Direct Democracy: Participation Without Populism?

Razia Iqbal

Good evening, everyone. Welcome and thank you very much for coming to tonight’s event, Direct Democracy: Participation without Populism. If I could all ask you to put your phones on silent, that would be great. My name’s Razia Iqbal. I present news and current affairs programmes at the BBC, Newshour on the World Service and The World Tonight on Radio 4. It’s my huge pleasure to introduce tonight’s distinguished panel. In the middle there is Nicolas Berggruen. He’s Chairman of the Berggruen Institute, which addresses fundamental political and cultural issues in our rapidly changing world. To his right is Nathan Gardels, who is Editor in Chief of The World Post and Senior Advisor to the Berggruen Institute. Together, they have written Renovating Democracy: Governing in the Age of Globalisation and Digital Capitalism. The book will be on sale afterwards and I think Nathan is staying around to sign some of those books. Alongside Nicolas is Chatham House’s very own Hans Kundnani, Senior Research Fellow in the Europe Programme and the Project Lead on Democracy and Technology, and tonight’s discussion is one of a series, which is part of this project. Welcome to you all.

Each of the speakers is going to address you for about five to seven minutes and then we’re going to have a little discussion and then we will open it out to the audience. The event is on the record. It’s going to be livestreamed. In fact, it must be being livestreamed as we speak, and if you’d like to participate on social media, the hashtag is #CHEvents. And I’m assuming you’ve all turned your phones off.

Right, so, what are we going to be talking about? In recent years, the rise of populism in the West, China’s growing influence in global governance and Russia’s alleged interference in foreign elections, have prompted a deep rethink of how democratic systems work and how they don’t work. Increasingly, liberal democracies are accused of failing to address dislocations of globalisation and the role of technology in amplifying tribalism, thus polarising societies and paralysing governments. So, it’s against this backdrop that the panellists are going to consider whether and how democratic systems can be rethought and rejuvenated in the 21st Century. What new ideas, partnerships and frameworks of governance have the potential to renew existing institutes of democrac – institutions of democracy? Can social networks and digitisation be used to deepen political engagement and empower direct participation, without fuelling populism, and is it possible to reconcile the power or direct participation, with the values of deliberation, pluralism and compromise? Big, urgent issues. Nathan, please, will you set us off?

Nathan Gardels

Thank you, and thank you, Razia. Let me begin, although we’re going to focus on democracy and deliberation and participation without populism, let me just first, very briefly, lay out the main themes of the book and how they relate to each other. ‘Cause what we try to do in the book is address how open societies govern themselves, facing the biggest challenge on the near hori – biggest challenges on the near horizon, which is the participatory power of social medial, digital capitalism and the reappearance of China at the centre stage, the centre on the world stage.

So, the way we frame the book is that we’re seeing the rise of populism in the West and the rise of China in the East and the spread of social media everywhere, as Razia said, is prompting a rethink of how democratic systems work or how they don’t work. Globalisation and digital capitalism are creating new classes of winners and losers that the old social contract is not configured to deal with. Now, we’re not going to focus on China tonight, but China comes into the picture because it challenges the dysfunctional democracies of the West to get beyond polarisation and paralysis and reach a governing consensus by other than illiberal means or fall into second class status on the world stage.

I’m not telling you anything new to say that we have a so-called leader of the free world, who relishes battling his way through every 24-hour news cycle by hurling barbed tweets at sundry foes. By contrast, China’s leader has used his enormous power to lay out a roadmap for the next 30 years. So, there’s the challenge. Now, in the book, we propose several responses to these challenges, the three Ps. We’re going to focus on the first one, but let me just go through the three Ps: participation without populism, pre-distribution of wealth, instead of redistribution only, and positive nationalism.

Participation without populism and here’s the basic principle, we’re going to get into the discussion. We can talk about California, where we’re from, which is very engaged in direct democracy for good and for ill. But basically, the notion is that since social networks have drawn more players into the political fray than ever before, never has the need been greater for the counterbalance of impartial practices and institutions to sort out the cacophony of voices, the welter of conflicting interests and the deluge of contested information. To mend the breach of distrust between the institutions of self-government and the public, we call for a new form of citizen engagement, participation without populism, which, essentially, means integrating social networks and more direct democracy into the system, through new mediating institutions that complement representative Government. We can talk a lot more about California and our experience in direct democracy, but just to give an example here in Britain, if such a public forum for deliberation had been in place before the Brexit referendum and all the consequences we now know had been aired, the outcome would likely have been quite different.

Pre-distribution, second point, the innovations of digital capitalism are steadily disruptive and increasingly divorcing employment and income from productivity growth and wealth creation. A social context that responds to this dynamic should protect workers instead of jobs, as they constantly turn through innovation and foster an ownership share by all in the wealth generated by the robots that are displacing gainful employment. The aim is to enhance the skills and assets that are less well off in the first place, pre-distribution, instead of only distributing wealth of others after the fact. We call this universal basic capital. The idea is not just to break up concentration at the top, but to build wealth from the bottom. The simple message is, if you want to fight inequality in the digital age, the best way to do it is to spread the equity around.

Finally, positive nationalism. To harness globalisation we call for dialling back one size fits all hyper-globalization, through allowing industrial policies for nations to build their own economies and embracing the idea of positive nationalism, which means an allegiance to the values of inclusive society, instead of nationalist incantation, but understanding, at the same time, that open societies require defined borders.

Now, we also have ideas to deal with China, but I’m going to skip those for this session and simply say that unless we follow a path along this course to deal with the internal issues of democracy, as we were discussing earlier, much of the debate these days is, “Oh, it’s democracy versus Russia and China.” It’s not about what’s happening in democracy and how it’s working or not working. And unless we follow a course along the path that I’ve outlined here, our fear is that the West will be positioning itself on the wrong side of history. So…

Razia Iqbal

Thank you very much, indeed. Nicolas?

Nicolas Berggruen

Well, I’ll just say a couple of words on one of these three Ps, pre-distribution. I know we’re going to speak mostly about democracies and how to recap democracies in a system or in a way that can allow much more participation, in a productive way. But the pre-distribution idea is something that we are really testing and the reason why I want to expose it is, we’d love to get feedback. The idea simply being that in traditional capitalism, labour and capital were really the ones that would fight it out and had, let’s say, a way – you know, had to divide the spoils. And the reality is that more and more of the value is going to the intellectual property, and much more than capital or labour. If you look at the most valuable businesses that have been created and that are actually the most valuable businesses in the world, over the last 15 years, they’ve been created with almost no capital and very little labour. So, you can see that the value is accruing more and more towards IP and algorithms are going to become more and more valuable.

