Excerpt from my book “One World! – Why the rise and fall of Great Powers musst come to an end” published in German but not yet available in English.
Whereas democracies assume that everyone is fallible, in totalitarian regimes the fundamental assumption is that the ruling party or the supreme leader is always right. Harari
What defines a system as ‘democratic’ is only that its centre doesn’t have unlimited authority and that the system possesses robust mechanisms to correct the centre’s mistakes. Harari
The sciences of nature are fundamentally accessible to all humans. Knowledge is not inherited; it must be acquired through individual effort. In this regard, science and enlightenment were inherently democratic from the beginning. However, democracy as a political form of governance does not necessarily arise from the demands of enlightenment. If knowledge and skills are to replace privileges, we may well argue that the leadership of the state should be in no other hands than those of educated experts. Given this premise, it is by no means surprising that leading figures of the European Enlightenment, such as Montesquieu, Locke, Voltaire, Hume, Rousseau, or Kant, widely differed as to their opinions on this matter. For instance Rousseau: his “volonté générale” was never more than an intellectual construct, only to be found in the real world when the masses are incited by demagogues. And let’s not forget: more than two thousand years earlier, none other than Plato had expressed the opinion that the governance of a state should be in the hands of the knowledgeable — the philosophers as he called them. In doing so, he was inspired by Sparta, a military dictatorship.
The demand for democracy did not seem to logically derive from philosophical premisses or the principles of enlightenment. Governing a state requires knowledge and experience – much more than overseeing an individual enterprise, like a foundry, bakery, or shoemaker’s workshop. There, nobody would think of entrusting leadership to somebody without experience. So, why should all individuals in a state have an equal say when it comes to decide matters of good governance? Why should all people be equally eligible as candidates for the highest positions of power – for example president and prime minister – even if they have no idea of the tasks that await them? Does such an understanding of democracy align with the goals of European Enlightenment?
The question is even more relevant because the most important institution of democratic states is almost immune against democratic influence. In the most advanced states, modern industrial enterprises were only exceptionally organized democratically – at times this was the case in the former Yugoslavia and during the first post-war decades in Japan. The aversion to democracy in business had a sound reason, for this central institution of the Western world and beyond owes its extraordinary success precisely to its non-democratic structure. In efficiency-driven institutions, what matters is expertise and the ability to use it rationally to achieve planned goals. The industrial enterprise, as the economic powerhouse of all modern states, is a consciously anti-democratic, hierarchically devised organization, which by its very omnipresence presents an alternative model to political democracy.
Hardly anyone protests this anti-democratic stance, as it appears to be reasonable and even indispensable. It is generally accepted as a matter of course that in a rationally managed company, the voice of a layperson without specialist knowledge should not carry the same weight as that of a trained expert. However, this truth does not apply to the economy as a whole, but specifically to manufacturing companies. Trade, with its offshoot advertising, requires little specialist knowledge, but all the more the ability to persuade, manipulate, and exert psychological influence. As a former real estate agent, the current president of the United States is known to come not from the manufacturing sector, but from trade.
The central importance of specialist knowledge for the manufacturing industry leads to the further insight that, at best, the traditional family business is a carefully managed autocracy that acts in the interests of its employees; at worst, it is a dictatorship that wears people down. The modern joint-stock corporation is no exception to this rule. Being mostly controlled by shareholders, that hardly makes it a healthier place for employees, as it generally aims to serve the interests of investors. And the effects of such an undemocratic organizational structure extend still further. Those who resist the directives of corporate management may not be sent to Siberia, imprisoned, or outright killed, as is the norm in political dictatorships. Corporations have a simpler solution: dissenters or the inept are simply fired. The principle, however, remains the same. Like in a political dictatorship, the dissident is excluded from the ranks of recognized group members. Amazon, Google, Microsoft, Volkswagen, etc. are undemocratically structured. This is not a criticism, but a necessity. It is the responsibility of a higher authority, the state, to ensure that their activities serve not only private interests, but always the common good as well – or at least that they do not conflict with it.
But why democracy, after all?
