3 February 2020
Spend some time around the policy community in Washington DC, and it becomes quickly apparent just how much energy, dynamism, good intent and innovative ideas flow around the city. Thinkers in and out of government, on both sides of the political divide, and often working collegially across it, see the challenges and opportunities that lie ahead of the United States, its allies and partners and the world at large. And they are earnestly working on solutions. These are smart people at the top of their game, generating principles and policy actions worth taking further.
It also becomes quickly apparent just how little bandwidth there is for putting these ideas into action. Those few leaders with the power to turn initiative into reality are distracted by the relentless day-to-day churn of modern politics and government, by the starker partisan and political pressures that exist for them, and by finite resources. What might seem a policy priority may not be a political one.
This is not unique to Washington and the United States. Democracy has many advantages, but its pitfalls include a tendency toward short-term return over longer-term interests, being reactive rather than proactive, and being geared towards internal competition rather than cooperation. In 1919, British historian Halford Mackinder said democracies refuse “to think strategically unless and until compelled to do so for purposes of defence.”[^1] Democracy today faces pressures that make it, if anything, even less prone to think strategically than in Mackinder’s time.
This is arguably the key problem facing liberal democracies. It is a bad time to not be thinking strategically. Australia, the United States and their like-minded partners confront a global environment that is unusually crowded and complicated by historic standards, with a number of profound technological, political and environmental shifts underway all at once. Not only is the current modus operandi of the leading democracies leaving their citizens exposed to significant strategic risk, but it is also undermining faith in democracy itself.
The tragedy is that it did not have to be like this. Australia, the United States and other liberal democracies are in this predicament largely due to a lack of will, not deficiencies in resources, talent, awareness or ideas. Point to any of the tectonic shifts underway — such as climate change or the rise of authoritarianism — and it is possible to imagine how capable and determined democracies could have mitigated them earlier. Now, effective action will be more expensive and more uncomfortable than it needed to be and success harder to achieve.
Thinking through how democracies can act more strategically is essential for Australia and the United States to address these challenges. The problem is creating political space for a more strategic approach that is sympathetic to the unique pressures and incentives of democratic government, building a constituency for strategic thinking and action and taking some of the pressure off a beleaguered political system.
By almost any measure, the United States, Australia and other advanced democracies are in enviable positions. Washington and Canberra govern over healthy and wealthy populations, rank low on global corruption indices, have some of the largest economies in the world and possess very capable militaries.[^2] Yet, despite these advantages, there is a sense that all is not well. A growing body of expert commentary is warning about democratic malaise, political crisis and Western decline.[^3] Some even predict the end of liberal democracy as we know it.[^4] A few of the reasons for this alarm are well appreciated, namely that the decades-long period of liberal democratic and Western dominance that coined the ‘End of History’ is coming to an end.[^5] What seems less well appreciated is that it may very well be the most complicated environment liberal democracies like the United States and Australia have ever seen, with no fewer than three major strategic shifts underway at the same time.
China’s growth has pulled millions of Chinese out of poverty and enriched countries all over the world, not least the United States and Australia. But this massive economic growth has empowered a country whose governing party is ideologically opposed to the idea of democracy and to the concept of an international rules-based order that constrains major powers. China can now prosecute its interests with economic influence at the service of the state, backed up by a rapidly modernising military force. Arguably, the demonstration-value of a powerful China, combined with diminishing Western influence, has provided cover for growing authoritarianism elsewhere, with Russia, Turkey, Saudi Arabia and others acting more assertively in their own interests.[^6] According to Freedom House, 2018 saw the 13th consecutive year of a decline in global freedom.[^7]
In an economically interconnected and globalised world, the rise of these powers has presented challenges to governments in Canberra and Washington both of whom are under domestic pressure to maintain economic growth. Difficult choices between security and economic dependence are compounded by the willingness of some authoritarian countries, particularly China and Russia, to seek to play on the divisions in domestic democratic constituencies, and drive wedges between traditional liberal democratic allies and partners. A case in point is the discomfort that the United Kingdom — a key security and intelligence partner of Australia and the United States — is clearly feeling on whether to accept Huawei’s participation in its 5G network.
The second strategic trend is climate change, an environmental crisis of scale and speed unknown in human history.[^8] This is a clear threat and strategic challenge to all countries, and yet the world’s liberal democracies have generally preferred to protect domestic constituencies from the sacrifices required to mitigate it. While this inaction is not unique to democracies — only two countries in the world are recorded as likely to meet their Paris Agreement commitments at present — the advanced democracies bear much of the responsibility for historical emissions.[^9] To this day the United States, Australia and Canada remain among the very highest emitters on a per capita basis.[^10] And unlike many other nations, the advanced democracies have the resources and the mature innovation systems to play a far more proactive role in mitigating emissions and environmental decay.