So, the question is, how do you share those in a way that’s fair? And our thinking is, as opposed to having a big fight to take from the ones who own the IP and redistribute to the ones who don’t, let’s turn things around and have everybody own a piece of the IP, own a piece of the robot from the beginning, and you can do it. You can do it, thanks to technology, and you can also do it conceptually. So, if you started a new business, as opposed to, let’s say, Nathan owning 100%, or Hans or Razia owning 100% of the business, you could own 70% of the business, it wouldn’t make a difference. If you’re successful, you’re very successful. you’re going to be very rich. But if 70% is owned by the state, meaning, let’s say, through sovereign wealth fund, owned by all citizens, then everybody is participating in the great company that Razia has created. And everybody, including the state, is on the same side, as opposed to, you know, the other side. States normally are debtors and in this case, the state becomes an owner on behalf of citizens. So, the idea is to change the equation to everybody being a participant, everybody being in the same boat, everybody being an owner of the future and that’s, we think, an interesting concept to test.

So, the idea being simply that a lot of these discussions, democracy, capitalism, geopolitics, take concepts that exist that are fairly, you know, standard, in terms of history, that try to turn them around. Same principles, but change the game, change the board, so that if you bring people in together, as opposed to fighting each other, which is where we are in terms of the democratic debates, you have people against each other everywhere, within nations, within parties, within almost any society and you have the same thing in capitalism. Capitalism has conquered the world, but how do you make capitalism work for everyone? And that’s an idea that we’ve thrown out.

So, sorry, this is very specific, but I wanted to expose it. Hans?

Razia Iqbal

Okay, thank you. Hans, why don’t you contest, if you want to, some of the things that you’ve already heard and then we’ll open it up a bit more?

Hans Kundnani

Thanks. So, I mean, first of all, I should say I want to focus on the democracy parts, rather than the economic part or the geopolitical parts, and I agree with much of what’s in the book, but I’ll, for the sake of argument, focus a bit on some of the things that I see slightly differently. And in particular, what I’ll try and do is – as you said, Nathan, this is very much, you know, based on the American experience, the California experience, in particular. It seems to me that if you approach this from a European perspective, based on a European experience, some of these questions actually look a little bit different. So, I’ll try and talk a bit – a little bit about that.

Let me start with this idea of a crisis of liberal democracy, because I have to say, it’s not obvious to me that there is a crisis. Everybody says there’s a crisis, but actually, putting your finger on what exactly the crisis is, or whether there even is one, I think is actually quite tricky. David Runciman, a Cambridge Professor of Politics, points out that, “A democracy functioning badly looks quite a lot like a democracy functioning quite well. It’s quite difficult to tell the difference between the two.” And I think Britain, right now, is a good example of this. It’s not obvious to me that we’re having a crisis of democracy. I think that we are, personally, I agree with you that we are. As I say, I don’t think it’s obvious. But even if we agree that we are having a crisis, it seems to me there are very different ways of understanding what the crisis is, what’s caused it, and I think this matters quite a lot.

So, for example, you talk in the book about, “The decay of democracy in the past several decades,” and I agree with that, but it seems to me, as I say, quite difficult to know how to understand this current populist moment, if that’s the right way to describe it, in that context. So, for example, one of the indicators that you would’ve pointed to as a sign of this decay of democracy, would’ve been a decline in voter turnout, right, which, you know, seems, over the last, you know, few decades, to have been going downwards and it seems to have been a chronic trend. But, to some extent that has been reversed in lots of elections we’ve seen recently and, to some extent, as a result of populism. So, in Germany, for example, in the last general election there, the AFD, which is a party that I don’t particularly like, brought 1.2 million voters, who hadn’t voted in the previous election, back into the political process. So, in that sense it seems to me that, you know, in some ways, populism is providing a, kind of, correction, rather than being part of the crisis itself.

And that brings me to the next point, you talk about polarisation quite a lot and you seem to take it as athematic that polarisation is a bad thing. You describe that as “going hand-in-hand with paralysis,” several times in the book and so, it’s something that needs to be, sort of, minimised. I’m just not sure if that’s true. It seems to me that, you know, polarisation can be a good thing or a bad thing. What matters is how you’re polarised and what issues you’re polarised on. Over the last few decades it seems to me that part of what’s happened is an increased polarisation, but at the same time, there’s also been this, kind of, increased consensus around some issues, particularly around economic issues. So, I would actually argue that, you know, as centre right and centre left parties have converged around, basically, neoliberalism, for want of a better term, that’s part of what’s produced extremism. It’s forced political opposition to the extremes and more specifically, if you have this consensus on economic issues, then, to some extent, you end up fighting, I think, about cultural questions, because there’s no debate around economic questions. So, in a sense, neoliberalism, it seems to me, produces identity politics.

And if we compare, say, Britain, Germany and the United States, it seems to me this mixture of polarisation and consensus works differently in each of the three cases. So, in the US case, you know, you clearly do have a very polarised society, but it seems to me that you also have this trend of, as I say, convergence between the Democrats and the Republicans around economic policy, coinciding with that increasing polarisation. And the problem, it seems to me, is the kind of issues now that America is polarised on. It’s these culture war issues around race and religion, and so. That’s extremely toxic to be polarised about that and if you look at Britain, there’s a big debate about this. Some people would say the same thing is happening in Britain as in the US, polarisation around, basically, culture war issues.

Another way of looking at it is that we’re basically arguing over economic issues and the degree of, you know, basically, free trade deals and the degree of economic openness and so on. That seems to me a much more productive thing for us to be polarised over, and I would argue we should be polarised over it. This is precisely what’s supposed to happen in democratic politics and then Germany, to take the third example, I mean, I think there you could make the case, I’ve made this case, there’s been too much consensus in German politics in the last, you know, decade or two. That actually you needed more polarisation, except, as I say, around the right kind of issues.

