Many readers of these blogs will have heard about the
difficult economic situation of Greece. Most inhabitants of this country want
to get rid of the austere measures taken for improving the economy and imposed
by the countries of the euro zone and the International Monetary Fund. Therefore
most Greeks have voted for parties that want to renegotiate the conditions for
getting aid from these institutions. But what measures do the Greeks want to
take themselves? Actually I don’t know so the case that I discuss here is pure
fiction but it might be real.
Suppose that the Greek government wants to reform the
budget and in order to balance the books it sees as options either increasing
taxes or reducing spending.
To get enough support from the people, it will be up
to them to decide what to do. So the government organises a referendum in which
the voters can say what they prefer. A blank vote counts as a rejection of both
options.
There is a hard campaign in which the government
explicitly says that it will do what the majority of the voters prefer, while
the opposition advises to cast a blank vote, because it wants to bring the
government down, for it stands for nationalizing the most important companies
and levelling the incomes. Then it is this what the voters prefer to do:
increase
taxes reduce spending
first third of the voters preferred dispreferred
second third of the voters dispreferred preferred
remaining third of the voters dispreferred dispreferred (blank
votes)
result dispreferred dispreferred
It is clear from the referendum that two-thirds of the
electorate support our fictive Greek government so it has no reason to resign.
Nevertheless, whatever the government will do will be against the preference of
the voters: Either when it increases the taxes or when it reduces the budget, it
will be a decision that is opposed by a large majority of the people. In either
case, the voters will say: The government doesn’t do what it has promised.
The case discussed is not exceptional. It’s an example
of what can happen if people have to take decisions without having the
opportunity to decide in consultation but when they have to cast votes as
individuals. It’s a situation that often happens in politics. In this fictive
Greek government case the best the government can do is increasing the taxes a
bit and reducing the expenses a bit; so doing a bit of this and a bit of that.
This is what we often see in the political arena.
Be it as it is, the upshot is that sometimes we have
to decide to do what we explicitly have rejected.
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