Yanis Varoufakis: Can the Internet Democratize Capitalism?

Yves here. Trust me, you must read this post. In its entirety. Varoufakis discusses the operation of “liberal democracy” as opposed to “classical democracy,”. and argues that voter apathy is a feature, not a bug. But the real meat is in his discussion of how the economic rights of laborers has changed over time and how that has had profound implications for democracy.

By Yanis Varoufakis, professor of economics at the University of Athens. Cross posted from his blog

Technological fixes to time-honoured problems are all the rage these days. Bitcoin is meant to fix money, social media are seen as an antidote to Rupert Murdoch and assorted tyrants, networked robots are to help countries like Japan deal with demographic declines etc. Perhaps the largest claim is that the Internet has helped (or is about to help) democratise capitalism. Ten years ago that claim struck me as both fascinating and dubious. So, I sat down and wrote an article about it (circa 2004). Its gist: The Internet is a wonderful leveller. But democracy requires a great deal more than mere ‘levelling’. Primarily, it requires political institutions that enable the economically weak to have a decisive say on policy against the interests of the rich and powerful. Ten years later, I am re-visiting this question, under the shadow of a global crisis that made it even harder to convert an e’Demos into genuine e’Democracy. What follows is an updated version of the original paper.[1] (Click here for a pdf version or just read on.)

1.  The Internet’s Toughest Assignment: To Put Demos Back Into Democracy

As soon as computers were linked to form a mass communication medium, the notion of e’democracy was bound to surface. Hobbling at least a decade behind e’mail, e’porn and e’trade,[2] the idea of putting Internet-based technologies in the service of democratic institutions finally emerged. “And not one moment too soon,” add those who see it as one of democracy’s last lines of defence.

We live in an era of heightened fears that democracy is an empty shell. The young feel the democratic game is not worth the candle. Older generations despair, rightly, that the 0.1% have cornered the ‘democracy market’ while the banksters’ bailouts have all but destroyed the legitimacy of our democracy’s institutions. More generally, we live in a world where consumer sovereignty trumps democratic ideals and where the fear of the ‘other’ overrules the pleasures of tolerance. It would not be far fetched to claim that too large a segment of the population would happily sell their right ever to vote again (or to stand in an election) for a depressingly small sum. Is it any wonder that voter participation is in free fall across all ages and social classes everywhere? 

Younger people, reliant as they are on the Internet and in a permanent state of optimism regarding the possibilities offered by technology, tend to think that the solution lies in finding suitable… apps. They harbour the hope that the failures of our representative democracies can be compensated for by new participatory decision making processes that we can refer to, generally, as E’democracy.

What can E’democracy do to help empower a networked Demos (nb. Demos is the Greek word for ‘the people’)? One (widespread) answer is: Present people with the opportunity to be part of a deliberative process which will turn them into active participants in the debates unfolding within the existing chambers of power. Once there (even virtually), they will (hopefully) become ‘hooked’ on democracy, realising what they have been missing, and, through their presence, reinvigorate our stale democracies. 

E’democracy’s indisputable appeal is not in the least dented by the realisation that no one seems to know quite what e’democracy entails. In fact its indeterminate meaning gives novices the opportunity to participate in defining it. In so doing it might give them cause to re-think democracy, and thus reinvigorate it. Judging by the large retinue of definitions in the emergent literature on E’democracy, the safest route to defining it is through the successive elimination of that which we do not want it to be: According to Coleman and Gotze (2003), it ought to be irreducible to e’government (as it is possible to imagine a dictatorship deploying highly efficient e’government systems); to pose no threat to representative democracy (i.e. it need not be a Trojan Horse for direct or plebiscitary democratic alternatives); to have little to do with technology as such and a great deal to do with re-conceptualising the ‘space’ between the ‘people’ and their ‘political rulers’… Though this elimination does not home in on a definition of Aristotelian precision, it does give us enough to go by and inspire the thought that e’democracy has significant potential for reversing democracy’s decline.

Optimism is a fine and useful sentiment as long as it is built on a solid analysis of the problem at hand. The ambition described in the previous paragraphs implies that democracy’s current troubles, although systemic, are the result of a steady degeneration which can be reversed through greater engagement and participation (facilitated by the Internet and related ICTs[3]). I hope this turns out to be so. But I fear that, as things stand, E’democracy is unprepared for the larger than life enemy at which it is asked to tilt.

If we look closely at the world around us, we shall note disturbing evidence that democracy’s predicament gets worse in countries where it has already succeeded in establishing mechanisms for effective citizenship participation and fostering affluence (see The Norwegian Study of Power and Democracy, discussed in Ringen, 2004). If this is right, and liberal democracies somehow fall prey to their own ‘success’, how can their degeneration be checked?

The hunch underpinning this paper is that, behind voter apathy and the low participation in politics, lays a powerful social force, buried deeply in the institutions of our liberal democracies and working inexorably toward undermining democratic politics. If this hunch is right, it will take a great deal more to re-vitalise democracy than a brilliant Internet-based network linking legislators, executive and voters.

Of course this is not an argument against Internet applications for the purposes of deliberation or promoting citizen participation. It is, rather, an argument for examining carefully the history and present state of our democratic life before designing technology’s contribution to it or, crucially, before developing too many hopes that will then be crushed by a merciless reality.  

2. An Empowered Demos: The Athenians’ Audacious Experiment[4]

Democracy, as we all know, was born in Athens.[5] Are there lessons for e’democrats to be learnt from that relatively short-lived experiment? The most profound one is that an empowered Demos does not get easily bored with politics. Through good times and ill, Athenians never missed a chance to partake of assemblies; to argue away briskly, disagree furiously, reluctantly (and, on the odd occasion, enthusiastically) converge on commonly agreed courses of action. Those who stayed at home or concentrated on making money were famously labelled… ‘idiots’.[6]

It is, however, easy to dismiss Athenian democracy on two grounds: Its hypocrisy and its irrelevance for the modern world. Regarding the former, one might argue plausibly that, since the Athenian economy (public, private and domestic) engaged slave labour, and women along with resident aliens (the metics) enjoyed no citizenship, their democracy was a sham. And as for the charge of irrelevance, there is the obvious fact that modern industrial societies are too large and complex to be run by means of direct democracy.

Be that as it may, classical Athens must be the first port of call for aspiring e’democrats. The reason is that Athens allows us an intriguing glimpse of democracy’s major inter-temporal contradiction; the same contradiction which e’democracy is being called upon to deal with today. The best place to start looking for that glimpse is the charge of hypocrisy.

The Athenians invented neither slavery nor sexism. What they did invent, however, was the notion of a citizen who enjoys not only free speech but also isigoria (equal say in the final formulation of policy) independently of whether he was rich, comfortably off, or indeed a pauper eking a modest existence out of manual labour.[7] In this reading, the key figure was not Pericles, or orators of stunning talent like Demosthenes, but, rather, the anonymous landless peasant who, despite his propertylessness, had a voice in the Assembly of equal weight to that of the great and the good. This was the remarkable novelty of Athenian society which has probably never been replicated since.

If e’democracy is to give voice to the voiceless, it is interesting to ask: What was it that endowed the labouring Athenian citizen with isigoria? Is there room for re-introducing whatever that was into contemporary democracies? Can e’democracy bring it about?

Today we tend erroneously to think that Athenian citizens lazed about in the Agora while the slaves did all the work. Though true for some Athenians (rich kids and their philosophising teachers), the labouring citizen was present in all realms of production (peasants, artisans, manual labourers) – see Finley (1980) and de Ste Croix (1981). Free men worked side by side with slaves[8] and sometimes it was the slaves that enjoyed higher status in their ‘profession’.[9] In this context, Athenian citizenship was inextricably intertwined with the unfreedom of slaves (as well as of women and the metics). More concisely, freedom and unfreedom fed of each other in ancient Athens; they were, in a sense, each other’s accomplices.

Aristotle’s definition of democracy (see Politics 1290b) is telling in this regard: A constitution in which “the free-born and the poor control the government; being at the same time a majority” (emphasis added).[10]  Meanwhile, in his Rhetoric (1367a) he defines a free man (eleutheros) as a masterless person who needs obey no one because he does not depend on having to produce or sell anything. Plato takes things further in the Statesman (289c ff.) saying that one is fit for public office to the extent that he is not supplying indispensable goods or services.

Of course, neither of these great philosophers were known for their democratic credentials. In fact, especially for Plato, quite the opposite is true. Nonetheless, what is of interest to us thousands of years later is that both Aristotle and Plato should see freedom not as the opposite of slavery but as the antithesis of dependent labour! In a sense, one’s genuine freedom depended on the extent to which one was free from both physical masters but, interestingly, free from the market as well.

As anti-democrats, Plato and his followers argued that political reasoning could not be entrusted to those who had to work for others – irrespectively of whether they were free labourers or slaves. In this sense, the Great Debate in ancient Athens (between democrats and their critics) had a clear frontline: Democrats invoked the Demos in a bid to assert the rights of the poor to isigoria. Not merely to have a voice but, more importantly, to have a voice of equal weight.

That democracy survived for so long in classical Athens is an historical miracle. Never before (and possibly never since) had so large a percentage of poor labourers enjoyed such unprecedented direct decision making powers in matters of State. This influence kept Athenian democracy vibrant till the end. On the one hand the poor citizens, and their gentile supporters (such as Protagoras and Pericles), fought for its preservation. On the other, Aristocrats, who never accepted that their voice should have no more gravitas than that of a cobbler, fought for its diminution.[11] It all made for animated Assembly meetings and fascinating debates in the Agora.

The question is: How did it come about? The brief answer is: Cleisthenis’ reforms[12] extended citizenship to the Attica countryside, breached the State-community and fashioned a civic identity which was made quite independent from ‘birth rights’ (social class, that is). In short, the Demos was born.[13] How did it differ from that which angloceltic liberals refer to as The People? In contemporary liberal circles The People are imagined as an abstract, disaggregated collection of private individuals; individuals defined by: (A) preferences, passions, instrumental rationality,[14] and (B) rights designed to protect them from the arbitrary rule of the State.

In sharp contrast, Cleisthenis’ Demos was imagined as the State itself; as an active community of citizens in which the political sphere, the economy, the State and civil society all co-existed within the Assembly: Democracy was about the Demos getting (physically) together and engaging in a contest of opinions about what ought to be done. The point of the exercise was not to stage a process whereby the rulers consult the people but one in which the people rule.[15]

We often forget that Athenian democrats saw no reason for constitutional rights whose purpose would be to shield civil society from State interference. In their eyes, the two were indistinguishable.[16] It is this coincidence of the political sphere with economic life, but also culture, military affairs etc. that made it possible for the Demos to exercise real power in shaping everyday life.

Candour demands that even the most enthusiastic apologists of contemporary Western democracies admit that the latter come much closer to Aristotle’s definition of oligarchy than to his depiction of democracy. There simply is not, at least according to Aristotle, enough Demos in our Democracy today. Put differently, even though Socrates would not have been poisoned by the British or French Parliaments for smuggling subversive ideas into the mind of the young (protected, thankfully, by an impressive panoply of juridical authority), our electorates (‘We, the People’ in the language of the American Constitution) exercise no power over daily life which might be comparable to that of Athenian citizens. Moreover, there is a deep sense in which the power actually exercised (by both citizens and their elected representatives) has been declining steadily with every twist and turn of our recent political history.[17]

Is it any great wonder that we are increasingly unwilling to put our energies into the political process? Is it surprising that a democratic process less redolent of a ruling Demos than of unaccountable oligarchy is ripe for neglect in the icy hands of apathy?

3.  Do We Want the Demos to Rule?

Even if the reader agrees that Athenian democracy is not to be scoffed at (as an historical juncture of momentous political importance), the natural rejoinder is: So what? Surely, industrial societies are too complex to be run by an Assembly of all citizens. Additionally it is perhaps a good thing that it is so, as Socrates’ fate testifies. Should e’democracy advocates take the direct democracy route, suggesting that ICTs are used to supplant representative government with an e’Assembly that will perform in cyberspace the functions of ancient Pnyka, they shall be laughed out of court.[18]

Although the legitimacy of e’democracy would undoubtedly suffer if it were co-opted by supporters of direct democracy, it is useful to establish the precise reasons for this. Why is direct democracy feared? Most people would agree (as noted in the previous paragraph) that there is nothing wrong with it in principle; that, ideally, it would be best; but that in large and complex societies, it is simply unworkable. I think this is quite right. But it is not the whole story as to why direct democracy is dismissed so readily.

