Алистер Смит - The Dictator's Handbook - Why Bad Behavior is Almost Always Good Politics

Iran’s revenue pie, despite its greater tax take, is only about 76 percent of Turkey’s. Thus, if Iran spends 25 percent of its revenue on private goods for its relatively small coalition of essential backers, then Turkey would only need to allocate 19 percent to private rewards to spend the same amount of dollars as Iran spends on private benefits. It is very likely that Turkey spends much less both as a percentage of the pie and in total than does Iran on corruption and other private goods. But as we saw, it is entirely possible to engage in an absolute amount of corruption in a large-coalition regime that is equal to the absolute amount in a small-coalition setting. Corruption will be reported as greater in the small coalition environment because, after all, it is a bigger proportion of the available revenue or GDP pie.

It is important to remember that the value of private gains for the millions of individual supporters in a democracy is small. It is substantial for the few key individual backers in an autocracy even if the total spent on private goods is the same in both. For instance, Turkey’s winning coalition could easily be about 20 million voters. Turnout in Turkey’s 2007 election was just under 36 million, out of 42.5 million registered voters and 48.4 million total eligible voters. With 36 million voting, the winning coalition in Turkey’s first-past-the-post elections could have been more than 18 million. Iran’s winning coalition could easily be no more than several thousand. Let’s err on the side of overstating Iran’s winning coalition by assuming it is as many as 100,000 people, including religious leaders, local and national political elites, important civil servants, key military officers, and the government’s goon squads (the Basij led by Ayatollah Khomeini’s son), who enforce its antiprotest efforts. If Iran spends as little as $5 billion on private rewards (we have no way of knowing the actual amount), then the average coalition member gets $50,000, more than ten times per capita income. If Turkey spends the same amount on private benefits (and, again we have no way of knowing the actual amount), then the average Turkish coalition member can expect to receive only $250, less than 2 percent of per capita income. Of course, in either case most coalition members will get much less than the average and a few will get vastly more. But obviously there will not be many coalition members in Turkey who are willing to beat and even kill their fellow citizens for $250. It is equally obvious that in relatively poor Iran, for $50,000 a head it should be easy for the regime to get supporters to go out and oppress their fellow citizens.

Private goods make up a part of every government’s spending just as they make up a part of every corporation’s spending. But it is much tougher to get people to engage in truly nasty behavior in a large-coalition environment than it is in a small one even if the totals spent on private gains are equal. History has not produced large-coalition-dependent leaders as brutal as Genghis Khan. Equally, we must realize that the nature of private rewards in more democratic systems are likely to come in the form of distorted public policy rather than through more overt means such as outright bribery, black marketeering, or extreme favoritism.

What, then, are the private rewards provided in democracies? How might public policy be distorted to create benefits for some and costs for others?

It is fashionable to talk about politics in terms of concepts like ideology or left-right continuums. The standard mantras from either side of the left-right continuum go something like this: Liberals care about the poor and are dedicated to alleviating their misery. They are often stymied by the rich and powerful. Those very rich and powerful tend to be conservative. Conservatives care about the rich and are dedicated to protecting them from the taxing and spending inclinations of liberals, whose supporters, not surprisingly, tend to be relatively poor compared to conservative backers. As a simplification of politics that works fine. We do not challenge this view so much as offer a completely different way to think about it.

The rules governing how people rule inevitably divorce what policies politicians really desire from what they say and do. Not that we doubt that politicians hold sincere views of good and bad public policy—rather those views are not terribly important and, besides, there are few ways to tell the difference between declarations based on opportunistic political expediency and true beliefs.

From the perspective of this book, so-called liberals and so-called conservatives appear simply to have carved out separate electoral niches that give them a good chance of winning office. Democrats in the United States like to raise taxes on the rich, improve welfare for the poor, and seek heavy doses of benefits for the middle-class swing voters. Republicans in the United States like to reduce taxes on the rich, decrease welfare for the poor, relying on back-to-work programs instead, and, similarly, look for a heavy dose of benefits for the swing middle voters. Many of the taxing and spending policies, pork-barrel programs and the like, are simply private goods distributed to the relevant party’s coalition of essentials. Both parties pay special attention to the middle-class because there are an awful lot of middle class voters and they can be tipped either way. They like to define the rich—those who might be asked to pay higher taxes—as anyone whose income is higher than their own. They like to think of welfare payments as rife with fraud and cheating that needs to be ferreted out. And they are very happy to have government programs that disproportionately benefit them—no surprise there—such as tax deductions on mortgage interest, expanding Medicare benefits, subsidies for university tuition for their children, and increases in social security payments even in the absence of inflation.

The very poor are not likely to vote but the working poor are, and, of course, they are likely to vote for people who adopt policies that benefit them. The less well off love progressive taxes and hate sales taxes. Those who hope for expanded and more effective programs for jobs training, Medicaid, long-term unemployment insurance, and low or no taxes at their income level, tend to turn to candidates most likely to fulfill their wishes. These wishes are public policies to be sure, but they are public policies that benefit primarily the select group whose voting “bloc” is essential to the winning Democratic candidate. They are unlikely to vote Republican because, let’s face it, a winning Republican candidate is not likely to support the programs we just mentioned, at least not on the same scale as a Democrat. So these policies are payments for political support, no more and no less so than any other private reward.

The rich like subsidies too. Republican candidates trying to build a coalition around the support of the relatively well-to-do are the candidates most likely to provide these subsidies. The well off and Republican candidates by and large favor, for instance, government support for medical research on cancer, Alzheimer’s disease, and other ailments of the elderly who happen also to be the wealthiest age cohort in the United States. What is more, the well-to-do are more likely to live long enough to suffer from these diseases. They like lower capital gains taxes since they have enough money that they can invest in the pursuit of equity gains and they don’t like inheritance taxes since they can save enough to leave a tidy sum to their heirs. The poor rarely consume any of these benefits but they pay for them to help the rich if they pay taxes at all. But with Democrats more often controlling legislatures at the federal and state level than Republicans, it is worth noting that more than 40 percent of Americans—mostly at the lower income levels—pay no income taxes at all.6 That, after all, is one of the private rewards they covet just as in smaller coalition regimes the rich pay few taxes and covet their private gains. Private benefits, whether in large- or small-coalition environments, distort economies in exactly the self-serving ways we should expect. And even in the most democratic of polities these private benefits are perfectly explainable without appeal to high-falutin principles of equity, efficiency, or ideology. People support leaders who deliver policies that specifically benefit them. That’s why earmarks— pork in colloquial terms—are reviled in general and beloved by each constituency when the money goes to them.