Recent surveys have shown that people now in democratic societies have become far more cynical about their system of government, and the state of their nation, than at almost any time in the past:
- In 1995 the World Values Survey found one in 15 Americans thought it would be good to have a military force rule the country. That number has leaped up to one in every six Americans.
- Most Americans no longer believe they can achieve a higher quality of life than their parents. That economic stagnation suffered by most people in the U.S. over the past several decades has led to widespread discontent, as demonstrated in the recent Presidential election.
- The wealthy now feel more disengaged than ever before from the lives of average people and feel there is a “war on the rich”—and this, ironically, makes them more critical of liberal democracy, even though they are the greatest beneficiaries of the social and economic order.
- Paradoxically, economic elites and special interest groups have far more influence on government policy than any other sectors of American society.
Roberto Foa, an investigator for World Values Survey, described how this discontent in America is echoed in many other liberal democracies across the globe, especially in Europe. He offered a checklist of ways in which the underlying trends could be curbed through legislative action—reduce the power of lobbyists in Washington, and shut the revolving door that lets politicians and others shuttle between the federal government and private sector for career advancement. His third suggestion identifies the core of what’s gone wrong, both here and in Europe:
In times of slow growth like the present, the rapidly rising fortunes of the rich are being purchased at the price of material stagnation for everyone else. If we want the bulk of ordinary citizens to remain invested in democracy, we need to channel a much greater share of our economic output to them.
He’s right about the disparity, and about the solution. But Foa and his partner, Yascha Mounk are going to publish their findings in January’s Journal of Democracy. Mounk says: “The warning signs are flashing red.” Their conclusion: liberal governments are not as secure as their citizens may think. Mounk cites data from an organization that monitors freedom that showed how free societies increased in number over three decades beginning in the early 1970s. During that period, South American regimes became more democratic and Eastern Europe stepped out of the Soviet shadow. But now the data has revealed a decline in freedom since around 2005.
Their indicators for democratic decline—within what appear to be healthy democracies—are simple and straightforward: rising cynicism about democratic institutions; greater tolerance for military rule or non-democratic systems of government; and growing strength among movements that oppose the existing democratic order. If a country manifests all of these factors it’s a warning: everything may seem stable and secure at the time, but early tremors of a major upheaval have begun. Venezuela followed this pattern—the indicators of discontent emerged in the 80s, and Hugo Chavez won control of the nation on a wave of popular enthusiasm and freedom crumbled. These researchers point to nationalist movements in various European states—Poland, Italy, France, Greece and even here, in the United States—as signs of a new order that might abridge democratic freedom. Here, for many years already, we’ve had Occupy Wall Street and the Tea Party.
What’s clear is the dramatic rise in discontent over how capitalism works in democracies across the globe. What these researchers skirt is how this emergency needs to be addressed by the private sector. While government could take some steps to reduce inequality, only the private sector can increase opportunity by investing in new jobs and properly rewarding those who make profit possible—employees.
I grew up in Romania, and as a child I lived under two oppressors—Hitler and Stalin. I know from experience how this nation serves as a beacon of hope to other people around the world, and how much better democracy works than any other form of government. Those who haven’t suffered through other, lesser social orders have little idea how much better our lives are compared to nearly anyone else in the world. We need to address these signs of discontent now by choosing to reward more generously those who create our products and deliver our services—to show them we are still the land of opportunity.
In the coming months, I’ll talk about how free market capitalism must change itself to address the gulf that stretches between top and bottom income levels creating a the crisis of opportunity inequality. Businesses must lead with action to help heal the rift that fuels the discontent in this country. In a democracy, we as a people, and institutions such as our corporations (not to mention government) must work aggressively on behalf of the common good—and I’ll describe some of the ways this can happen.