So, anyway, where all of this, kind of, leads me is to say that I think what we might be arguing about here is how we should understand democracy and different kinds of models of democracy. And so, when you come to talk about solutions, you propose these new non-partisan mediating bodies, as you said in your remarks, to, sort of, balance elements of direct democracy, so you introduce more elements of deliberated democracy, in order to balance out the direct democracy. I wondered, when I read that, though, whether, actually, part of the problem, and certainly Danny Roderick, who you mention when you use the term ‘hyper-globalization’, I think would agree with this, that part of the reason we have this crisis in the first place is because we’ve had too many of these independent agencies, too much power has been taken out of the space of democratic contestation and, sort of, handed over to these non-majoritarian institutions, these, kind of, depoliticised spaces. And I think, particularly in Europe, that’s a problem, because, in a way, the EU is the ultimate example of this, kind of, depoliticised, technocratic process of governing.

So, I suppose I wonder whether the solution might be, sort of, almost in the opposite direction. You talk quite positively about the Founding Fathers in the United States and how, actually, they were quite hostile to democracy, which I think is quite right. But you almost seem to suggest that the solution to the crisis of liberal democracy in the United States is to, sort of, slightly go back to that model. It seems to me that we can’t turn the clock back in that way. I think that a big part of what’s happened is that our societies, over centuries, have become much less deferential and I think part of the reason we’re having this crisis right now is because right now they’re becoming even less deferential than they were, you know, ten years ago or so ago – ten years ago, or so. And so, the idea of, for example, a upper house, which you propose, which would be – you know, which would consist – you, I think you describe it as a sober second chamber, composed of…

Nathan Gardels

Progress that – yeah, second reading.

Hans Kundnani

…eminent men and women of experience and expertise, I mean, this sounds quite a lot like the House of Lords in the UK, which you mention, actually, at one point. You know, the current House of Lords, rather than a, sort of, reimagined House of Lords. I wonder whether, actually, we need to go in the other direction, to accept that societies have become much less deferential, to think about how you deepen democracy, rather than, sort of, limiting it in the way that it seems to me you do.

And, as I say, to bring it full circle to where I began, in terms of talking about polarisation, it seems to me there are these two models. One is to say, you know, the aim here is to, sort of, create harmony, to, sort of, somehow move beyond the, sort of, clash of interests that exists in democratic politics. And so, you’re quite positive about, you know, Macron, who you see as non-partisan and non-ideological. That’s one model and I can see the argument for that. I wonder, though, whether, actually, I mean, certainly, the way I think about democracy is that a, sort of, clash of interests is not something that you can, kind of, take out of democratic politics. That’s the essence of democratic politics and so, you know, actually, we need, I think, to go back to what we used to have, which is where you have a centre right party and a centre left party, representing different interests in society, rather than trying to represent the interests of everybody, and fighting that out and going back, again, to a situation where you had real alternatives in the centre ground of politics, two real alternatives, rather than thinking you can somehow transcend that with a kind of there is no alternative, kind of centrist politics.

Razia Iqbal

Hans, thank you. Let’s start, then, by drilling down a little bit with you, Nathan, and if you can explain a little bit more in response to the contesting that Hans has just presented, that the – that these mediating institutions that you speak of, how would they actually work? ‘Cause you said something quite controversial, that if they had existed and had been in place before the Brexit referendum, that perhaps the outcome would’ve been different. Let’s put that to one side, but just explain how those mediating institutions might function.

Nathan Gardels

Okay and then I want – I need to respond to some…

Razia Iqbal

Yeah, you – I’m sure you will.

Nathan Gardels

…wrong points and some mischaracterisations and other stuff.

Razia Iqbal

I know you will.

Nathan Gardels

And other stuff. I was trying to – I didn’t have a pen and I was trying to remember all of those. But let me start by saying that I think the – not the assumption of our book, the reading of the situation across the Western democracies, whether it’s Brazil, or whether it’s Europe, or whether it’s the United States, is a rupture between the institutions of public interest, so, the institution of self-government and the public. That is the crisis of democracy.

Voting, how can I put this? Voting is not what matters most. The more – the fact that more people are voting is not the issue. The issue is that the – as important as elections are to democracy, what’s outside the ballot box is equally, if not more, important. We’re just impartial institutions that allow you, in diverse societies, to sort out differences, to make fair trade-offs and to come to a consensus. That’s what’s broken. That’s what broken in Britain, that’s what’s broken in the US, that’s what’s broken in Brazil, that’s what’s broken in Italy, it’s what’s broken in Germany, it’s what’s broken in France. In France, Macron won his 33%. In Germany, in that same election, or the same election period, Merkel won her 33%, you know. But back in – I mean, Macron maybe won, I forget what he won exactly, but Le Pen won 33%, the same as Merkel in Germany. So, the electorate is divided, there’s no consensus. I’ll come – I will address the economic issues. I’m not sure your point there. I don’t think there’s a consensus of – on economics.

So, the point is what’s – if what’s broken is the – is what’s outside the ballot box, the impartial institutions and practices that mediate all these interests in society, that’s what has to be fixed. So, in the book, as you mentioned, we talk about the California situation, because we come from California, we’re actively engaged there, but we make it very clear that this is not – what we’re talking is not a model for the world, it’s a way to think about exactly what I just said, what is democracy, what institutions matter? So, in the California case, it – well, what we do in the book, let me just say this about the last thing you said about the House of Lords and so on, I see Tony Giddens sitting here, I don’t want to offend him by – and the House of Lords, but…

Hans Kundnani

It’s pretty hard to.

Nathan Gardels

But what we do in the book and, again, it’s the way to think about democracy, we’re not saying what we’re proposing is every – you know, is the model for everybody, in the book we talk about participation without populism as a third turn of democracy. The first turn was the American Founding Fathers, as you pointed out, who, from their own experience in writing Constitutions of the States after independence from Great Britain and coming through a Constitution in 1789 and studying Greek and Roman antiquity, said, “Democracy’s a really bad idea.” Democracy does not appear – the word ‘democracy’ does not appear in the Bill of Rights, in the Constitution or the Declaration of Independence, or in any of the state things. That was the first turn of American, what’s called the Republic, which put a lot of filters between the public and power, these mediating institutions.