Put bluntly, many qualms about direct people-rule are due to a deep-seeded mistrust of ‘common folk’. The ‘democratic elites’ are not keen to see the Demos rule the land. At best, their reluctance takes the form of concern for the minorities’ protection from the tyranny of the majority. At worst, it extends to pure scorn for the capacity of the multitude to know what is good and proper for them. In effect, some of the ancient arguments in favour of oligarchy (e.g. those of Plato) are embedded in the defence of today’s representative democracies. If this is right, the ‘distance’ between decision makers and the people is not an undesirable feature that crept up on our societies imperceptibly but, rather, a feature designed into our system of government in order to keep the plebs in their place. But is this right?

I believe that a fair reading of liberal democracy’s history confirms that this is so: That the devaluation of citizenship is an integral component of a ‘successful’ modern democracy; not a failure to be corrected by technical means (including the best ICT has to offer). If I am right, e’democracy has its work cut out for it! Effectively, e’democrats will be facing the task not simply of involving more people in deliberations regarding policy making but, more ambitiously, of deploying new technology as a part of a broader political intervention whose purpose is to re-invent the political sphere.

The previous paragraph contains a large claim (in italics), without which the verdict concerning e’democracy’s ambitious task is ill-supported. What is its basis in fact? The next section shall attempt to argue that liberal democracy has its roots, not in ancient Athens, but in feudal Europe, the Protestant/Puritan ethic, and the tumultuous rise of the merchant as the pivotal figure around whom the economic sphere gained autonomy and dominance over political society. The culmination of this ‘story’ is that the Demos’ low participation in the democratic process was an inevitable end-state of this particular historical trajectory. None of this is particularly novel. However, e’democrats must be kept in touch with these historical facts because they speak directly to some potential features of the apathy causing the crisis of contemporary liberal democracy.

4. Apathy as a Design Feature of Liberal Democracy

Students of political science are taught that modern democratic constitutions aim at correcting the arithmetical simplicities of an undifferentiated popular will; that the constitution of a genuinely liberal democracy ought to require virtue in neither the ruled nor the rulers.

Notice how ‘un-Athenian’ this line of thought is. Athenians thought that virtue is indispensable. Whether of an oligarchic political persuasion, or fanatical democrats, they agreed that no system of government could flourish without virtuous decision makers. Their differences simply centred on whether it is reasonable to expect the labouring multitude, the banausoi (as Aristotle called them), to be capable of the virtues needed by those who rule; whether political virtues can be learnt or not (recall the debate between Socrates and Protagoras in Plato’s Protagoras).

In our day and age, we tend to think of good laws (and constitutions) as the ones designed for wicked people (and unscrupulous politicians). Prudence is high on the agenda (for good reason, no doubt). However, there is more to our current stance than a prudential philosophical pessimism: Contemporary liberal democracies rely on a particular kind of pessimism regarding human nature; the kind that harks back to the Protestant Reformation.

The liberal democracies that e’democracy is meant to rescue from apathy have their roots not in ancient Athens but in constitutions of a Protestant (and, in the case of the USA, Puritan[19]) pedigree. A constitution is good, in this vein, if it exploits efficiently the ‘fallen nature of man’ (his selfishness and his propensity to put self-interest before the Common Will) in order to promote the broader social objectives of liberty, stability and prosperity. You can almost smell the polished pews, hear the thundering voice of the Protestant preacher. And if you are a student of political economy, the image will come to you of Adam Smith’s invisible hand, working supra-intentionally behind the self-interested merchants’ backs, pushing prices down, quantities through the roof, and thus procuring the Common Good against the mean merchants’ private Will.

This is of more than just philosophical interest. For here is an important lesson for those who fret over the decline of participation in political processes: For if the good constitution is the one meant to run as if on automatic pilot, just like a market is meant to organise economic decisions spontaneously, there is clearly no reason why The People should be involved in politics. And, therefore, there is no reason why we should worry about apathy and falling voter turnout. In fact, it might be better if none of us got involved in politics lest we mess up the well-crafted workings of an automated system of government! Borrowing a line from Adam Smith, the Common Good stands a much better chance of being served if no one is actively trying to serve it![20]

The above, some might argue, is of no more than academic interest. Perhaps. But it is still interesting to note that the political philosophy preceding the establishment of democratic constitutions not only had few qualms with a politically passive multitude but, in fact, positively favoured passivity, even apathy. Did things change as liberalism began to embrace the notion of representative democracy? Did the new spirit of accountability to the citizen infuse a great urgency for active citizenship? Not really.

Americans are right in thinking that representative democracy is an American invention. English protests (to the effect that the House of Commons is the mother of all modern parliaments) are thwarted by the fact that the victory of Parliament, though important for many other reasons, was not a victory for representative democracy. Even the English Whigs saw Parliament’s victory as a welcome defeat of democracy.[21] The American Revolution had stirred up too great a popular demand for universal franchise (at least for white men!) to be ignored by the new constitution. The latter signified a profound break with what had gone on before it and its opening line “We, the People…“ captured the radical idea that legitimacy comes from a single source: free citizens (as opposed to loyal subjects).

Nonetheless, it is not at all clear that the invocation of the People was intended to empower them. Morgan (1988), for instance, argues that the Founding Fathers invented the idea of the American People, and of their ‘sovereignty’, as a means of imposing upon them a stable government over which the People would have no direct control. Though representatives were to be elected, the Federalists were particularly wary of a ruling Demos. Indeed some of their texts could have been written by Plato (or some of his anti-democratic disciples). The multitude was to stay out of political deliberation and be contented that they are represented in Congress by their social superiors. Who were these to be? Unlike Plato who thought that the ideal Republic ought to be run by the philosophers, the Federalists had another category in mind: The merchants.[22]

Meanwhile, on the other side of the Atlantic even the most progressive Whigs, including those who were profoundly influenced by the democratic gains in America, were sceptical about democracy. J.S. Mill, for instance, thought that the gentiles should have more votes than the cobblers and the masons, and that they should run the state on the latter’s behalf. The liberal spirit was therefore constitutionally at odds with the dangerous idea of Demos-rule.[23] Apathy was fine, as long as the authority of socially superior representatives was consented to by their ‘inferiors’. Impressed by a Newtonian view of the social universe, as one guided through the providential hand of market forces and Common Law, 18th and 19th century liberals celebrated the creation of a social order in which a passive people enjoy citizenship rights (and protections) and legitimised, through their consent, a form of enlightened oligarchy.

Seen from this perspective, is it not the case that voter-apathy was designed into our liberal democracies at their inception?

5. Freedom from What?

When designing policies (including e’democracy projects) to combat apathy, it may help to know what we are up against. For if democracy’s woes are repercussions of systemic features, the remedies will be effective only to the extent that they reach deeply into the roots of the systemic problem. So, what is the problem? It is, I wish to claim here, that our system of government is fundamentally oligarchic in nature, with add-on provisions for legitimising the oligarch’s authority through periodic endorsements by a passive electorate. Against this background, e’democracy is now being called upon to turn the latter into an active Demos. Can it do this without changing quite radically the character of liberal democracy in the process? Without clashing with well-entrenched vested interests?[24]

Magna Carta, the defining document to which the West turns when in search of its political and legislative ancestry, was not about fashioning an Athenian-style masterless Demos: It was about entrenching the rights of masters vis-à-vis the Monarch. Its purpose was to give them, the lords and masters, the freedom to do as they pleased with their property, their servants and their slaves. Echoes of Magna Carta could be heard even in post-revolutionary America and they may resolve the puzzle of how, in the US, the loudest voices for liberty came from slave-owners.[25]

The divide between lords and their subjects was essential in defining the lords’ freedom from the Crown. Note the difference and the similarity with ancient Athens: Just as the Athenian labourer’s citizenship (a great source of empowerment for him) was defined in juxtaposition to the slaves’ (and the women’s) unfreedom, similarly the medieval lords’ freedom was defined in terms of their ‘ownership’ of their servants (and their servants’ output). This is the similarity. The difference was that, whereas in Athens genuine freedom was extended (to Plato’s consternation) to a large class of poor, propertyless labourers, the freedom procured by the Magna Carta, and later (1688) by the Glorious Revolution, was reserved for the masters exclusively.

Later on, and as the dawn of the Enlightenment was approaching, republicanism beefed up demands for a more widespread form of freedom. Classical republicanism (e.g. Algemon Sidney, Henry Neville, James Harrington) imagined a new society in which active citizens would work toward the Common Good (see Skinner, 1997). But even these radical visionaries had no plans for Demo-cracy; for they made it abundantly clear that their active citizen would be no labourer. Indeed that he would be a man who does not have to work for others.

By the time the American Colonies rebelled against the English Crown, and the notion of a sovereign American People became the touchstone of the Republic, commercial society had already won many victories against the idle aristocracy. The protestant ethic had entrenched the glorification of work in general and of trading for the common good in particular. The man who does not have to work for others (see previous paragraph) gave his place on the Republican Pantheon to the merchant. In this light, the fledgling republic was to be built up through the hard work of the multitude,[26] legitimised by their consent, and ruled by the merchants (that is, by those whose social location allowed them to sell more than just their own labour).

In ancient Athens, many working citizens (e.g. free peasants) were free not only in the sense that they were not slaves but also in that they were not obliged to enter specific labour markets (i.e. free from having to work for someone else, courtesy of their small plots of land which provided them with the basics of life).[27] Even those who did work for others had an equal say in matters of State in the Assembly. This ‘say’ (their citizenship) equipped them with a powerful shield with which they could protect themselves from the rich and powerful (and which was the object of much aristocratic consternation).

In contrast, in the loci of early liberal societies (e.g. the US and Britain) the working multitude had no alternative but to work for others unprotected by direct access to decision-making. The Enclosures denied British peasants access to any means of reproducing their lives unless they went through some merchant (who also enjoyed privileged access to Parliament). In the US, the labouring classes found themselves attached to a rapidly shifting set of property rules which led to increasing concentration of land and capital in the hands of a specific social class comprising inspired merchants and, famously, the so-called Robber Barons.

The modern era was arguably marked by this great transformation: Labourers became formally free to choose whom they worked for, free from all access to arable land, but unfree not to work for someone. Simultaneously merchants became free from labourers (e.g. they did not have to house them, as feudal lords had to do in the past) and could simply rent out their labour.

In this new context, it became suddenly possible to extend citizenship rights (including the franchise) to the many without changing anything.[28] The fact that the peasants no longer had conventional rights to land-access meant that there was no longer a socio-economic need to maintain a sharp juridical and political division between rulers and peasants. It became possible (and therefore inevitable, in view of the great legitimising effect of such a change) to extend citizenship rights to them all (at least to all white men). Had such an extension to juridical rights occurred under feudalism, the feudal lords would lose all their power over the peasantry.[29] The key to understanding how liberal democracies surfaced is to see that, while citizenship was no longer restricted (to the few), the scope of citizenship rights (and democratic power) was severely circumscribed. On the one hand, the economic sphere steadily gained effective independence from political power. And on the other hand, whatever political power was left over economic life, it was practised by office holders who rose through the merchant and professional classes.

The historical tone of the above may strike the modern reader as an irrelevance regarding the problems facing representative democracy (and e’democrats) today. This would be, I submit, a mistake. Take for instance modern South Africa. After the glorious defeat of Apartheid, the hopes that the black majority had invested in the democratic process (for greater prosperity for the vast majority who were, courtesy of Apartheid, caught in the clutches of poverty and disease) began to fizzle out. Blacks fought tooth and nail against Apartheid, hoping that full citizenship would empower them not only politically but also economically. They are currently finding out (in a cruel manner) that citizenship, for all its undeniable moral and psychological worth, means little in a socio-economic system where asymmetrical economic power has replaced political and juridical privileges.

