The call last week for a referendum on the UKs membership of the European Union and yesterdays announced referendum by the Greek Prime Minister on the proposed bailout and austerity package, draws an interesting parallel. Referenda are both rare and divisive, especially in the UK. The reason for the former is that they are not a particular good way of making decisions as they have questionable democratic value. The reason for the latter is that they usually present a binary offer – in/out, yes/no – as demonstrated by the Electoral Reform referendum last May. This is hardly conducive of a balanced and moderate discussion in which all possible options are examined. As an example the recent calls from Euro-sceptics called for a yes/no on EU membership, it was only later after much opposition that a third option in a referendum was considered.
The purpose of a representative democracy is to appoint experts to make decisions on the people’s behalf. During its passage through the Commons a prospective law is examined philosophically in debates in the chamber, practically as evidence is gathered and considered by committees and technically during its various readings, including a line by line examination. The vast majority of people have neither the time nor expertise to properly weigh up matters as complex as EU membership nor scrutinise a Parliamentary Bill; besides they are often lost in the fog of misinformation such as that propagated by the media and groups such as UKIP and the BNP. That’s why we ask politicians to make complex decisions on our behalf.
Similarly referenda can descend into ridiculous arguments such as that over AV; even its supporters weren’t fans of AV but they chose to support the compromise they were offered. There was no third, fourth or fifth alternative. This creates two issues; polarised arguments that get lost in emotional propaganda designed to confuse voters. As the rhetoric is ratcheted up, each side becomes entrenched in polarised positions that present the argument in black and white when it should be shades of grey.
Secondly, they are fundamentally undemocratic. Those setting the referenda have decided the policy options prior to the vote taking place; they’re value is somewhat illusory or at best, their application extremely limited. Those voting aren’t deciding an issue, their deciding which of the politicians decisions to endorse. For example, the AV referendum was not based on sound analysis of evidence, but a political compromise. To be truly democratic, it should have offered a range of different systems.
That point aside, the conclusion to be drawn is that direct democracy in the form of referenda is often not a good approach and is thought with problems as attested to by the call for a vote on EU membership. However the situation in Greece offers a very different situation and challenges this perception. At this stage a referendum seems not only politically the right thing to do, but morally also; economically it is likely to prove a disaster.
Politically, the Government is offering the people the opportunity to reject or accept the actions of their government. The current situation in which the Government is essentially working in spite of its population, can’t continue. The population are clearly rejecting its current actions; the offer of a vote will allow them to make their view clear. Morally, its imperative; what happens in the coming months will shape Greece for generations to come, if it hasn’t already. The austerity measures and bailout package or the alternative – default and withdrawal from the Euro – will shape the fundamental nature of Greece for the next few decades. In such a situation, a referendum seems appropriate.
Economically it is likely to cause further problems as markets react badly in the short-term and if a default were to occur, we are likely to see a major Lehman-style credit event. But this is the whole recession writ large; the subtext of the last three years has been the tension between democracy and economics. Our reliance on the financial sector and its lack of accountability, the socialisation of the bank bailout, ongoing debates over 50p tax rates are all symptoms of this relationship that has faltered now that crisis has arrived.
Can we draw a distinction between Euro-sceptic wishful thinking – that we can maintain our current trading terms and level of influence while withdrawing from every other element of European union – and the crisis besetting Greece? If we can, it’s by drawing a distinction between the technical debate of one and the philosophical nature of the other. This might be a false dichotomy, the Euro-sceptics certainly see our membership of the EU as a philosophical issue and the bailout package is certainly technical in most senses of the word.
Perhaps instead it comes down to what is at stake. The Greeks are voting on the future shape of their society, the social contract, the economic settlement. The experience of post-Soviet Russia and Argentina demonstrate quite how desperate and fundamentally different things may become. Withdrawal from the EU would be just another chapter in the UKs steady post-war decline, our economy suffering significantly and our global influence diminishing dramatically. Whatever your view, it’s hard to begrudge Greeks an opportunity to influence the austerity that’s tearing their society apart.
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