I'm not displeased by the election results last night. But.
Economists talk about "Market Failure" — cases where markets will not lead to an efficient (Pareto Optimal) allocation of resources, because of: market power; externalities; asymmetric information; adverse selection; moral hazard; etc.
Good economists then go on to talk about "Government Failure". Just because the market isn't perfect doesn't necessarily mean the government will do better by intervening. Most of us don't understand government failure as well as we think we understand market failure, so we might not say as much about government failure. But at least we mention it.
The Efficient Market Hypothesis says that asset prices should reflect people's best estimate of the fundamental value of those assets based on available information. Changes in asset prices should reflect new information. When we see asset prices fluctuate over time without being able to explain those fluctuations in terms of the arrival of new information about fundamentals, we may begin to doubt the Efficient Market Hypothesis.
OK, so an election is not exactly the same as an asset market. But nevertheless: people are supposed to be voting for the MP or party they think is best, given their available information. So let's ask the same question: what new information arrived during the course of the election (or even since the last election) that could explain the opinion polls and the final results?
We could even make this personal. Did you change who you planned to vote for? If so, why?
(I didn't pay much attention to the election campaign. I figured it would take some big bit of information to get me to change my vote, and anything that big I would hear about anyway. And since it was so unlikely I would change my vote, I voted in advance, selling my option to change my vote in exchange for a shorter line-up.)
Worthwhile Canadian Initiative 
Frances: have to admit I have a hard time imagining the prairies going NDP in a big way, at least federally. At the provincial level the NDP are Chretien centralists. When Gary Doer went to work for Harper in Washington, Buzz Hargrove wrote a scathing review of his premiership and his unwillingness to incur deficits or bail-out union heavy industries; he had his facts right. Lorne Calvert cut health care spending. Doer castigated the federal NDP at their last leadership contest for being, basically, a bunch of socialist loons.
My sister in Winnipeg recently moved from a heavily Jewish area that the federal Liberals held, to a riding in that city that is hugely Asian and African. Both went to the Tories, the latter by a landslide.
Nick,
I did in fact change who I voted for, in part because of my friends, and in part because of the candidates in my riding. I’m personally fiscally conservative and socially liberal (and would be completely in favour of a Green/Liberal merger). There was a decent chance that the NDP would take my riding (as opposed to no chance for the Liberals), and I was turned off the Conservatives by my above-stated view of their fiscal and social position.
A general inquiry (bleg?): I’m very interested to what degree WCI readers think we need electoral reform. Are you satisfied with first-past-the-post? What kind of system would you prefer, if not?
Iron Troll: To those who say we need electoral reform, I have two comments. First, do countries with other electoral systems have better or worse policies that correlate with their electoral practices? I don’t see it. The serious discussion is about policy, anything else is just a day at the horse-races. I do think that political parties that lose gain from talking up representative voting, because it stirs up the base and fits into a things-gotta-change narrative.
Second, my own take on FPTP is that it’s an indifferent deal for voters but a great deal for parties. If you lose, you lose, regardless of how badly. True, second place is better than third, but you are still shut out of power, especially with a majority government. However, as we all know, you can get disproportionately high parliamentary power with a lower proportion of the popular vote. This means that parties can focus their resources on certain districts, rather than spreading the love all around. If you can win even while effectively writing off 25% of the potential seats, that is a good deal.
So, although you lose big in FPTP, you win really, really big with incrementally smaller gains. Chretien did this even better than Harper. It’s like paying for a 2,000-sf house and getting an extra 1,000 to lord around in (actually it was Chretien who got 1,000…Harper only got an extra 300 sf). I’m sure there is some games theory to back this up….
I’m indifferent to electoral reform, but I can’t imagine any party seriously wanting to turf FPTP when they see the bonus ratio.
K:
my legal name is Réné.The new vicar didn’t knew my grandmother had a lisp and took her pronunciation at face value at baptism time. The trouble I had since at the passport office…
Frances has a very good point: “Canada” has extremely different meanings.