The South African experience is quite vivid because the extension of citizenship rights to all is so recent. However the underlying argument is pertinent all over the globe. Singaporean workers have no real political freedoms (e.g. no free press). Their citizenship is curtailed by an oppressive regime which promotes energetically a buzzing commercial society, while at the same time denying its citizens political rights. Compared to India, where liberal democratic rights abound, it is unclear whether the average Singaporean has less control over matters of State (affecting daily life) than the average Indian.

In conclusion, the ‘free world’, a term we often use interchangeably with ‘Western Liberal Democracies’, is free only in a limited sense: Citizenship (including formal liberties) is distributed liberally to all citizens but its reach is confined to a small political sphere; a sphere which is increasingly losing out to a separate economic sphere where all the capacities to change people’s lives (for better or for worse) congregate but where citizenship is irrelevant.[30]

If the above is not wrong, the reason for growing apathy has been rationalised: Labouring citizens are coming to the conclusion, in ever greater numbers, that

a)    political institutions were designed for and by employers (i.e. merchants who did not have to labour for someone else), and

b)    wrestling political institutions from employers’ hands is a Pyrhic victory, and thus not worth the trouble, since power has shifted elsewhere.

The repercussion for e’democracy is clear: So far the debate is focussing on (A); that is, on how political institutions can be opened up to the multitude. This is, naturally, a legitimate objective for e’democrats which can be met fairly easily through the deployment of appropriate technologies. The preceding analysis adds two wrinkles to received wisdom:

First, (the point made earlier in Section 4 above) the exclusion of the multitude from political debates and institutions may be more than a failure; it may well be a design feature of our system of government (in which case resistance to e’democracy’s attempts to bring the masses into these debates and institutions will be much fiercer than expected [Yves: as the coordinated 17-city paramilitary crackdown on Occupy Wall Street attests]).

Secondly, e’democracy ought to aim at much more than simply to enable citizens to enter the political sphere: It should aim at helping the political sphere to wrestle importance and power away from the economic sphere. And this is the rub. For what I am suggesting here is that e’democracy’s work will have been done only if (and when) it succeeds at elevating the status of the labouring citizen for the first time to a level comparable with the free-labourers of ancient Athens.[31] In short, e’democracy cannot do without a framework for producing goods and services along the lines of participatory, self-managed enterprises.

6. Conclusion: The Prospects of Demos-Rule in our Post-2008 World

David Hume was intrigued by the ease with which a small minority manage to control the majority. He attributed that feat to ‘opinion’.[32] Extensive citizenship and the notion of popular sovereignty was the ‘opinion’ which legitimised liberal democracies and sustained the right of elites to monopolise decision making in the context of a parliamentary oligarchy. However, as the economic sphere (the social relations of production of goods and services) became increasingly autonomous from politics (and the latter exercised decreasing power over the former), political goods (including the worth of the right to vote) were devalued. A crisis of legitimacy ensued of which low voter turnouts are mere symptoms.

In large, complex societies where citizenship rights are widespread, representative democracy (inter-mediated by Internet-based means) is inevitable. But for people-rule to make a comeback, we need to subvert ‘opinions’ which maintain the rule of the few and cultivate, instead, opinion-forming systems which permit the rule-of-the-many. With economic power largely residing outside the sphere of politics, and immune to the democratic process, this was always a tall order for liberal democracies. Since 2008, when the financial collapse triggered a sequence of political interventions in the name of The People but for the benefit of the financiers whose behaviour had triggered the collapse, economic power shifted further away from the realm of political decision-making. In this sense, our post-2008 world is typified by a stark contradiction: Never before has democracy been needed more to stabilise financialised capitalism while, simultaneouly, being less possible given the success of the masters’ of the economic sphere to keep it outside the realm of political control.

In this context, the notion that the democratic deficit can be dealt with by some technological fix (i.e. some variant of e’democracy) is absurd. The Internet has granted the weaker and poorer their personal Speaker’s Corner within cyberspace but has not created an e’Assembly in which they can over-rule the powerful minority who control the economic sphere. An e’Mob has been created, even an e’Demos. But it has not been admitted into anything resembling a genuine e’Democracy.

Granted that e’Democracy is impossible now, could it become possible in the future? And if so, under what conditions? To materialise, e’democracy must help breach the two-century old divide between political and economic power by introducing direct political control of the production and distribution processes at the micro level; at the level of the enterprise. Is something like this possible? No and yes.

  • No, because it is hard to imagine that the Internet can break down the monopoly of capital’s power over labour in societies where labour is chronically under-employed due to the structural failures of existing ologopolistic capitalism.
  • Yes, because the Internet (and related technologies) can, potentially, break down the foundation of existing oligopolistic capitalism, precisely as the steam-engine spelled the end of feudal production and distribution processes.

In conclusion, this paper argued that the Internet’s democratising potential is understood best through an historical re-evaluation of democracy’s inner contradictions. Ancient Athens was characterised by such a delicious contradiction: the slaves’ unfreedom was pivotal in making citizenship particularly valuable for the free labourers.[33] Their actual freedom depended on other people’s slavery. In modern times, citizenship and formal freedom are widespread but highly devalued. This devaluation partly explains why citizenship was spread so liberally around and, at once, foreshadowed voter apathy and the diminution of the political sphere. The burning question is: Can citizenship be simultaneously widespread and valuable?

The good news is that it can. The bad news is that for citizenship to be simultaneouly widespread and valuable, the political sphere must claw back much of the authority that it has lost to the economic sphere; first at the time of the Enclosures and, more recently, after the 2008 debacle. None of that ‘clawing back’ will result automatically from our splendid connectivity through Twitter, Facebook and various other Apps and Internet resources. They may give us voice but they will not grant us isegoria. To create isegoria, and thus to empower citizens broadly, our ‘connected’ social economy must not only allow rulers and citizens to communicate but should also feature multiple networks enabling consumers, labourers and innovators to form units of production which create and distribute value in a participatory manner; in a manner such that no one employs anyone and everyone contributes labour and ideas while being rewarded according to contribution but also need.

Of course this requires nothing short of a revolution in the foundations of capitalist production. It will not happen through idle chatter in the social media. If it happens, it will occur as the Internet undermines the currently dominant corporate model which relies on the segregation between non-labouring shareholders and labouring non-owners. Only when the capitalist type of firm loses its ‘evolutionary fitness’, due to technological Internet-based innovations, and gives its place to a new type of participatory production model, will the political and the economic sphere become integrated again in a manner consistent with democratic principles. Then e’democracy may be born as our e’Demos reclaims control of the economic sphere.


Coleman, S. (2003) and John Gotze (2003). ‘Bowling Together: Online public engagement in policy deliberation’, London: Hansard Society

Coleman, S. (2004). TO VIMA (newspaper interview), 17th April 2004 (in Greek)

Condorcet, J.A.(1795,1979). Sketch for a History for the Progress of the Human Mind, Connecticut: Hyperion Press

De Ste Croix, G.E.M. (1981). The Class Struggle in the Ancient Greek World, London

Finley, M.I (1980). Ancient Slavery and Modern Ideology, London

Morgan, E.S. (1988). Inventing the People: The rise of popular sovereignty in England and America, New York: Norton

Morone, J. (2003). Hellfire Nation: The politics of sin in American history, Yale University Press

Ringen, S. (2004). ‘Wealth and Decay’, Times Literary Supplement, 13th February issue

Skinner Q. (1997). Liberty before Liberalism, Cambridge University Press

Smith, A. (1776), An Inquiry into the Nature and Causes of the Wealth of Nations, Oxford: Clarendon Press (1976)

Varoufakis, G. (1996). Quality in Ancient Greece, Athens: Aiolos

Varoufakis, Y. (1998). Foundations of Economics: A beginner’s companion, London and New York: Routledge

Wilde, O. (2000). The Complete Letters of Oscar Wilde, edited by M. Holland and R. Hart-Davis, Fourth Estate

Wood, E.M. (1988). Peasant-Citizen and Slave: The Foundations of Athenian Democracy, London


[1] The original paper was authored on behalf of access2democracy, an organisation in which I participated that championed ‘e’democracy solutions’ in Europe and internationally. The paper was, in essence, a critique of these ambitions.
[2] War and commerce were always better than emancipatory political projects at tapping into technological innovation.
[3] Information and Computer Technologies.
[4] As a Greek I am loath to delve into ancient Greek history, in the context of a modern debate, lest I am seen to indulge ancestral worshipping in a bid to embellish my views with unearned authority. However, it is imperative to position the present debate in a broader historical context (which begins with Cleisthenis’ reforms and then moves to the roots of liberal democracies in feudal conflicts.)
[5] Less well known is the fact that, initially, it was a term of abuse invented by Athenian anti-democrats; a term which today would come closer in meaning to ‘mob-rule’. Later on, democrats (e.g. Pericles) adopted the term thus emptying it of its negative connotation and bathing it in adulatory light (especially in his famous Epitaph speech in which Pericles invokes the principles of Athenian democracy in order to praise Athenians who fell in the Peloponnesian War).
[6] The ideology of participation extended to their view of poetry and the arts: Εν μέτρω ως ποιητής, άνευ μέτρου ως ιδιώτης. (In rhyme/good-measure as a poet. Without it as a privateer/idiot.)
[7] Notice that isigoria is in a sense the very opposite of consultation.
[8] Slave labour was exclusively used in only two areas of economic activity: The silver mines of Lavreion and domestic labour. See Osborne (1985)
[9] Some of the most important functions of the State were performed by slaves whose position was the closest Athens had to senior civil servants. E.g. they acted as bankers, tested foreign and domestic currency for their metal content, acted as quality controllers for imported merchandise. See Varoufakis (1996).
[10] In contrast, Aristotle defines oligarchy as a constitution in which “the rich and better born control the government; being at the same time a minority”.
[11] Often crossing into treachery, as they sided with enemies of Athens (e.g. the oligarchic Spartans) to rid themselves of the scourge of mob-rule (democracy).
[12] The main motivation behind such reforms was, arguably, the need to bring about an alliance of the different social classes in the face of serious external threats – e.g. the impending Persian onslaught.
[13] A nice symbolism of the major change brought about by the Cleisthenis and Solon reforms was the change in the conventions of second names. Citizens acquired a Demotikon; that a surname reflecting their local Deme (municipality), rather than the paternal name. They escaped the vagaries of patriarchy and inheritance and belonged to the local Deme/Demos.
[14] As I have expanded on this elsewhere (see Varoufakis, 1998, Chapters 3&4), I shall refrain from saying more on the liberal notion of the individual.
[15] Thus the Demos are not merely The People. The are The Ruling People. To make this point more sharply, it is useful to recall that Athenians avoided elections. Indeed elections were thought of as oligarchic in the sense that they favoured the gnorimoi (the well known) thus giving inordinate power not to solid arguments but to social status. Only positions in which technical expertise was necessary (e.g. Chief Architect or Stratigos, commander of the armed forces) were distributed by elections. The rest were decided by lotteries, leaving matters to the goddess Tyche  (meaning Luck, an illegitimate daughter of Zeus) 
[16] Hegel’s Gemeinschaft and Gesellschaft  were one and the same and ’lived’ in the Assembly.
[17] The recent creed that monetary policy cannot be entrusted to elected representatives (let alone the Demos) is but the tip of a gargantuan iceberg. The real depreciation of political goods has to do with the steady loss of authority on the part of nation states, with no parallel empowerment of democratic institutions at a supra-national level (e.g. the EU).
[18] S. Coleman makes this point forcefully (see Coleman and Gotze, 2003): “Indeed, one of the reasons for promoting e-democracy is to strengthen representative structures so that the allure of ‘technopopulism’ remains resistible.”
[19] See Morone (2003).
[20] Referring to the merchant, Adam Smith wrote (in his Wealth of Nations, 1776): “By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good.” (Emphasis added.)
[21] When Cromwell’s comrades in arms demanded, following the elimination of the monarchy during the English Civil War, that they should be given the vote, Cromwell turned them down angrily. He thought they had won enough: The right to be ruled by constitutional government and a Parliament of their superiors, rather than be subject to the arbitrary rule of one man.
[22] The plebs (e.g. workers, mechanics; i.e. Aristotle’s banausoi) “…are sensible that their habits in life have not been such as to give them those acquired endowments without which, in a deliberative assembly, the greatest natural abilities are for the most part useless… We must therefore consider merchants as the natural representatives of all these classes in the community.” Alexander Hamilton, Federalist, No.35 (emphasis added).
[23] As the following extract from a speech in Parliament reveals, Mill thought of representative democracy as an efficient means of appeasing and pacifying the multitude. This is quite different from putting the many in the driving seat (which is, arguably, the point of democracy): “It has often been noticed how readily in a free country people resign themselves even to the refusal of what they ask, when everything which they would have said for themselves has been said by someone in the course of a discussion. The working classes have never had this tranquillising assurance.” J.S. Mill, Speech in the House of Commons, April 1866 (J.S. Mill and H. Taylor Archive, LSE Library, Vol. XLV). In another speech he outlined the representatives’ qualities: “I demand that all those who exercise power should have the burden laid on them of knowing something of the things which they have power over.” J.S. Mill, Speech in the House of Commons, 20 May 1867 (J.S. Mill and H. Taylor Archive, LSE Library, Vol. XLV) Notice that this is utterly consistent with a passive multitude and an ruling aristocracy whose qualification for running the state is that they are knowledgeable over the things they have power over.
[24] I ask this because, while reading some of the e’democracy literature, I got the disconcerting impression that a substantial proportion of e’democrats write as if the rest of the world is eager and ready to applaud the handing over of more power to more people, through new technologies, if that is what it takes to dust of the cobwebs of apathy from our foundering democracies. Such delusion will not get us far.
[25] The man who wrote that “commerce between master and slave is despotism”, Thomas Jefferson, did not even free his slaves in his will. Oscar Wilde, upon visiting the US, wrote back with his usual ironical turn of phrase: “In a free country no one can live without a slave.” (1881)
[26] It might help to note that, with the coming of industrial society, the status of manual labour was diminished by the transition from artisan work to production lines.
[27] Additionally, they voted in legislation for the provision of free theatre tickets for citizens who could not attend the competition amongst the great dramaturges.
[28] It was indeed an early 20th century British suffragette who coined the phrase: If democracy could change anything it would have been banned.
[29] The reason being that peasants already had access to land and other productive means. If they also acquired rights and political autonomy, the Lords would forfeit their capacity to extract part of the surplus from them
[30] This is not dissimilar, at some level, to the observation that as women move into certain professions, after decades of struggle, these professions lose their social status (e.g. teaching).
[31] This is not a call for returning to ancient Athens. In ancient Athens the privileges of citizenship enjoyed by the free labourer could not have been spread to women, metics and slaves without the collapse of the ruling order. It is the task of modern democracies to combine a form of citizenship which is wide in its distribution (as we experience currently in liberal democracies) and great in its scope (as it was in ancient Athens).
[32] In 1795 Cordocet wrote that “force cannot, like opinion, endure for long unless the tyrant extends his empire far enough afield to hide from the people, whom he divides and rules, the secret being that real power lies not with the oppressors but with the oppressed.”

