“Of the five regimes, democracy is only better than tyranny” – Plato.

For many, the ideals of democracy are embodied in universal suffrage – the right of every citizen to decide on their government.

However, to many observers, absolute democracy is not just impossible – it can be detrimental to a country’s growth. Chief among these arguments is that not everyone understands all the key political and economic issues and their strategic implications, and are therefore more likely to vote on the basis of ‘bread and butter’ issues. Hong Kong’s Chief Executive Leung Chun Ying famously said recently of democracy: “democracy will see poorer people dominate the Hong Kong vote”. We see plenty of examples of how democracy has resulted in policies being developed to benefit the masses – those groups of people with the most number of votes.

Of course, policies that benefit the masses are always welcomed, but not if these are short-sighted policies designed to elicit popular support in the shortest possible time. Hand-outs and subsidies are the most frequent examples.

It is common knowledge that government policies are a game of sacrifices. One side would have to make sacrifices to make the other side happy. This is most pronounced when it comes to the employer vs employee, and businesses vs consumers divide. A policy that benefits employees is most likely to eat into the well-being of the employer – no matter how well meant it is, or how willing the employer is to accommodate. A policy that promotes trade protectionism often conflicts with free competition and choice – causing some disadvantages to consumers.

Therefore, as business people, we must be wary of how a populist government (not necessarily a popular government) is more likely to introduce pro-poor, pro-employee and pro-consumer policies to the detriment of business growth and profitability. By their very definition, many of these populist policies are detrimental to free enterprise and innovation.

Some would argue that there are many examples of ‘populist’ governments in Europe that embrace socialism and a welfare state, and yet are prime examples of business conduciveness and efficiency. We must however be conscious of the difference between these developed countries, and our own developing country. Most profound are the mindsets and ethics, which would take some of us in the East a whole generation to master.

So why then should we support an inclusive government and greater democracy? Despite its many failings, democracy remains the best form of government for businesses. While there are indeed many in the society who will remain ignorant of the importance of good governance, many more are beginning to understand that it is sometimes more prudent to sacrifice some bread and butter issues, in favour of more sustainable policies. More importantly, a democratic regime provides the stability and continuity that are essential to long term business growth and sustainability.

Plato may be turning in his grave to know that democracy has not only survived, it’s has prevailed. And as business people, we owe it to ourselves to support it.


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