First Nations saw people coming with guns and wanting either to trade furs or steal their land.
The ancestor (in QC we don’t say “my” but “the” ancestor) came in 1660 and my cousin in the 13th degree still farm the estate ( 18% ice cider available at the Québec City Vieux Port market, thanks for the plugola).
Most Anglos came after the Conquest and were very surprised to find someone was already there.
Ukrainians in SK recreated their mir in the form of the coop movement and later the western branch of the NDP.
In AB, they came from the southern U.S. and were not indoctrinated in the history of the place in the same manners as those coming through Pier 21 or Grosse-Île.
(standard Pierre Berton here)
The U.S. have a similar situation with different civilisations settling there ( Yankees and Quakers in the north, Cavaliers in the Tidewater, Yeomen in Appalachia ), with these groups then migrating en masse somewhere else or absorbing others ( Quakers submerged into Yankees). The U.S. is still fighting its war of Civilisational merger. As we are, though less violently.
All of them have different political projects. In any ordinary country, first-past-the-post defines whatever bizarre structure history and foundation myth a country will have.
Champlain tried to mix equally Indians and Europeans but had not enough people to pull it off.
The majority group in Canada , the one who defined the main narrative is the 3rd wave, the Wasps.
Eveybody else is uncomfortable with that project. Agree with some parts , disagree with others, not a single group havving the same likes and dislikes.
Each model is different, not inferior and certainly not bad or evil. I don’t mind how they work things out in AB (I say don’t mind not don’t care).
When the French and Indians signed the Great Peace of 1701 ( aka the Peace of the Braves)
http://en.wikipedia.org/wiki/Great_Peace_of_Montreal
they made the Great Peace wampum : two canoes on the same river , going in the same directions but not touching each other.
This what we should ask each other : cooperation and friendship between different peoples. Not loyalty as it implies a common freely chosen project. And I take that from John A. Macdonald ( “Treat them like free men …you know the quote).
And if we have a not very efficient political market, it is because we don’t have identical products and customers with identical tastes. It’ tough to find the most efficient producer if you don’t know what product you want.
Condorcet and Arrow would have a field day with us.
S.H dicovered that the numbers are in Ontario and is now adopting the Wasp narrative. How long can he hold on AB as the Wildrose is already shouting “Treason” and playing footsie with the ADQ?
frances, northern mines generate enough drudgery that QC-BC merger could be weed on weed…
I’m deeply unsatisfied with FPTP. Yes it is good for parties, but it is not good for representation. It is in theory possible for a 100% 1-party Parliament in Canada to be elected with a small number of votes…and a 60% Parliament elected with 40% of the votes is what exactly happened.
How could that be fair?
Yes we should have more parties and more coalitions. It isn’t a question of some external being deciding whether the policies generated by other systems are “better or worse” by some objective criterion. It’s a question of whether it’s what the people really chose, for good or ill. And a Harper majority government is not what the people chose. I would say this for the Liberals and the NDP in that position.
Mandos – Canadians value “peace, order and good government” and the corresponding stability of governance while we rightly and properly recoil from the pizza parliament instability of Europe (where proportional rep is common) that has contributed to unsustainable public expenditures, rapidly increasing sovereign indebtedness (see 2011 OECD analysis with average debt to GDP of 80% today across EU forecast to rise to 100% within two years), not to mention collapsing birth rates and a failure to integrate their low levels of immigration, which (while not caused by), are difficult to address with mutiple splintered parties, none of whom holds a majority of seats in the Parliament.
Indeed, more parties and more coalitions produce more instability, enhanced fiscal profligacy and at the electoral margins the le Pens and other extremist parties are able to obtain a voice under proportional representation (as we have seen recently in Europe).
We want to help poor befuddled Europe (not emulate them), as we did in both the first and second world wars when many of our fathers went over to save the Europeans from the Europeans.