The political incentives in democratic systems to avoid short-term pain and use climate change as an ideological football appears to have outweighed the need for long-term planning and action. As the years go by and the scale of the energy and social transition required becomes greater, the gap between the short-term interest of protecting key constituencies and the long-term needs of the wider community is only becoming larger and more difficult to navigate for political leaders angling for re-election.
The third trend is a changing industrial landscape brought about by automation and artificial intelligence (AI). Some studies project the benefits of AI to be significant, potentially adding another US$13 trillion to global GDP by 2030, but it could also result in severe disruption to the way of life in many developed and developing countries.[^11] The International Monetary Fund has warned that the impact of automation and AI could lead to an economic ‘death spiral’ of mass unemployment, falling wages, economic contraction and rising inequality.[^12] Capital, concentrated in the hands of those few companies that control the means of AI and automation will be the key source of productivity and profitability. Essentially, labour could be rendered far less valuable.[^13]
These technological and industrial changes may already be shaping politics. In recent political referendums and elections in some of the liberal democracies, there appears to be a growing gap between urban areas considered to have largely benefited from globalisation and industrial changes, and more blue-collar regional areas for whom that change has brought stagnation and uncertainty. For example, in the 2016 US presidential election, ‘Rust Belt’ states such as Michigan and Ohio got behind anti-establishment candidate Donald Trump.[^14] Michigan had not voted Republican since 1988.[^15] Much the same dynamic is thought to have occurred in the Brexit Referendum, in which urbanised London was the only electoral region of England to vote to remain in the European Union.[^16] These industrial trends can and do affect politics — and the shift to automation and AI is only getting started. But mitigating this looming risk is still not an obvious priority for political leaders in the United States or Australia.[^17]
That the United States, Australia and their like-minded partners have stumbled into this unprecedented convergence of risk — despite plenty of warning — exposes the incentives in democracies that work against the long-term interests of citizens. The system is inclined toward short-term reward over long-term benefits, competition over cooperation, and being reactive to events rather than setting a common proactive agenda. Each of these traits is the opposite of what these strategic-level challenges and opportunities demand.
Responsibility for this malaise should not be vested entirely in the political class but also in the signals the electorate itself is sending to politicians who depend on their votes. For example, while citizens may tire of the hyper-partisanship in modern politics, the same citizens also appear to be more polarised and less willing to compromise with those who hold different views. In a recent political study, American respondents identifying as liberal had an overwhelmingly poor view of Republican qualities and the same applied for conservative views of Democrats.[^18] It should not be surprising that some elected leaders see opportunity in pandering to this increasingly partisan divide rather than seeking to redress it.
The unfortunate result, and one that itself may only further exacerbate the dysfunction, is increasing pessimism and cynicism about the ability of democracy to solve problems. When interviewed in late 2018 by Pew Research on what the United States will look like in 2050, Americans predicted a country of reduced international stature, widening inequality and growing political polarisation.[^19] Forty-eight per cent were very worried about the ability of their political leaders to solve problems. Similarly, the Australian Election Study showed trust in government has reached its lowest level on record, with only 25 per cent of respondents believing government to be trustworthy.[^20] This loss of faith in democratic governance is particularly strong in younger generations. According to the 2019 Deloitte Global Millennial Survey, which exclusively surveys millennials and Generation Z, the prevailing mood in every developed liberal democracy was more pessimistic than optimistic, while those in emerging markets such as Nigeria, India and Indonesia were significantly more optimistic.[^21]
There is also a small but growing minority considering the idea of less democratic alternatives. The World Values Survey, a global survey of people’s values and beliefs, showed a growing cohort of citizens in some developed liberal democracies — including the United States, Germany and Spain — that prefer the idea of a strong leader over parliament and elections.[^22] Again, this view is stronger in the young, with those born in the 1980s scoring highest on cynicism toward democracy, including in Australia and the United States. In fact, almost one in four people born in the 1980s in the United States and one in five in New Zealand describe democracy as a ‘bad’ or ‘very bad’ way of governing a country.[^23] These trends in public opinion are making it increasingly difficult for political leaders and policymakers to build the political capital to implement long-term strategic reforms across democratic societies.