Their /the Chinese/ system of governance is more like what is typical in big companies…, so they wonder why it is hard for Americans and other Westerners to understand the rationale for the Chinese system … Ray Dalio
The Enlightenment insisted on expertise and competence, and this program was faithfully adopted by business. So why do we need political democracy at all, if the core organizational structure, even of democratic states, is and will certainly persist in being anti-democratic given that its extraordinary efficiency is owed to this very fact?
The great Max Weber had already raised this question. He believed that modern states would increasingly resemble authoritarian bureaucracies. Had he been able to witness the rise of China, he would have seen this as a most convincing confirmation.
As a matter of fact, the two central Western institutions – the political order on one, the economic enterprise on the other side – are in stark opposition, each attempting to extend its governing principle across society. Labor unions have to a limited extent achieved democratic participation in areas such as working conditions and wage negotiations.[1] However, the likelihood of the democratic principle spreading to the economy is nearly zero, especially in our time where expertise is essential. But the reverse process, the spread of hierarchical and undemocratic corporate structures to the political order, remains a real possibility and danger. This is not just a theoretical conclusion – this tendency has been proven time and again throughout history, most recently by a certain Donald Trump.[1] If the majority of a population consists of poorly educated, perhaps even largely uninformed people who do not understand the complex problems of a modern technological society, then the uninformed will elect an uninformed person as their president or their parlamentary representative. In comparison, a political dictatorship can — under certain conditions! — be far more successful, indeed just as successful as a modern industrial enterprise.
In any case, it seems difficult to deny China’s one-party system and its leadership a sensational historical success. Within a few decades, China catapulted from a bitterly poor agrarian nation to a superpower that threatens to dethrone the previous alpha state, the United States.[1] The secret of this success is as clear as in any well-run enterprise. First, a goal is set; for a company, this is maximum profit. In the case of a country like China, the goal is determined in such a way that the government can count on maxi-mum consent from most of its citizens. This was and is the eradication of poverty and eventually the achievement of Western levels of prosperity and beyond.[1]
Second, the goal must be reached in the shortest possible time and at the lowest cost according to rational criteria. For a company, this approach usually involves the reduction of costs or improved production methods. In China, it is taken for granted to engage scientific experts in overcoming poverty. Development – 发展 (Fa zhan) and science – 科学 (Ke xue) – based on knowledge and skills are the prevailing mantras – fully in line with the Enlightenment. The government’s promise may be summarized in the following way: „We’ll make all of you a bit wealthier every day, but we can only achieve our ambitious task if you follow our instructions to the letter. If you don’t, you are the enemies of progress, and we will eliminate you.“
So far, the Chinese leadership has fulfilled both parts of its promise: a meteoric rise – meticulously planned like that of any successful corporation – and, on the other hand, the ruthless prosecution of all dissenters and dissidents opposing its directives.[1] So long as the first part of the promise is consistently realized, most citizens support the regime, and it can feel sufficiently secure.
Did China endorse and fulfill the Enlightenment’s ideals by not only applying knowledge and skills to corporate management but also to the governance of the state? And if so, why don’t we transfer even in Western states the undemocratic but well-functioning corporate model to the political sphere as it works so well in China – and is, indeed, increasingly emulated by developing countries worldwide? Why not an elite of knowledgeable people, when in democracies there is a risk that the ignorant and demagogues will rise to the top of the state?
It seems that lots of people in Western countries are asking themselves this very question, certainly those in the economic sphere like the many CEOs doing business in Russia or China. There can also be little doubt that the freedom to express one’s opinion on any subject in public is an intellectual luxury that means little or nothing to people living in poverty. They willingly give up this freedom if they can hope for material progress in return.[1]
German history offers a stark example of such voluntary renunciation of freedom. Between 1924 and 1928, the share of votes for the Nazis had decreased from 6.6% to 2.6% – as Germans were gradually experiencing better times. They could afford democracy and freedom of speech. Then, the Great Depression of 1929, which had swept over from America to Europe, hit Germany, undoing in an instant the modest economic recovery of the previous four years. Between May 1928 and September 1930, the number of unemployed skyrocketed from 270,000 to about 1 million. By 1933, it had multiplied to 5.5 million. Desperation drove people to clamor for a savior.[1] The share of Nazi votes surged from 18.3 to 43.9 percent in these three years. The freedom promised by democracy – and largely granted until then – no longer played a role for family men queuing in front of soup kitchens. They were ready to follow any populist who promised them salvation. Democracy had lost.