The second turn came 100 years later, with the progressive era in the United States, which happened in the States, not from the top down, but in the States, in response to corruption, technological change, much as we’re seeing today, in which the progressive movements said, “Let’s have a direct democracy.” “If the political class are so corrupt, they’re not serving us,” is what people are saying now, “let’s make the rules ourselves through direct democracy.” We adopted the Swiss system, in most of our states, which allow people to make laws directly. But they also included in their reform programme, for the first time, getting cronies out of running Government and bringing professionals in. City Managers didn’t exist before the progressive [inaudible – 26:41]. They were run by cronies that belonged to machines. So, they brought in both smart Government and direct democracy.

What we’re trying to talk about in the book is a third turn, where you combine both of those things, the deliberative emphasis of the Founding Fathers and the direct democracy and the smart Government of progressive era for this new turn. And why now, why now? Because of the impacts of the participatory power of social media, which brings more players into the fray.

Now, the final point, you made many points and – but let me just make this one thing about the mediating institutions, on the contrary, what we’re proposing is not mediating institutions like the European Commission, which is so far from the public, but the opposite. And it comes from the California experience and the California experience of direct democracy is, in our view, something that’s going to be very predominant in the future everywhere. In Italy, the Five Start Movement came to power, the Internet Party, with their slogan, “Participate, don’t delegate.” The Yellow Jackets in France, their biggest demand is, “Direct democracy, let’s vote and make laws directly.” In California, we’re – we are a direct democracy. We have a Governor and legislature, but all the consequential decisions are made by the public at the ballot box. That means a majority has voted for outlawing same sex marriage, for getting rid of benefits for immigrants, both of those were thrown out in the courts. They’ve also voted to protect the coast, that’s a great thing. They’ve also tied the fiscal situation in knots. “We don’t want to pay taxes, but we want the state to spend,” so you’ve locked in spending and locked out revenues, etc. So, our experience and anticipating this is going to be happening across the West because of his rupture with self-government and the public, mediating institutions to deal with the increasing demand for direct democracy, which is part and parcel of the participatory power of social media and social networks. So, other – if you do not have mediating institutions to feel – to deal with this impartial practices and mediating trade-offs that I discussed in the beginning, direct democracy will look a lot like social media, the good and the bad and the ugly. So, you’ve got to look at where the democracies are headed and you have to deal with it by forms of citizens’ engagement that are mediated. So, you don’t have a dumb mob, but you have collective intelligence. So, I’ll stop there because I’m getting lost in my – the – following your points.

Razia Iqbal

When you – the – I just want to pick up on the point that you make about the structures in California, because if you’re saying you’re not presenting that as a model for the rest of the world to follow, which I think you are saying…

Nathan Gardels

Yeah.

Razia Iqbal

…that you don’t want to do that, but there are things in there…

Nathan Gardels

Yeah.

Razia Iqbal

…that are of interest to the rest of the world, is it possible to replicate, when, actually, some of things that are effective, in terms of direct democracy in California, are actually stymying effective governance as well?

Nathan Gardels

No, they absolutely are, that’s right, that’s what I’m saying. Direct democracy is – last year…

Razia Iqbal

But isn’t the point effective governance?

Nathan Gardels

Yes, last year, about this time, I was in Rome at a conference with the Five Star Movement, The World Forum on Modern Direct Democracy and the room was full of people, or the conference was full of people, all who wanted, you know, disempowered citizens who wanted somehow to get a piece of power. They were all about direct democracy, let us get in there and let us have a voice. Those who actually experienced direct democracy were all about deliberation. We need institutions, so that you just can’t say we don’t like same sex marriage and that’s the end of it, ‘cause in California, if you gather 500,000 signatures and say we don’t like same sex marriage, it goes to the ballot and the public votes on it, and it becomes the law, unless the courts challenge it.

So, to get back to your first point, so the – what’s – the crisis of democracy, this – the same question was asked the other day in an interview with The Economist. They said, “What’s the problem, what crisis of democracy? You’re just liberal cosmopolitans who don’t like the,” you know, the “way people…

Razia Iqbal

The outcomes, yeah.

Nathan Gardels

…are – the way you people are voting.” I said, “No, it’s not the issue of elections, you know. Like I said, Macron goes this way, Le Pen, goes that way. It’s an issue of the institutions of – impartial institution practices outside the ballot box that make democracy work and allow a governing consensus to happen in diverse societies.”

Nathan Gardels

Do you disagree with the need for the presence of what’s Nathan’s talking about?

Hans Kundnani

Well, I think what’s, sort of, emerging here is that, I mean, I think we just have a different view of direct democracy. So, I mean, my impression, correct me if I’m wrong, is that this book, or at least this section of the book is borne, I mean, I think you just said this, is borne out of disillusionment with direct democracy.

Nathan Gardels

A mediated direct democracy.

Hans Kundnani

And you seem to be, sort of, saying that, you know, direct democracy is, sort of, here to stay and there’s nothing we can do about that, but we don’t really like it and so, we have to try and, sort of, “counterbalance it,” is the term you used, with these deliberative institutions. I’m much more positive than that about direct democracy. Now, you know, it would be easy…

Nathan Gardels

You are? Come to California.

Hans Kundnani

Well, but here’s the thing, here’s the thing, I’ve just lived through Brexit for three years, you know, and so…

Nathan Gardels

Well, there you go.

Hans Kundnani

…actually, this is also fertile ground, this is also very, very fertile ground…

Nathan Gardels

Yeah.

Hans Kundnani

…to be – you know, lots of people and, you know, particularly your Remainers in this country, would have exactly the same view as you, which is direct democracy is a nightmare. The reason we have this constitutional crisis that we do right now is because we now have this clash between representative democracy, i.e. Parliament, and the results of this referendum. So, you know, I have been through that, too. Nevertheless, it seems to me not just that this is something we – where we can’t turn the clock back, but I’m much more positive about it than you are and I think we need to, sort of, figure out how to make this work.

Nathan Gardels

But just to say on that, I mean, that’s our view too. I mean, it – I’m trying to say it’s a historical inevitability, fortified by the participatory power of social media, which drives people towards direc – the political form of that empowerment is direct democracy. So, it’s something all democracies will have to deal with.