A more surprising consequence of the maladaptive trends in modern democracy is disillusionment among political leaders themselves. In November 2014, a journalist interviewed a number of members of Congress on why politics was so dysfunctional. In discussions with 90 politicians, he found a cohort of elected leaders just as frustrated with partisanship and dysfunction as the general public. Members pointed the finger at a range of causes: electoral map-making, or gerrymandering, which creates districts that are sharply partisan and unrepresentative of the broader region; a media that sees stories and profit coming from conflict and drama rather than cooperation; and the impact of donations and fundraising that beholds candidates and parties to special interests while punishing those who seek compromise and reform.[^24]
These characteristics of many modern democracies can make it difficult to even meaningfully progress policies that have a high level of national support. The 2019 Lowy Poll saw climate change reach the top of Australians’ list of threats to the national interest.[^25] It was also the top concern for respondents in Deloitte’s Global Millennial Survey, suggesting that there is popular support — and votes — in delivering comprehensive action.[^26] But it is not overall majorities that determine elections, it is the number of electoral districts actually won. And if the majority that seeks action on climate change is concentrated in certain electorates while a more sceptical or apathetic cohort is spread over others, then the incentive for political leaders to respond is not there. Again, this incentive structure makes it difficult for many democratic systems to respond to structural challenges like climate change, which may require short-term economic outlays to ensure a long-term positive outcome.
Modern democracies — partly by accident, partly because of common human biases and possibly by design of those with vested interests — have fallen into habits that are an anathema to fostering confidence in a society’s ability to seize opportunities and challenges. The system as it is will only get worse as the public becomes more disillusioned, the challenges more pressing, and the political system more divided and less able to reform. It may not be climate change, China’s rise or any other single strategic issue that is the greatest threat to the interests of Australians, Americans and their partners among the democracies: it may in fact be the refusal of their societies to think and act strategically.
It is important, however, not to assume that these trends are inexorable. While there are some structural limitations that undermine the tendency for democracies to plan and act strategically, they are also some inherent strengths and advantages. Democracies can be highly resilient. Their systems are accountable and efficient so they can be very good at maximising their capabilities when needed. And the competition of ideas in democracies means they can be adaptable and innovative. These are all desirable traits at the strategic level.
There is a long history of democratic systems proving time and again that they can be effective strategic thinkers and actors when compelled. Some examples of marshalling of resources to achieve long-term political and strategic goals include the New Deal, the First and Second World Wars, the Apollo Space Program and even the Cold War. All these required significant resources and sacrifice on the part of the broader community. Further, all were able to be sustained across electoral cycles and, in many cases, changes of leadership.
An important question is whether there is something about the practice of democracy today or the forces it is subjected to which make it harder for democracies to think strategically. It is possible that the ‘professionalisation’ of politics has created a cadre of apparatchiks hardened and motivated by political battle rather than policy challenges.[^27] Perhaps feeding a rapid news cycle traps government and media alike in a short-term, reactive hamster-wheel that prioritises sensation over substance.[^28] The rise of social media seems to have hardened partisan positions in the public, which bleeds into politics — and provides fertile ground for nefarious state and non-state actors to stoke for their own purposes using new technologies.[^29] Moreover, perhaps the nature of the challenges that liberal democracies now face — such as climate change, or a China that is savvy about gaining ground without crossing the threshold of Western military responses — are not immediate enough to trigger the compulsion for national defence that usually switches democracies from tactical to strategic.
In the face of such an array of difficulties, it may be tempting for some to reach for a dramatic redesign of democracy as the only way to set the system straight. A better course of action may be to understand how to more routinely trigger democracies’ already existing capabilities to think and act strategically. For these triggers to work, they need to offer something to all stakeholders, and demonstrate value through tangible progress and real outcomes toward the risks and opportunities that democracies are facing. They would need to offer elected leaders something to challenge the current incentives that prioritise short-term competition and partisanship. And they would need to show the public something different — to allow them to feel more confident in the ability of their government to meet opportunities and challenges, and more confident that their society is on the right path.
The goal of this effort need be no more complicated than seeking to create just a little bit more space for strategic opportunities and challenges in these busy, distracted, hyper-partisan democracies. Elevating those opportunities and challenges in the national consciousness, mobilising resources for genuine action, and building public buy-in and a willingness to ‘sacrifice’ resources in the national interest are necessary steps in setting a new course for democracy. For Australia, the United States and other democracies, this could focus on three lines of effort: forging optimistic strategic narratives with which populations can easily connect; building this agenda among allies and partners; and launching specific direct democracy initiatives that galvanise public support. These objectives would help to harness the inherent advantages that democracies possess for the long-term and could address some of the systemic and overlapping challenges they collectively face.
