Mises Wire

The Difference Between Democracy in the Market and Democracy in Politics

Mark Brandly writes in "How to Win an Election": 

Choosing between two candidates is analogous going to Walmart and being presented with two shopping carts already filled with items. Everyone will leave the store with the same cart of goods. Each cart contains products that a person may want and products that one wouldn't choose to have, but the voter is not able to take anything out of either cart.

This demonstrates the concept of bundled choices in political decision making. The carts represent candidates and the products are the political positions of those candidates. The candidates might support policies that a particular citizen favors, but that individual won't agree with everything a candidate stands for. In private decisions, one chooses only the items he wants, since the choices are not bundled, but in political decisions, you don't have this option. If you support a candidate, you realize that you are accepting a bundled choice that includes some policies that you do not favor.

Also, for reasons that will be explained later, the two carts are very similar. They contain many of the same items, the items that are different are still similar (e.g., both carts contain a shirt — one red and one blue), and the two carts cost about the same amount. In addition, each taxpayer will end up paying for one of the carts even though he wouldn't voluntarily purchase this basket of items.

We see here the conflict present in political decisions. You want a blue shirt, someone else wants a red shirt, and I don't want a shirt. Your wishes conflict with mine. In order for you to be satisfied, you support policies that are harmful to me. We don't see this type of conflict in market democracy.

Read the full article. 

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