How to Square Money With Politics by Selling Votes
Money and politics have always made uneasy bedfellows. Their relationship is considered toxic to good governance. But a new paper by professors from the University of Chicago, titled “Voting Squared: Quadratic Voting in Democratic Politics,” breaks new ground by attempting to legitimize the role of money in politics.
In the quadratic voting system, each person can buy votes for or against a proposal by paying into a fund the square of the number of votes that he or she buys. The money is returned to voters on a per capita basis. According to the authors, the system is expressly designed to counter a “tyranny of the majority,” or a system in which the wishes of an apathetic majority prevail over those of a minority, which may be deeply (and personally) invested on the issues at hand.
The roots of the tyranny of majority lie in the “one person, one vote” principle. Originally envisaged as a means for universal suffrage, the principle gained widespread popularity at the end of the second world war because it enabled a number of countries to assert their right for self-governance over colonial powers. Over the years, the principle has become a deeply entrenched rule in democracy because of its association with equality: Each person is allowed a single vote, regardless of his or her circumstance in life.
But practical implementation of the one person, one vote concept is a double-edged sword. Even as it promotes equality, the principle sidelines or ignores the preferences of a minority who care deeply about an issue because it affects them directly (as opposed to a majority that may not have a personal stake in the issue). The authors cite gay rights as an issue that was deeply important to an affluent minority (gay couples, on an average, earn more than their heterosexual counterparts) but unimportant to the vast majority.
There are two reasons to worry about the tyranny of the majority, according to the authors. First, the majority can subvert the political process of democracy by creating laws and policies that favor their own interests. The second reason is related to the first. Minorities are systematically excluded from power, as a result of the legislation and policies favorable to the majority population. The cycle, thus, becomes self-perpetuating. For example, slavery was codified into law by the majority over a minority.
These concerns are not new. The paper’s authors quote Plato (who thought democracy was a “lawless rule of the mob”) and cite Aristotle (who suggested weighting votes by property holdings) to make their case for the dangers of majority rule.
A marketplace of ideas
The authors used the example of an economic marketplace to devise a solution. Thus, the participants in an economic marketplace express their preferences for goods by paying the highest possible price for them. In a similar fashion, voters most invested in the proposal or cause at hand should be willing to pay a premium price for its implementation.
The argument is enticing but votes and economic goods are hardly equivalent. The paper’s authors provide an economic threshold, a price that each group — majority and minority — is willing to pay for legislation to pass. But, the argument against quadratic voting is not merely about economic threshold.
“The actual goal (of voting mechanisms) is not to take current preferences and translate them into right outcomes. Rather, the goal is to encourage better and more reasonable preferences and shape a more durable consensus in future polity,” writes Tyler Cowen, author of Marginal Revolution, a blog about economics. In simple words, consensus is achieved by persuading a large uncaring majority through dialogue. In doing so, the minority crafts dialogue that appeals and resonates with the majority’s experiences. Compromise and bargain are essential byproducts of this dialogue and the result is a centrist position.
One could also argue that quadratic voting could have an adverse effect on the American society. The United States represents a unique case for intense minority preferences. Differences, whether in culture, values, or lifestyle, are celebrated here. The accentuation of differences promotes innovation and free thinking. Free speech is codified into daily life through the First Amendment. Intense preferences, whether by minorities or majorities, are expressed in the form of protests, demonstrations or persuasive dialogue, which are all considered forms of free speech. Social capital and interactions are considered key to oil the wheels of politics and business. The model for politics, at least in theory, is social and community-based, rather than economic.
Take, for example, a noted venture capitalist’s suggestion to break up California into six states for better governance purposes. The proposal, which would have resulted in a division between the rich and poor areas of the Golden State, was defeated during elections.
Would the quadratic voting system have made a difference to his proposal? The chances are high because he had capital and a wealthy cohort of friends at his disposal to buy up votes. This minority also had the intense incentive of multiplying their wealth in a technocratic (and tax-friendly) Silicon Valley government. Correspondingly, the brewing class warfare in the Bay Area has already disaffected a majority of workers from the ideals of Silicon Valley, who probably do not have the capital or resources to compete with the Silicon Valley elite.
The problem is that quadratic voting relies exclusively on an economic model. It eliminates incentives to persuade or exercise free speech. Instead, the passage of legislation or discussions about policies becomes a question of money rather than an idea’s inherent value. Of course, this is not to say that the political system in the United States is perfect. In fact, like most democracies, the system is more imperfect than perfect. For example, several disastrous economic policies have been pushed through government by Big Business.
As Cowen writes:
If minority groups know they have the possibility of buying up votes as a path to power, paying the quadratic price along the way, we are sending intense preference groups a message that they have a new way forward. In the longer run I fear that will fray democracy by strengthening the hand of such groups, and boosting their recruiting and fundraising.