Why Politics Fails

Introduction: Simple Problems, Impossible Politics

The headline in The New York Times was stark: ‘Warmer Climate on the Earth May be Due to More Carbon Dioxide in the Air.’ The author, Waldemar Kaempffert, highlighted a theory originally developed back in 1861 but which was only now being taken seriously again – mankind’s emissions of carbon dioxide might be permanently heating the atmosphere.

Kaempffert argued that seemingly small increases in CO2 could have grave consequences, converting ‘the polar regions into tropical deserts and jungles, with tigers roaming about and gaudy parrots squawking in the trees’. Florid description aside, the scientists Kaempffert spoke to argued that the rise in global temperatures of ‘the last sixty years’ was due to ‘man increasing the carbon dioxide content of the atmosphere by 30 per cent – that is, at the rate of 1.1ºC per century’.

The Times’ prescient article was published on 28 October 1956. The ‘last sixty years’ of globally rising temperatures Kaempffert referred to was the time since the start of the twentieth century. The science on which these predictions were based was already a century old.

More than six decades on, the warnings feel much more real to us. Global temperatures are another degree Celsius warmer. And the pace of change is accelerating. The current best-case scenario is another 1.5ºC increase, which brings us ever closer to the prospect of squawking Arctic parrots. But more likely is the desertification of much of Southern Europe, India and Mexico, endemic flooding and billions of displaced people.

The scientific jury was still out on why global temperatures were rising (or even with much confidence whether they were) in the late 1950s. We no longer have the excuse that ‘we really don’t know what’s happening’, despite the special pleading of climate sceptics. The debate has moved from whether humans are responsible for climate change to what, if anything, we can do about it. Progress of sorts, but it raises a crucial question. If disaster is about to hit us, what the hell have we been doing for the past seven decades?

Climate change is a simple problem with impossible politics. By simple, I mean that the road from A to B – carbon dioxide emissions to global atmospheric heating – is direct and well understood. Carbon reduction – removal even – is an obvious solution. We understand the science. What we don’t understand is how to get anyone to do anything about it, even though it affects us all. Why, despite knowing for decades that climate change is a fundamental threat to humanity, have humans been so passive?

Carbon dioxide is a global problem but our politics is helplessly domestic. If I pollute more, my emissions cannot be contained within my national borders. They are your problem too. And vice versa. And if I’m just a small country, then it probably doesn’t matter much if I pollute – I can’t change the global climate on my own. Of course, that’s not just true for me – it’s true for most other countries. We’d all prefer to carry on as normal and hope someone else will pay the costs of carbon abatement. There’s no world government that can effectively sanction us. And so, in the absence of effective international agreement, we all blithely continue to heat the atmosphere. Our politics doesn’t seem big enough to respond to even an existential threat.

But maybe it is. Over the past few decades, since at least the Earth Summit in Rio in 1992, there have been concerted political efforts to wake us from our inaction. They have not always been successful. The Kyoto Protocol of 1997, which set binding targets for rich countries, was either unsigned (America), non-binding (China) or abandoned (Canada). The Copenhagen Accord of 2009, attempting to resuscitate Kyoto, was an abject failure. But the Paris Agreement of 2015 does seem to have been effective so far, despite the Trump administration’s brief exit from it. Its success is a product of flexibility, deliberately vague wording and pushing decisions off into the future. Though imperfect, it shows that politics doesn’t have to fail.

Climate change presents us with five core political challenges. It tests our vision of democracy – can we really assemble a stable global consensus on how to reduce emissions, one that doesn’t break down into chaos or polarization?

It raises fundamental questions about equality – should richer countries pay more to resolve climate change; does each country have an equal ‘right’ to pollute?

It forces us to consider questions about global solidarity – what do people in developed countries owe those in poorer countries; are we willing to financially bail out people whose coastal villages or beachfront properties are threatened by rising oceans?

It potentially threatens international security – how can we cope with mass exoduses of climate refugees; how do we enforce international climate rules in the absence of an international police or legal system?

And, most fundamentally, it threatens our collective prosperity – by despoiling the environment for short-term gain, are we not only risking the costs of drought, famine and pollution but also threatening our long-term ability to eke out existence on a rather lonely satellite of the sun?

These are existential political problems. But they are not new ones. We have struggled for millennia as a species to reach our collective goals of democracy, equality, solidarity, security and prosperity. And other great challenges await us beyond climate change: from poverty to polarization to pandemics. We need solutions. While politics is imperfect, it may be our last best hope to reach common ground.

Common ground

Politics. A fraught word. For some of us it signals the distasteful, venal conniving of politicians. For others, it invokes possibility – a chance to collectively accomplish what none of us alone can. Or perhaps both. Politics, at its root, is how we make collective decisions. It’s about how we make promises to one another in an uncertain world. And it is essential to resolving our common dilemmas from climate change to civil war, from global poverty to the COVID-19 pandemic.

