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Mark · Site Admin Joined: 13 Nov 2007 Posts: 1052

Perhaps direct or participatory democracy has not yet evolved to the point where it can limit government risks or prevent the wealthy elites from looting a national treasury.

My thought had been that since most Americans disapproved of the recent bailouts, we could have prevented them if we had been allowed to vote directly on such matters instead of having to leave the decisions up to a government bureaucracy we cannot hold accountable.

This seemed to be validated by the following excerpt from a June 2007 article:

How direct democracy makes Switzerland a better place

http://www.telegraph.co.uk/news/1...s-Switzerland-a-better-place.html

Interestingly, the strong elements of direct democracy in Swiss politics have not weakened representative democracy or parliament. On the contrary: when established as a modern and devolved republic back in 1848, Switzerland was - as Britain is still today - a purely indirect democracy with a one-party government. It took many years, and many democratic movements, to get a more fine-tuned division of power, which now offers all forces and groups in the country a fair opportunity to take an active part in setting the political agenda, and in determining the final decision. And this is not simply oppositional: while most popular initiatives proposed by minority groups fail at the ballot box, most governmental proposals get support. Government in Switzerland is not delivering for people, but with them.

As each municipality and each state (or canton) has its own constitutions, you can also measure the effects of modern direct democracy in practice. Startlingly, those parts of the country where the people are most involved in politics also have better public services and stronger economies.

From the Swiss experience we can all learn that representative democracy can do much better, if it includes comprehensive and citizen-friendly methods of participation. In Switzerland, the most important - but a relatively few - issues are decided by the people, important and more numerous matters by parliament, and the least important but very numerous issues by the government. That's what they mean by democracy.

* Bruno Kaufman is president of IRI Europe, a Brussels-based think-tank

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But in actuality, that is not how it worked out:

Switzerland sets bailout for UBS

http://www.chinadaily.com.cn/world/2008-10/17/content_7114990.htm

Excerpt:

Switzerland extended urgent help Thursday to its storied banking industry as the government acknowledged that even the world's biggest wealth needed protection from the tumult gripping the global financial system.

Less than a week after Europe and the United States coordinated moves to ease the crisis, the Swiss government said it would take a 9 percent stake in UBS, the financial giant that has been among the hardest hit by losses from American subprime mortgage debt, and provide it with 6 billion Swiss francs ($5.36 billion) in capital.

A pedestrian passes a UBS branch in Zurich. [Agencies]

Rebuking UBS for failing to maintain adequate risk controls, regulators also set up a $60 billion fund to absorb troubled assets lingering on its books, a move intended to strengthen its financial and competitive position.
...

The knowledge that the losses at UBS stem from such un-Swiss habits as reckless borrowing and betting on shaky American mortgages is doubly painful. Many individual Swiss shareholders believe their banks should have stuck to the private wealth business they have long dominated, rather than getting caught up in what they consider the casino-like world of Wall Street.
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And direct democracy didn't seem to be of much help in Venezuela either:

Venezuela Faces Loss on Lehman

http://online.wsj.com/article/SB1...689555475.html?mod=googlenews_wsj

Excerpt:

The Venezuelan government, which this week mocked Lehman Brothers Inc.'s woes as a sign of capitalism's imminent demise, could become a victim of the investment bank's failure.

The government of Hugo Chávez holds about $300 million in debt instruments that Lehman had agreed to cash, according to three analysts who calculated the holdings separately. With Lehman in trouble, Venezuela will have a hard time selling the debt.
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I still think that direct democracy has great potential. Undoubtedly there are many greedy and irresponsible people among any citizenry. Many will make bad decisions with money over which they have control. But I doubt if most would want to allow their neighbors to take risks with their own personal finances. So I believe that collective decisions would tend to be more sensible than individual decisions. While I might be willing to splurge or gamble with my own paycheck, I certainly wouldn't delegate the power to splurge or gamble with my paycheck to my neighbor.

If I had any say in the matter. Smilie_PDT

Mark · Site Admin Joined: 13 Nov 2007 Posts: 1052

Of course this is much too small a sampling to be an indicator, but since Venezuela seems to have the most direct democracy, Switzerland next most, and the USA the least of the three, the fact that the hit in the US was $850 billion, in Switzerland $60 billion, and in Venezuela only $300 million, appears to support my original thesis to some extent.

In other words, the more voice in government a people have, the less that government can rip them off.