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Friday, February 8, 2008

The Crazy Arithmetic of Voting

The hoopla over Super Tuesday reminded me of an essay I read long ago by Bruno Leoni (1913-1967), an Italian legal scholar and great champion of liberty. I’ve been meaning to discuss the many important themes in his book, Freedom and the Law (expanded third edition), and will surely return to it in the near future. But for now I’ll focus on the final chapter, Voting Versus the Market.

As usual, Leoni’s essay is a model of clarity and incisiveness, with a knack for making you wonder why you didn’t think of some subtle implication of liberalism or statism.

In the political season we are told over and over that every vote counts. Great sums of money are spent to get out the vote. It is an unquestioned article of faith that the more voters who participate the better. Low turnout is considered a tragedy, record turnouts a reason for declaring a national holiday.

Why? What is it about voting that sends people into rhapsody? On its face voting doesn’t seem to be a good way for individuals to get precisely what they want. It’s more like going to a supermarket and choosing between two shopping carts, each pre-loaded with a different array of goods.

Leoni’s essay takes a realistic look at the democratic process. The results won’t hearten Chris Matthews and other cheerleaders of the current political process.

A large literature in economics has looked for ways in which behavior in the political arena and behavior in the marketplace are alike. If political choice really resembles market choice, one might say the political process respects individual preferences. Leoni, however, begins by saying that the actions of voters and market transactors are far from actually being similar. He writes:

No procedural rule seems able to allow voters to act in the same flexible, independent, consistent, and efficient way as operators employing individual choice in the market. While it is true that both voting and operating in the market are individual actions, we are compelled, however, to conclude that voting is a kind of individual action that almost inevitably undergoes a kind of distortion in its use.

Once you think about this, the point is indisputable. If the chooser has access to the required money or credit, individual choice in the marketplace is decisive. I like Wheaties more than Cheerios. So I go to the store and buy Wheaties. Except for the rare occasion went the store has run out, I will bring home Wheaties. The same is true of my choice between a Chevy and a Honda. End of story.

Choice in the political arena is nothing like that. Whereas in the market everyone gets what he or she wants within the budget constraints, Only voters ranking in winning majorities (if for instance the voting rule is by majority) are comparable to people who operate on the market. Those people ranking in losing minorities are not comparable with even the weakest operators on the market, who at least under the divisibility of goods (which is the most frequent case) can always find something to choose and to get, provided that they pay its price.

Leoni is right. If I vote for Barack Obama over Hillary Clinton, I have to wait to see if I am in the majority before I know if I get what I want. If 50 percent plus one voted as I did, great — I get my choice. But what if 50 percent plus one vote for Sen. Clinton? I’m out in the cold.

Either you win and get exactly what you want, Leoni says, or you lose and get exactly nothing. Even worse, you get something that you do not want and you have to pay for it just as if you had wanted it…. Voting appears to be not so much a reproduction of the market operation as a symbolization of a battle in the field.

That takes some of the idealism out of democracy, whether representative or direct, doesn’t it?

Leoni continues the battle theme: The political language reflects quite naturally this aspect of voting: Politicians speak willingly of campaigns to be started, of battles to be won, of enemies to be fought, and so on. This language does not usually occur in the market. There is an obvious reason for that: While in the market supply and demand are not only compatible but also complementary, in the political field, in which legislation belongs, the choice of winners on the one hand and losers on the other are neither complementary nor even compatible.

Majority Rule

He delves further into the shortcomings (forgive the understatement) of voting as a decision-making procedure by examining Anthony Downs’s famous defense of majority rule. He quotes Downs:

[T]he basic arguments in favor of simple majority rule rest upon the premise that every voter should have equal weight with every other voter. Hence, if disagreement occurs but action cannot be postponed until unanimity is reached, it is better for more voters to tell fewer what to do than vice versa. The only practical arrangement to accomplish this is simple majority rule. Any rule requiring more than a simple majority for a passage of an act allows a minority to prevent action by the majority thus giving the vote of each member of the minority more weight than the vote of each member of the majority.

But does every voter have equal weight with every other voter?

Leoni writes, “This argument seems to be the same as saying that we must give a one dollar bill to everybody in order to give each one the same purchasing power. But when we consider the analogy at closer quarters, we realize that in assuming that 51 voters out of 100 are ‘politically’ equal to 100 voters, and that the remaining 49 (contrary) voters are ‘politically’ equal to zero (which is exactly what happens when a group decision is made according to majority rule) we give much more ‘weight’ to each voter ranking on the side of the winning 51 than to each voter ranking on the side of the losing 49. It would be more appropriate to compare this situation with that resulting in the market if 51 people having one dollar each combine in buying a gadget which costs 51 dollars, while another 49 people with 1 dollar each have to do without it because there is only one gadget for sale.”

Leoni anticipates an objection: “The fact that we cannot possibly foresee who will belong to the majority does not change the picture much.”

Uh-oh. This is trouble for small-D democrats and small-R republicans everywhere. Leoni is saying that in a democracy or republic 50 percent plus one equals 100 percent and 50 percent minus one equals zero. Considering the other perverse consequences of politics, who’s really surprised by this one?

Democracy Against Aristocracy

Leoni points out that the motive of early democratic movements, such as Jeffersonianism, was to prevent the tyranny of an aristocracy. In that sense, advocates of liberty should sympathize with democracy and be wary of moves toward rule by the few. But this does not mean that majority rule respects individual liberty the way the free market does. Leoni, drawing on Public Choice literature, imagines that some forms of super-majority rule would be appropriate when the issues at stake are rather important for each member of the community, or adopting the unanimity rule when the issue is absolutely vital for each of them.

But, he adds

we must bear in mind that none of the rules adopted or adoptable in political decisions can produce a situation which is really similar to that of the market under conditions of competition. No vote trading could be sufficient to put each individual in the same situation as the operators who freely buy and sell goods and services in a competitive market.

When we consider law as legislation it can be clearly shown that the law and the market can in no way be considered similar from the point of view of the individual and his decisions.

In fact, the market process and the legislative process are inescapably at variance. While the market allows individuals to make free choices provided only that they are prepared to pay for them, legislation does not allow this.

In other words, politically one size fits all. If you lose this time, you’ll have another chance later to impose your will on everyone else.

The upshot? Anyone who values his or her liberty should favor replacement of government by the market wherever possible.

(Due to my upcoming travel, TGIF will be on hiatus for the next two weeks.)

  • Sheldon Richman is the former editor of The Freeman and a contributor to The Concise Encyclopedia of Economics. He is the author of Separating School and State: How to Liberate America's Families and thousands of articles.