Ian Lee
Unless everybody belongs to the Borg collective, politics is about coalition. FPTP forces the coalition before the election, proportional push it after the vote. Proportionnal seems unstable but allows for gradual changes. FPTP constrains members and voter into awkward combinations Ontario and Québec in the former Libs
Québec and ALberta under Mulroney
Ontario and Alberta currently ( and even then only 46% Cons in ON)
The resultat is that, like in a bad dying marriage, you endure till the catastrophic failure (Libs booted out of french Qc in 84, QC and AB bolting out of the PC in 93. Instability is not avoided : it takes place in another form at an other time. INstability doesn’t come from the structure but from the lack of commonality in voters plans and vision for the polity.
S.H courted ON. Alresdy the Wildrose is unhappy…
The current Con arrangement will crash. In 5 years , 10 years, there will be a surprise wave of the Inuit-and-potato-growers Party.
And we still not have answered “What does Québec want?”
Jacques Rene – very clever arguments – which I accept with the following modifications.
Coalitions arranged a priori i.e. political parties, are much stronger structures with greater resilience and endurance similar to marriage (but yes can eventually decay).
Coalitions arranged after elections – due to proportional representation – are more analogous to short term hookups, with much lower levels of commitment, greater levels of opportunism which require more log rolling, back scratching et al – dare I say, a more commercial, utilitarian calculus, which while acceptable for commercial contracts fails to provide a stable foundation for politics.
The key point is that FPTP encourages the establishment of a “hegemonic period” of party dominance e.g. PC Party in Ontario for 42 years. During those periods, we experience stability which facilitates planning, hard decisions, reallocation of resources – in short, rational strategic planning.
In the proportionate voting system, at very most a period of stability can only be achieved for the period between elections – if at all.
Moreover, it facilitates fringe parties e.g. Netherlands, France, Austria, which destabilizes the polity and politics.
Following Thomas Hobbes and the Chicago thinker Eric Voegelin and close friend of Hayek, order is the overarching value which permits liberal values to flourish (Order and History).
FPTP is far from perfect but is similar to Winston Churchill’s description of democracy as the worst possible system of all – except for all the rest.
Ian Lee
Instability in Europe is not caused by fringe parties. They are a symptom of stagnating incomes for the working and middle-classes ( 30 of economic growth confiscated by the happy few),bad immigration policies and the loss of social mobility. So is the Tea Party. in the U.S. Sometimes the target is misgguided, the group is instrumentalized by other interest groups but they are a symptom. FPTP merely puts a band-aid over a festering wound, ensuring you will get gangrene.
The whole choice is between a facade of stability followed by abrupt changes or slow adaptation. Get an election in two ridings every week and see how you are forced to behave respectfully toward everyone instead of hoping for the kill and good riddance to ( select your target group).
You quote Hayek. I’ll qote LaMennais: “Between the strong and the weak, freedom oppresses and the law liberates.” And in a civilized world, the law must have the consent of the governed. Parties and FPTP enables the minority to govern the majority, without their consent ( except in the sense that you had a shot at dictatorship and lost ). Coalition are messy. It’s also called life.
And Hayek, for all his talk about liberty, was perfectly comfortable with freedom for the select few. Like the Chamber of Commerce…
Jacques Rene – While we can agree that the European countries have poor immigration policies (and birth rates around 1 to 1.5 depending on the country), the idea that Europe “lost its social mobility” is a bit of stretch. My father left England after the war because as he told me ad nauseum, if your father was a bricklayer, you were going to be a bricklayer without any exception whatsoever (see the very unconsciously humorous references to Kate – daughter of multimillionaire – as a “commoner” in marrying Prince William). Europe and social mobility are not words that are generally concatenated in conversation or analysis.
In my many visits to West, Central and East Europe over the past 50 years, I cannot recall marvelling, a la de Toqueville, at the entrepeneurial vibrancy and social dynamism and mobility in UK or France or Germany. Rather, I marvelled at the great cathedrals and historic architecture as monuments to a gradually dying civilization (and each time makes me think anew of Mackenzie King’s insight that Europe has too much history and not enough geography and Canada has too much geography and not enough history).
