Whatever happened to the European social model?

“Can the debt and deficit laden European welfare states . . . rescue their public finances and reform their social market economies?” asks Timothy Garton-Ash in a column in the Guardian this week. Can any of the Western democracies work their way out of their sovereign debt while maintaining their social fabric? Including the U.S.!?

Even before the bank debt crisis was transferred to the public purse in 2008, gaping holes had started to open in the public accounts of every developed society that was unable to exploit fortuitously local natural resources. The full development of the “social market economy” had not actually been possible until the latter half of the 20th century, and then only the most industrialized societies were able to give it a try. And give it a try they did, without employing the same cold, hard analytical skills that they used to develop their burgeoning, ravenous and muscular economies.

The reality in those countries that did look like social market economies was that they had split into two internal realities. Cold, clear market economies on the one side and warm, fuzzy political fantasies on the other. So long as the political reality didn’t infringe on the operations of the market reality, each could live in their own space, peering occasionally with bemusement into the other reality. The deal centered around the political reality being able to sustain itself without imposing too great a burden on the market reality.
You could ask anyone on the market side and they’d tell you that the politicians weren’t living in reality, that their math skills stunk, and that that “it” would never work – but heck, so long as vast swathes of society were happy to be deluded, and those delusions didn’t interfere too much with the “natural” market forces that really made the world tick… who were they to try and correct the fallacies, right the wrongs or destroy the fantasy?
On the other side, in the political reality, everyone was agreed, with great frustration, that the inhabitants of the market reality were just one enlightenment short of recognizing the inevitable self-destruction inherent in a market economy model that failed to recognize that it was supposed to serve the needs of the political reality.

The disconnect was pretty universal and early in life most people picked or found themselves in one reality or the other, which then shaped and framed their worldview thence forward. The actual reality, the real shared universe, got little attention and virtually no recognition.
What allowed these two realities to persist for a century, and what has now virtually collapsed in 2010, was the subtly corrupted accounting on which the market economies were based, and which sustained the illusion of self-funding welfare societies.

At the beginning, the social welfare provided was very meagre and was available to only a few. For instance, pensions were only subsistence and only a few lived long enough to collect them. In the middle, the economies that supported (funded) the slightly better welfare programs of their age were unconsciously over-muscular, leveraging unbalanced trade, resource exploitation, uncosted environmental pollution and unfair competition to generate unnatural wealth (profits) that made the welfare states that relied on them look affordable. In fact, they weren’t.
The collapse of the Soviet communist system mid-way through this period just “proved” to everyone that asserting the political reality over the market reality was a road to doom. In actual fact it proved the necessity of allowing natural markets to operate and the fundamental role of freedom in human society, but it did not help to frame the proper and useful placement of market economies – it just proved that we need them.
The the later stages, as social welfare developed more fully and costs rose significantly, the market economies of the West started to run out of resources and face greater competition from the rest of the world. In response to those pressures a complex system of debt was used to replace real wealth. The political reality encouraged the markets to manufacture a debt delusion that was bound to crash when it ran out of bubbles to inflate. This happened in 2008 and the real reality, that the political reality is dependent on the market reality, came home to roost. The first response, the understandable reaction to the shock, was denial; and the remedy was to repair the debt damage in the market reality by transferring it to the political reality, by bailing out the banks.

Now we must face the fusion of our political and market realities, if we are to forge a path forward for cohesive human societies. We must face the reality that we cannot account for our social needs with the same mechanisms that are appropriate for our market economies. If we are to build sustainable market societies we must recognize the social rewards of social work alongside monetary rewards for market success. The reality is that the market economy is a smaller realm of activity than the social services realm, and the market economy simply cannot produce sufficient monetary wealth to pay for the the necessary social activity with money.
Transitioning to this fused reality is not hard, or far away. The future of the “social market economy” is the “market economy society“. A subtle but profound transition of emphasis accomplished by an equally subtle and profound change of our priorities. The market economy remains but the political reality is profoundly altered by accepting responsibility for itself and transitioning from dependent to independent.
The market economy society establishes a framework within which the market can operate without responsibility for society, because society has assumed responsibility for itself and the market operates within a space created and nurtured for it by the society. The mechanisms that create this reality are simple and universal as well as being accessible and immediately effective.
In a market economy society the monetary cost of labor is only its commercial value adding quotient. This is true because the society provides the basic services necessary to sustain a reasonable life (shelter, sustenance, transport, education, healthcare, information and the protection of the law) for free – the majority of the cost of these services is absorbed by the citizens of the society in return for the reward of living in a peaceful, free, market economy society.

This is the only desirable and feasible human society. The debt bubble has burst, the industrial growth train has run out track and steam and the elevation of social awareness is irreversible.
The looming “age of austerity” being offered up by the old disconnected realities is neither necessary nor acceptable, as we shall see. The measure of our skill as a product of Nature will be our ability to reimagein our actual reality, with clarity of practice and intention.

What could have been… UK 2010 election results

If the UK had the LIFE PR election system in place the results of last week’s voting would have mirrored the desires and intentions of the people better, created a more effective legislative body and produced stronger leadership.

Of course, the UK doesn’t even have PR let alone a LIFE PR system. This left the average citizen trying to cast a vote that covered so much ground and met so many needs that they are to be commended for having made any choice at all. Faced with trying to select an effective local representative, choose a national direction and say something to the world, all in one vote, was a mighty task indeed. In the end many voted to keep out what they didn’t want. Hardly a model of effective democracy.