The same may happen in the United States. There the outsourcing of the past thirty years has caused a significant portion of the working class to drift into precarity.[1] For these people, Donald Trump is a messiah who, like Hitler, Mussolini, and other great seducers, promises them salvation. Furthermore, the contrast between the super-rich power elite and the broader masses is evident not only in income and wealth but also in education and the opportunities it provides. A handful of American universities still rank among the world’s best, but most Americans read less than a single book per year. Donald Trump is a representative of this stratum. Therein lies an acute danger as a minimum level of education is essential for democracy to function.
The state – a moral purpose with technical means
It is particularly crucial to remember that elections are not a method for discovering truth. Rather, they are a method for maintaining order by adjudicating between people’s conflicting desires. Harari
Democracy is based on the understanding that the people is never a unitary entity and therefore cannot possess a single will. Harari
Let me summarize: The attitude of the European Enlightenment toward democracy was ambivalent, depending on whether governance was based on privilege or on knowledge and ability. Privilege was embodied in ruling dynasties that had for centuries stood at the head of states availing themselves of hereditary power. This was unacceptable to all great thinkers of the 18th century. In a democracy, an inept statesman can be voted out, whereas in a dictatorship, removal is only possible after catastrophic defeats or devastating civil wars ….
Notes:
1 Ulrike Herrmann (2022) aptly and only seemingly paradoxically describes the role of unions when she states, „Unions are the saviors of capitalism.“
2 But the economy is not a monolithic entity. While the manufacture of products generally requires a high degree of knowledge and skill, successful trade rather relies on persuasion and psychological influence, i.e. on theatrical talent. In extreme cases, factual competence, can be completely dispensed with. Production and trade are therefore two fundamentally different parts of the economy. Everyone knows in which area Donald Trump was socialized.
3 Ray Dalio: Deng died on February 19, 1997, having transformed China almost beyond recognition. When he came to power, 90 percent of the population lived in extreme poverty; at the time of his death that number had fallen by more than half, and as of the most recent data is below 1 percent. From the start of his reforms in 1978 until his death in 1997, the Chinese economy grew at an average rate of 10 percent a year, sextupling in size while experiencing an average inflation rate of just 8 percent… reserves grew from $4 billion to nearly $150 billion (inflation-adjusted to today’s dollars, its reserves grew by over $250 billion)… Output per person has increased 25 times, the percentage of people living below the poverty line has fallen from 96 percent to less than 1 percent, life expectancy has increased by an average of about 10 years, and the average number of years of education has increased by 80 percent… the number of science, technology, engineering, and math (STEM) graduates that are coming out of college and pursuing tech careers in China is about eight times that in the US.
4 Although extreme poverty has been eliminated at an astonishing pace, “it cannot be ruled out that China’s income inequality, which is the highest in the world, and the sub-proletariat of rural migrant workers living in miserable conditions will develop such political explosive power that it will shake Xi Jinping’s regime, which appears so unshakeable to the outside world” (Münkler 2023).
5 Ray Dalio brings it to the point: When they are in a superior position, the Chinese tend to want a) the relative positions to be clear (i.e., the party in a subordinate position knows that it is in a subordinate position), b) the subordinate party to obey, and c) the subordinate party to know that, if it doesn’t do so, it will be punished. That is the cultural inclination/style of Chinese leadership.
6 Francis Fukuyama is quite outspoken when he states: “A modernizing dictatorship can in principle be far more effective than a democracy in creating the social conditions that would permit both capitalist economic growth and, over time, the emergence of a stable democracy.”
7 And it doesn’t matter whether this messiah has a right-wing or a left-wing hue. Cf. Francis Fukuyama 2018: „Parties of the left have been losing out to nationalists for well over a hundred years, precisely among those poor or working-class constituencies that should have been their most solid base of support.“
8 Fukuyama 2018: “Between 2000 and 2016, half of Americans saw no gains to their real incomes; the proportion of national output going to the top 1 percent went from 9 percent of GDP in 1974 to 24 percent in 2008.”