[33] Valuable in the sense that it gave them protection from those who wanted to make them do things they would rather not do.

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  1. j gibbs

    One of the persistent myths about American government is that things used to be better here. The reality is that things have always been next to impossible for ordinary people lacking the right connections, the right job, the right parents, etc. Why does this myth persist? Because we all get 12 years of schooling in which there is drummed into us every day how wonderful things are here and how lucky we are and how valuable our rights as citizens are. I remember going through this myself in the Fifties, and waking up in 1965 to realize that my government was insane and was determined to ship me to Southeast Asia for target practice in which I was scheduled to be a target.

    Catch 22 is only incidentally a funny book. In essence, it is a true book. Individual people have to wake up and realize they are on their own and their only chance is self development and fast footwork. Our society is really about survival of the fittest in a world of corrupt institutions Hell bent on grinding up everyone who is on the outside, while pampering and enriching those on the inside. Good luck to all.

    I suppose this is off the point of the main post, but I wasn’t too clear on what the point actually was. I mean after two hundred plus years of Representative Plutocracy, how can anybody with a sense of history expect anything but more of the same? You might as well try to reorganize a Pigeon Circus to write Scripture in the clouds.

  2. JLCampos

    It is a common place that the invention of the movable type provoked the Reformation. Another common place is that the taming of steam changed the social morphology of the world. I am sure that the electronic development will produce a change, a change that I am unaware of perhaps because its gross resulting features are not logically organized yet.
    What would happen is impossible to guess but there is this certainty that the organization at that time will be the only possible and will be actually the best possible.
    Whether I like it or not is irrelevant.
    Varoufakis jumps from Athens to the Anglo Saxon powers ignoring everything in between, the Romans Roman law Canon law, the Muslims, the Chinese, in a word everything restricting his views to the British archipelago and its avatars.

  3. JEHR

    What a wonderful analysis! I was inspired to send the link to the leaders of our three parties in Canada as follows:
    “The link below is a very important essay that deserves reading (and re-reading). It analyzes the very bases of the origin of our democracy and talks about how the oligarchic nature of our present democratic institutions was build into the the forms of democracy that we have today (i.e., neoliberalism and the oligarchical nature of our governments with its apathic voters). It is a very important analysis:


    Quotation from Varoufakis’s paper:

    ‘In large, complex societies where citizenship rights are widespread, representative democracy (inter-mediated by Internet-based means) is inevitable. But for people-rule to make a comeback, we need to subvert ‘opinions’ which maintain the rule of the few and cultivate, instead, opinion-forming systems which permit the rule-of-the-many. With economic power largely residing outside the sphere of politics, and immune to the democratic process, this was always a tall order for liberal democracies. Since 2008, when the financial collapse triggered a sequence of political interventions in the name of The People but for the benefit of the financiers whose behaviour had triggered the collapse, economic power shifted further away from the realm of political decision-making. In this sense, our post-2008 world is typified by a stark contradiction: Never before has democracy been needed more to stabilise financialised capitalism while, simultaneouly, being less possible given the success of the masters’ of the economic sphere to keep it outside the realm of political control.’

    “When we consider that we, in Canada, have an economist leading OUR oligarchic government, the idea that it is necessary for politicians to control the predatory economic forces of our democracy becomes blatantly problematic.”

  4. sufferin' succotash

    A certain amount of jumping around is inevitable, but V. could have briefly discussed the Roman Republic, partly because it may have had an even greater impact than Athenian democracy on political thought in the Western world.
    It’s not clear from the essay how Protestant-engendered guilt feelings affected early modern and modern political thought. The concept of Original Sin is common to Protestantism and Catholicism. The Protestant Reformations and the subsequent wars of religion did promote the notion of resistance to tyranny (not a new idea but one that was effectively reinvented during the 16th century). In addition, Calvinism with its stress on grass-roots church organization did encourage the idea that the congregation (“common herd”) could and should share in the business of governing.
    One thing about Hamilton: he certainly made no secret about his preference for oligarchy. One only has to change his “merchants” to “bankers” to bring him up to date. In fact, even that might not be necessary because in the late 18th century merchants and bankers were often synonymous. It was “no accident”, as the Marxists used to say, that Hamilton also authored that first attempt at financial oligarchy: The Bank of the United States.

    1. Banger

      Hamilton was very different from the current oligarchs. He believed the U.S. Was in a very vulnerable position and needed a government with a strong central authority both in military and economic matters to avoid the interference of then Great Powers of that time. He was also interested in the people and their ability to prosper unlike the leaders of our oligarch class who see themselves as a separate country.

      1. sufferin' succotash

        Full disclosure: my opinion of Hamilton is like John Adams’: he was a would-be Caesar in a buff-and-blue uniform instead of a toga. Undoubtedly Hamilton had–personal ambitions aside–the interests of the nation at heart. He was also convinced that those interests would best be served by creating a mercantile/financial elite. What would be good for the BUS and its shareholders would be good for the USA. At the time it seemed like a good idea because in 1790 there were only three banks in the entire USA and the nation’s financial capital was still London. Financial interests and patriotic sentiment were seemingly pushing on the same wheel. As you pointed out, that’s no longer the case.

  5. F. Beard

    Capitalism is already democratic, at least per share. Government-backed banks are NOT democratic (they violate Equal Protection Under the Law in favor of the rich) and have made common stock companies LESS democratic by precluding the necessity to issue more shares to finance investment and even by financing stock buy-backs.

    1. diptherio

      Democracy, from demos, meaning people. Capitalism isn’t “dollar democracy” or “share democracy”; such formulations are oxymoronic. What you mean to say is that capitalism is share-ocracy (or perhaps stockocracy?).

      1. F. Beard

        Large companies WOULD be broadly owned and thus broadly democratic IF we had not had government privileges, including implict ones such as the lack of a Postal Savings Service, for the banks.

        So let’s get to redistributing their common stock equally, eh? Except none to skippy and other naysayers.

  6. Lafayette


    YV: Primarily, it requires political institutions that enable the economically weak to have a decisive say on policy against the interests of the rich and powerful.

    Is it not a matter of “how democracy is practiced”? It is extremely difficult to extract just one area of concern from the many that may present a challenge to any democracy. However principal that area may be – and given the recent cupidity of Wall Street bankers, their transgressions are awesome to behold.

    Of course, given that the US is the worst in terms of Income Disparity and given that it exalts Capitalism for having been the prime-genitor of great wealth, it is not a negligible issue for most Americans. Rather, though it should be, in the generalized political apathy, it has yet to become one.

    I would suggest that we seek a way to surmount a politically somnambulant American electorate. If that would happen, perhaps even the grassroots could be awakened by the economic rip-off being conducted by the comparatively few against the many.

    I will remind you of the present Income Disparity calamity by reprinting here the results of a study performed by the Paris School of Economics of World Top Incomes Database (accessible here) for the US. The Global World Top Income Database at the Paris School of Economics demonstrates clearly that the share of Total Income of the Top 10% of American households increased from 31.5% to 46.3% over the past five decades up to 2000:
    1960 – 33.8%
    1970 – 31.5%
    1980 – 32.9%
    1990 – 38.8%
    2000 – 43.1%
    2010 – 46.3

    In 2012, the TenPercenters reached a figure of 52%!

    What must be done is evident. The top level Tax Rates must be put back to above where they were before Reckless Ronnie’s administration tore them down in the 1980s, which triggered the runup in riches as the above numbers demonstrate so well.

    But where does that political will come from? Not presently from grassroots America, which cannot seem to digest such facts. That class remains in a foreclosed stupor prompted by the present economic morosity.

    We need a good schoolteacher to get that point across, not a total reformation of the democratic process in the US. Were that “teacher” to exist on the political landscape, regardless of the funds that the OnePercenters throw at politicians in order to maintain the political status-quo, the grassroots will rally to the cause.

    If we look to Europe, which has constructed its Social Democracy painstakingly over the past 70 years since WW2, it takes a lot of teaching and a lot of time. Estabmlishing Social Justice & Fairness cannot be done overnight, for sure.

    But when do we get started on that long-learning process? Zat iz ze $64,000 kwetchun.

    1. financial matters

      Great article and discussion.

      Interesting dollar amount to come up with. ;) Keynes’ idea of ‘enoughnous’ was about $66,000/yr. Daniel Kahneman came up with a similar conclusion “Below an income of … $60,000 a year, people are unhappy, and they get progressively unhappier the poorer they get. Above that, we get an absolutely flat line. … Money does not buy you experiential happiness, but lack of money certainly buys you misery.” The current minimum wage is around $14,500 and a proposed living wage of double that would be around $29,000.

      1. financial matters

        Robert Skidelsky in ‘Keynes: The Return of the Master’ (2010) extrapolated Keynes’ enoughness to todays value.

      2. Wayne Reynolds

        Would that $60,000 income be personal income as opposed to household income? A vast difference there, methinks?

        1. Lafayette

          The household income median presently for the US is about $52K (see info-graphic here.)

          So, the US is not that far off the mark. The question is, therefore, why are so many people complaining? Frankly, we need an analysis of “Why people are not content with their lot in life in this Greatest Democracy on Earth?”

          That might shed some light on the matter. But, it will do nothing to address the malignant problem of Income Disparity. Only reformation of taxation can repair that damage done since Reckless Ronnie’s hatchet-job on upper income taxation in the 1980s.