An important rule of thinking strategically is to first determine what needs to be achieved. It is not entirely clear if the United States and Australia have a good sense of this — which means attempts to use national power to solve strategic level issues can suffer as a result. Because of this trait, democracies often struggle with another critical consideration: choosing what not to do. Strategic objectives created by democratic institutions are often so broad that they offer little guidance on what is a priority and what is not, and play little real part on decisions of allocating finite resources to best effect.
Australia’s 2016 Defence White Paper, while deservedly described as the “most rigorous and comprehensive in Australia’s history”, nevertheless struggled with some of these pitfalls.[^30] Its ambitions — a trio of Strategic Defence Interests and Objectives roughly split into defending Australia, making contributions to Australia’s near region and contributing to coalition operations around the world — leave almost nothing out. There is no obvious prioritisation for what Australia will choose to focus its finite resources to achieve, and what it will not.
The United States’ 2018 National Defense Strategy is sharper about the risks the United States faces, calling out “inter-state strategic competition”, epitomised by China and Russia, as the primary concern for US national security. But it was not paired with a real budget increase, nor did it appear to set up a clear conversation about what the US military can do less of in order to concentrate its finite resources on China and Russia. Even the document’s chief architect, former Deputy Assistant Secretary of Defense Elbridge Colby, implied that the implementation of priorities in the document was clouded by conflicting subordinate guidance and a lack of political will to engage with the question of what not to do. Problems like these are having an increasingly detrimental effect on the ability of the United States, Australia and their partners to focus national power in a world where they will not enjoy the advantages they once did.
One problem facing democratic governments in their conversations with their constituents is the lack of a compelling and inspirational narrative. Democratic institutions will often assess the environment they operate in as it is, rather than beginning with a strong sense of what they want it to look like. This predisposes them to be reactive, cede initiative and lack ambition because what strategic thinking exists is seen through the lens of what is, rather than what could be.
To lift confidence in democratic governments’ abilities to solve challenges and seize opportunities, Australia, the United States and their democratic partners could each start with an optimistic and proactive strategic narrative that sets out what they want their countries and the world to look like, the compelling goals they want to meet with the resources at their disposal, and a plan for how they will address obstacles along the way. This becomes a statement of intent that, if done well, could begin to serve as a rallying cry for the community. But in order to serve this purpose, narratives must be clear and specific so as to actually serve as a guide for the allocation of resources. Narratives should also be inspirational to increase the likelihood that the public will connect with them. Finally, these narratives need to be regularly revisited and assessed to hold institutions to account on progress. The payoff for elected leaders who might see risk in this approach is greater opportunity for a positive legacy and the potential to break from the dysfunctional short-termism that makes politics dissatisfying for them and their peers.
During the Second World War, allied leaders held a series of conferences where they determined their strategy for the war and what was to come after. They focused military efforts on defeating Germany and determined what a post-war Europe should look like. Eventually, the Bretton Woods system and the United Nations sprung from the cooperation and decisions set at these meetings. These were confident leaders operating in adversity and backed by committed societies, working together not just on the crisis at hand, but thinking optimistically about what was to come after it.
Unfortunately, current partnerships are not living up to these examples. The strength of the alliances and partnerships that like-minded liberal democracies share is a competitive advantage available to them alone, and the collective resources at their disposal are immense. Yet these advantages seem to be taken for granted and are far from being used to their full potential by governments.
In the Center for American Progress’ 2019 study into voter perceptions of foreign policy, two-thirds of US respondents rated working with allies and international institutions to confront global challenges as a “top” or “very important” priority.[^31] In the 2019 Lowy Poll, 72 per cent of Australians rated Australia’s alliance with the United States as “very” or “fairly important.”[^32] Other like-minded partners, like New Zealand and the United Kingdom, also rated comfortably above many others as Australia’s “best friends” in the world.[^33] It is fair to say that these unique partnerships have a history of delivering results, retain strong support among the public and are objectively a critical and unique competitive advantage for many democratic societies.
To capitalise on these partnerships and reinvigorate them, Australia should sponsor a dialogue, inviting representatives from like-minded democracies to discover and develop a set of optimistic, specific and tangible goals for the group to work on together. These should be structured around ‘grand challenges’ that could, for example, be crowd-sourced from the public and private sectors of the participating nations. This is an opportunity to show what capable and committed liberal democracies can do using several elements of their national power. There is a long list of possible ‘grand challenges’ on which motivated and well-resourced democracies can take the lead, including developing options to offset the impact of automation on future workforces, defeating political interference by authoritarian states and pooling resources for space exploration.
