-house they will continue to lose markets.

It seems US politicians also share the idea of short term “profits”, in this case “benefits now” for all US citizens means more social benefits, “free” schools, unlimited military, higher minimum wages and on and on, without regard for the real resources of the country.

Now it is the Democrats doing it, but the Republican government under Trump did essentially the same thing, even before “the virus” arrived; “let us live (beyond our means), lets us print money”. Most other representatives democracies do much the same because the voters do not feel responsible at all for the fate of their countries. For the voters, it is always the politicians fault. I reality, it the fault of the voters who tolerate such system.

In representative democracies, the politicians never tell the people the hard truth; “as a nation, for decades, we have been spending money we do not have”. The politicians can not tell the truth because they have been buying the votes of the people with the people’s money and, in a representative democracy, the people never feel responsible for the fate of their country. In their eyes, “it is all the fault of the politicians”.

It is time for voters to stop “protecting” themselves from the hard facts. It is time the voters be and feel responsible for major decisions, it is time for direct democracy.

If the US does not change its ways, there will be no “rescuer” for the US in the way that GM and the US banks were rescued by the US government. The American people need to wake up, or will perish while asleep, and they will take many other democracies down too in their wake.

Victor Lopez

 

I continue with the automotive industry to illustrate how the management thinking of US business schools, from the elite schools to the humblest community college, practically destroyed US manufacturing, including high tech manufacturing.

In another post I will discuss how US schools of public administration undermine, and are unable, or unwilling to fix US democracy.

What happened to cars, happened to most of US manufacturers. It happened to low-tech, mid-tech and high-tech companies across all industries, and continues to happen because most American management has fallen behind. It has happened because American business training, from executives to the most junior worker, has fallen behind in most industrial sectors.

The US still has some exceptional companies, even in the high-tech industry, but they are an exception. Most Americans know and suffer the problem, many lost their jobs and earn now lower wages, therefore the country is now in and ever worsening political and economic crisis.

American car companies lost market share because they fell behind in the design and manufacture of components and in the design and manufacture of the vehicles themselves.

It happened because the business schools preached “profit is the primary goal”. To motivate the managers to produce higher profits, the boards of companies tied the pay of the managers to the profits.

Managers soon figured out that the best way to increase their pay was to maximise short-term profits. Profits 5, 10, 20 or more years down the road lost importance. After all, most managers stayed in the same company for just a few years.

To maintain profits down the road, you need to reduce profits and invest in research, in development and in training. But American managers were and still are, motivated to generate profits right away.

Slowly at first, the “results” of the approach came in.

American cars fell behind in technology, in performance, in quality and in sales.

At first, Mercedes Benz took away market share from GM´s Cadillac, Fords’s Lincoln and Chrysler’s New Yorker. The American owners of Mercedes Benz experienced more advanced features, better handling, better quality of materials, and finish. Soon the “luxury car to have” became Mercedes Benz. BMW did the same; it placed itself as an alternative to Mercedes. To many people, a Cadillac became “a Chevrolet with leather seats and a few gimmicks, not real luxury.”

This is how Cadillac manages destroyed Cadillac; in 1980 Cadillac sold 33% of luxury cars sold in the US, today its share is 7%. In 40 years, American managers were unable, still are, to match their competition. But it was not only the Germans. In 1989 Toyota launched its luxury brand Lexus. This made things even worse for the Americans.

But even more important economically for America was what happened to the American popular car brands.

When oil crisis hit in the 70s, the price of gas forced many Americans to consider compact cars. They bought imported Toyotas, Hondas, Nissans (then called Datsun) and Volkswagens.

The new owners were surprised, not only the imported cars consumed less gas, they were put together better and were more reliable. They noticed that in particular in the Japanese brands.

The owners raved about their Toyotas, etc. Soon the car magazines made everybody aware of what was happening; the sales of the Japanese brands grew even faster at the expense of US brands.

American managers and the American business schools never considered that perhaps the Germans, particularly the luxury brands, and the Japanese had better managers, it never crossed their minds.

To them it would be impossible that Toyota or Mercedes-Benz would have better managers. How could it be?; the Harvard Business school, and the rest of the World’s “top” business schools were all in the US. Nobody ever heard of German or Japanese business schools“comparable” to Harvard, etc., they had none then, they have none now. The Germans and the Japanese do not believe in the MBA, etc.

American managers “reasoned”; “if they trained us in the best business schools it is obvious we are the best managers.”

Because American business schools and American managers thought they were the best, they looked at other factors to explain the success of the Japanese. The Germans bothered them less because Volkswagen was not as successful, and the luxury market was much smaller than the mass market.

The Americans “assumed” the Japanese advantage was due the much lower wages (at the time) of the Japanese auto worker, the “docile” Japanese unions and the diligent Japanese worker.

The American “experts” convinced themselves, and convinced the politicians and the unions, that if the Japanese had to make cars in the US their competitive advantages of lower wages, docile unions and diligent workers would evaporate and, given the “superior” business skills of American managers, the Japanese would be toast in no time.

The American government told the Japanese; “look fellows, you have to manufacture cars in the US if you want to sell cars here. If you don’t, we will slap huge tariffs on the cars and you will have no market.”

