337 – Democracy and Inequality

Posted on August 9, 2015 by


Do good institutions—democracy and the rule of law—promote growth? Or are good institutions only made possible by the prior development of a thriving economy?” Joseph Ober, in the current issue of Foreign Affairs, asks this question anew and comes down clearly on the side of “good institutions.” Around 800 BC, Greece was a poor region, he argues. It created good institutions – democracy and the rule of law – which led to a comparatively low level of social inequality.[1] The result was cultural “efflorescence,” what “the historical sociologist Jack Goldstone describes the conjunction of a sustained period of unusually high economic growth with an explosion of rich cultural activity.”

The analogy for today is clear: “good” institutions cause economic growth and cultural activity. To achieve directionality in historical processes, the author blanks out the sources of Greek economic success – by implication he intimates that it was home-grown. It was not. The Greek cities throve on long-distance trade around the Mediterranean and the Black Sea – unless, in the case of Athens, they owned silver mines (and slaves to dig for it) for funding their fleet at Salamis. Trade and political institutions grew together inextricably: democracy may have been born on the trading island of Miletus well before it reached Athens.[2]

The prescription is problematic also in other ways. The article’s author unwittingly gives the game away when he notes: “by the time of Plato and Aristotle in the fourth century BCE, there were over 1,000 more or less independent Greek poleis.” True, some of these cities thrived and had a good life. Collectively or individually, however, they did not solve the problem of coalescing into a viable state. Fragmentation was their fate. First the Macedonians, and then the Romans imposed their rule on Greek cities. The Greek cities had failed to create institutions that allowed state formation.

A reflective pause: I find the gushing about the Athenian political model subtly amusing. Not Athens, but Rome was the chief inspiration for modern democratic institutions (and to some extent Jerusalem – about that later). The intellectuals who shaped the political model of the American Revolution despised “Athenian mob-rule” and wanted structures that could keep it in check. Slowly, they also came to recognize and fear oligarchic partisanship and faction: the American constitution signals the return to a more royalist model[3] as well as a complicated system of checks and balances. The American Constitution tries to strike a dynamic balance between the particular interest and that of “the whole.”

Far from reflecting amorphous Athenian direct democracy, modern political structures explicitly struggled with and tackled the issue of group interest.[4] From the outset, the political system was bi-cameral as in Rome, acknowledging diverse regional as well as property interests. Athenian direct democracy was a fleeting and unsuccessful exception.[5]

To me, the current “rush to Athens” signals political naïveté, and our unwillingness to acknowledge and address the issue of “groups” and their interests in political life. It is, however, consistent with the currently fashionable worldview of personal autonomy, where “democracy” is some atomistic market for political decisions. In short – a beautiful case of “invention of tradition” or anachronism.

What was the superiority of Rome over Athens? Rome arose on a river – where spheres of political interest met for trade. Rome soon learned how to construct bridges, and profit – economically and politically – from being at the river’s edge. The highest priest in Rome was called the Pontifex – the Bridge-builder (the Pope still goes by this name). The Romans built physical and political bridges – were masters of integrating diversity into their political and economic system. In this way, the city grew eventually to encompass all of Italy and then the Mediterranean.

The process went seamlessly from integrating peoples – the Sabines, Latins, Umbrians, Etruscans, and the Italians – to integrating social classes. Inclusions of these peoples rested on explicit political structures: the two legal entities, Senātus, and the Populus Rōmānus, were sovereign when combined. In SPQR – Senatus Populusque Romanus – the connecting QUE had pride of place in the acronym. I know of no other political system where the integration of political opposites was its “founding” stone and where addressing social and political inequality was a constitutional mandate. Of course, this was all based on “learning by doing” – in many ways inchoate and haphazard. But it was “good enough” to give Romans a commanding edge.

Unsurprisingly for me, the Romans were able to create an empire despite the infinite diversity of the Mediterranean. The Romans succeeded where the Macedonian and Levantine autocracies had failed. “Democratic institutions tempered by law” is a necessary but not a sufficient condition. Complexification of institutions beyond the amorphous democratic meeting is required. Integration of diversity must be addressed openly and dynamically through dedicated political structures.[6]

The limits of the Roman model were not so much political as economic. The Roman system addressed settled people with a sufficient economic base to warrant integration. It worked both ways: both the center and the periphery gained. Beyond the border were unsettled people – be they nomadic, or just scattered and subsistent. Unregulated trade ensued.[7] The resulting wealth led to emergent political structures outside the limes. Clans and lineages learned to group under a paramount leader. Such emergent structures exploited Roman imperial weakness; their invasions further weakened the empire. The empire was unwittingly nurturing future conquerors.

The Roman Empire first tried political consolidation to stave off incursions: all subjects became Roman citizens. In a next round, the Empire espoused a universalistic religion – Christianity. It allowed the emergence of a coherent bureaucracy prepared to structure the state (Ambrosius in Milan was a political leader before becoming bishop and one has a hard time separating his two roles).

Christianity had its uses beyond the limes too. The conversion allowed semi-integration. Sharing the same faith built reciprocal trust. Both inside and outside the limes, Christian converts became political leaders able to play a constructive and stabilizing role across it. A good example was Aretas (an Arab of the Jafnid family), who lived in the VIth century along the limes to Arabia. He was one of the leaders of the St. Sergius cult popular among the nomads. He also supported Christian monophysism.[8] By straddling the limes he was a bridge-builder, and probably an enabler of Islam.

