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RickSchwartzPaper2-DispersedBenefits 4 - 13 Jan 2009 - Main.RickSchwartz
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In Federalist 10, James Madison contended that the vastness and heterogeneity of the nascent American nation would limit the tendency of democracies to exercise political power for the narrow benefit of factious interests. He argued that with a politically engaged and sovereign people, dispersed costs would outweigh concentrated benefits, even though the expansive American continent precluded the level of personal interconnectedness as the direct democracies of the Greek city-states the Framers used as reference points. Madison may have been right that dispersed costs could outweigh concentrated benefits, but if so, he would have to wait for a few hundred years of media evolution. Unfortunately, he lived in a world where political intermediation was a necessity, but hoped that the proposed representative system would "refine and enlarge the public views, by passing them through the medium of a chosen body of citizens, whose wisdom may sacrifice it to temporary or partial considerations best discern the true interest of their country, and whose patriotism and love of justice will be least likely to." [MISSING QUOTE?] Whether it was his "wisdom," "patriotism" or "love of justice" that allowed him to maintain such cognitive dissonance, Madison deliberately overlooked slavery, which would have served as a powerful and poignant counter-example to his argument, for the sake of political expedience in convincing the democracy-wary, land-owning anti-federalists to ratify his proposed constitution. Coordinating a participatory democracy was simply impossible on an American scale, so an admixture of representation, federalism and separation of powers was the next best thing.
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In Federalist 10, James Madison contended that the vastness and heterogeneity of the nascent American nation would limit the tendency of democracies to exercise political power for the narrow benefit of factious interests. He argued that with a politically engaged and sovereign people, dispersed costs would outweigh concentrated benefits, even though the expansive American continent precluded the level of personal interconnectedness as the direct democracies of the Greek city-states the Framers used as reference points. Madison may have been right that dispersed costs could outweigh concentrated benefits, but if so, he would have to wait for a few hundred years of media evolution. Unfortunately, he lived in a world where political intermediation was a necessity, but hoped that the proposed representative system would "refine and enlarge the public views, by passing them through the medium of a chosen body of citizens, whose wisdom may best discern the true interest of their country, and whose patriotism and love of justice will be least likely to sacrifice it to temporary or partial considerations." Whether it was his "wisdom," "patriotism" or "love of justice" that allowed him to maintain such cognitive dissonance, Madison deliberately overlooked slavery, which would have served as a powerful and poignant counter-example to his argument, for the sake of political expedience in convincing the democracy-wary, land-owning anti-federalists to ratify his proposed constitution. Coordinating a participatory democracy was simply impossible on an American scale, so an admixture of representation, federalism and separation of powers was the next best thing.
 Because technological conditions had made political representation a practical necessity in any sizeable democracy until recently, small minorities of American society have been very successful at achieving their own political objectives at the expense of the great majority of the population. Mancur Olson ascribed this tendency to the high costs of organization facing large, heterogeneous groups relative to the low costs of coordinating and mobilizing small, homogenous groups. Predictably, political intermediaries are manipulated and lobbied much more vigorously by small, insular (and often moneyed) factions than the generally disinterested majority. Whatever the justifications offered by defenders of public choice, American history is littered with examples of political action enabled by the concentrated benefits and dispersed costs problem, ranging from slavery to trade protectionism to speech regulation to spectrum allocation to Wall St. (and now Detroit) bailouts. Whether attributable to political parties catering to factious interests to more effectively wield political power or sheer laziness resulting from the principal-agent problem, these problems all arise from the need for political intermediaries in the first place.
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 I think you're missing a quote and a strikeout in the first paragraph, Rick. I've marked the two places.

-- AndreiVoinigescu - 20 Dec 2008

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Thanks Andrei, I misplaced that link. It should have been at the end of the quotation. For some reason I also didn't notice your comment until now, but appreciate it nonetheless.

-- RickSchwartz - 13 Jan 2009

 
 
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Revision 4r4 - 13 Jan 2009 - 05:19:20 - RickSchwartz
Revision 3r3 - 20 Dec 2008 - 19:26:18 - AndreiVoinigescu
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