          Yes, America needs to reward personal initiative and risk-taking – both essential ingredients to any dynamic economy. In that manner, yes again, it will create millionaires as a consequences. But, does America really ‘n truly need billionaires who have far more Net Worth than they know what to do with?

          I put that question since it is a matter of “utility”. As were most questions that political economists of the 19th century debated. In the US, that debate never really occurred – even after the riots (and deaths) at the turn of the 20th century.

          We still seem to think that “the sky’s the limit” and no cap should be put on the accumulation of riches. Regardless of the amount, because we have no Common Sense Notion as regards Social Justice. (Meaning not “equal” total incomes, but “equitability” in the distribution of total income.)

          Great Income Disparity is unconscionable in any nation – and in the US it is the worst of any developed country. (See Gini Index here.) Because it means that at the other end of the scale people are incarcerated below the Poverty Threshold. At present the percentage is 15% of all American men, women and children.

          That’s about 50 million of fellow Americans – about the size of the states of California and Illinois combined …

          1. Minor Heretic

            “The question is, therefore, why are so many people complaining?”

            Your nose was two feet below the surface of the water. Now it is only two inches below the surface. You are so much better off. Why are you complaining? What we call the poverty level is a ridiculously low number. Many who don’t meet that definition are still lacking some basics.

            Being below that threshold of prosperity brings up the inversion of a cliche: Money is Time. Citizens who aren’t quite making it are overworked, tired, stressed, distracted citizens. They lack the free time, spare mental capacity and extra energy to be politically engaged. Athenian society, economics, and expectations were such that laborers had the time and opportunity to spend hours participating in direct democracy. Good luck getting a two-job retail worker away from quotidian survival to participate in economic policy making.

            YV is right that personal economic sovereignty is the precursor to democracy.

        2. Lafayette

          Household Income is the typical determinant, since the family-unit is more important sociologically than the aggregate of “individuals”.

          (My opinion only …)

    2. Banger

      Such a “teacher” would be beaten down either in the way Nader was or the way MLK was. There is no chance that such a personage can come to the fore in the U.S.

  7. Lafayette

    EV: I hope this turns out to be so. But I fear that, as things stand, E’democracy is unprepared for the larger than life enemy at which it is asked to tilt.

    There is no force stronger than an idea whose time has come. That time came once before in the 18th century.

    Nowadays, after thirty years of wholesale pillaging of Finance Markets, perhaps America is prepared for yet another change? And what better change exists than to take the incentive out of earning hallucinatory wealth by taxing it? (We did that for the longest time, and America nonetheless made a bundle of millionaires. See the tax-rate history of the US here)

    The plutocrats will respond, “What happens is that the money and the clever people hightail it to other climates!” I wish them Godspeed!!! The sun will still rise in the east and set in the west, and America will still create riches for a select class of individuals. Normalcy in terms of the TenPercenter Class is back at around 30% of total revenues.

    And finally, we won’t know the outcome if we don’t try, will we … ?

  8. The Dork of Cork

    “None of that ‘clawing back’ will result automatically from our splendid connectivity through Twitter, Facebook and various other Apps and Internet resources. They may give us voice but they will not grant us isegoria. To create isegoria, and thus to empower citizens broadly, our ‘connected’ social economy must not only allow rulers and citizens to communicate but should also feature multiple networks enabling consumers, labourers and innovators to form units of production which create and distribute value in a participatory manner; in a manner such that no one employs anyone and everyone contributes labour and ideas while being rewarded according to contribution but also need.”

    The facebook Roboten are a product of a deflationary ecosystem – they cannot connect in a physical manner with those around them as they do not have access to enough energy credits.
    These Facebook roboten are not crofters with one foot in the land and the other in Industry – these people are living inside a facebook poorhouse.

    This is a long term project – most especially in the mercantile eurozone but also in the deficit Anglo countries which are on the receiving end if these mercantile products – not enough money is available for domestic economic or social life in either of these these bank infested extraction zones.

    This of course is not a recent thingie – the bankers always wish to create a deflation so that the energy use will flow into their conduit machines that service their clients.
    The problem is wether it was intentional or not to destroy society via scarcity policies be it bank credit slurry production which prevents the effective end use of energy or importing labour to maintain the rate of profit at the expense of energy use per capita they have done so in a spectacular manner.

    Mr. J. A. Hobson ” Democracy After the (Great)

    “Where the product of industry and commerce is so divided
    that wages are low while profits, interest, and rent are relatively
    high, the small purchasing power of the masses sets a limit
    on the home market for most staple commodities. The
    staple manufacturers, therefore, working with modern mechan-
    ical methods, that continually increase the pace of output,
    are in every country compelled to look more and more to
    export trade, and to hustle and compete for markets in the
    backward countries of the world. . . . Just as the home
    market was restricted by a distribution of wealth which left
    the mass of people with inadequate power to purchase and
    consume, while the minority who had the purchasing power
    either wanted to use it in other ways or to save it and apply
    it to an increased production which still further congested
    the home markets, so likewise with the world markets. . . .
    Closely linked with this practical limitation of the expansion
    of markets for goods is the limitation of profitable fields of
    investment. The limitation of home markets implies a
    corresponding limitation in the investment of fresh capital
    in the trades supplying these markets.”

    Dork – nearly 100 years later ~ a fantastically.accurate description of todays euro soviet.

    Local Deflation action since the 1970s ~ (as defined by a lack of currency to consume the local Industrial surplus) has caused the opposite reaction of facebook roboten – this growth in the personal computing story can be seen as a consequence of both the 1980s and todays deflation simply because people have nothing else to do.
    Technology is a tertiary thingie – infact this technological development in response to deflation can now be seen as a fantastic waste of time and resources.
    Although banks like to waste stuff so as to maintain their seat at the apex so when looked at from this angle the destruction of Europe has been a success.

    1. Lafayette

      but should also feature multiple networks enabling consumers, labourers and innovators to form units of production which create and distribute value in a participatory manner

      An approach to fairness would be a legal determination of who can share profits in a company and how much.

      For the moment, the corporate BoD Compensation Committees select the august few (and how much). BoD members are all cronies and know one another very well. They are all either 1Percenters or, at the very least, 10Percenters.

      Let’s presume though that a law existed by which:
      * On the BoD were at least two representatives elected by the company’s workforce.
      * After-tax profit-sharing had to be equitable (but not equal) amongst that workforce, that is, everybody from TopManagement down to the Shop-floor included and
      * A “rule” also existed that determined the equitable nature/value of the sharing.

      What law states that after-tax profits must be shared only amongst TopManagement?

      Such rules might go a long way in assuring that, at least, a company’s workforce – which also contributes to its success – is also rewarded for its contribution.

  9. human

    An Article V Convention is criminally overdue.

    I propose to outlaw consecutive elected terms and increase representation to at least ten times the current 435(535? though I am ambivalent about the continuation of such a supremely non-democratic institution such as the Senate) to begin to decentralize and distribute political influence. No artificial impediments are to be legislated for entrance to the electoral system other than reasonable numbers of petitioners. And, for deities sake, gerrymandering is to be made illegal. In this day and age, the problem is to be put to unbiased calculation of the shortest boudaries of a given number within a political district. I believe that current computers are capable of this /s.

  10. nwterry@gmail.com

    I’m afraid I find most of what Yanis says here rubbish, very much a shame as we no doubt share aspiration for ‘more power for the people’. I don’t think the Athenian Democracy worth much consideration and recommend Joseph Heller’s ‘Picture This’ so you can have a few smirks to inoculate against the general pretensions. Some of the intellectual ground can be found in Yves Schmell’s (2014) ‘Democracy Before Democracy’ in The International Political Science Review.
    ‘Was democracy invented by the Greeks to replace the anarchy and imperial rule characteristic of earlier Near Eastern societies? Although what was explicitly borrowed from antiquity by modern political thinkers looks Athenian, there was democracy before the polis. Egyptian and Mesopotamian politics relied on public debate and detailed voting procedures; countless assemblies convened at the thresholds of public buildings or city gates; disputed trials were submitted to superior courts; countervailing powers reminded leaders that justice was their responsibility. This was not full democracy, but the Greek version was not perfect either. In this article, “archeopolitics” is used to contrast this efficient form of pluralistic regime (“hypodemocracy”) with truly egalitarian ones (“hyperdemocracies”) and group interests’ polyarchies.’

    Anyone who has listened to primate ‘conversations’ knows politics is pre-human and even amongst insects we find consensus mechanisms. The democracy of an elite on the backs of slaves, or of people writing declarations of independence with a White House run by slaves serves only to remind us how easy it is to make false claims about freedom. The first election with universal suffrage in the UK was 1948 only a year after ‘we’ left Athens after Churchill’s vile intervention against our real Greek allies (an attempt to impose a chronic dictatorship of the rich), one that included bombing and strafing of working class areas. Churchill rather enjoyed turning guns on workers.

    I was brought up with clown stories about Magna Carta as the beginning of modern democracy. We also ‘learned’ the USA was the beacon. We need an honest history in order to work out how we would want to use new technology in creating democratic freedom for the individual. Such freedom, of course though we forget, involves obligations to others, freedom from socially approved epistemic authority and the acceptance of a balance of justice and law. This is a difficult system to model for programming. In most work like this we tend to break the whole into sub-systems we can manage.

    The key issue for a modern democracy is how we can make something local-global that prevents control by an elite class. The current system is clearly designed just for that elite control and still based in the same structures as early empire. Of course the Greeks didn’t invent slavery Yanis. Why would anyone want to claim this victory from the ants?

    I doubt democracy is what we really want to model anyway. It might just be a project like building the miniature Greek astrolabe found in a shipwreck. Making gears by chipping away as brass with a chisel might not be somewhere to start in an electronic world. Democracy may be fatally flawed even in ideal form, let alone the dross we have been taught about Athens, Magna Carta and Uncle Sam. There is no depth in this analysis, only appeal to out faction. We need some systems science. I will only mention the obvious sub-systems to design are the one that stops money taking over power, the one that stops majorities installing a dictatorship, the one that prevents knowledge being skewed by media control … and though I have to say many program designs do a lot of excluding one can see already we need to know a great deal on the life-cycle of democracies before thinking what IT can do. In stopping the rich taking over (elites usually extend to 15% and would probably include Athen’s sod busters), IT could let us know where money ends up and see money trails. We like to say in management information systems that equality of access should be king. In this sense IT is democratic, far more so than humans and this is the intractable problem of all MIS – control of the means of production and information. I doubt we have to go back to the Athens of genocide, almost constant war and reference to homosexual flirting and flute girls for the answer. Not that I’d mind the flirting, but honestly Yanis only flirts with what a democratic system might be here.

    1. Dan Kervick

      The key issue for a modern democracy is how we can make something local-global that prevents control by an elite class.

      That’s only the negative challenge for democracy: preventing oligarchy. But the positive challenge is creating effective systems of governance and social decision-making that in some way equally reflect the entire people.

      1. The Dork of Cork

        Democracy was /is a con job by the banks against the power of the (fiat) King.

        It gives you a illusion of having a piece of the action when in fact you are a tiny cog in their gigantic scarcity engine.
        its a illusion that is more easily seen in times of stress when the powers that be are prepared to do anything to transfer resources to the banks & corporations – thus the democratic gloves come off the Iron hand of corporatism.


      2. allcoppedout

        Good point Dan. The positive might come just by preventing oligarchy, though biologically they spring up again after being cut down.

    2. Alto Berto (@AltoBerto)

      “Of course the Greeks didn’t invent slavery Yanis. Why would anyone want to claim this victory from the ants?”

      LMFAO, one the stupidest things I’ve seen written by far. Yes, I am aware of the symbiotic relationships between ants and various organisms. By your definition I suppose we’ve “enslaved” vegetables. Crawl back into your humanities department and get back to the deconstructing of sexist participles.

  11. financial matters

    I think Joe Firestone offers some proposals along a similar line as Yanis. (I think the internet allows us to better take on Yanis’ footnote [32] In 1795 Cordocet wrote that “force cannot, like opinion, endure for long unless the tyrant extends his empire far enough afield to hide from the people, whom he divides and rules, the secret being that real power lies not with the oppressors but with the oppressed.”)

