Guest Post: What Democracy?

Tyler Durden's picture

Submitted by James Miller of the Ludwig von Mises Institute of Canada

What Democracy?

A sacred cow is usually defined as that which is regarded as far too valuable or prestigious to even think about altering.  Any proposition that comes close to complete abolition is met with astounding ridicule.  In the realm of legalized harlotry (politics), careers are made out of defending sacred cows no matter how expensive, socially corroding, or intentionally dishonest they are.  Compulsory public education is one of the first to come to mind.  The various vote buying schemes that masquerade as a welfare safety net are another.  Whenever the political class or its apologists in the media find themselves in a bind trying to validate the government’s latest plot to fill its coffers or grind already-undermined liberties further into the curb, they often resort to evoking the greatest sacred cow of all: democracy.

Starting from the earliest years of basic comprehension, children in the Western world are propagandized into believing that without democracy, society would descend into unlivable chaos.  Schools, both public and private, perpetuate the fantasy to millions of forced attendees every year.  They are told that the government which has a hand in practically anything they encounter was formed with only the best intentions.  In America especially, the representative democracy constructed out of the collective genius of the country’s founding fathers is lauded as a gift to humanity.  And though its influence is waning in recent years, the Constitution served as a model for developing nation-states around the globe.  Back in 1987, Time magazine estimated that of the 170 countries that existed at the time, “more than 160 have written charters modeled directly or indirectly on the U.S. version.”

The Constitution is presented as the miraculous creation of divine individuals when, in fact, it was nothing of the sort.  Like any attempt to centralize state power, the Constitution was formed out of the economic desires of its framers.  Thomas Jefferson, John Adams, Thomas Paine, and Henry Adams weren’t even present at the Philadelphia Convention as it was drafted.  Many Americans at the time were suspicious at what ended up being a coup to toss out the decentralized Articles of Confederation in return for an institution powerful enough to be co-opted for the purposes of rent seeking.  As Albert Jay Nock noted:

The Constitution had been laid down under unacceptable auspices; its history had been that of a coup d’état.

It had been drafted, in the first place, by men representing special economic interests. Four-fifths of them were public creditors, one-third were land speculators, and one-fifth represented interests in shipping, manufacturing, and merchandising. Most of them were lawyers. Not one of them represented the interest of production

when the Constitution was promulgated, similar economic interests in the several states had laid hold of it and pushed it through to ratification in the state conventions as a minority measure, often — indeed, in the majority of cases — by methods that had obvious intent to defeat the popular will. Moreover, and most disturbing fact of all, the administration of government under the Constitution remained wholly in the hands of the men who had devised the document, or who had been leaders in the movement for ratification in the several states.

Unvarnished history like this is never taught in public schools and is hardly known by the public at large.  There is a reason for this of course.  When the rose tinted glasses are removed, the state appears as the organized criminal racket it really is.  Those entrusted as “representatives of the people” are really looking out for themselves and their financial well-being.  As government grows and regulatory bureaucracies flourish in size and scope, law formation becomes not just a job for the elected legislature but also of the executive enforcers.  In other words, the same people tasked with enforcing the law are also given discretion over what rules they wish to impose.  These unelected bureaucrats, in a constant effort to validate their positions of authority, will never seek to cut the tax money that is their lifeblood.  Instead, they will spend the whole of their budget every year as they live out their desire to have meaningful employment through crushing freedom.  The people’s will is sold off to ensure a new bloc of state-privileged voters.

Leviathan’s growth by bureaucracy has been occurring all over the Western world but it is accelerating at a worrisome rate in the United States and Europe.  In the 2012 edition of the Competitive Enterprise Institute’s 10,000 Commandments which provides a type of snapshot of the American regulatory state, it is documented that federal agencies were responsible for the implementation of 3,807 rules.  These economically destructive regulations were set in stone despite only 81 bills passing Congress and being signed by the President.  Representative democracy has been replaced by the rule of the unaccountable.  In an environment where the power players are shielded from public backlash, the opportunity for cronyism, corruption, and back room deals increases tenfold.  Revolving door politics becomes the norm as the regulators who write the laws end up being employed at the same firms that avoid their punitive nature.

