‘The malaise in Western Europe is attributable to affluence bought not by economic dynamism but by reckless borrowing. The response of Greece and Italy is to walk away from democracy’
When Eastern Europe emerged from the dark oppressive cloud of history in 1989, Western proponents of liberal democracy could be excused for their elation. Their cause had won a bitter ideological struggle with Communism. History appeared to vindicate the notion that democratically elected governments presiding over free-market economies delivered such an unprecedented combination of prosperity and freedom that everyone, in due course, would want to join. Freedom’s march appeared irresistible, especially because, in general, authoritarianism and poverty also marched together.
There were a few exceptions to this apparently iron-clad law of causality but they were accidents of history and geography. Singapore was prosperous but not very free and certainly not democratic. Nor were the Gulf monarchies, where the enormous natural wealth available to the state explained the ability of their authoritarian rulers to deliver economically. Besides, their economies produced little else but hydrocarbons, and once oil and gas were taken out of the equation, many argued, the explosive cocktail of political oppression and economic deprivation was still there.
Fast forward to 2012 and the picture is dramatically different. First, China is making the Singapore exception somewhat harder to ignore. Second, Singapore look-alikes are emerging in the Gulf, where benevolent despots preside over increasingly diversified and successful economies.
Meanwhile, in Europe an even more worrying trend is challenging the belief that political freedom fosters prosperity.
Greece, the country that gave birth to democracy, has nearly destroyed Europe’s economy. Italy, the world’s seventh-largest economy and the birthplace of the Roman republic, would make the costly rescue of Greece pointless if it too collapsed. Both countries’ crises are directly attributable to a sweeping malaise of Western societies: an affluence bought not by economic dynamism but by reckless borrowing.
The response of both countries is to walk away from democracy. Temporary though it is, it is a precedent that should raise serious questions.
After all, the dizzying success of Italy’s new prime minister, Mario Monti, is proof that difficult steps to fix the economy could only be taken by an unelected government. Monti is a well-respected international bureaucrat tasked with implementing structural reforms that European institutions, which are neither elected nor Italian, believe Italy must embrace if its economy is to avoid bankruptcy. They may well be right.
The ease with which Monti is tackling fiscal evasion in Italy is remarkable. The failure of his predecessors speaks volumes about the lack of courage and vision of democratically elected officials in the past.
A similarly unelected Greek government led by Lucas Papademos, another former international bureaucrat, is trying to fix the wreckage left by elected politicians of both Left and Right, albeit with less chance of success. But the point is the same. The mechanisms devised to save Greece from default are being approved first by an unelected government and then by foreign parliaments from those EU countries that will have to pay for the plan. And the plan itself is not a Greek concoction, but a number of measures drafted elsewhere and forced upon Greece at gunpoint.
The gun, though it is a metaphor for the threat of bankruptcy rather than military occupation, is salutary for economies like Italy and Greece. It may save their democratic governance in the long term since sharp economic downturns breed populism and social unrest. But there is no escaping the fact that such coercion is undemocratic. It is also evidence that democracy has, in the last two decades, displayed fewer virtues than democrats imagined.
The coalition of international mandarins and unelected officials dictating policies for the sake of societies unable to make the best decisions for themselves may be our best option. They could be the modern reincarnation of the Roman dictator, a figure who enjoyed unlimited but temporary powers in exceptionally dangerous circumstances. Such dictatorship was considered entirely reconcilable with Rome’s republican freedoms. Monti and the mandarins may complete their task of saving the republic and then graciously withdraw, giving way to elected politicians who will (we hope) avoid spoiling it all again.
Whether these temporary dictators will have made us worthy of the civic obligations inherent in a democracy is another matter. The evidence is mounting that democracy is not alone in creating and sustaining prosperous economies. Judging by European public opinion, people will sacrifice freedom and democratic principles in exchange for prosperity much more readily than the other way round.