Hans Kundnani

Yeah, can I just add one more thing, though, because I think this is important, that you talked about these independent institutions mediating between citizens and Government? And it seems to me that the other institution, which mediated between citizens and Government in a completely different way was political parties. So, you know, I’m very concerned about the decline of political parties. I’ve been very influenced by Peter Mair, the Irish Political Scientist, who’s written a lot about this. You seem to be much more relaxed about the decline of parties. In fact, you seem to – this is, by the way, another thing which the Founding Fathers were quite opposed to, right, is parties and factions. And you seem quite relaxed about this, the idea that you can, sort of, somehow replace the function that parties have with some kind of other institution. I don’t think you can, for the reason I mentioned, which is, I just don’t think you can have these non-partisan independent institutions that reach these decisions in this independent way. I think we have to confront the fact that there are different interests in society and that, you know, the reason I believe in democracy is because I think that the best way to resolve a – to find the best policies is for a clash of interests, rather than through some clever people figuring out what the best solution is. That feels to me like technocratic…

Nathan Gardels

No, I do have to respond to that, sorry.

Hans Kundnani

Alright, alright.

Nathan Gardels

So, it’s not that the institutions – that collaborative competition, which is competitive elections, doesn’t take place. The point is that the institutions…

Hans Kundnani

I know.

Nathan Gardels

…the platform in which that takes place, has to be depoliticised. The platform has to be impartial to allow that clash to take place. That’s point number one. Point number two, just on the parties, I know Nicolas thinks – maybe this is what Nicolas wanted to say, but I mean, the – parties, big part – big tent parties, outside of Asian countries that have a culture behind it, like civilizational weight, like Japan or China, outside those countries, the demassification of society is fragmenting the ability to bring everyone together under a huge tent. You know, you’ve got gays against – Gays for Guns, you know, you’ve got abortionists that want to protect animals, you’ve got a zillion constituencies that don’t fit under one tent. And if the tool of direct democracy is available and the tool of social network is available, it, inevitably, will create a fragmentation that you won’t be able to bring together implacably. That’s my suspicion; we’ll see, you know. It would be great if they – if you could build a consensus around big parties, like during the Industrial Era, but I’m afraid they’re going the way of lifetime labour and mainstream media, I just think it’s not going to happen.

Razia Iqbal

Nicolas, I’d like…

Hans Kundnani

Yeah, I am…

Razia Iqbal

…you to just…

Nathan Gardels

Right, right.

Razia Iqbal

…before we open it up to the floor.

Nathan Gardels

No, sorry.

Razia Iqbal

Go ahead.

Nicolas Berggruen

I mean, in a way, I would almost say, Hans, I wish you were right on everything. I actually think it’s, sort of – and I don’t mean it in a negative way, but it’s almost like an old-fashioned view of democracy. I think we are at a breaking point and the breaking point is multi-layered. One of them is, I don’t think political parties, traditional political parties, have – and they’re basically collapsed. I mean, if you look at even, let’s say, this country, there are lots of people within Labour, who are in favour of Brexit, or the other way round, and the opposite on the Conservative side. So, I don’t think the traditional political parties would present, sort of, you know, holistic views anymore. I think, as Nathan said it, there are bits and pieces everywhere, that’s the first thing.

Second, traditional media used to be a filter, it’s gone. So, everybody has a voice, it’s going to be irresistible for people to use that voice. The question is, how do you filter those voices? And you’ve had – traditionally, you had filters, political parties, you had traditional media, I don’t think they’re coming back in the way they used to, but you still need an editing or filtering system.

Razia Iqbal

This is funny.

Nicolas Berggruen

So, how do you do it? Government has to be a service organisation, to serve everyone. It can’t be distant. It has to reflect the view of the people. How do you reflect the view of the people? Just through elections and referendums, that’s very crude, you’ve seen it in Britain. So, it has to be a more sophisticated way of doing it and you can involve people, thanks to technology, you can have citizens’ assemblies that can be an Advisor to the public, to the elected officials, and to bureaucracy, all of them. So, you can use those tools to inform people, to inform Government itself, but you still need some form of filters. And just to, sort of, take it in a concrete example, you mentioned Europe, and I do think you’re right, you have an imbalance, for example, in Europe. At the local level, things are way too politicised.

Let’s say France, the country I was born in, you have somebody who’s elected, big majority, he’s got a majority in Parliament, he tries to do reform. As soon as he tries to do any reforms, stop, okay? So, you’re in a very difficult environment to get anything done, any reforms done. So, at the – at homeland – you know, at – in any country, things are very difficult, in terms of bringing people together to build a common future. Then, at the European level, the exact opposite, very bureaucratic, too distant, people don’t feel that their voice is heard and it’s not heard. And there is no democracy of Europe. So, on one side, too far away, not polit – not populist enough, if you want, not democratic enough, and the other side, all about populism and about elections and about, sort of, the latest, you know, what you – you know, whatever, a political football. And neither is good, so you need a real conceptualisation of where we are, using modern tools. And they are modern tools, they have changed the game. We’ve got to accept them. We’ve got to integrate them and it’s going to be – it’s – you know, and we’re at the beginning of having to rethink how to make the democracies work, not so that they’re too far away from citizens. They have to engage citizens, but they have to filter.

Razia Iqbal

Okay and for – just hold the thought that you’re having, because I’m going to open it up to the floor. Please wait for a microphone. Two hands have gone up straightaway, so, let’s have the woman right at the back, followed by the man in front of her. Please tell us who you are.

Lynn Forester de Rothschild

Hi, I’m Lynn Forester de Rothschild. So, I think it is great and vital to address democracy, but in thinking about this for a few years and more in the context of inclusive capitalism, I’ve come to believe that to talk about models of democracy is a little bit like rearranging the chairs on the deck of the Titanic, for two reasons. One is that we have seen, in America and Britain, that regular people aren’t thinking in this way and how do ideas connect to them? Which leads me to my second and most important observation, is that I think our problem is that we have accepted neoliberalism as an operating function for the social contract among all of us and our institutions and, basically, that needs to be replaced, and in the same way that it replaced what drove CANES and Government, you know, pre-war/post-war. So, I think what we real – we need to up our game in two ways. Intellectually, we need to think about how do we need to change our culture, our religion, our definition of happiness, our definition of success, so that it creates a world that responds to the people who feel so disenfranchised by these very, you know, ivory tower conversations? And I think that’s where we need to put our best thinking.

Razia Iqbal

Thank you very much. Anyone want to res – and it wasn’t, it was an observation, a very insightful one, but anyone want to respond?