Across the pond in Europe, unelected technocrats continue to try and save the floundering currency union.  Austerity measures, which amount to more tax increases than cuts in government spending, have been imposed by bureaucrats who have little to no identification with the people they are levied against.  It is centralized planning on continent-wide scale.  The person with the most sway in the crisis has been European Central Bank President Mario Draghi.  Though Draghi only has one vote in the body that controls the printing press, he is seen as its mouthpiece.  Last week as the Olympic Games kicked off, he infamously made the off-the-cuff remark on doing “whatever it takes to preserve the euro”.  The remark, whether Draghi admits it or not, carried with it the bought-and-sold notion that the printing presses would soon be put on overdrive in an effort to quell the crisis by buying sovereign debt.  Stocks in both the U.S. and Europe rallied on the news but sunk soon after the plan was revealed as a farce.  There was no trick up his sleeve; Draghi’s remark was pure posturing.

However the event was highly revealing of the reliance the global economy has on a constant injection of cheap, fiduciary currency.  Under central banking, consumer preferences which normally guide the free market’s structure of production take a backseat to the whims of the operators of the printing press.  Financial markets begin centering their operations around fresh batches of newly created digital currency.  Fractional reserve banking becomes even more emboldened.  Because money isn’t neutral and always enters the economy at specific points, the first receivers are able to spend and invest before overall prices are affected.  The last receivers must deal with prices rising prices as their wages stagnate; thus lowering their real income.

The free market economy is analogous to democracy because consumers vote with their wallets on who produces the best product.  Under central banking, few individuals are granted the monopolistic license to produce that which facilitates all transactions.   There is nothing democratic about central banking in practice; it is a system of top-down governance based on the fantastical idea that there exists an ideal amount of money that only a few intellectually gifted economists can determine.  With one hundred years of operation under its belt, all the central banker profession has learned through the various recessions which plagued the 20th century is that money printing appears to solve everything.

From the beginning of the Eurozone crisis, anyone not quenching their thirst with the Kool-Aid of good, honest government recognized that the large banks were the true beneficiaries of the various bailout schemes.  Because commercial banks in Northern Europe are exposed to sovereign debt, it is in their best interest for default to be avoided even if it means receiving interest payments in a devaluing currency.  The people of the PIIGS (Portugal, Italy, Ireland, Greece, and Spain) are told their governments are being bailed out as a benefit to them.  What’s really happening is the bankers are pulling the reigns of an unscrupulous political class looking to ultimately cash out by helping their friends in high places.  The rhetoric of preserving democracy by EU officials amounts to nothing but a childish ploy when contrasted with the brazen, systematic exploitation the state embodies.

To the ruling establishment, the approval of “we the people” matters insomuch that they don’t recognize their oppressors.  Democracy is a charade to convince the masses that they are in charge of their future when they are servants to authoritarianism.  Economist and philosopher Hans-Herman Hoppe was spot on when he recognized that

Democracy has nothing to do with freedom. Democracy is a soft variant of communism, and rarely in the history of ideas has it been taken for anything else.

Rather than give the people a voice, democracy allows for the choking of life by men and women of state authority.  When Occupy protestors were chanting “this is what democracy looks like” last fall, they wrongly saw the power of government as the best means to alleviate poverty.  What modern day democracy really looks like is endless bailouts, special privileges, and imperial warfare all paid for on the back of the common man.

None of this is to suggest that a transition to real democracy is the answer.  The popular adage of democracy being “two wolves and lamb voting on what’s for lunch” is undeniably accurate.  A system where one group of people can vote its hands into another’s pockets is not economically sustainable.  Democracy’s pitting of individuals against each other leads to moral degeneration and impairs capital accumulation.  It is no panacea for the rottenness that follows from centers of power.  True human liberty with respect to property rights is the only foundation from which civilization can grow and thrive.

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Buckaroo Banzai's picture

Time to return to the Articles of Confederation?

bankruptcylawyer's picture

oh yea, you know there's another sacred cow---the federal reserve. yea, i think you forgot that one. which basically means, the entire american system built up over the past 60 years. 

Vampyroteuthis infernalis's picture

We don't have real democracy or capitalism in the US. We have oligarchical, authoritarian leaders. This article is tripe at best.

engineertheeconomy's picture

The current political regime in the United States is actually a Military Dictatorship parading as a Free Democracy.

What goes up inevitably comes down on its own accord.

Physics Bitchez

0z's picture

Most of the commentators here argue over shades of grey.