What happened next is fascinating I will discuss in my next post. Movies should have been made about the abject failure, then and now, of the American business schools and the managers they “trained”, ans still “train”.

Victor Lopez

I do not know when American management thinking went off the tracks, but perhaps it happened soon after 1945.

I do not know what caused the shift to put short-term profits ahead of anything else; ahead of employees, ahead of the community, ahead of customers, even ahead of shareholders.

Every year since the 50s, and as the industries of Japan, and of Central and Northern Europe recovered from WW II, it is clear most of US industries lost the huge competitive edge they had at the end of the War.

For a while after WW II, American manufacturers ruled the World; they built the best cars, the best home appliances, the best air conditioners, the best tractors, the best heavy machinery, the best telecommunication equipment, the best chemical industry, the best oil industry, the best civilian and military aircraft, the best marine motors, the best pharmaceuticals, best rockets (although in this area they piggy-backed on the German engineers who developed the V-2 guided rockets during WW II, the best railways and on and on.

But something happened; except for some specific fields, like computers, European and Japanese industry first caught up with, then surpassed the Americans.

Let me give you a few examples; Bayer and BSF have become much larger than Du Pont and Dow Chemical. Toyota, Honda, Nissan, Mercedes-Benz, Volkswagen and BWW soundly defeated GM and Ford. Airbus, despite being a slow semi-government bureaucracy, has caught up with, even surpassed, Boeing. In heavy equipment, years ago the Japanese Komatsu and Hitachi have caught up with Caterpillar. Even in the “hyper American” oil industry, Schlumberger, a French company, is the World leader. Today the top air conditioning brand is not Carrier, but Daikin, Fujitsu and Mitsubishi.

I could go on and on.

All this happened while American companies had to themselves the huge American market with unmatched economies of scale. I mean, it is unbelievable that companies such as Toyota, Mercedes-Benz, etc., with domestic markets much smaller than the US, and with buyers with far less money than American buyers, could defeat American companies around the World and even in the US, in quality and technology.

Today, the US balance of trade in manufactured goods speaks for itself. Even in high tech goods, it is huge and negative. This was many years before the Chinese came into play.

I hear people refer to Google, Amazon, Microsoft and Facebook as high-tech companies, in some ways they are, but they are software companies; the high-tech hardware running their software is no longer made in the USA.

Good software is difficult to develop, and the Americans have many excellent software engineers, but we also know making software does not require the investment, the multitude of technologies and the number of jobs that making high tech hardware requires.

We all know also that software exports are important but do not even come close to the value of high.tech and mid-tech goods and their associated services.

But, why has the US lost its technology and market leadership in so many areas?

This happened; first, the “bean counters” took over most of US manufacturing companies, low tech, mid-tech and high tech. Instead of engineers and scientists with managerial skills in the top jobs, the “bean counters” took charge. For the “bean counters”, “we can make anything a little cheaper and a little worse, without the consumers noticing, in order to increase profits”.

This happened in the 1970s. It is about the same time that American business schools started to “preach” shareholder value as the top priority for managers. “Shareholder value” was a deceiving expression, what it means is: “maximize short-term profits, profits above anything”.

The Nobel Prize winner Milton Friedman was the major pusher of this terrible idea. I hopehe won the Nobel for something else…

To stimulate managers to produce short-term profits, corporations introduced “short term compensation”. This meant managers could earn money when their compensation was tied to quarterly profits.

Soon managers saw, for example, that there was not much point in reducing profits, and their pay, to invest in long-term research. We all know, the managers knew it too, that the long-term health, and profits, of a company depend on research and technology but managers, like most people would, followed the path that made them wealthy “now”.

Initially, American companies were so far ahead that the change in American management philosophy did not seem to make much difference, but not before long it did.

In time, the public noticed US made goods were of worse quality and were behind in technology. Naturally, sales and profits fell.

The “answer” of US managers?; “let us ship the jobs to low wage countries”. That fixed, somewhat, the issue of costs (lower costs-higher profits), but not the low quality and obsolete technology. Low-cost production was not enough to return the companies to their previous success; any unbiased person would have seen that, but money biased the managers.

I use the Automotive industry to illustrate the tragedy, but practically all US manufacturing lived, and still lives, the same disaster.

Because of its size and because it uses lots of high tech and low tech, the car industry is a good example to illustrate what happened.

Cars include a lot of high-tech people do not see. For example, the computers in today’s cars are far more powerful than a PC. Furthermore, to enable the computer to do its job, cars come equipped also with many high-tech sensors. The sensors convert changes they detect in the car and the environment into digital signals for the computer. The computer then activates the many devices that control the car, for example, the stability control system.

Today’s car is far more complex and far more high tech than a smart phone or a laptop, but most people do not consider a car a high-tech device, but it is.

American auto companies fell behind in technology in the late 60s.

As they fell behind, they lost market share, jobs and even profits. Such losses have bad effects on society and undermine democracy.

In my next blog I will continue with the story of American managers and how they undermined, and continue to undermine US democracy, although that is not their intention.

Victor Lopez

 

 

 

I am not American, but I am very interested in what happens in America because if America continues its decline, democracy will die. If US democracy collapses, democracy in other countries is doomed too.