But politics is a double-edged sword: it not only promises to solve our problems but creates new ones for us as well. We need it but we often hate it. We look for alternatives – efficient markets, advanced technology, strong or moral leaders who can get things done. But without politics these are false gods. Any technological quick fix, any perfectly designed market, any virtuous leader speaking ‘for the people’ will run up against us humans and our tendency to disagree, dissent and defect.

Politics is how we manage these inevitable disagreements. We can’t avoid politics or wish it away. Elections have winners, and so they also have losers. Spending money in an unequal world requires some people to pay more than others. Having police or armies protect us simply raises the question of who protects us from them. When we try and push politics down in one place, we find it pops up in another, like the proverbial paste in the toothpaste tube. So, loathe it or love it, we’re stuck with politics if we want to achieve things beyond our own backyard.

Are there things that you and I both want, despite all our ostensible differences? Most people – no matter how polarized we might seem to be on the surface – do agree on some things. Five, in fact. Five things at the heart of conquering our most existential challenges, such as climate change. Five things that also present a series of traps that we need to escape from. Let’s take them in turn.

Democracy

A contested concept for sure. But let’s take it as the right and ability of the mass public to choose and replace their leaders. Around half of the world’s population currently lives in countries that are broadly speaking ‘democratic’. Even if only half the world lives in a democracy, the idea is attractive to far more, including those stuck in authoritarian countries. Eighty-six per cent of people in the World Values Survey, which surveys people in democracies and non-democracies alike, think having a democracy is either a ‘very’ or a ‘fairly’ good way of running a country. In fact, over 90 per cent of people in China, Ethiopia, Iran and Tajikistan also agree with one of these statements. Democracy appears more popular in these four authoritarian countries than it is in the United States. Perhaps people mean different things when they say ‘democracy’, and scepticism might be higher when you live in one. But rule of the people, by the people, maybe even for the people, remains alluring to us.

That said, the past decade has been a challenging one for democracy. The ‘third wave’ of democratic transitions, which began in the mid 1970s and washed away most Communist regimes in the early 1990s, had petered out, perhaps reversed, by the early years of the twenty-first century. Authoritarian powers from Russia to China have increasingly flexed their military muscles. The ‘homes’ of democracy from Greece to the United Kingdom to the United States have been roiled by controversial referendums, the success of populist parties, and attacks on mainstream media, the bureaucracy and expertise.

Democracy may be a widely held ideal but it’s clearly one under increased pressure. Sometimes we bemoan the chaos and indecision when democracies can’t seem to decide on anything. At other times, we fear the anger and venom of political polarization as political parties denounce each other. But, for most of us, democracy remains essential, despite its flaws. Figuring out what makes it work effectively is a crucial challenge of our era.

Equality

Like democracy, the concept of ‘equality’ means different things to different people. But at its root is the idea that everyone should be treated the same, without favour, impartially, ‘equally’. Very few people openly argue that people should be treated systematically unequally, though clearly racism and sexism still fester throughout our societies. But equality extends beyond processes and fair treatment to opportunities and outcomes. Here there is more heated public debate. Standard ‘left–right’ politics in wealthy countries often hinges on whether affluent people’s incomes should be taxed and redistributed to the less fortunate.

Even here there is, perhaps surprisingly, a large amount of popular consensus. In 2019 just 7 per cent of people in wealthy countries disagreed with the statement that ‘differences in income’ in their country were too large. Seventy per cent of people wanted the government to do more to reduce this gap. And, sadly, 70 per cent of them also agreed that politicians in their country ‘didn’t care’ about reducing income differences. It’s unlikely that most people want everyone to have exactly the same income. But these survey data suggest a wide unhappiness with the levels of inequality we do experience in our day-to-day lives.

People may dislike inequality but that clearly hasn’t prevented a resurgence of income and wealth gaps across the industrialized world. We live in an age of an apparent inequality paradox – global inequality has declined overall as billions of people in China and India have been brought out of poverty, but in wealthy countries inequality has risen dramatically since the 1980s. Closing factories and stagnant wages in rich countries have produced a backlash against both wealthy urban areas and trade with poorer countries. The political effects of this backlash have been profound, upending traditional left–right politics in America and Europe, as populists denouncing ‘globalists’ have won election after election. Equality, or the lack thereof, has taken centre stage once more in our political life.

Solidarity

None of us is immune from the vagaries of fortune. We will eventually become ill and die. Or get hit by a bus tomorrow. Our working lives are rarely a straight uphill ride from A (rags) to B (riches). Sometimes we are unlucky. We hope that others currently experiencing good times can help us when we’re down, just as we might reciprocate. This is solidarity – support for your fellow citizen going through a tough period. We often debate who should provide solidarity and how much. But whether it comes from the state or the church, starts at home or among the poorest of the world, it has always been a widely shared human impulse.

