Left Behind: How Privatization Disenfranchises the Poor and Endangers Democracies


Left Behind: How Privatization Disenfranchises the Poor and Endangers Democracies

Public services are dividing countries instead of uniting them.

This trend breaks the unwritten contract between citizens and politicians/civil servants because citizens initially viewed politicians/civil servants as a group of people devoting themselves to run the nation. One of the most important differences between democracies and non-democracies was precisely the trust that citizens had in the leaders. Citizens were convinced that those leaders acted like “bonus pater familias”—in the interest of the nation and its citizens. That attitude constituted a moral barrier against corruption of power and corruption of money.

The business sector follows a similar pattern. The purpose has always been to earn money—profit—but many corporations had invested interest in the development of the society in which they operated. They were part of the local culture and knew about the conditions endured by those who worked for them. In 1965 more than four-fifths of all stocks in the United States were owned by individuals. Now those individuals own about one-third of all stocks.

Additionally, the global financial crisis revealed how reckless and selfish the business sector had started to act. It is estimated that business leaders in the United States are paid 373 times more than the average worker. In Britain that figure is 133. The revelation that multinational companies try to shuffle revenue and profit around to pay the lowest possible tax goes in the same direction. The idea that business is here to deliver goods and services to the people and act as a stakeholder with a strong interest in society is rapidly disappearing.

Citizens increasingly classify politicians and business leaders as “not like us” and thus take less of an interest in politics. In Britain membership of the Conservative Party, Labour Party, and Liberal Democrats as proportion of the electorate fell from close to 6 percent in 1970 to about 1.5 percent in 2019. The Conservative Party since 1955 has seen its membership fall from close to three million to the current figure of 124,000. With fewer members it becomes more and more difficult to fund the party’s activities making grants from the business irresistible at the price of cutting the links to the voters who look with suspicion on how political parties are funded. In the United States, the average price of winning or holding on to a six-year term in the U.S. Senate is $10.5 million; the average price of winning a seat on the House of Representatives $1.7 million.

It may be to stretch the argument—we may not yet be there—but the trend is clear that political influence and elections can be bought instead of earned.

This is the first part of a two-part series. Read part two here.

Joergen Oerstroem Moeller is a Visiting Senior Fellow at the ISEAS Yusof Ishak Institute in Singapore. He is also an adjunct professor at Singapore Management University & Copenhagen Business School and an honorary alumni of the University of Copenhagen.

Image: Reuters