The root problem with US democracy is that, like all representative democracies, it gives too much power to politicians and to the Supreme Court. In the US, and in all other representative democracies the politicians, as a class, they have all the political power; besides making all the political decisions, without the people having the power to stop them, they also appoint the Supreme Court judges; they have total control, the people control nothing, this has to change, it is killing democracy.

In the US, and in all other representative democracies, the citizens, the voters, only have power to elect politicians, they do not have the power to stop the policies and laws the politicians make. Nor do the people in representative democracies have the power to introduce on their own policies, new laws or changes the constitution.

The politicians know they have power, but to get elected they need the vote of the people. This requires a lot of money, particularly since the US Supreme Court made the democracy-undermining decision in 2010 of allowing unlimited contributions to political campaigns by corporations, unions, professional associations and individuals.

This has created the crazy situation where politicians need the money of big donors to get elected. If a candidate turned down money from those entities, his or her campaign will not be competitive; with lots of money, a much worse candidate will obliterate a better candidate.

This means all candidates have to accept as much money as possible from the big donors. The donations of ordinary wage earners do not really mean much any more, their vote at election time is all that counts.

Because for politicians their main goal is to get elected and they need lots of money from big donors, they can not consider what is good for the people over the long term. They promise a lot and do some things to please the voters “now”, even if those decisions are bad for the future of the voters, their children and the country. But let us not blame the politicians; they behave in the way the system forces them to behave. Let us change the system so that politicians have no choice but to make decisions for the long term and for the majority, not for the donors.

In the current situation  candidates are in a Catch 22  situation; “if I reject the donations, in order to represent the will of the average voter, I will lose the election for lack of money and staff, if I accept the big donations the interests of the voters will have to take a bad seat at the back seat”.

This dynamic has effective destroyed the basic idea of democracy; “government of the people, by the people, for the people”.

As a result of the current system, politics in representative democracies gradually deviate from the will of the people, from government of the people, by the people…, etc.

In the US, the situation is worse than in other democracies because, besides the terrible decision of the US Supreme Court, other factors already made money a decisive factor in American politics. But all representative democracies suffer “deviation from the will of the majority”. In other words, they do not really practice democracy much beyond freedom of speech.

This means than in the US executive and legislative key policy decisions, laws and regulations cater to the interests of lobbies and pressure groups, not to the interests of most voters. Sometimes the people inm power favour one lobby over another lobby, they do not put the interests of the people ahead of everything else.

To get elected and use their power, US candidatesb also have to fight like hell. Republicans and Democrats have to destroy each other’s credibility. Inevitably, this polarises the parties, the candidates and the voters. It is absurd to expect democracy to work with such bitter polarisation.

It is not then surprising only 30% of the American people trust politicians. Compare that to the 90% support level they get in Switzerland, higher than anywhere else; it is one of the positive effects of direct democracy.

Anyone can understand that with only a support level of 30% no democracy is solid.

Riots on American streets, the assault on the Capitol, etc., are just the symptoms, not the problem. The problem is that US politicians do not adequately represent the people, because they can not, even when they want.

The remedy for the US, and for the rest of us? Direct-representative democracy. In direct-representative democracy Americans will still elect politicians, but there will be a crucial innovation; if 1% of the voters demand a referendum on any decisions of the executive or the legislative, a referendum will take place. The decision will bound government and parliament. Nobody can overturn the decision, not even the Supreme Court; only the people, in another referendum could overturn the results of a previous referendum.

In my next blog I will discuss how prevalent US corporate management practices are also undermining the US economy, American wage earners and, as a result, US democracy too. Make no mistake, democracy is sustained on the shoulders of the political intelligence of the common citizen, not on the shoulders of politicians, scholars, entrepreneurs, etc.

Victor Lopez

All countries need direct democracy; it is the next logical step for democracy. But democracy is in danger because representative democracy gives too much power to the elected politicians, so much that in time the will of the people does not count for much, as the politicians can not resist using their excessive power to accumulate more, it is a never-ending spiral; until representative democracy enters crisis mode and collapse.

Canada, the country I live in, is ready for the next step, for direct democracy. But it is close to the US, and the US is politically unstable now. There is excessive polarisation among Americans. Democracy will not survive such polarisation. If an economic crisis comes up; Americans will go at each other’s throats or, more likely Americans, on the Left and the Right, will reject and even go after their elected elites for creating the mess.

As US democracy becomes more stable, Canadian democracy will follow. To save democracy in Canade and the World we all need a stable, less polarized US democracy. This will not happen without direct democracy.

The situation is made worse because democracies face now, like they did in WW II and during the Cold War too, a dangerous rival, the militarily and economically powerful Chinese regime.

As long as China, like the USSR, practiced communism, it posed no economic threat because Communism is very inefficient.

But China is no longer Communists, forget what they say. China now is now is more like Nazi Germany; it has a system of state-controlled capitalism, disciplined, hardworking, entrepreneurial and… also convinced of their superiority.