In a LIFE election the citizens would be casting one vote for a representative to the UK parliament/State Assembly. They would be able to pick from the same list of candidates, irrespective of where they live in the UK, and they would be able to select an alternative/second choice should their first choice candidate fail to muster sufficient votes to meet the quota. This would free everyone to vote for whom they truly wanted to lead their country, instead of voting for someone they didn’t want, and who wasn’t going to lead their country anyway, just to keep out a representative of a party they disagreed with even more strongly.

The UK State Assembly would have a maximum of 62 seats available [population/1 million]. Just over 29 million people voted so the quota for election to a seat would have been slightly less than 500,000 votes. On the face of it that would mean that Greens, who only got 285,616 votes, would not have had a single seat – but who knows how many people across the nation might have voted for a Green candidate if they knew that their votes counted? The BNP would have got a seat even though they got none in the May election, and UKIP would have secured 2 seats.

However all of the numbers are a little suspect because there was so much tactical voting and so little opportunity for the average citizen to truly express their intentions through their vote. Given the chance to choose a candidate who truly represented their views, citizens would quite likely have picked a much broader array of representatives to head up to Westminster on their behalf. Furthermore, with a LIFE PR system everyone 16 and older would have had a vote and those caring for others would have had their charge’s vote too – enfranchising the young, the old and the disabled.

So using the voting record from a flawed election to extrapolate what would have happened with a more perfect system is fraught with difficulties and anomolies, nevertheless it is interesting to look at. If nothing else if shows that the LIFE PR system is fair, effective and representative.

We will be posting a calculator model at www.standardsoflife.com that you can use to figure out for yourself how an election near you would have turned out if you had a LIFE PR voting system – post your results and comments at Topic – Voting.

Breaking the constituency link

The denunciation of a patently more democratic voting process based on its impact on a fundamentally flawed democratic structure betrays adherence to the latter.

Mr. Brown, and many others, say that they disapprove of introducing proportional representation because they believe it will break the link between an MP and their constituency. If we vote locally for a national assembly, he is right.

But the link that is broken is only broken in name, because it was broken in practice a long time ago. Our national parliament does not have the time and is not the appropriate venue for the resolution of local matters. It is a national parliament that concerns itself with national issues, and so it should.

The denunciation of a patently more democratic voting process based on its impact on a fundamentally flawed democratic structure betrays adherence to the latter. But it is hardly novel to point out that those in power are unlikely to support, or even to see, changes to the existing framework of power distribution as important or necessary.

Proportional representation is an excellent method of distributing power amongst representatives within a constituency. However if a single constituency is broken up into smaller pieces, the system falls apart. This is not a weakness of proportional representation, it is the logical result of the fundamentally flawed notion of segmented constituencies.

Improving the responsiveness of government, enhancing our democratic processes and more closely connecting the citizen to the actions of the government requires that we layer our government by constituency. We need local governments to tackle local issues and regional governments to tackle regional issues, just like we need national governments to tackle national issues. This will require national governments to give up their control and say over all issues that are not of truly national concern – this is probably a concept that hasn’t even crossed their minds.

Of course introducing proportional representation to the election of national representatives will result in a national chamber full of duly elected members who are concerned with, and were elected on, national issues. This is only a problem if the power to affect local issues is vested in the national parliament.

In reality the “constituency link” is a euphemism for

  • the false promise that you can elect a local MP to go to Westminster so that they can fix your local issues and represent your local perspective
  • the concentration of power at the national level
  • the further concentration of power within the national parliament to a select group of “ministers” (who I am sure have all the time in the world to devote to the matters, affairs and concerns of their local constituency)
  • a breeding ground for porkbarrel politics
  • the fundamental disenfranchisement of individual citizens because they vote locally for national representatives and end up with neither local action nor national representation
  • the protection of investment that “safe” constituencies provide
  • a system of waste that requires every MP to have two houses and travel continuously, such that they are rarely in touch with the reality of their local constituency, the broader electorate or even their own families

So Mr. Brown is right that introducing a fairer voting system will break the constituency link, but he is wrong to identify this as a problem. The problem is the lack of real democracy, and the solution is to break up the monolithic power structure of a single national parliament and devolve power down to constituencies. That will truly link the citizen with their community constituency.



Opportunity is knocking

Events have outstripped the establishment options.

78%. That’s the percentage of the electorate in the Norwich North that did not vote for the “winning” candidate in the last UK by-election.

So for every Conservative voter there are four others who don’t think that the Tories have the answers. We can do some basic maths here: the Conservatives won with 22% on a turnout of substantially less than 45%; that leaves 55% who didn’t vote at all and half of them is a little north of 27%. So if only half the people who didn’t vote, voted for an alternative… that alternative would have been the winner. Or, if only one in three non-voters voted and 10% of voters switched to the same alternative that would have been enough to win the election.

Add to that maths the fact that just under a third of all incumbent MPs will not be standing for re-election, and you have a real opportunity for real change.

Right now the economy isn’t even serving the minority, the population is aging, the country is committed to foreign wars beyond its means and the climate is heating up. None of these is addressed by the political choices on offer. Events have outstripped the establishment options.

It may be nine months premature to declare the death of Britain’s established political parties but it certainly demonstrates the opportunity. If a human baby can gestate from conception to birth in just nine months, surely a new politics can be born in the same time.

We want better. We deserve better. We can do better.

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