Nicolas Berggruen

I think we’re all agreed. I mean, Lynn, I would say, and yeah, I mean, and so, I think we agree with it. That’s part of the whole point of the book is, you have to rethink a number of these things, and you talked about inclusive, that’s the whole point. People feel excluded or included in everything, the fight, where they’re winners and losers. The question is, how do you bring people together? You were not here, I think, when we started about this idea of pre-distribution, bring people in from the beginning, as opposed to after the fact, on the economic side. So, we talked about this idea of the universal basic capital, as opposed to, you know, other mechanism. But the idea is yes, you’ve got to, you know, find ways to bring people together, as opposed to not, and I think that’s a part of, you know, what we try to expose in the book.

Nathan Gardels

In the book I’d just say we call it pre-distribution, which is making sure everyone has universal basic capital. It is inclusive capitalism, so, I mean, it’s another word for what we’re arguing, but it’s particularly relevant in the digital age, when employment and income are being separated from productivity growth and wealth creation, to be able to distribute wealth to those who are – pre-distribute wealth to those who are losing their jobs from intelligent machines.

Razia Iqbal

Hans?

Hans Kundnani

So, I think all three of us agree that neoliberalism is – went wrong, as it were, or part of what went wrong an d so, I think we broadly agree on that story, over the last 30/40 years. But it seems to me where we differ is precisely this point that we discussed earlier on, which is, my understanding of that story of neoliberalism, over the last 30/40 years, or hyper-globalization, how – you know, whichever term you want to use to describe it, it seems to me that part of the story of that is the growth in non-majoritarian institutions, independent agencies and the removal of ever more areas of policy, particularly economic policy, out of the space of democratic contestation, to be decided on by these independent bodies, often international bodies. And, you know, again, the EU is the, sort of, I think the, sort of, ex – the most extreme example of this. So – whereas, I didn’t get the impression, from the way you tell that story in the book, that you see that as being part of the problem.

Nathan Gardels

We just do. I mean, we agree with Danny Roderick, you know, and we say that part…

Hans Kundnani

Then it does seem to me to be a little surprising, then, to propose more independent agencies as the solution. That’s the bit I don’t get.

Nathan Gardels

Look, a Citizens’ Assembly in California to vet an initiative that outlaws same sex marriage is hardly the same thing as a Global Trade Tribunal.

Hans Kundnani

Yeah, but how do you…?

Nathan Gardels

I know, she wants to go on, so…

Razia Iqbal

I just want to get as many questions in as possible. The gentleman who’s got the microphone?

Alex Folkes

My name’s Alex Foulkes. I – one of my things I did in the past was I ran one of the Remain campaigns, the subsidiary Remain campaigns, in the Brexit referendum.

Nathan Gardels

Very good.

Alex Folkes

Oh, thank you. People will obviously disagree with my stance, but I think one of the best things about democracy is that you have competing ideas and they battle it out. Because by challenging each other, you explore the weaknesses in each other’s concepts and usually, not always, but usually, the best ideas, the best outcome will win. I think if you create citizens’ juries or whatever you call them, firstly, I think that existing Politicians are loathed to cede control to anybody else and you may create these citizens’ juries and they may come up with a fine solution to something, but, ultimately, it is the people in Parliament, the people who – or the Governors or the – whoever, will take a decision and that might be wholly unrelated to what the citizen’s jury comes up with.

And you ask for some intercession between Government and citizen, to me that’s always been Parliament. One of those organisations has been Parliament. So, the Government will try to govern for everybody, they will fail, but they will try to govern for everybody. Parliament is there to represent the interests of the people and one of the things that we have, in this country, is we have those directly elected MPs, the same as the States. What you don’t have, in many countries around the world, but those directly elected MPs, you have that ability to talk to your own individual MP, to be able to have the – your voice heard. Ultimately, this will fail, I feel, direct democracy, because of what we saw in the UK referendum, because of Facebook, because of interference by outsiders…

Member

Bots.

Alex Folkes

…because of people, bots indeed, because of people who will simply lie and change their mind after the vote has been taken. Now, that’s a very prejudiced point of view from mine, but I accept that. But I feel that that is the flaw in the solution that you’re proposing.

Razia Iqbal

Okay, I just want to get another couple of questions in and then maybe you can respond. The gentleman over there in the back and then the gentleman here in the front.

Paul Turner

Thank you. Good evening, my name is Paul Turner. I’d actually – I’m going to try to ask a very simple question, which is that you propose mediating institutions. Surely, that’s just another way of saying that people who are not elected get to decide.

Razia Iqbal

Hans, do you want to respond? No, not Hans. Sorry, Nathan, would you like to respond to that?

Nathan Gardels

I’m not sure what the last point meant. I’ll say something here. I think the participatory power of social media, which levels the playing field of information between amateurs, professionals, etc., etc., also undermines the idea of representative democracy, ultimately. And the direct democracy that’s being demanded and a mediated direct democracy that we’re arguing for is both a compensation – a complement to representative Government and a compensation for its declining legitimacy.

Elections, you have big faith in elections. The reason the Founding Fathers – well, the Founding Fathers made one big mistake to expand stuff, and I mean, I’m not saying it’s a mistake in any moral sense, but I mean, in a political governance sense, by expanding suffrage, you would allow people to control Government better. In fact, what happens is the vast electorate couldn’t operate without factions, or parties, organising it. And those who had the interest and the time, the money and the connections, are the ones who dominate elections. So, elections are not representative, necessarily, of the interest of all – certainly not the interest of all society. In fact, there’s a book by a guy named Sitaraman, who’s an Advisor to Pete Buttigieg, who was one of the Presidential candidates, it’s called “The Middle Class Constitution,” who argues and Elections actually create aristocracies, because they leave the average citizen out and let – not let things, but things then are controlled by those who have the money and time. This is certainly our experience in California. It’s certainly experience with direct democracy.

The oil companies come in and say, “We want to kill your climate change legislation and we’re going to call ourselves the Jobs Initiative” and they put $70 million into a campaign to undo, you know, the election. So, I’ll just go back to my initial point, elections are not the only thing about democracy. It’s the impartial institutions and platforms that allow for this collaborative competition between competing parties and competing interests. If those impartial institutions are destroyed, or if consensus is decimated by polarisation and partisanship, that’s what’s the crisis of democracy.