In wealthy democracies today, some of the most popular policies – the electrified ‘third rails’ of politics that will fry an unwary politician who tries to cut them – are solidaristic ones: Social Security in the United States, or the National Health Service, Britain’s alleged ‘national religion’. Across wealthy countries, almost 95 per cent of people think the government should be responsible for providing healthcare for sick people. Even in America, where the government’s role in healthcare is fragmentary to say the least, 85 per cent of people want it to be responsible for health.

And sometimes global solidarity strikes closer to home than we had imagined. Global public health has often seemed a rather esoteric topic: something that happened to people ‘over there’ – the target of foreign aid and international charity but nothing to provoke real existential worry. The COVID-19 pandemic has changed that balance of risk dramatically. The ill and well are tied together across rich and poor; the wealthy West and the global South. Pandemics don’t recognize national borders. COVID-19 also exposed stark disparities in access to health across the world. Who we feel solidarity for has become more important than ever, as a virus in a neglected tropical slum can travel invisibly to gleaming Manhattan penthouses. Or, indeed, in the reverse direction.

Security

Perhaps our most basic desire as humans is to be safe, to survive. If we can agree on anything, it’s surely that we all wish to remain alive and well. In worldwide surveys, 70 per cent of people stated they preferred security over freedom, with the number highest in those countries with recent experience of war. For most of human existence, the violence of war has been a tragic fact of life. But, until the Ukraine War broke out, interstate war had become scarce in recent decades.

Day-to-day life is also safer than it was. Keeping peace was largely achieved through ‘self-help’ for most of human history – we caught our own criminals. Today we have professional police services that, though often far from unbiased, are broadly able to keep public order. Trust in the police is generally high: well over three quarters of people have ‘high’ or ‘very high’ trust in the police in the United States, United Kingdom, Germany and Japan. It is in those countries where homicides and crime more generally are highest – Brazil, Guatemala, Mexico – that trust in the police is understandably low and the demand for security over freedom especially high.

The past few decades have seen growing levels of violence within states, from civil wars and terrorism to human rights abuses. Police violence is now a core political debate in many wealthy countries. By some accounts, 2016 was the most violent year since the Second World War. Can we avoid the endemic violence that pervades countries from the Democratic Republic of the Congo to Afghanistan? Can we make sure that the police and soldiers we employ to protect us don’t prey on us? And does the Russian invasion of Ukraine mark a return to the ‘bad old days’ of interstate war?

Prosperity

We all want enough money to live on. Most of us would like at least as much as we have today. And many of us have been lucky: each of us in the industrialized world lives a life of luxury beyond the wildest dreams of our ancestors ten generations ago. Even in a single generation, we have become used to getting wealthier. Around the world, 80 per cent of people think they live a life as good as or better than that of their parents – in China, 90 per cent think they are better off.

But endless economic growth is not without its detractors. We cannot simply extract energy without consequences. We are warming the planet, potentially beyond its carrying capacity. And we need to act quickly. The Intergovernmental Panel on Climate Change currently estimates that global temperatures will rise above the ‘tolerable’ level of 2ºC by sometime around 2040.

The consequences in terms of drought, flooding and sheer heat exhaustion are hard to wrap our heads around, though the increasing frequency of ‘once in a century’ landslides, floods and other natural calamities is providing us with unnerving glimpses of our future. In many wealthy countries, such as Australia, Germany and Italy, twice as many people value protecting the environment over economic growth. This trade-off is beginning to bite. We may all want global prosperity but maintaining it depends on halting, or at the very least massively mitigating, the destruction of our planet.

Political economy

Democracy. Equality. Solidarity. Security. Prosperity. Fine things. Goals that most of us can plausibly agree on, even if we debate the means to these ends, or even the finer variations of these ends. Collective goals such as these ought to be within our reach – and even if we can’t ever fully attain them, we should at least be able to travel in their direction.

So what is stopping us from striding purposefully towards our goals? And what is putting them in jeopardy? We are. Or, rather, our politics is. Political life is where our individual self-interest and our collective goals clash. And self-interest often overwhelms a collective goal. We continue, for example, to demand cheap oil to fuel our SUVs and flights to Paris for the weekend, even as we slowly cook the planet. I will show throughout the book how this gap between self-interest and collective good plays out and what we can do to harness politics and make it work effectively towards our ends. In other words, to stop politics from failing.

My arguments and evidence are based on political economy, the school of thought that takes seriously how the individual and society interact. By starting with a model of each of us – what we want and how we plan to get it – and then panning out to view society at large, we can see how our best-laid plans can be undermined by… well, us. We’ll look at how our own private interests culminate in collective chaos, and then how to escape the traps we’ve created for ourselves.

