Professor Benjamin Barber, author of the book Strong Democracy (1984), was recently a guest on John Stossel's FOX Business News Network program honoring the memory and ideas of Milton Friedman who wrote the world famous book Free to Choose (1980) and has been for all his life a dedicated defender of the free market capitalist system of political economy.
Barber was critical of Friedman's ideas, claiming that instead of the alternatives of socialism and capitalism, what is really the best system is a democracy. By this he meant, as he explained, a society in which decisions concerning economic and most other matters of widespread interest are made by way of the ballot box and not privately, by managers of firms and, especially, big corporations.
The same program had as a guest David Boaz of the Cato Institute who defended Friedman's views and added a nuance. He pointed out that no actual systems of pure socialism or pure capitalism exist, so we do best by judging which of these is better by examining societies that have come reasonably close to the pure versions thought up by political theorists. For example, although the Soviet Union, North Korea, Cuba, and Venezuela are not pure socialist systems, they come close enough to serve as laboratories of that kind of political economy, just as the U.S., Hong Kong, and the former West Germany come close enough to free market capitalism to serve the same function when we study, evaluate, and compare political economies. As Boaz pointed out, in matters of human affairs controlled experiments are impossible so we need to rely on historical examples, even if they are somewhat messy.
The thing about democracy is that it offers something that is relatively new in human political affairs, namely, popular participation in political decision making. And this is such a welcome thing that sometimes it obscures that democracy also has serious liabilities. These can be appreciated by considering that in democracies the majority can pretty much subject the minority to intolerable treatment. Sometimes, in fact, majorities are more ruthless than, say, a given monarch – Austro-Hungarian "Emperor" Franz Joseph is a good case in point.
Majorities often ignore due process, the requirement of justice in how minorities are dealt with. It all depends on what is the scope of politics in a society. If it is fairly limited, then majorities can be restricted to making decisions only about certain topics, like who should be the justice of the peace or how large should be the military's budget. (Even here the democratic method allows for using experts who understand special problems better than does the general population.) A bloated democracy – what some dub an illiberal as opposed to liberal democracy – can be quite tyrannical. And Professor Barber's so called strong democracy runs exactly that risk, that the majority in a society will simply run roughshod over the minority or various relatively small groups, not to mention the individual, the smallest minority.
The contrast that Professor Barber emphasized on Stossel's program was between a society in which big corporations versus one in which the majority make significant decisions. And if these were the only alternative facing us, democracy would be preferable most of the time. But big corporations can be restrained by way of holding them fully accountable for what they contract to do and how they handle their property and whether they encroach of the rights of the citizenry.
Take, for example, British Petroleum. Sure it has probably bungled its oil drilling operation in the Gulf of Mexico but this is partly because where it is doing the drilling is actually public property and BP's responsibility is determined not by the scope of its property rights but by government regulators, by what the government permits it to do (which usually is influenced by democratic politics).
If the government stayed out of economic affairs the way it stays out of religion or journalism, there would be no great problem with corporate power, no more than there is with university power or the power of any other united group of interested citizens. Sheer numbers in the face of principled courts is impotent. That power is only destructive when enhanced by government officials who are willing to cave into pressure, like referees who might take bribes from competitors.
Huge corporations aren't bad things – indeed, they make all kinds of valuable undertakings possible. What is bad is when huge corporations get into bed with government, which gives them special advantages, like all those bailouts they received from Washington which was in the hands of Democrats – "the will of the people," remember – at the time!
Huge companies are still just a bunch of people and when the rule of law is firmly adhered to, it makes no difference how huge they are. But without emphasizing the role of individual rights in our political and legal system, democracy can run amuck and follow lynch mob habits.
Professor Barber's strong democracy can produce California's Proposition 8 – anti-liberty for gay couples – type of politics (which, of course, many liberal democrats do not like despite how it expresses the will of the people there). Instead of strong what is needed is liberal democracy, the kind held in check by the rule of law and individual rights.