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Tuesday, October 16, 2012

Putin Takes on Big Tobacco

In political economy theory, democracy is said to have the drawback of excessive consumption of public revenues at the expense of investment, such as in infrastructure relevant to foreign direct investment. Latin American countries were contrasted negatively with the Asian newly industrialized economies, whose relatively strong states could buffer popular calls for more in entitlements so that more could be invested in infrastructure attractive to foreign multinational companies. The implication is that a tradeoff exists between democracy and economic development.
 
Apart from the economic aspects, the question may be whether a representative government can resist popular calls for more money to be spent by the government on popular consumption. In the U.S. case, it can be asked whether the fiscal stresses on Social Security and Medicare are due more to demographic factors (i.e., an aging population) or democracy itself. The ability of representative democracy to maintain a viable economy and republic in the long term is at issue.
 
Accordingly, Putin’s less than democratic approach to ruling Russia may have a bright side. Even though nearly 40% of the population smoked in 2012 and the world’s four big tobacco companies controlled 90% of the Russian market, the Kremlin was pushing strong anti-smoking legislation through the legislature. Besides the question of whether such legislation should be at that level in an empire-level federal system (there had been legislation at the republic level), the fact that the government was standing up to big business and 40 percent of its population (60% of Russian men) can be attributed to a strong state resisting popular pressure literally for consumption. This is not necessarily bad, as people do not always know what is best for them.

 
 
Even in democracies, checks exist against “excessive democracy.” The Electoral College and the U.S. Senate are two such institutional checks at the federal level in the United States. The electors in the College were to check popular pressure to elect someone who is not in the best interest of the people. In the wake of an attack, for instance, the people might want a president who will invade the offending country (or another). The electors may say, “hold on, that’s not in your own best interest so we are going to elect someone else—someone who will resist that momentary urge.”
 
Popular passion can also have considerable sway in the U.S. House of Representatives because each member is up for re-election in two-year intervals. It was to be annual, but in the eighteenth century travel time made that unrealistic at the empire level (whereas annual elections suffered no such obstacle for state legislatures). The six-year term in the U.S. Senate was meant to check the influence of the passions of the moment that can sway the House. So, too, the appointment of U.S. Senators by the state governments rather than directly elected by the people was so designed. The subsequent popular election of the senators has thus weakened this check.
 
In short, if it seems that elected representatives, including the American president, cannot say no to additional entitlement programs or to Wall Street, the relatively-undemocratic federal government of Russia might be found to have a few pluses even though putting down the democratic impulse of protest is hardly laudable. Perhaps the ideal is a government that is democratic yet of a strong enough state to withstand or at least check the passions of the people to consume more. Smoking is indeed a case of consumption that is not in a person’s or society’s best interest. Putin can indeed be credited if history will show that his government did indeed stand up to big tobacco and the large minority of smokers in Russia.

Source:

Lukas Alpert, “Kremlin Cracks Down on Big Tobacco,” The Wall Street Journal, October 16, 2012.