For all that, China will be dangerous for a while. I know the Chinese people, eventually, will get rid of their current regime. The reason is obvious; lack of freedom will, at some point prevent innovation in science, technology and also in culture. It will happen as soon as someone develops ideas, science or technology that threaten the regime. But that collapse can happen soon, or it may take decades.

Democracies still have a window of opportunity. The window will last only as long as the US is a democracy and as long as the US is clearly the most powerful nation.

Unfortunately, the way the US is going, it will become weaker economically, militarily, and politically.

What the US needs is to strengthen its representative democracy with direct democracy.

Economically the US is becoming weaker because US capitalists have practically abandoned making things to make money, particularly high-tech products. They prefer to maximize profits by manufacturing outside the US, or by practicing “financial engineering”, like buying their own shares to keep their value high, which is good for the executives.

One effect of such policies is that, even for its weapons systems, the US military depends on other countries, even on China, for some important components; it an absurd situation created by those who feel their mandate is to maximize profits.

Another result is a huge trade deficit in manufactured high-tech goods and services, not just in frying pans, microwave oven or vacuum cleaners.

The trade deficit means the US is sending money to China; logically, it is making China more powerful by the day. If the trend continues, China will pressure the US, and other countries too, in all areas.

Besides, others, observing China’s “success”, and the failure of the US, will be more tempted to emulate the Chinese dictatorship because “it works”.

But there is another problem; US representative democracy is in very bad shape. This is a problem the Americans have created all by themselves because of the dynamics of representative democracy. If US democracy collapses, Canada and the rest of the West will become puppets of the Chinese regime until that regime collapses.

Democracy, in theory has many advantages over dictatorship but only if democracy works properly. By “working properly” I mean, government has the support of the people. American are so disenchanted with democracy that only 30 have confidence in their politicians. In Canada, the support is better, 60%, but also much lower than in Switzerland, where the support hovers around 80%, why?, because they have direct-representative democracy.

Let us help Americans fix American democracy, for the sake of all of us, icluding the Chinese people…

Victor Lopez

 

 

 

Representative democracy in the US and everywhere else will perish if we do not renovate it with direct democracy.

Direct democracy does not mean we get rid of the politicians or the political parties. Direct democracy means the people decide whenever approximately 1% of voters agree that all voters should decide the issue in a referendum. This applies to laws, policies, changes to the constitution, taxation levels, budgets, treaties, etc.

Normally, the people let the elected representatives carry on as they do now. The difference with direct democracy is that we will have a mechanism for the people to decide if they support what the politicians want to do.

In a direct democracy, the elected representatives have to govern with a much sharper eye on public opinion.

In a representative democracy, the politicians monitor public opinion, but it is a sort of lazy glance. They do that because in a representative democracy they are only concerned about the effects their actions on the next election.

Their calculation does not always work, so we have the party in power losing the next election. This change is good, but no longer is good enough; the ones now in power will try to please the voters with other policies, but the strategy is the same: “how can we win the election by pleasing most voters at election time, or soon before”. Their concern is not, it can not be, the long-term good of the citizens, it is winning the next election.

Politicians play that game because the system of representative democracy forces them to. People often disparage the politicians as if they were people with character flaws. Most politicians are people like the rest of us but the system bends them out of shape.

Direct democracy does not “twist” the character of the politicians because the people decide the key issues. Direct democracy allows politicians to be better people because they have less decision-making power. This also means they do not have hordes of lobbyists pressuring them with their private interests. The lobbies know that in a direct democracy, politicians do not decide the key issues; taxes, budgets, the health system, the educational system, the size of the military, public works, hospitals, etc.

As soon as the voters become the decision makers on controversial issues, voters “grow up”; they soon learn they have to vote carefully.

Their behaviour becomes similar to that of homeowners, or car owners; they behave responsibly with what is theirs.

In a direct democracy, the politicians do not make grandiose promises either; “we will become the most powerful”, “we will have the best space program”, “everything will be free”, etc. They stop doing that because in a direct democracy the people can stop, and will stop, the politicians from doing foolish things. They do because in a direct democracy votes are responsible for the effects of their decisions.

Representative democracy is some ways is a delusion; politicians promise everything voters want, the voters believe them, get mad at the politicians when the “promised land” never happens, no matter who governs. It is time for voters to take control of the life of the nation, of their own lives, in their own hands.

The mechanism to have direct democracy, to exercise the will of the voters, is the popular referendum at the national level. If the national executive and legislative can decide but the voters can not force referendums on those decisions, particularly when they are controversial, the country does not have a direct democracy, even if there is democracy at the state and local levels.

In a direct-representative democracy the people call the referendums, not the government. In a direct-representative democracy and the results of popular referendums are also binding for the government, nobody can overturn them; not the Congress, not the Supreme Court. Popular referendums must meet both conditions, one is not enough.

One significant effect of direct democracy is on the lobbies; the lobbies are no longer so interested in influencing politicians. Lobbies now know the people are the final decision makers on any issue the people want to decide. Although a direct democracy has to take precautions with the role of lobbies, big business, billionaires, etc., in referendum campaigns. Otherwise we may end up with something similar to what happened with elections in the US; the big donors may end up controlling referendum campaigns.

Direct democracy will free politicians from the obligations to big money. This will be good for the politicians, for democracy, for the people and, over the long term, for the rich and big business too.