Faced with not one, but two universalizing religions (Christianity and Zoroastrism of the Sasanids), it is unsurprising that the Arabs come on the world scene with a universalistic religion of their own, much shaped by the Abrahamic tradition.

Integrating political structures and a universalistic ideology go hand in hand with empire building (state-building looks to its regionally circumscribed version – nationalism). Ideologies have drawbacks too, however: they tend to generate factions of their own, for no one person, authority, or institution has total control over its formulation. Catholic vs. Protestants; Sunni vs. Shia; Trotskyites vs. Stalinists; Mao vs. Deng. Ideological conflicts could tear an empire apart – and they often did. Intolerance reigned.[9]

The “Jerusalem” contribution was the introduction of tolerance into the political system.[10] It made faith a personal issue that need not affect the conduct of the state. After over thousand years of civil war, the West learned to tolerate opposing heresies. It did not, however, develop ways of integrating alternative ideological systems (Nazism and Communism were eradicated). It is just beginning to experiment with being truly multi-cultural.

Ironically, Islam here has a better track record. Starting with the XIIth century, two empires arose at opposite ends of the Mediterranean, reaching their height at about the same time. The kingdom of Spain was religiously (and ethnically) “pure.” The Ottoman Empire tolerated other religions until its end. The reason may have been that the Islamic political model did not allow for the legislative function – the Caliph’s role was military and judicial.[11] Short of enforced conversion, the Caliph was powerless.

Arabs looked to the Roman Empire for ways to becoming a state – and hit on religion. Their success was incomplete, however. Napoleon’s invasion of Egypt in 1798 made Islam’s subaltern status visible (the British repeated this process in India and China in short sequence). Redressing this imbalance has been Islam’s goal ever since. Subliminally, Islamic people were looking again to the West for ways to achieve sovereignty and dignity and hit the fundamentalist potential of a universal religion.[12] Their fundamentalism is also a reflection of our own as well as their lack of experience with the legislative process.

To conclude:

  • Economic development and political institutions go hand in hand. Any ostensible chain of causality is patent medicine. Every situation will be unique. Exporting institutions is recipe for disaster. Institutions need to grow organically in the economic and political context.
  • More importantly, however: a state needs to articulate explicit integrative structures. They cover areas as diverse as income inequality or cultural differences. Failure to address interests and conflicts – and constructively dealing with them – is recipe for disaster. Categorical thinking – be it the dogma of individual autonomy or totalitarian Gleichschaltung – are poison.

In a complexifying state, there is no alternative to trial and error, and learning by doing. Easy, amorphous utopia is the wrong direction. Also, it all takes time. Nothing guarantees “apocalypse now” more than “utopia now.”


[1]           “Athenian wages for non-skilled laborers were high—comparable to the wages being paid in the most advanced economy of early modern Europe, Holland during its seventeenth century Golden Age. Athens’ Inequality Extraction Ratio, a measure based on estimating the maximum feasible level of inequality for a given society, devised by a team led by Branko Milanovic (former lead research economist at the World Bank), is lower than that for any other pre-modern economy for which data is available.”

[2]           In the VIIIth century BC, Anaximander, a citizen of Miletus, was first to argue that the earth was not resting or floating on some support, but that it was suspended in space. He abandoned vertical (or hierarchical) structures for interplay of forces. Implicitly, he was contrasting his town’s worldview with that of Assyrian kings, then the predominant political system.

[3]           See Eric NELSON (2015): The royalist revolution. Harvard University Press, Harvard.

[4]           Davis GRAEBER articulated this felicitously when he quipped: “Americna people wanted a democracy, but got a Republic.” See his: Possibilities. Essays on hierarchy, rebellion, and desire.

[5]           Switzerland is a unique hybrid. It does have direct-democratic elements, but also a bi-cameral structure where federal interests are addressed.

[6]           Athens had only a rudimentary way to deal with faction: the political process of ostracism meted out once a year. It proved deadly for Athens. Rome too knew exile (after all, the institution of jail as punishment had yet to be invented). Exile in Rome was meted out under judicial rules yielding more previsibility than a popular vote.

[7]           Examples are trade with amber from the Baltic (Goths); horses (Xiongnu in China) ; odorous resins (and more) from Arabia.

[8]           Greg FISHER (2015): Rome and the Arabs before the rise of Islam. Amazon.co.uk

[9]           Fighting heresy is one of the tell-tale signs of exclusive monotheism; see Jan Assmann (2009): Monotheismus und die Sprache der Gewalt. Picus Verlag, Wien.

[10]          See Eric NELSON (2011): The Hebrew Republic: Jewish Sources and the Transformation of European Political Thought. Oxford University Press, Oxford.

[11]          Western empires took similar approaches: the British Raj foresaw four different civil codes. This diversity has survived in independent India, though the current “saffranisation” drive may change matters.

[12]             Iran is the only country that has achieved such legitimacy. Unsurprisingly, the current theocracy has much in common with Catholicism. Japan transformed Shinto into a form of monotheism. See Ian BURUMA – Avishai MARGALIT (2004): O)ddicentalism. The West in the eyes of its enemies. Penguin Press, New York.

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