Here is the real question; State or no State?

There is an answer, some people call it natural order. 

The rest is endless and pointless jaw/tongue stretching.

Anyone who wants to hold interesting conversations on the question of "social order" should read Hans-Hermann Hoppe.

TheGardener's picture

Aristocracy, before its dilution , claimed divine natural order and had the roots and genes to prove it.

Some are still around, filling up gas or getting dirty
for a living and not talking about fight club...

HHH is talk club and unlike shorting democracy with PM and thus zero hedge , he talks the book about insurance companies replacing basic risk taking off THE STATE , instead of living unhedged . He is a good libertarian read though for starters, or thought crime democrazy doubters, but he wears the warning label for the real thing.

gmrpeabody's picture

When there are more votes by people with NO SKIN in the game..., this is what you get!

Bananamerican's picture

“two wolves and lamb voting on what’s for lunch” is undeniably accurate"

I deny it....It's absolute bullshit. 

It's more like "10,000 wolves and 300,000,000 sheep voting"

This is some more of that Objectivist crap isn't it?


Author fucks up the animal metaphors right outa the gate.

"Wolves" run crony capitalist societies....not "sheep"!.....WOLVES!

AKA: rule-benders, bribers, kickback artists, the self-exalted, scam artists, bullshitters and sociopaths...godless sons of Mammon

everybody else? ya toss the sheeples a hay bale in the pen now and then, and the next time lunch rolls around, you take another one out and eat it. (and i include 99% of the truly "self-made" in there)

You see, you don't need all this Objectivist bullshit....and yes, you're welcome Alan Greenspan!

rsh00's picture

No State! I vote for No State! I want natural order!

Now let the endless, pointless jaw/tongue stretching begin on who will dismantle the state and how.

...You're welcome!

Taku's picture

Have to post this. 1 Canadian and 1 American died mysteriously in Vietnam recently. Canadian government at first would not provde any details citing 'privacy concerns'. US government statement unknown. Cause of death blamed on alcohol.



Taku's picture

Oregon man sentenced to jail for collecting rain water

Pumpkin's picture

This man does not know the law. He probably got a lawyer.  Getting a lawyer is the most common mistake anyone makes concerning the law.  There are many different ways he could have stopped this action in its tracks.  A lawyer will not do any of them.

AurorusBorealus's picture

The most important element of the U.S. constitution should be preserved... the first five amendments, known as the Bill of Rights, which Jefferson wrote after the constitution had been drafted and ratified.  Beyond this, you must ask yourself the question... "what type of government can there be?"... government by the one, the few, or the many... monarchy, aristocracy, or republic.  These are your only 3 options.  However government is formed, however, I think it functions best when run like a personal estate: with a fixed source of income, mandated by law, and expenses that come directly from the pocket of those in power.  No way would someone pay, from their own pocket, for the outrageous salaries and pensions government employees in the Western world receive.  When it is the "public purse," no one is responsible.

GMadScientist's picture

They only caved because they feared ratification would fail otherwise; the Federalists have been trying to claw those rights back for 225 years.


a) charles pinckney, not jefferson

b) they were written before, not after, and only included as amendments after because the Federalists rejected them orior to ratification

Sometimes you look back on the unholy bargains that occured to get things off the ground, bicameral legislature, the bill of rights, the 3/5ths compromise...and you wonder how we've lasted this long.

engineertheeconomy's picture

Where Hitler failed, Obummer has successfully engineered a slave labor death prison ponzi planet

You know what they say, paybacks are a real mother fucker

tlnzz's picture

 Justifiable righteousness. No one can stop an idea whose time has come.

GMadScientist's picture

He didn't do it alone; there's 42*535 other helpers that need a plaque too.


engineertheeconomy's picture

Direct Democracy, Transparency, Accountability, Consequences for Crimes Committed, Honest & Just Economic System. It's already been Engineered and although it is not to the Bankers liking, the numbers work out. Now the goal is to raise the consciousness of the average person so that the information can get out. Maybe 1 out of every 100 Zerohedgers are ready to see the truth. The rest can't handle the truth yet. Think you're ready? Here's an old book that will test your comprehension level 

let me know if any of you are ready yet 


Clashfan's picture

This sounds more like Still and less like the anti-democracy drivel of the thread's piece and of the hardcore Libertarians who support a "republic" over democracy.