A country where the people see that the will of most voters prevails is a more stable country. The wealthy need stability more than anybody else because they have more to lose.

Direct democracy is good for all. How do we know it? Just look at Switzerland; with far fewer resources than the US but higher standard of living, less economic disparity, less violence, better education, better health care and much more political stability, less political polarization; no riots, no assaults to Congress, no hate of their history, no irrational “we are the greatest”, etc.

The Swiss system is so superior that 80% b of the Swiss have a positive opinion of their executive and legislative. No other country comes close. In the US, the figure is 30%; no democracy can survive that forever, and things in the US are not improving.

Americans need direct democracy, and the rest of us have to support them because “as America goes so democracy will go”. We have the new scary authoritarians capitalists at the gates now; 80 years after Uncle Adolf, it is deja vu all over again.

Victor Lopez

This is a race against the clock for the survival of democracy.

The United States is the most important democracy. It is not the best democracy, perhaps it never was, but for decades US democracy has been deteriorating. If US democracy fails, and it is already failing because the social, political and economic division worsens with every election. More and more Americans are discouraged with the way US democracy works; only 30% of Americans are satisfied with their government, no democracy can survive like that.

If US democracy continues losing credibility among voters, many other Western democracies will go down because none has the power to face or compete with the new totalitarian-capitalist regimes.

US representative democracy is deteriorating because representative democracy has a huge flaw built-in; it is government by the elites, not by the people; the people vote but do not govern. Representative democracy is not “government by the people”.

Representative democracy is a vast improvement over rule by absolute kings, absolute parties, absolute religions or absolute dictators. It is very important that people have the freedom to choose and change rulers, but it is not enough, it was never enough. The people have to be the final decision makers on any issue the people decide they want to be, not the politicians, not even the Supreme Court.

The Americans, the French and many other nations made a colossal improvement when the people gained the right to vote to elect and reject leaders. They were right.

But representative democracy still is government by the elites, by the elected elites and those close to the elite; big business, big lobbies, various pressure groups.

This is more obvious in the US than in any other democracy; the people elect the leaders but the various pressure groups year after year have been gaining influence on those elected, and the voters have been losing it.

The root flaw is that representative democracy gives the executive and the legislative too much power. Between elections, politicians can pass any law, any policy, any reform of the constitution, can increase the budget, reduce the budget, increase the deficit, increase or reduce the armed forces, sign any treaty, raise or lower taxes, build any infrastructure, commit billions of to any project, etc., and the citizens, the voters can do nothing about it.

The voters may get angry about what the politicians do, but they can do nothing to stop them. The people can do nothing either to force the politicians to do things the people consider important. Even if the politicians break electoral promises, there is no mechanism for the voters to force the politicians to keep their promises.

All the people can do in a representative democracy is remember for the next election, but the next election is several years away. During that time, the same politicians can do other things that the people do support, unexpected issues may come up, the voters forget, the next election may be about other issues, etc.

If the people become furious when the politicians do something, or if they are too slow doing something they consider important, they can complain, take to the streets, burn cars and shops to show their anger, etc.

This means that in representative democracies, voters decide who will govern but lack the institutions to control what the politicians do.

In the United States, and in other representative democracies too, politicians use their excessive power to govern without considering how the people feel about the policies and laws politicians approve. The only consideration they need to make is to calculate if the decision the people oppose will have a significant effect in the next election.

The politicians often calculate like: “well, perhaps most voters, including who voted for us, dislike what we are doing, but before the next election comes about, we have time to do important things the people will like.”

Representative democracy puts voters in an impossible situation; voters elect politicians but have no control over what the politicians do. It is an absurd situation; voters decide who governs, that is important, but even more important is to decide how they govern. But the way we set representative democracies voters have no way of controlling what politicians say.

Representative democracy has become an absurd game; the voters vote, but the politicians decide. We have to go to “the voters vote and decide”. This does not mean voters will become involved in all the policies, laws, etc., but they will have the right, and the power to exercise it, to stop policies and laws approved by the politicians. Voter must also have the right to force the politicians to institute policies and laws the people decide they want.

Direct democracy is necessary at all levels of government. It is urgent in the US, and in most other democracies, at the national level. Direct democracy at the local and state level is important too, but if there is no direct democracy at the national level, it does not matter much if a few states of the US have direct democracy, or even if all the states have it, because the most powerful government in the US and in other representative democracies, is the national government. If there is no direct democracy at the national level, things will not change enough.

But reality in representative democracies is even worse than that.

In the next post I will show how the lobbies and pressure groups have much more influence than the voters on what the politicians say and, above all, on what they do. This has sent US representative democracy into a deadly spiral; morally, socially, economically, politically.

My goal with today’s post and other posts is to show how the US and other representative democracies, need direct democracy, without overthrowing representative democracy They need the change soon to avoid its collapse and/or the people turning to authoritarian practices.

I believe I will show to you how direct democracy will save democracy and will also bring more prosperity, more social justice, more social benefits, more efficiency, a better and universal health care system, better education, better protection for minorities, more freedom and dignity, do away with the bitter right-left, progressive-conservative division, fewer wars and, help all of humankind advance to a more humane live.