Razia Iqbal

But you can just answer…

Nicolas Berggruen

And I…

Razia Iqbal

…directly the gentleman…

Nicolas Berggruen

Can I…?

Razia Iqbal

…asking that question? Nicolas, go ahead.

Nicolas Berggruen

Yeah, I want to say one more thing about the referendum point. The reality that the referendums are a way to disintermediate, you know, the elected officials. But – and I think you’re right about that, the reality is that it’s going to become a fact, every – meaning you’re not going to not be able to deal with it in pretty much every democracy, because citizens are demanding it and it’ll be irresistible, from a governance standpoint. I’m not saying it’s good, but we have to deal with it.

Razia Iqbal

Can we just get the microphone here for this gentleman here in the front? And I wonder if you will just, Nathan, just address that question, with what…?

Nathan Gardels

Give me the question again?

Razia Iqbal

The question the gentleman asked in the corner, which is that the possi – what you’re arguing for is for people who will be making the decisions are unelected, when you’re talking about these mediating institutions.

Nathan Gardels

No, let me make…

Nicolas Berggruen

No, the inform – the bodies – a little bit like juries, that will inform and advise. They don’t necessarily make the…

Paul Turner

But the question was…

Nicolas Berggruen

…decisions.

Paul Turner

…will elect…?

Nathan Gardels

Let me give you a specific example in the book, and I hope you buy the book. Hello. Hello, I hope you buy the book, because I go through a specific example of this, in the case of California. In California already, as I said, the direct democracy is established and the voters love it. They don’t want the Politicians to make the decisions, okay? So, we’re proposing mediating bodies that take the raw public sentiment, no same sex marriage, get rid of immigrants, for example, or don’t pay taxes, but keep services, take that raw sentiment, formulate it into policy, have neutral, impartial institutions that can formulate things into policy, that take care – take the whole body politic into account and then put it back to the public, either to the elected representatives for a vote, or back to the public in a confirmation referendum. The public, in the end, or the public’s elected representatives, always decide in the concept that we’re using. You’re not replacing the public with unelect – with the legislative unelected leaders. They’re the mediated body. They’re not the ones who make the awkward decisions. They’re the one who processed the policy.

Razia Iqbal

So, the gentleman in the front and then Kirsty, behind.

Oliver Grimshaw

My name is Oliver Grimshaw and I just want to put three points, or questions, to you. Given that democracy is always a messy affair, I think the point which was raised early on, is there really a crisis? It’s a very valid point. Because if we go back a few decades, in the US, Britain, France and Italy, we had almost a breakdown in society because of the political confrontation during the election and the [inaudible – 53:19], where there were riots, there were fighting, there were complete uncertainty. In this country, there was a period of strikes, even having to cut down the working week. In France, there was revolutionary states, where the President disappeared. In Italy, political leaders were kidnapped and also assassinated. Compared to this state of affairs, we are in a relatively good shape. So, I really want you to argue more strongly that there is a fundamental crisis, even if you don’t like the outcome of the democratic process.

My second question is for those of us who look at California from afar, we seem to have the impression it is a primary example of a dysfunctional governing system, but you have the uphill task of trying to sell the rest of us that this is somehow a democratic governance model. So, my question to you, how are you going to go about counteracting this kind of global image of California.

And my third point is…

Razia Iqbal

Let’s just stick with…

Oliver Grimshaw

No, no. No, no, because I want to bring that in. My third point is the democratic transformation in Asia, minus China. Because if you take India, you take Indonesia and you take Korea, it’s a remarkable operational, functioning, state of affairs of a democratic transformation and how India managed to have 900 million people voting and turning out their leads and replacing them with other political parties, is, I think, a primary example of how democracy is functioning in a fascinating way. So, my question is, why have you not brought these other Asian countries into this analysis of China versus California?

Razia Iqbal

Well, okay, go, go, Nathan.

Nathan Gardels

No, I got it. I – the only thing I’ll say about India, really quick, is 70 years after independence from this country, they – 50% of people still don’t have toilets. So, I’m not sure what voting means. So, that’s number one, but I don’t want to argue about it. We decided not to talk about China and India, so I have a lot to say, if you want to go there. But California…

Razia Iqbal

You clearly haven’t persuaded him, Nathan.

Nathan Gardels

Well…

Hans Kundnani

But he’s…

Nathan Gardels

…the great thing about…

Razia Iqbal

I know, I know.

Nathan Gardels

…the great thing – wait, wait…

Razia Iqbal

He’s not saying it’s the best.

Nathan Gardels

…wait, wait, the great thing…

Oliver Grimshaw

What it actually is, is functional…

Nathan Gardels

…about…

Oliver Grimshaw

…about the issue.

Nathan Gardels

…these discussions, it allows you to, kind of, signal your themes of a book, in the hopes that you will buy it and say, hey, now I understand what they mean about California, when I read the book. The premise of the whole discussion is how dysfunctional California’s direct democracy is. That’s the premise. How to fix it and it happens to coincide with the global trend towards people wanting more direct democracy and what makes it different than earlier crises of democracy, as I keep pointing out, is the advent of social media, the participatory power of social media, the levelling of the playing field between amateurs, professionals, Politicians and the people, etc. That’s what’s different about the crisis and that’s what we respond. California, in a sense, is a canary in a coalmine. We’re trying to fix it. We’ve tried to change the direct democracy with some deliberative processes, but California, if you really want to go through dysfunctions, you know, we can stay here ‘til midnight and I…

Razia Iqbal

But…

Nathan Gardels

…can tell you.

Razia Iqbal

…we’re not going to. So, I’m going to take three more questions, Kirsty, and then there and then here.

Nathan Gardels

But it’s not a model. It’s not – we’re not saying it’s a model. We’re saying it’s the petri dish in which to raise these issues, because I think the rest of the democracies are headed in that same direction. I’m sorry.

Kirsty

And I’ve just got a quick question, which is, I wondered, to Nathan, whether you had looked at the example of Citizens’ Assemblies in Ireland, in the lead up to the abortion campaign, where they played an incredibly, I think, positive role in stopping populists getting hold of what is a very emotive and divisive issue, as we have indeed seen in the United States?

Nathan Gardels

Yeah, totally. We looked at it and we looked at it, we know the guy, David Farrell and the people who did that. Some people here in Great Britain, as you may know, are proposing citizens’ assemblies to now deal with the Brexit, if there’s another Brexit vote or conformational referendum. It showed, in a very highly emotional and polarised issue like abortion, these things can work.