This, I think, is the biggest problem (or one of them): debt-based fiat. Sovereign fiat would work much better. Then we could fight about the gold standard or whatever, but how much money is in circulation is important. We need sovereign money and the popular control of our own, sovereign currency.


smlbizman's picture

until mankind becomes the real definition of honorable, instead of the honorable that defines corzine...their will never be a proper govt.

Anusocracy's picture

I prefer panarchism.

You can choose your own government and how much your daily dose of arsenic is.

I prefer no government and no arsenic.'s picture


I'm a voluntaryist with a personal preference for anarchy. So if someone else wants to be beaten about the head and shoulders by the likes of Obama and Romney it's no skin off my nose as long as I can steer clear.

Anusocracy's picture


All those loser housewives, who get free cosmetic surgery once a week from their drunken, abusive husbands, deserve all they get.

I don't want to share in their personality flaws.

lesterbegood's picture

In international law (The Law of Nations; Vattel) the Articles of Confederation were superceded by the Constitution for the united States of America c. 1787. The Articles of Confederation is a dead document. It was also flawed, especially in regulation of monies and commerce.

A side note: there are two constitutions; the one referenced above and the corporate charter known as THE CONSTITUTION OF THE UNTED STATES which was created by a 3 man commission in 1868. It was adopted unlawfully by CONGRESS in 1871 with the Organic Act.

chumbawamba's picture

It wasn't unlawful.  Now, that isn't to say it wasn't in accordance with the original Constitution for the United States of America, but that document became a dead letter once the Union dissolved in the 1860s as a result of the southern States walking out of Congress.

What then took the place of the de jure Congress then acted under their plenary power to re-draft a Constitution for the District of Columbia and all its territories, possessions and instrumentalities.  Of the latter, they include the "STATES", as in the STATE OF CALIFORNIA, STATE OF NEW YORK, STATE OF TEXAS, etc.  Note: the capitalization is intentional and specific, as is the "STATE OF" prefix.  California and STATE OF CALIFORNIA are two entirely different political entities.  If you are domiciled on the former then you are in the Republic.  If you are resident of the latter then you are subject to the Democracy.

I am Chumbawamba.

chumbawamba's picture

"STATES OF" are political subcorporations of the United States (a federal corporation - 28 USC 3002).  They are included in the jurisdiction of the District of Columbia.  If you are resident in any STATE or other territory, possession or instrumentality of the United States (a federal corporation - 28 USC 3002) then you are subject to all the statutes of the Democracy.

Your Social Security Number is evidence of your citizenship in the Democracy of the United States.

I am Chumbawamba.

Disenchanted's picture



It's too bad that all that wasn't explained to someone when they first applied for and received their SS #/card.

I was 14 when I got mine and didn't know my ass from a hole in the ground. I was in my mid thirties before I even got a breath of what you're talking about.

So then what? How do you fix it when you've already, albeit unknowingly, voluntarily entered into that contract twenty some years previous?


edit: Nowadays young parents are required to apply for their child's SS# immediately after their birth to be able to take the per child exemption when filing their taxes. Again both of my children were born prior to me having the knowledge you're trying to impart here.

midtowng's picture

The solutions to the current problems of our democracy is MORE democracy, not less.

Totentänzerlied's picture

In a way, yes, because more democracy is a sure-fire way to hasten the end of democracy, which is in fact the problem. Gold star for you!

chumbawamba's picture

Democracy -"A government of the masses. Authority derived through mass meeting or any other form of direct expression. Results in mobocracy. Attitude toward property is communistic – negating property rights. Attitude toward law is that the will of the majority shall regulate, whether it be based upon deliberation or governed by passion, prejudice, and impulse, without restraint or regard to consequences. Results in demagogism, license, agitation, discontent, anarchy." [Soldier's Training Manual TM2000-25, United States War Department, 1928]

"Democracy is nothing more than mob rule, where 51% of the people may take away the rights of the other 49%." - Thomas Jefferson

"For tyranny is a kind of monarchy which has in view the interest of the monarch only; oligarchy has in view the interest of the wealthy; democracy, of the needy: none of them the common good of all. Tyranny, as I was saying, is monarchy exercising the rule of a master over the political society; oligarchy is when men of property have the government in their hands; democracy, the opposite, when the indigent, and not the men of property, are the rulers."- Aristotle


Democracy - Two Wolves and One Sheep Deciding What's for Dinner


I am Chumbawamba.

midtowng's picture

I guess its cool to be against everything that might possible help people. But then I'm not cool.

