I was often called an institutionalist, by foes and friends alike, when they were referring to my work and analysis. To them I say, yes, I am an institutionalist and proud of it. But what exactly does it mean to be an institutionalist? In Political Science, an institutionalist view of the world is through institutions. In most political systems, the behavior of actors is structured by formal and informal institutions. We can find evidence across the world on how institutions shape identity, power and political strategies. Similarly, on how institutional performance is shaped by political, social and economic factors. While legitimacy and authority can be exercised without any institutional boundary — for example through personal rule or dictatorships—self-governing institutions can generate a less subjective and personalized manifestation of that legitimacy and authority. Institutions can help organize the political and policy spaces and power, and the ways actors can maneuver and interact within the spaces and process. The challenge is to make these institutions work in a democratic governance context. Yes, dictators and authoritarian governments can empower themselves by controlling institutions like the armed forces, the legislatures and the banking system, and govern unilaterally without checks and balances and without fearing any consequences for discretionary rule. But it is more difficult to shape, operate and articulate institutions in more plural, participatory and transparent settings. One can argue that functional and democratic States, operate through a cluster of institutions that shape constraints and promote compliance through procedures and rules. Institutions are not perfect nor are they a panacea for governance, but do they have a role to play, particularly in today’s democratic governance?
If one looks at governance as the general exercise of authority, there has been over the last decades a steady reduction in the absolute or unconstrained power model. We argued previously that in theory democratic governance stands opposite to the notion of absolute ruling based on privileges of birth, ethnicity, religion and/or gender, or based on repression and oppression. It is clear that, there is no pure or perfect governance regime, but economic and social modernization, education and knowledge have helped move most of humanity closer to pluralistic ideals and aspirations, in great part on the back of institutions. While some humans may still show preferences for hierarchical, authoritarian and personalistic rule, the complex and divergent societies emerging in the world today need in order to be resilient procedural frameworks, consensual rules, pluralistic competition, and strong social networks and communities. Elinor Ostrom and others have argued that institutions can work, particularly if individuals or organized citizens play critical roles in designing institutional rules (formal and informal), monitoring compliance and enforcing sanctions.
Like any ecosystem, democratic governance is an organic aggregate of subsystems and other elements. In principle, democratic governance encourages cooperation involving State and non-State actors, and aims at shaping an inclusive policy agenda towards sustainable solutions. Democratic governance is a means to counter narrower interests, so opportunities can be expanded, and policy and politics translated into broad-based social change. As Robert Dahl would add, a democratic governance ecosystem would need not only elected official and free, fair, and frequent elections, but also freedom of expression, alternative sources of information, and inclusive citizenship. In practice, however, democratic governance is harder to achieve, articulate, and sustain over time. We are witnessing this today, as we are in a new era of crisis for democratic governance. The time of arrival of institutions, the sequence in which they have been introduced, how they evolve and adapt, and their impact, capacity and strength have varied across countries. While many countries have elected officials, and hold frequent and fair elections, not all offer or fully guarantee freedom of expression, have alternative sources of information or inclusive citizenship.
A cycle of democratic governance is ending, and a new phase of democratic renewal and transformation is upon us, in both older and new democracies. As such, the time is ripe for creative thinking on institutional systems and how to re-shape them to be more responsive to the new emerging socio-political matrixes. While the global wave of democratization in the 1970s brought an opportunity to promote basic institutions, such as constitutions, elections and rule of law, today both older and newer democracies find themselves in some sort of inflection point. In part, institutional systems have not kept pace with rapid change. Whereas in the past, institutional systems accompanied or were ahead of change, today the speed and diversity of change is putting excessive pressure on institutional systems to be more responsive.
Douglass C. North’s argument in his Nobel award winning work focused on the role of formal and informal rules of the game in a society, which were shaped by humans, to constrain and promote human interaction. The notion of institutions has evolved and expanded since the pioneering work of North. For example, the latest World Bank’s World Report 2017 focuses on Governance and the Law, and broadens the institutional argument. The report argues that institutions today perform three key functions that enhance policy effectiveness for development: 1) enabling credible commitment, 2) inducing coordination, and 3) enhancing cooperation.
Institutions cannot be understood in a vacuum, more so today where societies across the world are complex and face a set of challenges never experienced before. I think that institutions today need to be understood in the context of three aspirational notions. First, human development as conceptualized originally by the United Nations Development Program (UNDP) in the early 1990s. Human development is the answer to the question, institutions for what? Human development simple stated premises that people are the real wealth of a nation and human development is all about enlarging their choices. Amartya Sen, later complemented and refined the human development paradigm by focusing on key constraining issues such as deprivation, destitution and oppression as barriers for expanding choices and opportunities for people. Sen argued that in spite of a wealthier world, deprivations also remained unsolved in rich and poor countries. In spite of progress in many fronts, the persistence of poverty and unfulfilled basic needs, occurrence of famines and widespread hunger, violation of basic freedoms, exclusion of women, youth, and vulnerable population, and threats to the environment and sustainable development are all still key challenges to overcome by all societies. Human development approaches serve as both an end and a means to tackle these challenges and to remove various types of barriers that leave people with little choice and opportunities. Effective institutional arrangements for human development could help to effectively utilize scarce resources, expand opportunities, and invest in sustainable solutions.