Razia Iqbal

Gentleman at the back and then at the front and then we’re going to have to stop.

Peter Rani

Hello, my name is Peter Rani. You were talking about the Founding Fathers, made me think of the following. The question arose immediately: who was allowed to vote? And namely people who were able to read and write, who had an education. Seems to me that democracy might be working very well. Talking about America, you look, you have incredibly diverse President, one after the other, you can have Trump, you can have Obama, you can have Carter, and so on and so forth. It seems to me, and you were talking about the referendum here and also in Europe, there seemed to me to be a huge disconnect between the information as a – or the knowledge provided to citizens. Democracy would only work, and you were talking about China and India, I think the same problem, it will only work if people have access to proper knowledge. And Nicolas was talking earlier about pre-distribution and how you could share 30%, and so on. How about putting this algorithm open source, so the knowledge can be shared? You don’t help people by giving them the result, the – of whatever it is, but by giving them the means to do it for themselves. So, it seems to me that democracy, actually, is quite healthy today. What we’ve all forgotten is to actually share knowledge. Instead, what do we do? We give just information, information retrieval. When people voted for Brexit, the – was there any communication from the Government? I don’t think so. In France, even worse. In Europe, nobody has any clue about how the whole thing is run. So, I think the problem is not purely political. It’s a little bit deeper. It somehow reminds me of what led us 2000 years ago to the Dark Ages. Anyway, I think…

Razia Iqbal

Thank you.

Peter Rani

…which also…

Razia Iqbal

Thank you very much.

Peter Rani

…as far as…

Razia Iqbal

The gentleman here…

Peter Rani

…and that’s…

Razia Iqbal

…in the front.

Andrew Marshall

Thank you. Andrew Marshall, Cognito. I haven’t read the book. It seems to me, and perhaps quite naturally from the US, there’s a lot of focus on democracy within national silos. If you live in Demark, and there’s five million of you, you’re acutely aware, or any European country, really, you’re acutely aware that decisions get taken beyond your borders, in a way in a continental power you’re not. And that’s why, at least some people in Europe, are quite keen on telling their Ministers what they should vote on when they go off to take decisions at a European level or a global level. There’s been a World Federation movement for many years, a World Government movement, and I just wondered whether any of the panel had comments on that?

Nathan Gardels

On world federalism or on Denmark?

Andrew Marshall

On the fact that for smaller states, yeah, part of what’s really important in democracy is influence at an international democracy, if you like.

Nicolas Berggruen

I didn’t…

Razia Iqbal

Go ahead, Nicolas.

Nicolas Berggruen

No, I didn’t fully understand the question.

Razia Iqbal

Oh, okay. Do you want to ask the question in a different way, perhaps?

Andrew Marshall

Democracy is about influencing things and if you live in smaller states, that is why Europe came together, but it’s not just Europe. People want to influence things, you only want to influence things internationally, which is, I think, a little bit different from living in a continental state, where the rest of the world is less. And it seems to me that at the European level and at a world level, we need to put a bit more of that.

Razia Iqbal

Agree, disagree?

Hans Kundnani

Agree, I guess, yeah.

Nathan Gardels

Yeah, I think it’s always that issue of subsidiarity, at what level do you make the decisions, you know? Denmark, I mean, the Social Democratic Party just returned higher in the election, because they took on the immigration issue, which the centre left has not been willing to take on in Europe. It’s an issue from outside Denmark, but they put their mark on it. They couldn’t do it at the European level.

Hans Kundnani

And it seems to me, in both cases, no, I mean, I agree with you that things do look very different, if you live in a small nation state than in the United States, that’s clearly true. But, on the other hand, you know, both cases, the United States and Europe, you have a system of multilevel governance, with decisions being taken at different levels and, you know, it has – it’s a slightly different, you know, system in each case, although there are, obviously, some that would like to turn Europe into something like the United States, in that sense. But, actually, what I think’s more interesting is that despite those differences, seems to me the overall trend is in the same direction, which is my impression is that citizens are demanding decision-making to be taken closer to them, rather than further away. This is what I meant about this, sort of, the end of deference and, you know, I just – I – this – to make the link, actually, for China, it seems to me you have these two countervailing pressures going on, because on the one hand, and pro-Europeans will say this all the time, you know, you have to be a big unit in this world, in order to have any kind of weight. It was one of the key Remain arguments. So, there’s this, kind of, geopolitical pressure pushing towards larger units, but it seems to me there’s also a, sort of, bottom up pressure around, at least the West, which is pushing towards smaller units, ‘cause people want decision-making to be closer to them, and I think that’s the basic problem that we have to deal with.

Nicolas Berggruen

And then you have the unusual example of Switzerland, which is a small country, which has all types of different trends all at once, so very local. I mean, number one, every – there’s federal, there’s regional and there is municipal and they’re high – they’re very divided, the tax revenues and spending is very much divided between the three. So, there’s very local, people vote all the time on lots of different things, they have referendums all the time, so, it’s very close to them. At the same time, Government, truly, in Switzerland, is a service organisation, very remote and not populist. So, it’s an incredible, very unusual, mixture of two, where people are very involved, highly informed, have a lot of power over what’s happening, especially at the local level, but Government is actually quite remote from an emotional standpoint. There’s a President that’s a roving…

Nathan Gardels

Appointee.

Nicolas Berggruen

…appointment, I mean, a rotating appointment out of seven, and if you ask most people in Switzerland, “Who is your President?” they don’t know. So, it tells you how remote they are from politics, at the same time very involved. It’s a very unusual combination and it seems to work. So, the question is, in – I’m taking this and it’s a small country, it has lots of issues, you can’t transfer these things easily. On the other hand, it tells you that it’s a totally different way of running the democracy, much less emotional, even though people are – can express themselves. And it’s – not everything becomes a division of an – of the entire country and they’re able to keep citizens together, in one direction, keep, let’s say, inequality relatively subdued, compared to other places.

Razia Iqbal

We have gone way over time, for which I apologise, and Nicolas is going to be late for his next appointment. But thank you all very much for all of your questions and your attention. Thank you to Nicolas Berggruen, Nathan, and to Hans Kundnani, as well. Thank you all very much indeed. Thanks [applause].