Dambisa Moyo Offers Radical Ways to Fix Broken Democratic Systems
(Kitco News) - There is a severe mismatch between the long-term problems our society faces and the short-sightedness of our policymakers, according to New York Times best-selling author, Dambisa Moyo.
The celebrated economist, who serves on the boards of Barclays Bank and Chevron, argued that liberal democratic government systems have not been conducive to solving the world’s most pressing socio-economic challenges.
Her latest book, “Edge of Chaos: Why Democracy Is Failing to Deliver Economic Growthâ€”and How to Fix It,” discusses ways to bridge the gap between what she describes as a “schism,” or “mismatch” between long-term economics and short-term politics.
“These long-term economic challenges from demographics to income inequality, to natural resource scarcity, and issues around debtâ€¦these are long-term economic issues that are deeply embedded in the economy, and yet we have myopic short-termism embedded in the political process,” Moyo told Kitco News on the sidelines of the Mines & Money New York conference.
Her comments come as the U.S. national debt exceeded $21 trillion for the first time earlier in March, while some economists anticipate that President Trump’s tax cuts signed last December will widen budget deficits next year.
Moyo’s book offers “10 radical reforms” to these problems, one of which is to make voting mandatory.
“There are 27 countries in the world that have mandatory voting. Countries like Australia, Belgium, Greece, and the participation rates of voters are much higher, perhaps unsurprisingly since there are fines if you don’t vote,” she said. “In these countries, the participation rates are above 80%, very often above 90%.”
By contrast, voter participation rates in the U.S. hover around 50%, and even lower at 30% for low-income families, she said.
In the U.S., voter turnout has been on a steady downturn since 2008. The 2016 U.S. presidential election saw a voter turnout of 120 million votes cast, representing 56% of the population, down from 58% in 2012, and 62% in 2008.
Moyo noted that because of this apparent apathy amongst voters, the political system has deviated from the “one man one vote mantra” people have associated with liberal democracies.
“I think the consequences of that are quite dire, because what you end up with is basically narrow voting parties, and I think that policymakers and politicians very naturally try to steer the political agenda towards the people who are voting and not towards the broad societal base,” she said.
“I think it’s really important that we get those voter participation rates up,” Moyo added.
On global growth, Moyo remains optimistic in the short-term, citing good employment numbers from the U.S., as well as rising GDP and inflation under control. Beyond the short-term, however, she remains cautious as structural problems weigh on long-term growth.
“The IMF has just talked about how they think in 2020, they’ll start to see a global slowdown. Those types of structural concerns, and of course, the eternal question of where the heck is inflation, I think those types of issues are still looming in the global economic debate,” she said.