I came to political economy from a background in studying history. Like the other social sciences – but unlike history – political economy seeks to find general laws or patterns that explain human behaviour in the past and present. And, like many a convert, I found myself drawn away from my previous training – from the contingency and specificity of historical analysis to the universality, simplicity and just plain usefulness of political economy.

Political economists start with simple models of self-interested individuals and then see how those individuals interact with and constrain one another. We derive and develop mathematical models that explain and predict behaviour. We don’t do so out of a misguided physics envy but because these models force us to think through the consequences of the assumptions we make about people.

Political economy lets us ask and answer questions from the micropolitics of our everyday life – how will I feel about funding public pensions when I buy a house? – to the macropolitics of everyone’s life – does rising inequality threaten our political stability? It does so by assuming people are broadly the same – politicians and voters, rich and poor alike – and face the same temptations and traps. This book will show you that this way of thinking about the world is powerful and insightful, and sometimes even beautiful.

The basic model underlying political economy is that everyone is selfish, or at the very least self-interested. You have a set of things that you want, and you’ll do your utmost to get them. Self-interest is everywhere. It explains why we do what we do. And why we should expect others to do that as well.

You might say, isn’t this a highly cynical way to look at the world? But to study self-interest is not to condone it. It’s certainly not an ethical guide about how to live your life. Instead self-interest is a useful analytical tool; the basis of the theories we create to explain human behaviour. Political economists use this model of self-interest not just to describe, explain and predict individual behaviour, but also to recommend policies for governments. Policies that might make things better for us all, even though everyone is self-interested.

Focusing on self-interest means thinking about the world as individuals. Rather than talk about classes, or cultures, or some other group, we begin with individual people first and build up from there. In fact the very concept of a group of people having ‘interests’ is dubious – why would individuals in a group all behave in the same way? How can a group be said to have any preferences of its own? After all, it doesn’t have a single mind.

But individuals do have single minds. We have preferences about the world. There are some things we like and some things we dislike, and we can order these preferences. Given those preferences, we try to calculate how to achieve our favoured outcome. In an ideal world, we make the best possible choice. In mathematical terms, we ‘maximize’ our happiness given our options by picking the choice that gives us the highest ‘utility’. So we have a set of preferences about things that might happen, or we might get. And we have a way of choosing the one we most like. That’s the idea of self-interest.

The core insights in political economy don’t come from just assuming people have preferences and choose their favoured option. This would lead to a rather dull answer that people will choose to have as much of something as they can get. A higher income makes me happier. And I keep on getting happier, the more income I get. To infinity and beyond. Something presumably stops us from just getting ever higher and higher utility. That something is the world around us.

People always face some kind of constraint preventing them from getting exactly what they want. The constraint could be physical – there is only so much natural gas or gold on planet earth. It could be institutional – I might maximize my income by robbing every bank in the country, but the law is eventually going to be enforced and prevent me attaining that goal. And in many cases it will be social – other people’s own behaviour will constrain what I can achieve.

Constraints force us to face trade-offs. We can’t get everything we want and so we will have to make decisions about what we are willing to sacrifice. The existence of trade-offs is a regular, mundane part of our lives. When we go to the shop and choose to buy a particular brand of coffee, we are making several trade-offs: we are choosing one brand over another; we are choosing to buy coffee and not tea; and we are exchanging money for the benefits of getting coffee. And since money comes from working, the benefits we get from coffee are being traded off against that most basic element of our existence – time.

Political life is all about trade-offs. When I’m in a polling booth, I make a decision between one candidate or another. Implicitly, I am also trading off things I like about one party against things I like about another. For example, I may want lower taxes but be socially very liberal – across different countries, whether I vote in the UK for Labour or the Conservatives, in the USA for the Republican or the Democratic Party, in France for the Parti Socialiste, En Marche or Les Républicains, depends on how I weigh those preferences together.

I have also made a trade-off by coming to the voting booth in the first place. Voting costs time and effort. There might be benefits to your preferred party winning and those may outweigh the cost of standing in line to vote. But your own vote is very unlikely to be the deciding one. Once we weigh those benefits of your party winning by the tiny probability of your vote being decisive, the cost you incur for sure from voting will loom far larger. Which means it might not be rational to vote. Hence, political economists argue that there must be an element of ‘duty’ in people’s preferences that makes up for this and so helps predict who will actually turn out to vote. If I enjoy the feeling of making a difference, or I am especially interested in politics, or I can take time off work, then I will go out and vote. By contrast, turnout will be low among the apathetic, the apolitical and the impoverished, who can’t afford to take time off work.

Politicians also act in a self-interested fashion. US