But to help the US and other representative democracies adopt direct democracy, at all levels of government, you will have to do something. To change the facts you have to change your thinking and then act, pecefully, but forcefully, intensely, until the politicians accept to give more power to voters and reduce their own power.

 

 

Let my people decide!, not just vote!

Regardless of what country you live in, you do not have the freedom to decide issues. If you live in a representative democracy, and if it is not corrupt, you have the freedom to elect those who govern, but you do not have the freedom to decide over what the politicians decide.

If you do not live in a representative democracy (or in a direct democracy) you do not even have political rights, you do not count, only the “great leader”, “the great party”, “the great priest” count, that is a much worse condition to live your life.

I do not care in which representative democracy you live, you do not have the right to decide issues or to choose the issues you want to decide.

If you live in the UK, you don’t, if you live in France, you don’t. You don’t if you live in Germany, in any of the Scandinavian countries, in the Mediterranean countries of Europe, in Canada, in Japan, in the US, in Australia, in New Zealand, in Chile, in Mexico, in South Korea and in any of the other representative democracies, even in those with a strong and stable tradition of direct democracy.

The only democracy, besides Switzerland, who is seriously introducing direct democracy, inspired by the Swiss, is… surprise! Taiwan! Unfortunately, Taiwan just started to practice direct democracy, it is too soon to use Taiwan as reference, that is why I use Switzerland. Besides, Taiwan has a scary, not very democratic dragon, breathing its very hot breath down the spine of the Taiwanese people… who knows how long Taiwan’s democracy, or even the country survive? Although I am sure that sooner or later the big dragon will become a democracy, a direct democracy too, because the other system is no way to live.

Some of the representative democracies mentioned above practice a little of direct democracy. For example, some of the US states do.

Unfortunately, no state in the US has real direct democracy. They do not for two reasons; the courts can overturn the results of popular referendums. This negates democracy, democracy is “government by the people”, not “government by the people, unless the courts decide otherwise.”

The second reason is that the US has no direct democracy at the national level.  How could we say there is direct democracy in the US if there is no direct democracy at the level of government with the most influence over the lives of Americans?

There is no direct democracy in the US as long as there is no direct democracy at all levels of government, and as long as the courts can overturn the decisions of the voters. In fact, there is no real democracy anywhere as long as there is no direct democracy; no matter how many American politicians, “influencers”, university professors, etc., go on about the “great American democracy”.

In a direct democracy the people decide any issue, law, treaty, etc., which they want to decide and no court can overturn the decision of the people, not even the Supreme Court of the country.

For direct democracy to work, the process to have the people decide issues also has to be simple. For example, the number of signatures required to call a referendum has to be small, around 1% of the voters, perhaps even less, not 4, 5, even 10%, as it is in some places, it is ridiculous!

In a direct democracy the people have the power to decide issues such as;

• • • Laws and by´laws
    • Policies,
    • Projects,
    • Taxation levels,
    • Treaties with other countries,
    • Changes to the constitution,
    • Road building,
    • Hospital building,
    • To have or not, universal health care,
    • Building a swimming pool,
    • Setting a minimum wage,
    • Decide if there will be a universal basic income,
    • The building of a new shool,
    • Stop laws and policy decisions proposed by the executive and parliament, regional and local government
    • Increase or reduce the size of the armed forces,
    • If the country, the region, the municipality should be unilingual, trilingual or bilingual,
    • The education system,
    • If Taxpayers will fund if universities and is student will have to pay university fees,
    • If the multinationals based in the country will be held responsible before the courts if they break laws abroad,
    • If certain religious practices, many voters may consider offensive, will be permitted,
    • If homosexual relationships will be accepted as marriages, etc.

The freedom and the right to decide is the pending civil right people still do not have in representative democracies.

Direct democracy is not when the government, or parliament, decide to hold a referendum either. Direct democracy is when the people decide on what to hold a referendum, decide the wording and decide when, even if the executive and the parliament, the regional or local politicians, oppose the citizens, even if they do so unanimously.

By the way, Brexit was not the practice of direct democracy. When a California court, or the US Supreme Court, overturn a decision made by the people of California, that is not direct democracy either, it is not even democracy.

Direct democracy improves everything; the economy, education, the health system, etc. It does because the collective intelligence and knowledge of voters, who also know they are responsible for the effects of their decisions, is superior to the intelligence and knowledge of the executive and the legislative, and their experts.

Among the voters there are many experts on any issue, many more than in any government. In debates, social media, etc., preceding popular referendums, their opinions reach many other voters, particularly if there is still some media still interested in real democracy, in that what really concerns voters be discussed.

Governments and their advisors, not only have less knowledge than the people collectively, they do no feel as responsible because their bad decisions because they are not, particularly for the long-term bad decisions. The consequences will not affect their lives; they will be retired or in the cushy jobs they get from their colleagues in power, the grateful lobbies and pressure groups.

How many times voters will turn their heads and pretend they don’t see the dynamics of politics in representative democracies because they are scared to act, or because the media, who often uses selective news and commentary as very effective blinders shines its attention on superficial issues? For how long will this go on?

