Liberal representative democracy must, at all times, keep a wary eye on two economic endemic threats which could best be described as economic contradictions within the system. The first is the generation of excessive expectations. The second arises from the disruptive effect of the pursuit of group self-interest in the marketplace.

Such threats are economic. Some see them as the malign side-effect of consumerism. Others consider excessive expectations as the offspring of politics, rather than economics. Others still emphasize that group pursuit of market power goes against the grain of liberal democracy.

Liberal democracy implies the co-existence of all political contending groups, including the ‘losing’ side.

The rise of group demands depends on members’ expectations, but these are often fanned by competitive wooing of the electorate.

On the other hand, public authorities influence the allocation of resources, through taxation and expenditure policies and, at times, through direct intervention in the market place.

Growing expectations

Growing expectations impose public demand for different kinds of public spending and intervention that are not compatible with each other, and with the tax burden the electorate is willing to bear. In such cases, it is politics (and politicians) that upsets the economic apple cart and not vice-versa.

Seen from this perspective, it is best to think of politicians, not as ideologues or spokesmen of their constituents, but as entrepreneurs who deal in votes just as oilmen deal in oil.

This concept was first advanced by Joseph Schumpeter. In this context, the principles or policy platform of a particular political party may be important for its success at a given moment but, in the words of the British economist Samuel Brittan, they have no deeper or more permanent significance than the particular brand lines that a department store finds it expedient to carry this month, but may well want to change next spring or autumn.

Different stores will feel more at home with different lines of wares, but all will alter their display in order to win public support.

Self-interest

This is the political equivalent of Adam Smith’s doctrine that it is not from the benevolence of the butcher, the brewer or the baker that we expect our dinner, but from their regard to their self-interest.

In politics, as in economics, the pursuit of self-interest activates the citizen and politician – whatever moralists may suppose at given times.

If this is a true and correct assessment, the trend towards excessive expectations in democratic systems, Malta included, could be better understood.

Collective psychology is easily susceptible to influence. People in a crowd are likely to exercise a reduced sense of responsibility compared to private individuals in their business or home life. A crowd is not necessarily a screaming mob in a city riven by social tensions. It may be a television audience or a lobby led by articulate leaders, skilful in advertising or propaganda methods.

The economic contradictions of democracy are too complex to be resolved by the vote-seeking process. Although Parliament may be required to vote on such issues, and ministers may propose legislation, the real decisions should be made elsewhere, away from alternating fits of pique and partisanship.

Back seat drivers

In the area of state authority, there is space for agencies whose heads are not appointed by competition for votes, and who don’t have to please the electorate in an immediate sense.

If these are admitted to participate in the game, then all political groups must be willing to accept legislation on the statute book. Political warfare must be kept within certain limits. Politicians must be free to operate without interference from back seat drivers.

There must be general agreement on the broad structure of society and the rules of the political game

If the electorate is divided into two or more deeply hostile camps, democracy may wither. And unless there is the political will, in the end something has to give.

It all comes back to the politicians who are essentially professionals at dealing in votes but, in the main, amateurs in administration, with strong tendency to take refuge in the world of sound bytes, slogans and media exposure.

Democratic elections empower politicians to call the shots. They do not confer on politicians the ability to take careful aim at the right target at the right time. It is that skill that keeps expectations in check, that seeks a balance between group demands and national resources, and that allows democracy to overcome its inherent economic contradictions.

Politicians who, on gaining power, go crazy and ride on waves of ever-rising expectations, sustained by overspending and unlimited borrowing, will, in the end, lead their chariots and their followers into the wilderness. Survival depends on finding the way back. In turn, it all depends on self-interest.

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