And indeed, incomes are stagnating in EU – creating a new industry – “what is wrong with Europe studies” – by the various EC agencies, think tanks, scholars et al, to explain lagging productivity, far fewer new business startups per 100,000 or GDP growth consistently and steadily below USA and Canada for over 30 years or why GDP per capita is roughly 1/3 lower in EU.
Empirically, European countries have larger government share of GDP (than Canada or US) measured by expenditures or taxation, and it certainly appears, according to reports such as the Economic Freedom Index and the World Bank Ease of Doing Business Report, that Europe has significantly greater regulatory burden.
To use Foucault’s phrase, “governmentality” is much more deeply rooted and pervasive across Europe.
However, European governmentality really only emerged after the war when new constitutions and new legislative arrangements were created to replace the old systems swept aside by the war. And reforms included proportional representation in some countries.
It seems to me that proportional rep played a role in creating “governmentality” which contributed to stagnating economic growth, stagnating productivity, stagnating business formation, stagnating incomes.
As we saw in Canada over the last 5 years, splintered Parliaments create a dialectic, a pressure, an opportunity for e.g. BQ or the NDP or the Libs 2005-2011, to “blackmail” the govt by threatening to vote against the govt if its demands were not met.
Minority govts – fostered by proportional representation – drives up spending – and difficult choices are kicked down the road. Does anyone really think that Chretien and Martin would have attacked and resolved the deficit in a minority in 1995-98?
Revolution or just plain old fashioned chaos and uncertainty are a lot of fun when we are 22 or 25.
But order and stability seems OK as we get older.
Jacques Rene – one quick clarification. Above, I am using “larger European govt” as a proxy or stand in for anti-competitive policies, policies that do not promote efficiency, protectionist policies,and policies that discourage trade, property rights or an open economy. It is not the size of the govt per se, but the type of policies adopted – do the policies foster or discourage economic growth.
That argument (“good government”) for FPTP only makes sense if you think you’re going to be part of the majority-winning minority who reaps the benefit of said “stability” and “good government”. For the rest of us, it is unmitigated bad government. FPTP contains no mechanism for the losers to obtain redress for their losses.
But Mandos, Albert Hirschman taught us in 1970 that each of us face three choices: exit or voice or loyalty.
While exit i.e. emmigration is extreme, voice is always available, inasmuch as one can write letters, Op-Eds, organize a new political party, join an existing political party, organize protests etc.
Book review of Exit, Voice and Loyalty:
An innovator in contemporary thought on economic and political development looks here at decline rather than growth. Albert O. Hirschman makes a basic distinction between alternative ways of reacting to deterioration in business firms and, in general, to dissatisfaction with organizations: one-exit-is for the member to quit the organization or for the customer to switch to the competing product, and the other-voice-is for members or customers to agitate and exert influence for change “from within.”
The efficiency of the competitive mechanism, with its total reliance on exit, is questioned for certain important situations. As exit often undercuts voice while being unable to counteract decline, loyalty is seen in the function of retarding exit and of permitting voice to play its proper role.
The interplay of the three concepts turns out to illuminate a wide range of economic, social, and political phenomena. As the author states in the preface, “having found my own unifying way of looking at issues as diverse as competition and the two-party system, divorce and the American character, black power and the failure of ‘unhappy’ top officials to resign over Vietnam, I decided to let myself go a little.”
Professor Hirschman’s small book is bursting with new ideas. The economist has typically assumed that dissatisfaction with an organization’s product is met by withdrawal of demand, while the political scientist thinks rather of the protests possible within the organization. Hirschman argues that both processes are at work and demonstrates beautifully by analysis and example that their interaction has surprising implications, a theory that illuminates strikingly many important economic and political phenomena of the day. The whole argument is developed with an extraordinary richness of reference to many societies and cultures.
–Kenneth J. Arrow