The principalagency framework, derived from economics, enables us to picture the flows of political power, both as they are and as they ought to be in a democracy (see Principals and Agents in Economics and Politics).
Figure 1 below shows how I think a democracy should work. The principals are the people, as sovereign citizens. The sovereign interest is the public interest. The people also express political power through their private class interests, which, as such, create conflict. Private interests can include a labour interest, a landed interest, and a capital interest. The latter - the capital interest - is clearly the dominant private interest in New Zealand and most other countries in the 1990s.
In a democratic partysystem, the parties should be accountable
to the people, on the basis of political class. This requires
mass membership of the parties, and party candidate selection
to be based on a process akin to the primary elections in the
USA. Historically, by way of contrast, parties have been accountable
mainly to the private interests.
In addition, a democracy requires that the people - all of the
people and not just those in strategically placed electorates,
play a role independent from the party machinery in electing a
Parliament. This means a fair vote between parties, and a free
vote for one's local MP. The vote for a preferred local MP should
never compromise the party vote, as it always did in the preMMP
era. In the old days, most people, by making a realistic decision
to vote for the party rather than the person, were obliged to
endorse the party choice, where the party choice was made by a
narrow interest group.
Thus, a democratically elected parliament requires direct input
from the people as citizens, and indirect input through the parties.
The Parliament is the key institution in a democracy. It can only
control the inner Cabinet - the effective executive in New Zealand
- if its makeup accurately reflects citizen opinion. A Parliament
strongly biased towards one political class or one private interest
group is easily controlled by its servant, the executive.
An executive that is a properly accountable agent of a representative
Parliament is able to "run the country" with minimal
risk of abuse. The public service, including the armed forces,
are its agents. Through the bureaucracy, the executive rules the
people as subjects. Thus the people are obliged to conform with
the process of law, and are obliged to pay their taxes. Principal-agent
analysis based on the ruler treated as principal can be applied
to the ruler-bureaucratsubject part of a democratic polity.
The danger of this treatment is that the role of citizens and
parliaments can be neglected, even dismissed as unimportant.
The opposite of a democracy is an autocracy. The main difference is that the top half of Figure 1 is missing in an autocracy. The people exist only as subjects, and not as citizen principals. Figure 2 shows that the ruler's position replaces that of the citizenry, with some kind of public service existing as the agents of the ruler.
In historical autocracies, the dominant interest groups were those
of the landed nobility and those of merchants. They played key
roles as agents of the ruler. Historically, public administration
was seen as a duty of the upper social class. However, tax collection
was often facilitated through a private arrangement known as tax
farming. Indeed tax farmers were the predecessors of the modern
capitalist class, and tax farming brought the upper echelon of
merchants into the power loop.
In classical autocratic governments, the free people were mostly
peasant subjects, and it was from them that most taxes were raised.
In the more developed autocracies, there were also significant
numbers of selfemployed artisans in the emerging cities.
They were free subjects.
Any additional labour requirements tended to be supplied by slaves,
who were tradeable commodities rather than subjects of a ruler.
Labour markets as we know them today only emerged when peasants
lost their land, or were evicted from the land to which they were
bonded. Free wage labour, as it emerged, took on the status of
subjection to the monarch.
A parliament in an autocracy served as an agent of the private
interests who were themselves nominally subject to the power of
the autocrat. Such a parliament created laws that were administered
by the bureaucracy and the judiciary, and whose duties were performed
by the dominant propertied interest.
In his 1997 Robb Lectures, Immanuel Wallerstein's pessimistic
scenario was that societies would reform on an autocratic basis,
following a difficult and unstable transition. The logical outcome
of that scenario would include the return of such institutions
as tax farming (a privatised Inland Revenue Department?) and,
eventually, slavery. The historical bifurcation, as he saw it
was that states would move either in the direction of Fig.1 or
the direction of Fig.2.
The overriding problem that Wallerstein presented was that, even
if states moved towards democracy, the diminishing role of states
in the worldsystem meant that governance was dominated by
an international economy that had no constitutional principals,
and, as such, looked more like Fig.2 than Fig.1.
Nevertheless, with the introduction of MMP, New Zealand, as a
sovereign nation, took a huge step in the direction of Fig.1.
The democratic system works differently depending on the varying
strengths of influence. Furthermore, the directions of influence
can be reversed once certain conditions are met. The most obvious
example is that a single party government, or a tight coalition,
can recreate the conditions whereby the executive rules the parliament.
Indeed, given the absence of preferential voting for electorate
candidates, we are likely to see the emergence of coalitions well
before elections are held, with electoral accommodations being
made to ensure that each coalition has only one strong electorate
candidate in each electorate. Thus we are likely to continue our
long tradition of adversarial politics, with one coalition or
party becoming the executive Government, and the other coalition
or party becoming the ineffectual Opposition.
Nevertheless, this kind of adversary politics is a vast improvement
on the old kind of adversary politics. Previously, a private interest
would dominate each single party, and just half a million votes
would secure "the Treasury Benches" for that party.
Today, the winner will need many more votes, making extremist
politics very difficult.
Jenny Shipley has been made leader of the National Party for just
one reason, so that National can win the next election on its
own. Jim Bolger has shown that he cannot command more than about
600,000 voters. To achieve that goal, she will have to adopt a
policy programme that is popular with the post Employment Contracts
Act working class; the social class that occupies the middle strata
of New Zealand society. She will only adopt New Right economic
policies if the champions of the New Right can persuade the new
working class that they are the best policies for New Zealand.
She will not adopt such policies in the face of opposition from
the voters she needs. If she lurches to the right, she will not
be fulfilling her contract with her party.
Extremist politics can still occur however, despite having a wellconstituted
democracy, as New Zealand now does. Extremist interest groups
can succeed by making a direct pitch at the mass of voters in
the political centre. Voters from the middle economic strata of
New Zealand society have in the past been seduced by minority
agendas. With modern multiplemedia techniques of persuasion,
the key relationship in Fig.1 may turn out to be that between
private interests and citizens; that of opinion formation, or
as Noam Chomsky called it, "manufacturing consent".
It is that relationship which forges political class, and it is
political class - expressing informed opinions - that drives a
democratic polity.
When there is no democracy, there is no need to manufacture consent,
and there is no need for an informed citizenry. The existence
of attempts by the interests to influence popular opinions is
proof that democracy does exist.
The New Right, which still represents the agenda of organised
capital in New Zealand, will seek to seduce the new centre. They
will seek to create a political class that favours New Right policies.
They will fail. They are more likely to be able to sell conservative
ideals to Jenny Shipley's core constituency: welfare targeting,
family values. They may even be able to sell support for public
utility asset sales, but only if middle New Zealand becomes the
beneficiary of those sales. They will not be able to sell a pure
market agenda, and they will not be able to sell a globalisation
agenda that includes a level playing field for foreign interests.
Whatever the complex dynamics coming into play, New Zealand is now sufficiently democratic to ensure that singleinterest political programmes will be very difficult to implement. We have rediscovered our principals.
{ This document is: http://www.oocities.org/Athens/Delphi/3142/krf28-pprincipal.html
{ the above reference is to: http://www.oocities.org/Athens/Delphi/3142/krf26-pr_agent.html
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