    Interestingly as well pointed out by Yanis we can’t count on our elected representatives to act in our best interest. But at least I think better alternatives are being well articulated which can be a starting point.


    How to Restore the Good Name of Government
    February 21, 2014
    By Joe Firestone

    “So, if something can be done in this area, it must be done by the President. There are four very important things he can do before the elections of 2014 that would help to restore some faith in Government and, as a by-product, at least tentative trust in the possibility that renewed Government deficit spending may help people.

    1. The President can re-institute the rule of law in the area of national security and secrecy by ending mass surveillance of the US population immediately, ceasing all investigations and attempts at prosecutions of journalists who have been trying to tell the public about the overreach of our intelligence agencies, beginning investigations and prosecutions of intelligence operatives who have broken existing laws in gathering intelligence, ending current prosecutions of whistle blowers, and issuing pardons for those who already have been tried, convicted, and jailed.

    2. The President can re-institute the rule of law in the area of FIRE sector control and mortgage frauds by beginning investigations and prosecutions of high level executives at too big to fail FIRE sector organizations who have committed fraud including those that caused the financial collapse of 2008, which, in turn, led to the Great Recession and the destruction of so much middle class wealth.

    These first two initiatives are supremely important because they will deliver a very visible presidential message that the Government is re-instituting honest government and a single system of law, which, in turn, will give people some reason to believe that renewed spending by the Government will be carried out honestly for the benefit of people, and not for the benefit of FIRE, health care, energy and other elite corporations. Giving people this is an essential step in restoring faith in additional spending, since from their point of view, it looks like the financial power of Government has been used to save big corporations and Wall Street and see to it that they prosper, while leaving working people and home owners to twist slowly in the economic winds of “the long depression” (Eskow’s memorable phrase). How can they believe that renewed spending will help them if they believe that the Government promising good results from new spending is a corrupt government, in the pocket of the 1% or perhaps even the 0.001%?”

    1. human

      This is simply wishful thinking in the hope of a savior.

      Recall that during this administration’s first months, when he implored us to “make” him do the right thing through a vetting process using change.org, the number one request was a return to “the rule of law” by holding criminal actors accountable. This was quickly ignored.

      Of course, you have to ask: Who’s law?

      I do feel that the thrust of V’s acknowledgement is that we have to do this ourselves. However change is accomplished. After all, “Democracy is not something governments do…”

      1. Brooklin Bridge

        This is simply wishful thinking in the hope of a savior.

        Right. It’s a very good list, but not one we will see happen.

  12. William Neil

    Bravo to Yanis for writing this and in homing in on so many key dilemmas and Yves for posting it. It is not an easy ready, but well worth it. It parallels my own readings in M.I. Finley, but seems to focus more on “Ancient Slavery and Modern Ideology,” which I haven’t gotten to, than “Democracy Ancient and Modern” and “The Ancient Economy,” which I have. I would say as a direct connection, though, between these books, and the tensions between ancient democracy and the modern economy, the relationship between “citizen rights” and economic rights under capitalism, you have to add in Karl Polanyi’s “The Great Transformation” from 1944. And there is a connection between Polanyi and M.I. Finley’s work at Columbia University over “embeddedness,” the degree to which economics dominates the values of a society or to which the economic rules take a back seat to broader societal ethical norms which preceded the emergence of capitalism, a judgment and discussion which is at the core of Finley’s “The Ancient Economy.” (And he sides with Polanyi.)
    On the whole, I disagree only in minor matters with this essay; Yanis gets most of the troubles and the difficulty of resolving them correct, and head on. And haven’t the Snowden-NSA revelations also diminished the utility of the Internet for both organizing and resolving the eclipse of democracy? If there is no such thing anymore as truly private communication – and, on the matters at hand here, momentous ones – isn’t that true? No private or privileged communications for any citizenship, meaningful or illusionary.

    I’ll end what could be a long, long posting with just two more observations from my own work in this area. I think Yanis underestimates the American elevation of Roman “democracy” over the Athenian model, the Roman being far less direct and more oligarchic in nature, and much more dependent in its earlier more republican features upon the land owning peasantry whose world and role were shattered by the demands of military service as the Empire grew and grew. Our founders were hooked on Romans, not Greeks.

    Land ownership and debt and concentrations of power grew out of this dynamic and led to the revolt of the Gracchi brothers, and the elite’s (Senator’s) violent reaction ended the Republic, not Caesar’s crossing the Rubicon. And I believe that the classical historian Michael Grant observes that neither the Greek nor Roman political worlds could resolve the debt dynamics that arose in their societies (that should make Michael Hudson smile and he has written about it.).

    And I would not underestimate the importance, in theory and practice, which Yanis does not talk about, for the dream of Jefferson’s hopes built upon the rural yeomanry. Idealizations and myth’s aside – the truth was that “once upon a time in America” there was widespread land-ownership which gave a basis in citizenship and the chance for economic independence, although it is very true that the farmer was a budding capitalist seeking always new markets and with one eye always on land speculation. Quite a tension there. And blacks, women and indentured servants need not apply for the franchise. And we know the fate of the farmer in America, Wendell Berry has told us in his Jefferson Lecture in 2012. Was the Agrarian revolt in the 1890’s the last cry of a broad democratic stake in both politics and the economy? Now that is gone and so is the counterveiling power built by unions in the 1930’s and we can argue Athenian democracy in the “locals” and how that translated through the Reuthers and the Meanys in Washington DC – but however one comes out in those equations – they’re gone now as we listen to Nader, Alperovitz and Hedges tell us the score on the Realnews network, and sometimes here at NC.
    Great work Yanis and Yves, we need more and more of this discussion.

    1. Dan Kervick

      On the Roman vs. the oligarchic phenomenon, I think it depends where you look. A lot of people equate the American system of governance with the political philosophy of our illustrious founders. But while those philosopher kings were debating points of history and political theory and writing them into constitutions, ordinary people with very pronounced democratic instincts were creating robust democratic institutions all across the country.

      1. William Neil

        Sorry for the delay in getting back to you. You are correct, the ideals of a democratic republic set in motion by the founders, who were forced to give up the classical notion of virtue in those who governed in deference to the checks and balances built into the new framework (in a large republic the passions/interests would cancel each other out) , which would also operate inside the government itself between the institutions, were eclipsed by what arose from the rambunctious people themselves. According to Gordon Wood, this left the surviving founders horrified – this is not what they intended – gazing out upon “Jacksonian” democracy. They got an early preview of what they didn’t want to happen with the Revolutionary government elected in Pennsylvania, about as close as young America got to Greek Democracy on a big state wide scale. The state would prove to be not so good by the late 19th century, infamous for being in the pockets of the railroad and coal barons. For some additional irony to that first radical democracy in the Keystone state, consider the governments prostration, and I do mean prostration, in front of the gas industry frackers, marked by passage of Act 13.

        I was drawn back to the work of Gordon Wood because of the monopolization of colonial history by the Tea Party and the Right, and that also led me to J.G.A Pocock’s work “The Machiavellian Moment” which issues a challenge to Wood’s thesis that there was an abrupt break from the republican classical tradition by the 1790’s. I would urge Yanis to take on Pocock’s book, and I’ll leave both of you with just the titles of the last two intriguing chapters, which are entitled “Virtue, Passion and Commerce” and “The Americanization of Virtue: Corruption, Constitution and Frontier.” Thinkers in both 18th Century England and then later in the colonies worried about how classical virtue and checks and balance could be maintained in face of intensified special interests – the rise of the Bank of England, bonded debt and the powerful financial circle which of course grew up around it. Madison thought he came up with a way in a “big” republic to check anyone group’s capture of government. My contemporary take is that he failed to anticipate a coherent ideology – neoliberalism – which would unite most businesses in their attitudes towards labor, government and the New Deal regulatory state, a movement so powerful that it would escape all Madison’s devices and capture the machinery of government and the courts.
        And one last plug for Pocock’s difficult work: when the Florentine republic was in mortal danger from outside forces, under siege, literally, and this is one of the Machiavellian moments, Pockock describes the rise of what he calls the apocalyptical tradition, a variant on the classical republican tradition, when the citizens are summoned to arms to defend what they have from annihilation…often it involves a broadening of the franchise…and I believe he traces a left and right wing version of it…His book, which came out in 1975, does make mention of Nixon’s and our Republics troubles under him….
        Let me close by saying the Right’s apocalyptical tendencies are the dominant ones today, the “Left Behind” books and, if I am not stretching this too far, you can read into the “Walking Dead” phenomenon more than a bit of what happens when current institutions fail: citizens arm and create new ones close to the old Hobbesian state of nature, which a U Va scholar has written about in a provocative essay.
        On the left, Chris Hedges is writing close to this strain of thought in his compelling essay “The Myth of Human Progress.’ Gar Alperovitz has a low key, no strains nor conflicts version of working out the current stalemate over 30 institution building years. Ralph Nader is still hoping that our culture’s citizen’s can produce the “rumble from the people” which he was able to focus upon Congress in the 1960’s. I hope they all read Yanis’ little essay hear. Good things can emerge from a dialogue around its nodes.

        1. human

          Madison’s “Big Republic” has become lost in our population (and territory) increase. In order to re-realize his recommended representation, we now need more than ten times as many representatives. This would certainly dilute capture and increase debate.

          And as a decendent of Sir John Hawkwood likes to continually remind me (as you bring up the apropos history of Firenze), “Those who make peaceful revolution impossible will make violent revolution inevitable.” – John F. Kennedy

          1. William Neil

            I think your comment is right on target and on the whole, the thinking on the left, and especially the ecological left, is towards smaller economic institutions, co-operative ones and democratic ones. You can hear this in both Nader and Alperovitz and Naomi Klein…Hedges I have to re-read with that in mind. But if you take Alperovitz’s work, for example, there is a tension with the traditions of American reform…which is that some of the best on the left – the Populist/Progressive and the New Deal, relied upon capture of national institutions and national level reforms. New Jersey’s response to corrupt local bosses in Jersey City, Hudson County, Atlantic City…was to build a powerful governor’s office…just ask Chris Christie how this can cut two ways…

            But what Alperovitz and Hedges share, and Nader to a lesser degree, is that we have reached a moment of grand blockage, or even collapse, in Hedges case, where national reform politics from the left is impossible. This, along with much of the history of ecological thought, drives the crucial decisions and institutions closer to the local level.
            Let me clarify one thing though, when I mentioned the arming of the citizens in defense of their threatened Florentine republic. This was part of the classical republican tradition where property holding was the basis of independence from the corruptions of virtue which trade and commerce brought, and since constant warfare was the reality of Rome, Greece and the small Renaissance states, like Florence, it was necessary to have an armed citizenry to defend republics. The fact which Yanis points out, and M.I. Finley too, that Athens broadened the franchise to non-property holders was a daring and disturbing development to some…for Rome the dynamics of Empire overwhelmed whatever was good in their earlier traditions…
            And now for the troubling context of this line of ancient thought for today…see Victor Davis Hanson’s work…today the private Right is armed and bristly about it…the left has moved centuries away from this…setting classical theory aside…imagining an armed left today to match or counter the Right…seems absolutely foolhardy…that was not where I was going…just citing the ancient connection…

            1. human

              VDH…hmmmm. But, the main stream media ignores this. They do pick up every little nuance of an empowered Left and scream, “Socialist anarchists,” whatever that means. And, indeed, the USSA Left does need to become much more vocal, as is happening in South America. You call this “ancient” history when you could just as well eliminate your adjective. It _is_ history. Another case in point is the original 9/11 in ’73. The very organized Chilean Left in coalition with the military was on the verge of reinstating Allende, if it were not for the overwhelming use of force by outside actors. Unmarked F16’s anyone?

      2. Bill Wolfe

        Dan/Bill – A fine history that explores the tensions between the myths and theories of the Constitutional oligarchs and the “ordinary people” is Terry Bouton’s “Taming Democracy – “The People”, the Founders, and the Troubled Ending of the American Revolution”.

        The oligarchs won.