When you find about another form of government superior to democracy, you let me know. Because history hasn't revealed one yet.

NidStyles's picture

Nope, you're just a moron to think that the masses want to help each other rather than steal rape and pillage people from the other groups that have collectivized.

Inibo E. Exibo's picture

There's no government like no government.

whoisjohngalt11's picture

When the Pigs can change the writing on the barn wall (i watched Animal farm yesterday) then we no longer have a democratic republic ,but instead a living (ever changing) constitution, which can be changed as the pigs ( leaders in charge) see fit..

GMadScientist's picture

So you're for or against the amendment ratification process, Herr dimwit?'s picture

I'm all for Orwell but as an interesting aside please note that the Animal Farm cartoon was funded by the CIA.


The cartoon that came in from the cold

Imminent Collapse's picture

Democracy, while an ideal, is a product of civilization, not of evolution. Go slowly! select carefully! for the dangers of democracy are:

1. Glorification of mediocrity.
2. Choice of base and ignorant rulers.
3. Failure to recognize the basic facts of social evolution.
4. Danger of universal suffrage in the hands of uneducated and indolent majorities.
5. Slavery to public opinion; the majority is not always right.

The Urantia Book, Paper 71

chumbawamba's picture

There are two systems of government in the United States, both existing simultaneously in the same space: a Republic and a Democracy.

Depending on your status as either a creditor or debtor, you either exist in the Republic or the Democracy, respectively.

I am Chumbawamba.

Race Car Driver's picture

Sheep. It's what's for dinner.

chumbawamba's picture

Those in the Republic have God-given rights as guaranteed and warrantied by the Constitution.

Those in the Democracy are chattle property.  They are livestock.  They have no rights, only privileges granted by their keepers.

Those chanting for Democracy are literally as bleating sheep.  They are saying, "Feed me! Shear me! And when I no longer produce, slaughter me!"

I am Chumbawamba.

AnAnonymous's picture

Those in the Republic have God-given rights as guaranteed and warranted by the Constitution.

Which constitution is that? The Constitution that states that slavery shall be protected?

chumbawamba's picture

Arguing gets you nowhere.  A sheep could win a debate against Socrates, but in the end you'd still be a sheep.

You should be asking yourself how you can get out of the pen.

I am Chumbawamba.

Abitdodgie's picture

There are two Constitutions . The First is the Republic one " Constitution for the United States of America " and the Corporations Constitution " Constitution of the United States of America " if you are a citizen of UNITED STATES OF AMERICA then the Corporation Constitution applys to you . 

aerojet's picture

I get so tired of hearing thes bulshit Internet legal theories!  The Corporate Constitution and becoming "sovereign" citizens--all this shit has been tried and tried again and none of it has amounted to a hill of beans in any court of law.  The government we have is arbirary, it adheres to no principles whatsoever, and the last vestiges of the Constitutional Republic continue to disappear because the whole thing relies on people who have to uphold their own high standards, which they don't (and never did).  If honest, thoughtful people would run the system and not be gamed or subverted, we would have a system with long-term stability, but we don't have that and never will.

chumbawamba's picture

You're right, and wrong.  There has been a lot of misinformation put out there over the years as people felt around in the dark looking for the escape hatch.  What do you expect when the object of the Game is to figure out not only that there is a Game and what it is but its rules as well?

This government, flawed though it is, does abide the rule of law.  It is heartless and cruel and has zero tolerance, but it does adhere to the law when properly applied.

The fact is, you run the system already, but you haven't figured out the rules.

I am Chumbawamba.

engineertheeconomy's picture

Our Criminal Military Dictatorship Government makes up the rules as they go, that is the rules that apply to us. They don't even pretend to be subject to rules any more. They have one general unspoken rule amongst themselves, which is that they all have to stick together as a united front so that they can preserve their stolen wealth and keep us enslaved in their evil system.

Precious's picture

then fucking leave, dickwad

LULZBank's picture


Which constitution is that? The Constitution that states that slavery shall be protected?

US Constitution gives rights to everyone, including slaves.