“Why doesn’t the government do something?” How many times have you heard, or said something like that. The answer is they don’t do something because it is called democracy. Democracy has constraints. Let me expand.

One constraint is the number of people who need to agree. In Australia we have a federal government at the top layer consisting of two bodies – House of Representatives and Senate. Below them are six state and two territory government each with two houses except for Queensland. On the third layer are 537 council or regional bodies. So if the federal government passes a law, it can be overridden in some situations, or watered down by the other two levels of government.

Take an example. The federal level decide to put money into social housing. The states argue over their slice of the pie, and each ends up with an allocation. They decide which councils will have social housing built in their area. The councils then go through an approval process before they allow building to go ahead. Some councils have pressure from NIMBY residents who don’t want social housing. Many councils have building regulations that are different to the neighboring council. Some councils don’t have enough staff to approve the developments for months.

Different state departments must sign off on environmental issues, waste management issues, transport and parking issues, noise assessment etc. This requires a plethora of reports and studies. The money gets chewed up and by the time the administration process is complete, a substantial proportion of the funds are gone.

If you think this is bad have sympathy for the US. It has a federal level, 50 state levels and 89,000 local government and municipal authorities.

So what is happening? A number of things. There is an unclear set of authorities. In many situations, it is unclear who is actually responsible. If you want to talk about a particular proposal, there may be multiple departments and levels of government that have a hand in the decision.

There are no, or inconsistent standards. Each entity has it’s own set of rules and some are contradictory. A building code that is applied at state level may be slightly different to a council level. Federal legislation may be supplemented by state and/or municipal legislation. Something as simple as a driving license can have different rules in different states.

It is generally referred to as “bureaucracy”. Because there is no clear map of responsibilities multiple people want a say in decisions. Probably the most absurd in Australia is health where the health system is run using joint funding from federal and state governments. It is then administered by regional health units which cover particular municipalities. I suspect the situation persists because neither state nor federal governments is prepared to give up their control.

The alternative is central control where all decisions are made centrally. Oh. That is China isn’t it and that must be bad. And Russia too…. and North Korea.

Why so many levels of Government? Some is historic. In years past, it made sense to have a regional control authority. That was in the days before telephones. The only communication was letters and it may take a week to send a letter and get a reply. Email and Zoom was not even a concept in science fiction. So are local councils relevant today?

That is such an emotion charged question that it is hard to give a straight answer. There are arguments for and against. I suspect those against abolishing municipalities would win any debate. It will change our community; the garbage will not be collected on time; money will go to other communities; residents will have no say in local development.

The arguments in favour are based around cost and efficiency. Neither are strong on the self interest scale so it is unlikely the arguments for abolition would ever win. Fear will prevail.

An interesting fact that not too many people are aware of is that in the early 1900s States in Australia raised 80% of tax revenue. They progressively handed over control to the Federal level and now the Federal Government collects 80%. The lesson is that it sometimes takes a century to change government structure. Not in our lifetime.

Changing government structure has the best chance of success when the change is incremental. This is not only well known to politicians but also being practiced. In New South Wales over the last two decades, we have had merging of local councils. We have garbage collection contracts that span multiple municipalities. States develop planning regulations and try to force them on all councils. In perhaps another 100 years, municipalities could evolve to be delivery arms for state governments. In 200 years and states may be delivery arms for federal governments.

Another big constraint for bureaucracy is political survival. A Lord Mayor may be a big fish in a small pond, but at least they feel important. It is not too hard to surround yourself with others who feel a need to be important and find a few reasons to justify their existence. It can be attending a school presentation night or talking to a resident who wants to complain about a hole in the road. They fill out their days and justify why their job is critical to local residents. Just arguing with other levels of government could absorb half their time.

Of course to show you can add a difference, you create a difference. If the state says it is black you say it is white. It might not be too important in the big scheme of things, but it shows you can stand up to those bullies at the next level. If there are a group of people in your backyard who have a certain view, even if they are the only people in Australia who have that view, you fight for them. If your council area has an asbestos mine, you are a supporter of asbestos mining.

Which brings us to another constraint on democracy. You have to win votes to get elected. That is different from representing the majority view, but the two situations are conflated by politicians. “We have a mandate to do this!” they cry. Well, you were elected but do you believe every voter supported every action you proposed? Of course not. It is just you were the lesser of two evils.

They say survival is the most basic instinct. That works for politicians too. Get elected, then do nothing that is likely to reduce your vote at the next election. Usually, this means do nothing at all. Politicians are scared to make radical changes. They talk of “burning political capital”. What it means is that doing something radical will turn some people against them. Haters have longer memory than those advantaged.

We have talked about the levels of control, and the need to get re-elected, but there is another constraint as well. It is the financial constraint. It takes two forms. The money used against you, and the money you as a politician have to get re-elected.

The most blatant example in Australia is when PM Kevin Rudd proposed a super tax on minors who were making fortunes due to China’s demand for coal and iron ore. The campaign they waged cost tens of millions. A new tax would end life as we know it. Rudd backed down. If they would spend tens of millions to fight him, who knows what they would have given his opposition at the next election? So a democratically elected government is scared of corporations.

Look at the US where one report has members of government spending a quarter to a third of their time fundraising. Does anyone see something wrong in electing a representative to spend a third of their time raising money? Australia can easily go down that path. We are experiencing some of that now with all sorts of dodgy donors being flushed out on a regular basis. The line on accepting donations is more a dirty smudge on a dark night.

This discussion could go on to many more topics but I wanted to make three key points.

1. The more democracy, the more people involved in the decision, the less effective the decision will be. If you want quick decisions go to an autocracy.
2. While politicians rely on approval in the short term to be elected, they will never think long term. If you want long term thinking, elect politicians for longer periods, or rely on the Public Service more. Of course politicians hate that because it changes the power balance of their ministry.
3. Money not only talks. It is the lifeblood of democracy. It determines who will rule and what they will promote. A politician has a survival instinct and money is the quickest way to survive.