        1. William Neil

          Bill Wolfe:
          Thanks Bill, that one is going on my reading list. That tension of the “oligarchs” vs. ‘the people” is there in all the history I’ve read, ancient, Renaissance and modern. In some senses, maybe in full reality, it mirrors the tendencies in capitalism (and in ancient economics before we had capitalism, according to Polanyi and Finley)…from small competing firms, or farmers, if you like, to the emergence of dominant firms – and in ag. the virtual elimination of Jefferson’s dream. What it suggests to me is that even if the de-centralizers of today win their dreams, economic, democratic and ecological, they will have a constant struggle to prevent the old cycles from re-appearing.
          Just one more thing to clarify and to give full credit to someone who’s work I mentioned in a glancing way. It’s important, because if there is a growing sense of the apocalyptic, in varying degrees on the left, there is certainly so on the Right, and theirs started earlier, in the 1970’s. Paul Cantor wrote a worrisome essay which appeared in the summer issue of The Hedgehog Review entitled “The Apocalyptic Strain in Popular Culture: The American Nightmare Becomes the American Dream.” It doesn’t dwell exclusively on the “Walking Dead” tv series, but that’s a quick way to cut to the heart of a Right-leaning view of the ground Yanis covers in his great posting. You could say the survivors in the series are “decentralizing too,” armed to the teeth and ready to shoot “outsiders,” and re-inventing gov’t along the way. A virtuous armed citizenry in the classical republican tradition? Emerson’s “Self-reliance?” A Right wing version of ecological architect in “Garbage Warrior?” I don’t think so. But we should pay attention to Cantor’s take on this. It’s worrisome.

    2. sufferin' succotash

      I believe that the classical historian Michael Grant observes that neither the Greek nor Roman political worlds could resolve the debt dynamics that arose in their societies
      Grant is half-right. Chronic indebtedness was not resolved in the long run, but there was a solution in the short run: territorial expansion, with its accompanying military conquests, enslavements of subject populations and overseas colonizations. This turned out to be the fallback option for both Greeks and Romans, the classic (as it were) method of temporarily pacifying the unruly masses while maintaining the income streams of the ruling elite.

      1. William Neil

        Sufferin’ :

        I agree with your comments, quite right. What the Gracchi brothers failed to achieve in their attempted reworking of existing and oligarchical Roman institutions, threatened by the debt dynamics in the land economy, the military worked out after the Republic had been left a distant memory and a hollow shell of institutional “residues.” Historians still fight over J. Caesar’s legacy, left, right or what…

        I strongly urge contemporary American history scholars to go back to our founder’s Roman obsessions and also work with classical scholars to “take back” the history of both from the Right. In my very modest attempts to do so and proclaiming no formal classical scholarship certificates, I was perplexed by Robert Dahl, the famous political scientist from Yale, and his claim of the 500 hundred year history of the Roman Republic. That’s stretching it…Neither he or Gordon Wood mentioned what Michael Grant does, that there was without question a plebian-debtor revolt in the early 5th century BC – that’s three centuries before the Gracchi revolt in the 2nd century BC – and this alludes to another comment made above about “secession”: this early revolt involved the physical removal of the protestors from the City of Rome (self-initiated, they were not thrown out) and their setting up their own parallel institutions…this of course threatened Roman unity and the basis of the army itself, which relied upon the small landholders who formed the backbone of the Roman infantry – and the core of the protestors. This proved to be a relatively effective instrument of protest, and led to the rise of the institution of the “Tribune of the People”…a phrase which resonates down the years for us too, and not without some great irony, think of the rise of the yellow press, Huey Long…and so many odious other forms of political life that have claimed to represent “the people.” So two great Roman revolts resulting from economic debt …neither one of which gets much coverage in the political science professions. And then their was the Spartacus revolt…enough.

  13. Lafayette


    It is clear that stark Income Disparity in the US is driving us to a crossroads at which we must take important decisions about the future – or we are condemned to perpetually repeat the past.. Kooky Kapitalism must be dealt with, which means turning upside down notions initially bred by Friedman at the University of Chicago School of Economics.

    Unfettered Capitalism just doesn’t work well because it has no regulatory environment to halt its excesses and avoid catastrophes.

    We have seen and felt the dangers of Cannibal Capitalism first hand. Hundreds of thousands suckered into loans that they could not afford (and were foreclosed out of house and home) along with others made unemployed by the recession who also came to the same end.


    An American living in Europe, I’ve become a Social Democrat. The Social side of that phrase means that the collective is more important than any individual’s lust for lucre. The Democrat side of the phase indicates that socialism, per se, is not the answer either because it assumes that a government’s role is only to tax ‘n spend on programs that are make-work for civil servants. (Yes, I know that I exaggerate to make that point.)

    Which is why I have become economically a Centrist. There are government programs that are well worth whatever the expense necessary to assure that they are birthright provisions for all. Two of the most important are Universal Health Care and Tertiary Education.

    Both are provided here in France (and elsewhere in Europe), and I know plenty of Americans living here who would never go back to America (even with Medicare) or have had their children educated to postgraduate degree levels here nearly free, gratis and for nothing. They now have the skills/competencies that are absolute requirements in this Brave New Globalized Economy, and without a $30K debt-albatross hanging around their neck at graduation like their compatriots educated in America.

    When we gather together, inevitably the discussion turns to why those two key attributes of a Social Democracy remain such a distant goal for a nation as advanced as the US. Americans, compared to Europeans, are centrists – which may not be obvious for the moment. We have benefitted from a Two-Party system of democracy, which makes for stable governments, even if relative power can change at our biennial elections.

    Europeans have learned this lesson and are tending towards two-party systems for the same benefits. That is, relative stability of governance and an ability to assimilate any “good idea” that happens to come from outlying fringes.


    These, I suggest, are the two key attributes of a democracy that is able to provide its citizens a modicum of social stability in which its citizens can expect a decent lifestyle. That is, have and raise a family and look forward to a happy retirement. It’s not necessarily the “pursuit of happiness” but why should we ask for more?

    Somewhere along the pursuit, however, we lost our way. I suggest that happened in the 1980s, when we opened Pandora’s Box of Ills by favoring capital accumulation by individuals rather than the government. Which occurred with the hairbrained notion that lower taxation “liberates economic growth”. What it accomplishes, actually, when badly managed, is exaggerated Income Disparity and unconscionable Human Suffering.


    That thirty-year cycle wealth-frenzy is hopefully coming to a well-deserved close. But what’s next?

    We can only hope that, as a nation, we elect representatives who will go neither too far to the Left nor to the Right. And that the Central Way, with a balance between capital-accumulation and social justice for all is the prevailing rule.

    Amen …

    1. Brooklin Bridge

      From what I understand, France is in the grip of a wholesale privatization effort and while you may – with a decent salary – be looking at a veneer of “centrist” balance between government protection of the little guy and the so called benefits of the market place, the reality on the ground is vastly different. Try looking for work in the lost cities (les quartiers chauds) in the suburbs. Try taking a train from Paris to Bordeau or to Lyon unless you make the big bucks. They are more and more dominated by high speed rail meaning you can’t get any other type and meaning they are hors du prix. Most of the major highways are private, full of toll booths and approximately 40% more expensive to travel than if they were government owned and operated. Granted, there is still a long way to go to fully cannibalize the exceptional social gains France attained in the 60’s and 70’s, but they are working furiously at it and the direction isn’t awe inspiring unless les fleurs de lys d’or sur champ d’azur represents progress to you.

    2. Banger

      Indeed, Europe created real social-democracy and now, with that success, it will start to dismantle what it can get away with. It started with foreign policy–the Europeans elites decided that they should support the U.S. military, paramilitary and covert war projects throughout the world during Bush and now Obama. Ukraine, Libya, Syria are examples of this sort of push–hopefully this will end well for the Ukrainians (has not ended well for Egypt, Libya, Iraq, Afghanistan, Syria) but Western intel services were key to making the project work. We’ll see what happens. My point is that the French are ready to support neoliberal policies around the globe so why wouldn’t they in France and the rest of Europe?

  14. Brooklin Bridge

    The problem I see with e’democracy and participation of the people is that the internet is too big and complex to be taken over from an unwilling oligarchy or controllable by isegoria (the equal right to participate by poor and rich alike?). How to get from here to there?

    Technological innovations of the past were “own-able” and therefore controllable as seeds of change by individuals or relatively small groups. Not so the internet. Even now we see evidence that the “evil empire” is gathering force to lay ridged claim to the infrastructure as well as the content. They have unimaginable resources and are not going to give up easily.

  15. Ignim Brites

    This is just more “magical” critical theory, and if you twist it just right very in tune in an obscurantist way with the post national agenda of the multi-national corporations and banks. Universal syndicalism. I am sure TPTB are quaking in their boots about that one. Yet, how would those corporations and banks react to Scottish independence, or Catalonian,? What about Greek secession from the EU and Euro followed by an abrogation of liability by a new Greek sovereign of all euro denominated loans held by Greek citizens. What about reconquista efforts in California? Very demos-cratic in their way. In short, increasingly, throughout the world, there are no peoples to even be democratic. The internet is not going to solve that. More likely it will exacerbate it. Or to put it another way, the new name for revolution is secession.

    1. Yves Smith Post author

      You clearly did not bother reading the post and grossly misrepresent Varoufakis’ position. Do you regularly put your foot in your mouth and chew in public?

  16. TarheelDem

    Instead of coming at this from the “democracy” end of the issue, let me come at it from the “e-” end of the “e-democracy” solution being envisioned. An app in the terms used today requires the definition of classes of users, the network conditions over which it runs, the specific processes and operations that the app should support, and the data elements, data relationships, and knowledge structures in which information involved in the processes should be structured. That’s a high-level non-technical description of what is needed to begin. Experience in IT shows that each and every one of those is or contains a highly charged political issue relative to the status quo.

    Take the first one. What are the classes of users? Varoufakis’s article identifies “citizens”. Note that immediately risks contoversy with those advocating for “voters” or “individuals” or even generic “persons” (and you can grasp the persons is problematic for several reasons).

    So, “citizens”. What exactly are the attributes that any app might want to capture about a citizen that would affect the way the process occurs? What is the operational definition of a citizen in a democracy as opposed to other forms of governance? What can a citizen do singly? What can citizens do as groups? What must citizens do as groups? What operations are denied to citizens, either as individuals or groups? What class of user must do those operations, if they can be done within the process? (Example: System administration–Snowden’s actions at NSA show the implications of how this role is defined.) What operations are totally excluded from the scope of the process? (Example: In contrast to most nation states, in which heads of state are expected to speak on behalf of the whole nation, some anarchists insist that no one person can speak on behalf of any whole group. )

    So what exactly does a citizen know and do or not know and do?

    Likewise with the high-level term “deliberation”. What individual and group operations are involved in “deliberation”? How exactly do you know when deliberation is complete? What possible operations come next?

    When you say that “the people rule” or “the citizens rule” or “citizens have equal say in the final formulation of policy”, what does that mean and how do you know that “equal say” has occurred?

    There are in information networks a effect that begins to privilege communicators in a more connected nodal position over communicators in a less nodal position. Humans communicating have a built-in bias towards pruning communication link and concentrating messages through nodes to reduce the number of connections they have to pay attention to. This is a bias toward hierarchy, privileging the more gregarious or promiscuous in their communication and over time providing power to the person at that node. (That is what search engine optimization is seeking–more hits and greater power within the internet.) Any e-democracy app would have to envision some means of countering that tendency, which could inadvertently create an oligarchy in fact that would then search for some story to justify its privilege.

    Those are notes that assume that there are no existing institutions working actively to deny the app and process from ever becoming effective polity. In fact, we know that there is definitely opposition in place seeking to monitor and control the internet.

    1. Brooklin Bridge

      While you raise some interesting technical issues, I’m not sure that isn’t barking up the wrong tree (or perhaps one very close by). Before the web, transactional integrity (the ACID criteria) was all the rage, along with mission critical and fail safe, when discussing just about anything that involved internet commerce and distributed applications. Then poof, the web came along with requests and essentially read-only responses and suddenly everyone was designing their applications with almost totally different philosophies about both those things. They just didn’t seem to matter as much. Lo, people were tolerant given the awesome power of the visually simplified query and super intuitive embedded links. Times were fast and loose and it all seemed to work somehow and while, for instance, traditional ‘heavy’ transactions have rightfully crept back into the picture, the style of thinking about what was critical changed dramatically and permanently (standalone business or domain applications, etc., are another matter).

