America has flourished because we have carefully safeguarded the complex interplay between politics and markets, between a system where every vote counts equally and one where money talks.
Free markets have numerous failings, but they remain the most efficient and effective way of coordinating economic activity — the production of goods and services (without a coordinator) — and allocating resources that humankind has ever devised. Markets function through inducements: People cannot be usefully or morally compelled to invest or invent, or even to produce.
Those who gain greater market power enjoy greater control over markets. Anyone who has negotiated with Wal-Mart or has tried to compete with Amazon understands the power that market success bestows. The rich have influence in the market in proportion to their wealth, not their numbers. Money talks loudly in the market. And because the rich have more money, producers of goods and services lavish attention on them in an effort to relieve the wealthy of some of what they have earned.
Democracy is a very different enterprise. If economics is about the allocation of resources, politics is about the authoritative allocation of values.
Politics make markets possible. If society did not provide mechanisms for enforcing contracts, respecting private property and otherwise regulating behavior, markets wouldn’t exist. They remain intact precisely because the citizens of our democracy understand their value. In times and places where private property is expropriated, contracts voided and currency debased, markets can cease to exist, to the detriment of citizens.
However, whereas markets necessarily give disproportionate power to the wealthy, in democratic politics every citizen is equal: one person, one vote. Bill Gates’s vote counts no more or less than that of a welfare recipient.
There is nonetheless clear tension between free markets and democratic politics. Because markets rely on inducements, the wealthy end up with more political power than the rest of us. Because of their outsized economic role, big corporations can get tax policy changed, roads built by taxpayers and regulations suspended, all while I’m still waiting for a stop sign on my corner.
But what have these grandiose musings got to do with polling, campaigns or elections?
Everything, I submit, because we are about to reach a tipping point in this country where a segment of our society gains so much political power that it imperils our democracy. While the rich have always had a good deal of political power, the continuing effort to gut our campaign finance laws threatens to degrade our democracy beyond recognition. Money properly talks in markets, but when it is given free rein in politics, it threatens the core principle of one person, one vote. It gives the wealthiest among us not just incrementally more power to decide our nation’s direction, but threatens to replace democracy with oligarchy.
Some maintain we are already there. An experiment by two Berkeley political scientists is ominous. An organization with which they worked requested appointments to discuss a bill with members or top staffers in 191 congressional offices. While one random subset of offices was told the prospective visitors were constituents, the others were told they were campaign donors (in fact, all were donors). Those identified as donors were three to four times more likely to get appointments than simple constituents.
Princeton Professor Martin Gilens and Northwestern’s Professor Benjamin Page went beyond access, analyzing the opinions of the wealthy and interest groups, as well as those of ordinary citizens, on 1,779 policy outcomes over 20 years. Simply put, they found that when there was disagreement, policy followed the desires of the rich and not the rest of us, almost all the time.
Such results don’t resonate with my experience — yet. But there is no doubt that our failure to safeguard the subtle relationship between politics and markets is putting our democracy at risk.
Mellman is president of The Mellman Group and has worked for Democratic candidates and causes since 1982. Current clients include the majority leader of the Senate and the Democratic whip in the House.