Direct democracy is a great advance, it is not the “promised land”, there is no “promised land”, but if you want direct democracy you will have to pressure your elected politicians. It will not be easy because most of them dislike direct democracy. They will give you all sort of explanations as of why representative democracy is better than direct democracy, but among the reasons they will not give you are: “because we think we know better, that the average voter is not capable of decidin issues, and because we hate to lose power and influence…”.

Cheers!

V ictor Lopez

This is the continuation of a previous blog about reforming all representative democracies to also have direct democracy, which really means more power for the voters and less power for the politicians in the executive and the legislative at all government levels.

Diversity is a great idea; let us push it further, to the beauty of cultural diversity let us add more territorial diversity. That is what the Swiss have done with amazing results.

Perhaps you thought I was crazy when I wrote about having 25-26 provinces out of what now is Quebec. Well, you may be surprised to learn that Quebec is already divided into 15 administrative regions.

This means the people of Quebec recognise, French-speakers are diverse among themselves, like non-French-speakers, are diverse. They are diverse because they live in different geographic areas. The people of each area are also different because of their economy, their natural resources, climate, history, etc.

Since Quebec already has 15 administrative regions, it should not be too difficult to turn them into provinces. They could be called regions, but would assume most of the power of the province. The province would keep the powers the people of each region, by referendum, decide they do not want to have.

I propose the Swiss model because Swiss model “pushes power down to the cantons (provinces) and the municipalities”. The Canadian federal government would lose some powers to the current province, just like the province will lose power to the municipalities and, this is key, all governments and parliaments will lose power to the voters; voters will decide issues and laws, not just elect representatives.

Do not fear too much government if we divide countries into much smaller units where voters have decisive decision-making powers, it will not happen under this system.

You will have fewer politicians because we are also bringing direct democracy. Direct democracy needs fewer politicians, or needs less time of the politicians, because voters are far more involved in decision-making. In Switzerland, most politicians are part-time politicians, even in the Swiss national parliament. Direct democracy makes life easier for the politicians too, they do not have to bear the burden of making the decisions; the people will assume that burden whenever the people decide. The system frees them from the lobbies “breathing down their necks” all the time.

Because lobbies lose a lot of power, business groups, lobbies of various sorts, do not have to spend time and money lobbying the politicians because the politicians govern for the people, they have no choice.

But there is something even more interesting in Quebec; the people of Quebec already recognise they also have 28 natural historical regions. This goes way beyond the 15 administrative regions and even beyond the 25-26 I mentioned in another post.

It should not be too difficult to give the people of each of the 28 regions the power to run their own affairs. Perhaps in Quebec the logical step would be to create 28 new provinces or regions, each with autonomy the Province of Quebec has now, or more; let the people of each region decide that by referendum. Let Quebeckers organise themselves the way they want to; no need to follow what the colonial powers decided, or what the politicians, in Quebec and all of Canada, decided long ago.

The approach will result in most new provinces being unilingual French, a few would be unilingual English, unilingual Native Canadian language, and some bilingual.

This approach would also mean the creation of unilingual French provinces in other of the current Canadian provinces with sizeable French  areas. Like wise in the case of native Americans.

Here you have the 28 historical regions of Quebec, to give you an idea. You can look at your country along similar lines.

Abitibi-Temiscamingue. 150 000 people. 57 000 sq km (22 000 sq miles)

Lower Saint Lawrence. 197 000 people. 22 000 sq km (8 500 sq. miles)

Beauce. 106 000 people. 4 000 sq km (1 500 sq miles)

Bois Francs. 242 000 people. 7 000 sq km (2 700 sq miles)

Charlevoix. 27 000 people. 7 000 sq km (2 700 sq miles)

Chateauguay Valley. 1 700 000 people. 57 000 sq km (22 000 sq miles)

North Shore and Lower North Shore. 92 000 people.  300 000 sq km (116 000 sq miles)

Eastern Townships. 300 000 people. 10 000 sq km (3800 sq miles)

Gaspesie. 140 000 people. 31 000 sq km (12 000 sq miles)

I could go down the list; Lac-Saint-Jean, Magdalen Islands, James Bay, Lanaudiere, Laurentians, Mauricie, Monteregie, Montreal region, North of Quebec, Nunavik, Ottawa Valley, Outaouais, Pontiac, Quebec City region, Rupert’s Island, Saguenay, South Shore of Montreal, Timiskaming, Ungava District.

In case you may think some are too small to be viable as new “provinces”,  remember the smallest of the 26 Swiss cantons has 14 000 inhabitants. Many cantons have less than 100 000 inhabitants.

It is interesting that the Swiss decided to turn their representative democracy into a direct democracy when they got fed up with the way elected “representative” politicians handled another pandemic… does it ring a bell?

They pressured the politicians until they had no choice but yield. The result is the creation of the best governed and more prosperous country humans ever developed; direct democracy and small territories with lost of autonomy; diversity at work like nowhere else.

Other representative democracies; the US, Spain, France, Germany, Italy, etc., can also reform themselves along the lines of smaller units, with more autonomy, and direct democracy at all levels.

Representative politicians in representative democracies, in your country, do not like these reforms because they will have less power to decide, but the people will decide more, will decide issues and laws, as it must be in a real democracy.

