Undercover Economist

How referendums break democracies

The Dutch parliament have just agreed to abolish advisory referendums. I don’t blame them. I did not much care for the result of the latest referendum that was held in the UK, so I confess to disliking referendums with the fervour of a sore loser.

The winners no doubt feel more cheerful about the idea but even they may agree with this: the campaigning process was corrosive, and the consequences for the health of British politics have been even worse.

This scepticism might be seen as kicking democracy when it is down. The Pew Research Center found last year that 17 per cent of Americans think military rule would be a good idea, while 22 per cent favoured a strong leader “without interference from parliament or the courts”. The numbers in the UK were fairly similar.

Most of us still believe in democracy, but even its staunchest supporters will admit that it has its flaws. The most obvious of these is that we voters pay little attention to the issues. Consider Jeremy Corbyn’s recent shift; his opposition Labour party now advocates the UK leaving the EU but remaining in the (or “a”) customs union — not to be confused with the single market. This has been roundly agreed to be a significant change in the political landscape. But the now-momentous-seeming distinction between the customs union, the EU and the European single market was obscure to all but the wonkiest of wonks until a couple of years ago (myself included). It surely remains obscure to most voters today.

I do not mean this as a criticism of the voters. Why should we pay attention? We have other things to do. A decade ago, economist Bryan Caplan’s book The Myth of the Rational Voter (UK) (US) argued that it made sense for us to express our misconceptions, prejudices and tribal loyalties at the ballot box, since doing so was almost costless.

A voter thinking of popping to the polls and then trying out a new pizzeria would be perfectly rational in checking out TripAdvisor, rather than the party manifestos. This is because her vote will almost certainly not make any difference to her life, but her choice of restaurant almost certainly will. We vote because we see it as a civic duty, or a way of being part of something bigger than ourselves. Few people go to the polls under the illusion that they will be casting the deciding vote.

If voters are not paying close attention, then what might we expect from a referendum? The psychologist and Nobel laureate Daniel Kahneman, in Thinking, Fast and Slow (UK) (US), writes, “When faced with a difficult question, we often answer an easier one instead, usually without noticing the substitution.”

The difficult question in a referendum might be, “Should the UK remain in the EU?”; the easier substitution is, “Do I like the way this country is going?”

Another simple heuristic is this: “If one of the options was awful, they wouldn’t be asking, would they?” Except that in the UK’s referendum on EU membership, for reasons of short-sighted political expediency, they did ask.

Of course, any democratic system is weakened by the fact that voters are not paying close attention. But representative democracy provides a line of defence against voter ignorance, by asking us to elect someone to make considered choices on our behalf.

I can’t fix a blocked drain, so I ask a plumber to do it for me. I am not sure whether that blotch on my cheekbone is malignant, so I ask a doctor. And I am, truth be told, a bit vague about the difference between the European Court of Justice and the European Court of Human Rights, which is why I elect an MP who can call on the advice of civil servants and the House of Commons library on my behalf.

I may make the same knee-jerk, tribal decision in an election as in a referendum, but at least I will be assisted by my recognition of longstanding party brands. Just as we recognise brands like Apple, Coke and HSBC, most voters know the difference between Conservative and Labour, or Republican and Democrat. We vote for people who seem to share our instincts and trust them to handle the details.

These brands have another advantage: they provide their owners some modest incentive to tell the truth and keep their promises. The shortlived campaigns that coalesce to fight referendums have no such constraints.

That points to one other disadvantage of a referendum: there is nobody to hold to account after the result. Theresa May campaigned for Remain. Three-quarters of MPs were for Remain. So if the result of the exit process goes badly, who can be blamed? Not them — and we’re certainly not going to blame ourselves. The buck stops nowhere.

No voter can master every issue, and few voters try. Any democratic system must cope with that. Referendums, instead, invite us to ignore the question, give the snake-oil peddlers an edge, concentrate our ignorance into a tightly focused beam, and hold nobody accountable for results. They magnify the vulnerabilities of our democracies and diminish their defences. The Dutch are wise to avoid them.

 

Written for and first published in the Financial Times on 2 March 2018.

My book “Messy: How To Be Creative and Resilient in a Tidy-Minded World” is now available in paperback both in the US and the UK – or through your local bookshop.

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