Notoriously, a branch of economics known as “public choice theory” assumes the worst about people. The aim of this body of thought is not to consider how public policy ought to be made in an ideal world in which politicians are saints and angels; instead the theory tries to explain how policy changes are in fact made in the real world by self-interested party bosses and their hangers-on. In a previous Standpoint column (December 2010), I summarised the main message as being that many government decisions do not pursue the greatest happiness of the greatest number, but “the greatest good of oneself and one’s chums”.
A notable contribution was the 1962 book, The Calculus of Consent, by Jim Buchanan, later awarded the Nobel economics prize, and Gordon Tullock. Tullock has described public choice theory as “the use of economic tools to deal with traditional problems of political science”. Often the result is to show bad outcomes, such as pork-barrel government spending, can emerge from supposedly benign and innocuous democratic processes. However, human beings are far from predictable. Sometimes they defy the cynics and perform altruistic deeds exclusively for the public benefit. For example, public choice theorists have a problem with the so-called “voting paradox”. When each voter in an electorate of 50,000 goes to the polling booth, the effect of the one vote is tiny relative to the effect of the tens of thousands of other people also voting. Why does anyone bother?
But voting in an election is hardly strenuous. Surely, much weirder is the phenomenon of “political activism”. Some people join a political party in order to have themselves elected to an office of some sort, perhaps at the local level. But the great majority does not. Only a small fraction of the membership of any of the UK’s political parties is likely to become a MP, MEP or local councillor. (Elected local government representatives in the UK total just over 20,000, whereas the combined membership of the UK’s political parties is usually put at roughly 400,000.)
Evidently, a few hundred thousand of our fellow citizens organise and attend political meetings, write campaign literature, tramp the streets putting leaflets in letter boxes and so on for no obvious reward, and in fact even pay membership dues so that they can commit these unselfish acts. Are they mad? As it happens, activism in British party politics has been waning for decades. In the early 1950s the Conservatives claimed to have more than three million members and Labour more than a million. If widespread popular participation in British politics is indeed mad, this particular form of insanity is now in drastic decline.
As a result, the long-established parties have seen a large drop in their income. One reaction has been to press for increased state funding of political parties. At present Labour receives almost £7 million a year from the taxpayer, while the amounts given to the smaller opposition parties (the Greens and the nationalist parties) total a few millions. The recent revelations about Labour politics in Damian McBride’s Power Trip, with all the details on “Smeargate” and the like, ought to raise questions about whether this money is being spent properly. Admittedly, McBride was on the civil service payroll for most of the time he was working for Gordon Brown. (See review, page 56.)
The mainstream political parties are finding it increasingly difficult to finance themselves from membership fees and donations, and — to give Ed Miliband his due — he is trying to stop Labour once again becoming over-dependent on trade union money. Meanwhile the “Smeargate” shenanigans suggests that government money should no longer be paid to political parties and certainly weakens the case for extra state funding in future. Will traditional political activity in the UK therefore disappear, as the parties find that they cannot afford a meaningful campaign and research infrastructure?
An emerging counter-argument is provided by the UK Independence Party. In local elections this year UKIP has been taking about a quarter of the vote, not that different from the two leading parties and well above the Liberal Democrats. At the national level UKIP’s income was for many years under £500,000 a year, less than the bonus of many individual City traders, and it has never received much from the British state. One interpretation might be that, when people can see a big cause (like the independence of their nation), they are prepared to devote time and effort to promoting that cause, and they do so regardless of their short-term self-interest. Public choice theorists would struggle to explain the rise of UKIP by “the use of economic tools” within the context of a so-called “science” of politics.