Cheers!

Victor Lopez

Note: Data about Quebec regions from Wikipedia.

Two blogs past I wrote about how the territorial organisation in Canada would change if the country adopted and adapted Swiss direct-representative democracy

I looked at Canada and wrote that if the country adopted Switzerland’s philosophy of territorial distribution, Canada would have around 125 provinces and territories. We also saw that Ontario would be split into approximately 46 new provinces and territories.

You might have thought: “Are you crazy? We already have too many politicians and too many problems trying to get then provinces to work together ! We already have enough problems with the French-English divide, the issues with Native Canadians, bilingualism, internal trade barriers, etc. Not to mention increasing the number of politicians!”

OK, but listen for one minute:

The French-English divide would not exist. One immediate benefit would be the death of Quebec separatism.

The divide would not exist because the division between French Canada and English Canada would not arise.

Imagine that instead of Quebec we had 26-27 provinces; Quebec has the population of Switzerland. Switzerland has 26 cantons.

If Canadians find that it is too radical to break up the existing provinces, they could keep them but giving them authority only in the areas that the new mini-provinces decide they do not want or can not deal with. Naturally, all that would be decided by popular referendums. The referendums would also include taxation authority.

This also means that Quebec, Ontario, etc., would assume some of the current roles of th federal government. The federal government would have only the responsibilities that Canadians decide it should have. The role of the federal government would be much smaller on internal issues.

One of the wisest thing the Swiss have done is separate language from territory. Well, they have not really done that. What they have avoided is the creation of large territories, one for the German-speakers, another one for the French-speakers and so on. They have not created anything like Quebec and they have also avoided the creation of large German-speaking “super cantons”.

By doing that they avoided merging territorial identity and cultural-language identity. What they have done is make sure each that the people of one language and culture are not all in one large territory, or canton.

I do not know if it was intentional but it is as if the Swiss had  realised that one language and culture in one large territory fosters “tribalism”, nationalism, separatism, rivalries along ethno-cultural lines and all the problems associated.

Other countries should start to consider this approach, not just for language and culture, also for religious groups and separate the “need” for one country or territory to identify with religion. Sadly, most of humanity is not ready for this; you only have to look at the crackdowns totalitarian regimes of people of different ethnic group, religion or culture; total barbarism in the 21 st century.

By splitting in this way, the Swiss have many small cantons sharing the same language but which are independent of each other, and compete in taxes, ease of doing business in the canton, etc.

This means the German cantons are too busy competing to worry about “we are one people because we share the same language”. This is the mother of all problems in nations with several native cultures and languages.

The French cantons are also too busy to think of “one French “identity” for the same reasons.

In Quebec, following the Swiss approach, there would by perhaps 19 French-speaking cantons (provinces) and perhaps 3-4 English-speaking cantons, along with 2 or more cantons with Native Canadian Languages.

The idea of the “Quebec nation” would have never taken root because each French-speaking canton would compete with the other French cantons, along with the English-speaking cantons.

So, there you have it: if Canada adopted the territorial-political organisation of Switzerland, all the headaches Quebec separatism has given to Canada, and to itself, would never have happened.

In my next blog we will look at each of the hypothetical cantos; location, size, population, etc.

This organisation, if it spread to all of Canada, would recognise the real diversity of Canada.

As in Switzerland, most the cantons created out what is now Quebec would be unilingual, mostly unilingual French. No bilingualism except in very specific situations, and by decision of the people, but others would be unilingual English, and there would be unilingual cantons following the various native Canadian languages. Remember; the idea is small unitary provinces with one language, but small to prevent tribalism.

The subdivision of Quebec, Ontario and the rest, besides less political nationalism, now represented by Quebec, there would also be less commercial and industrial nationalism because the much smaller new provinces and territories will see they have to be open, to trade, and prevent the uneconomical internal trade barriers the Canadian Provinces erect among themselves: it makes no sense.

Quebec political and commercial nationalism, together with commercial nationalism of the rest, are hurting Canada; there is no reason for Canada to have lower standard of living (75 000 USD per person in Switzerland, 52 000 in Canada), half the unemployment rate, a much better universal health care system, have more vacation and free time, much less likely to be in prison, much less likely to be murdered, less inequality, lower infant mortality rate and live longer.

All that in a country with no natural resources, except for water. Canada is the richest country of the World in natural resources, in absolute terms and per person.

And, let us not forget, Swiss citizens have much more control over their politicians; they can stop any law or decision the politicians make. They can do that at all levels of government.

But there is more; the Swiss do not have the antagonistic government we have in Canada. In Canada, the opposition, at the federal and provincial level speaks of the Prime Minister, the ministers, the party in power, as a bunch of stupid, dishonest manipulators. The government does the same to the opposition. It is bad for the country, but such are the dynamics of representative democracy.

You will not believe this; in Switzerland there is no opposition; the major parties of the “right” and the “left” govern together in coalition. Perhaps even more amazing is that the Swiss Parliament meets only a few times a year. Therefore most politicians in Switzerland, even at the national level, are part-time politicians and continue working at their regular jobs.

See you in two days!

Victor Lopez