      I suspect this opportune simplification, or something like it, would somehow find it’s way into satisfying the needs of e’democracy but as you rightly suggest, it would first have to overcome relentless opposition (unlike the web) and some though not all of the technical and semantic issues you raise.

      1. TarheelDem

        Simplifications have political consequences that must be incorporated into the consideration. Otherwise, the programmers can impose their own assumptions, which might create a process hard to change in the future.

        You comment sparked another issue. To what extent are e-democracy processes free to be asynchronous and what operations must be synchronous?

        But the political philosophy issue most in my mind is what exactly does democratic rule mean. Does it indeed just stop at stating policy? How does it hold accountability to policy? Much easier in an agora than over a distributed network.

  17. Brooklin Bridge

    For it to catch on, it will have to involve porn somehow. People may think acceptance of the net came about due to the exceptional elegance of the network protocol stack, but ohh noooo. It was those free pictures.

    1. human

      LOL. How many here are willing to acknowledge that it was gaming and porn that drove early increases in computing capabilities and power and still does to a large extent?

  18. Alto Berto (@AltoBerto)

    I take issue with “e’democracy” only in that it is making things more complicated rather than simplifying issues. When we installed electronic voting machines we did not start calling it “electronic democracy” nor should we call this e’democracy. It should just be called democracy and e’voting. The same nonsense is applied with “meritocracy”, it’s just an aristocracy by another name.

    Other than that this is an excellent post and it’s refreshing to see that at least someone has read moses finley.

  19. impermanence

    Until people give up on the notion that you can have, ‘something for nothing,’ stealing will remain the primary motivation for nearly everything that takes place on this planet.

  20. gaddeswarup

    May be ban at every level people over certain income to hold electoral positions and appointments by elected representatives for a start.

    1. human

      Unworkable (for reasons of access additionally), as is the wonderful proposition that anyone with an “indispensable” occupation be ineligible for public office. Lawyers and accountants would be all over this like flies on sh*t.

  21. Banger

    I like Yannis–but most of the time I don’t get it and in this field (one that I know something about) I don’t think he quite gets it though I like a lot of what he says. As some others have noted–why ignore the Roman Republic? There is where you get a wonderful account of class struggle starting with Livy–I believe the balance between the patricians and plebes was what catapulted Rome to world domination and what inspired the Constitutions rather than Athens. The U.S. was never meant to be a “democracy” it was a Republic with some democracy to create a balance between the aristocrats and the average people maybe slightly more skewed towards the plebes than the Roman republic. The plebes, btw, earned their rights in Rome by fighting and by refusing to cooperate unless their demands were met–they played hardball unlike America’s plebes do know (but once did somewhat)—we are now in Empire anyway so the whole argument, at least as far as the U.S. is concerned, is moot. Only the rich can stand up in the public square so how can we have democracy?

    As for the internet–it has been a fairly neutral institution but because power has shifted almost completely to the ruling elites the internet is now just another tool for control. Most of the plebes have their bread and circuses so most Americans don’t care whether the oligarchs rule or not.

  22. Gabriel

    Provocative article.

    I wonder if rather than going after “financialized capitalism,” i.e., large global corporations, head-on as a way of wresting power from them so as to grow it at the bottom, we may want to go around these large corporations.

    There are ideas that are dispersed in various economic areas that amount to doing that – “going around” the large corporations. One major supporter of these ideas is Gal Alperovitz who is pushing the idea of locally-owned, non-profit corporations that provide services and products for the local area, including financial, e.g., Mondragon. He favors creating local corporations that are the opposite of the maximize-shareholder-welfare large corporations. Local banks, local producers, local consumers, local jobs, etc on a non-profit basis for the better welfare of the community. What’s being done here is to build a connected set of non-profit organizations that support each other in service to their community.

    Other thinkers suggest locally generated electric power.

    Three-D printing allows local manufacturing in small and large batches.

    So, I suggest that one possibility to the “problem” of the heavy political power of large corporations is to go around them and to build new corporations that will follow different rules. The ideas and means, most of them, are at hand.

  23. allcoppedout

    Yanis did foreshadow likely critique in his notes Banger. It’s really tough to model democracy without succumbing to ‘ideal types’. One wants to agree in spirit, but the issues are very complex. I suspect what we want is a politics we don’t have to pay much attention to because it works. New technology could help with that, but we’d need to know what we were trying to model. This would have to be less dreamy than Yanis is here.

    Even something reasonably easy to sort technically, such as an electronic parliament that situated our representatives locally and put them at the centre of actually representing the people who vote for them has not been tried – in place of the tiny villages of Washington and Westminster. And one doesn’t have to think for long to worry whether one wants to be controlled by a voting polis ‘informed’ by the BBC, Fox or a ‘majority that is always wrong’.

    Few of our firms are democracies, not much of our education system and so on. We would want to explore more on known limits of democracy. I have no doubt we need to change and could do so in small steps. Currently, we can’t even vote for anyone suggesting even incremental change, such as internet voting on specific issues. It would help if someone put forward what we can now do, securely, to change politics with new technology. Much easier to codge some already rather well-known quasi-history together, not unlike politicians in public rhetoric perhaps.

    1. Banger

      I have mixed feelings about democracy but I can imagine a world that was democratic but it would have to involve all aspects of life including our economic life. I like the idea of group-mind that is talked about in the Wisdom of Crowds and other social science experiments. The problem the Founders had with democracy is that it could be subject to collective madness as well as collective wisdom. I don’t agree–I think that “the people” can make all kinds of mistakes and, in fact, are likely to make much greater mistakes than in the Constitutional Republic we had a few years back that ended in 2001. But it can also quickly right itself and make the right adjustments as the collective gains collective wisdom. It’s worth a try.

  24. William Neil

    One last comment and thought directed to Yanis:
    Yanis, at the core of Pocock’s book, is the idea that the best of the classical republican tradition rested upon a civic and psychological notion of independence grounded in the ownership of land – both oligarchs and yeomanry. The oligarchic ideal of this was the large land-owner who could retire from any taint of the corruptions of commerce and the markets and devote himself to the practice of civic virtue…. in our modern version of this, not rooted in land, is Soros and kind and the hoped for left leaning billionaires that Nader is having lunch with.
    But the ideal was that commerce and trade was corrupting, and so was the concept of delegating to others, who might not be like oneself in the act of governing. The more the division of labor in society created commercial others, the further the ideal of representation faded away.
    An interesting challenge to the modern Right should be then, today, setting all the flaws of the classical ideal aside, esp. the Roman version, how, in a society where at best 20% are noble, independent entrepreneurs, and where therefore 80% are dependent on other economic actors, can one even approach these ancient Western ideals of republicanism?
    Note too the Right only dwells on the “dependency horrors” of relying on government, the very ideas that 80% of the citizenry will be dependent by def. on private economic actors…escapes mentions…why? Because one day we will have a society where everyone is an entrepreur. Polanyi would have quick work with that: such a result would tear apart society – and nature – in the blink of an eye…and one can argue that under today’s trends, with only 20% or less really, having “independence,” we are still rapidly tearing up both democracy and nature.

  25. Garfield's Ghost

    Not much has been said about the role of currency policy in the conflict between economic and democratic forces.

    In American history, this topic usually forms only a subtext, but its force becomes apparent when it breaks the surface. Major cases include the Jackson-Biddle conflict, where Biddle made good on his blackmail to cause the Panic of 1837 in the face of losing his charter; financing of the Civil War, when Lincoln was driven to use Greenback paper currency as a successful alternative to usurious loans from the banking establishment; the catastrophic closing of the Greenback system in 1873; and the various Panics afterwards, which generated political conflict as to whether gold (controlled by the banks) or silver (available more generally) would be used. Currency was a hot political topic in the U.S. until 1900 or so, but the debate conspicuously withered following the 1907 Panic and founding of the Federal Reserve System, and fell into the silent limbo of TINA since WWI.

    Today, most national banks in the US and elsewhere are under private ownership and control, so, duh, bankers’ interests will have priority and preferences of the electorate will take a distant second, at best. One only needs to look at the plethora of unpopular trade agreements (e.g., TPP) and IMF actions to find an abundance of examples. So it’s hard to see how a government can adopt democratic reforms which conflict with banks’ interest, when the banks hold their debt of Damocles overhead. Curiously, the Constitution originally reserved the right to coin money to the Federal rather than private sector. Possibly there were good reasons for this clause beyond providing a uniform currency for the states.

    Perhaps it’s time to reopen the currency debates, and consider the notion of reforming, even replacing, the Fed (ok, LMAO, too). The government printing office might as well issue its own fiat currency (what we have today, anyway), but in doing so, would subject the process to oversight, and generate less debt in the process.

    Fed proponents piously praise the virtues of “independent” monetary policy, but that adjective also means, “democratically unaccountable”.

    1. F. Beard

      Curiously, the Constitution originally reserved the right to coin money to the Federal rather than private sector. Garfield’s Ghost

      Let’s have both government and private money suppllies; that’s the ethical solution since:

      1) Government is force and inexpensive fiat is the ONLY proper money form for it to avoid privileging private interests like gold owners.

      2) The private sector should be voluntary cooperation so being forced (legal tender laws for private debt) to accept fiat is a non-starter, ethically speaking. Government backing for the banks is also very improper.

      The above is implied in Matthew 22:16-22 (“Render to Caesar what is Caesar’s”). it sounds extremely reasonable to me

  26. Joe Firestone (LetsGetitDone)

    I appreciate financial matters citing above my post as a solution to the conundrum posed by Professor Varoufakis in his brilliant and very well-written essay. And perhaps it is partial solution to leveling the playing field that now sustains and drives forward the evolution of the neoliberal oligarchy in the United States. But, I think that it is a series of other posts of mine and my co-author Henk Hadders published some time ago at Lambert’s blog, and ending with this one outlining the primary solution, which is a way of finally defeating Michels’ Iron Law of Oligarchy.

  27. James Maynard Gelinas

    The Internet is a technological means of communication. It doesn’t offer anything more than a faster post office, and, unlike digital messages, the identity of an author’s postal letter can be confirmed by wax seal. By this logic, an Athenian democracy would have been possible to implement by the US’ founding fathers, assuming a working national post office.

    Idealistic tech heads got this all wrong during the 70s and 80s. Technology merely affords improved efficiency, it can not change the underlying political system. Only people, acting in unison, can do that.

    I think this is why so many political leaders have been frightened of organized movements that have sprung up by using new technologies. For example, the Iranian Green, Egyptian and Turkish protest movements, which used social media as an organizing mechanism. The same could be said of Occupy and more recently in Ukraine.

    In each case, the state responded to self-organization with excessive violence. In some cases there were attempts to diffuse technology. But it is the underlying use of technology that’s feared by those in power; in particular, for groups to self-organize and act in unison outside the realm of constraints imposed by the state.

    Blocks of organized citizens need not engage in criminal conduct to attract the interest and violent repression by state counter-intelligence operations. Organizing legal boycotts, work refusals, or merely popular demonstrations in public (petition the state of grievance) is more than enough. For it sets a precedent that citizens who act outside the boundaries of a highly regimented and limited political system might achieve political goals. And in so doing, those citizens might realize actual gains rather than the fluff of mere dialog with power.

    In Iran, Egypt, and recently in Turkey we saw the state place snipers on buildings and had them shoot civilian protestors. It’s almost as if the lesson learned from Tienanmen Square by states the world over is that planned violence against civilian protest movements works.

    Until states unlearn this lesson, people will risk standing in the way of an onslaught of bullets merely to express an opinion in public. Which is why state violence and organized counter-intelligence against Occupy protestors is so dangerous. Not because the US government shot dead protestors like in Iran, Egypt, and Ukraine. But because the murders are incidental to the destruction of self-organized peoples that is at stake.

    Without the possibility for that kind of organization, there is no amount of technology which will provide a palliative to the underlying problem of political disenfranchisement in the face of pervasive voting rights.

  28. Jeff N

    wow, you were so right that we should all read this! I think it changed my life! or at least the way I look at ALL issues now! (mind blown)

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