But to succeed in an environment where multilateralism is in crisis and collective action is regarded sceptically by more than a few governments, such a dialogue and any activities flowing from it would need to be carefully designed to maximise impact.[^34] Participation should be limited to those countries motivated by and committed to a shared agenda. Grouping together ‘coalitions of the willing’ on specific goals is more likely to achieve outcomes than pursuing wide membership simply for the sake of it. Even among the group of like-minded democracies, not all will sign up to support each ‘grand challenge’, which is preferable to seeking consensus on every initiative. Crucially, such challenges must be designed to minimise bureaucratic overheads and translate into specific outcomes — or else they will only add to the scepticism about ineffective collective action.
One obstacle to a more strategic and ambitious policy in the United States and Australia is a view that there is little real public appetite for it. Voters may say they want vision and strong action, but if this requires more taxes it is a non-starter. In one Australian survey taken before the last federal election, seven out of ten Australians supported more spending on public services, but only very small percentages in each tax bracket felt that they were not paying enough tax.[^35] Few elected leaders want to take on this issue. However, questions like these may not be getting at the issue in the right way. Connecting taxes and revenue with specific choices over what public money buys may yield different results.
On a much smaller scale, the city of Lincoln, Nebraska, experimented with this concept more than a decade ago. When Chris Beutler was elected mayor in 2007, his administration faced circumstances familiar to many democratic governments large and small: not enough revenue to pay for services and a population hostile to the idea of tax increases, reductions in services and generally distrustful of political leaders.[^36]
Beutler created an initiative called Taking Charge, which brought the community into the budget process as participants, not just observers. They engaged citizens directly on questions of specific trade-offs, like the costs of different levels of snow removal. This appears to have been an open and transparent conversation about the fiscal challenges the jurisdiction faced, and the available choices of cutting services, raising revenue or doing both. When engaged in this way, citizens supported some surprising outcomes. In one 2011 survey, a staggering 84 per cent were willing to raise property taxes to preserve services.[^37] The city found that citizens were willing to cut some ‘sacred cows’ from the budget when they understood the trade-offs; and — arguably just as important — this process endowed residents with a higher level of confidence in the city government. Not only did Taking Charge give the city’s leadership the space to pursue reform, but it also improved the conversation between public and government.
The challenge is how to take a local government model like the experiment in Nebraska and apply it at a national level, where the issues are more complex and the distance between political leaders and citizens is greater. Indeed, direct democracy is regarded with suspicion by some experts who see it as a pathway to community division rather than as a unifying tool.[^38] One low-risk, high-payoff way to make a start at the national level would be to identify a specific inspirational initiative each year, such as in exploration or big science. After an information campaign to inform the public about the initiative and what it would mean for them, voters would decide if they wanted to dedicate extra tax to its realisation. This would connect the public with trade-offs around strategic opportunities and challenges; and may be an avenue for democracies to link taxes to long-term goals or visions that generate public buy-in.
For those interested in the long-term prosperity and strength of the United States, Australia and their like-minded partners, and in the success of democracy as a model, current trends should be of serious concern. Strategic risk is higher than it needs to be and citizens are growing more pessimistic about the future and disillusioned with democracy. This is before one even begins to consider the opportunities that short term-oriented, reactive and hyper-partisan democracies are missing. The irony is that the way that democracies are currently working is not satisfying for anybody, least of all political leaders and the general public.
The refusal of democracies to think and act strategically is a significant driver of the malaise in which the United States, Australia and their partners find themselves. But this is not to say they are bound to continue down this road. These countries have shown in the past that they can think and act very effectively at the strategic level, building consensus and getting behind strategic actions that require short-term sacrifice to achieve long-term goals and ambitions. That democracies find themselves in their current predicament is not due to a lack of capability or a systemic flaw in democracy itself; it is a succession of choices by democratic societies inclined to think tactically rather than strategically.
While some will leap to the conclusion that democracy needs a wholesale redesign, turning this malaise around may not require it. Creating a deliberate space in the conversation between citizens and governments for action on optimistic and strategic ambitions may begin to reset this malaise. Allowing people to own some of those ambitions may contribute further. This is a low-risk and high-return strategy that it is just waiting to be tried.
Cover photo: Voting buttons in the US House of Representatives chamber (Getty)
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