The second aspirational notion linked to institutionalism is the role of the State. It helps answer the question, institutions with what? Human development is about changing a society to enhance people’s well-being across generations, expanding their choices in health, education and income, and increasing their freedoms and opportunities for a meaningful participation in society. While human development is about individuals and their choices, it requires a State that can organize, facilitate and guarantee conditions, level the playing field, and structure encompassing transformations. I am not arguing for a totalitarian type of a State that monopolizes decisions or mandates policies and becomes the answer to everything, but rather for a strategic instrument that hosts acquired and legitimate power, makes effective and transparent use of authority, and has some combination of devices and tools to check the arbitrary use of power, and to ensure that power and authority are used for the common good.
Historically the evolution of the State as a socio-political, bureaucratic and ruling entity has responded to specific needs or demands of the society, sometimes generated by external processes, others by internal ones, and often by a combination of both internal and external factors. For example, as farming developed, people ceased their nomadic wandering and private property became important and a more organized communal life needed to take shape. In this context, the State evolved as a key instrument to define, protect and transfer private property. Likewise, between the late twelfth and fourteenth centuries the move from a feudal system to city-states responded to the need of imposing some form of rule and security to vast uncontrolled land patrimonies. And, most recently, during the seventeenth and eighteenth centuries the move from absolute monarchies and colonial territories to constitutional and independent states responded to the need of self-determination and the rise of civil society. The aspirations for a less tyrannical form of government, has also driven the evolution of a more democratic and decentralized State throughout the nineteenth and twentieth centuries. Unlike previous periods, the twenty first century is about building and re-building nations that are on the one hand more democratic and yet at the same time more complex.
As such, the State for the new era goes beyond the traditional elements of territory, centralization and security. Moreover, it goes beyond Gianfranco Poggi’s premise of state-making as an extension of authority or rule in the territorial space, and its physical raison d’etre. As the UNDP 2013 Human Development Report premised, “a strong, proactive and responsible State develops policies for both public and private sectors—based on a long-term vision and leadership, shared norms and values, and rules and institutions that build trust and cohesion.” So, it is a State for human development that becomes the receptacle of legitimacy, authority and rule-making, and that role is institutionalized in formal instruments such as constitutions or more informal arrangements such as spontaneous collaboration, both of which become social contracts with certain rights and obligations.
Kenneth Dyson’s classic book highlights the functional ability of institutions to organize constraints and affect compliance, as a degree of “stateness” to orient human action. Ultimately, Dyson focuses on the complex set of institutions that make up a State, and the sense of certainty that they could bring to insure biding decision of common concern. In democratic governance, autonomy and independence are key for accountability and checks and balances, as are coherence, common substantive purposes and authoritativeness. Similarly, as Gretchen Helmke and Steven Levitsky add, informal institutions, such as socially shared rules, usually unwritten, that are created, communicated, and enforced outside of officially sanctioned channels, are also part of the DNA of institutions. Ultimately, the outcome of State institutions has an impact on legitimacy, and it creates a paradox that was well explained by Guillermo O’Donnell’s work on the bureaucratic State and delegative democracy. On the one hand, as mentioned above, institutions can be used to favor despotic and/or autocratic or non-democratic (clientelism) tendencies and behavior. On the other hand, institutions can represent a potential force or infrastructure to mobilize collective interests, affect public goods and further promote democratic governance. Basically, institutions can create a vicious and/or virtuous circle.
In addition to human development and the strategic role of the State, for institutionalists like me, the third aspirational notion is the role of citizens and civic engagement. This helps to answer the question, who shapes institutions? There is evidence that shows that expansive human development, and an effective development State, depend on civic values, practices and engagement. When there is vigorous civil society, democratic governance is strengthened, and the opposite also holds. Citizen participation is an essential institution of democratic governance, as is the key link in the value chain that facilitates the virtuous circle. Citizens expect better government, by demanding more effective public services, transparency, accountability, and by acting collectively to achieve broad public goods. While this expectation and demand can vary across countries and levels of government (national or sub-national), and in some cases even be absent, institutions cannot be thought as simply arrangements, but as means to accomplish and expand human development. As Robert Putman would argue, democratic governance institutions do not exist in a vacuum only to facilitate decision-making processes, but most importantly they exist to produce public goods or to help educate children, guarantee safety nets for retirees, prevent crime and violence, create jobs, and promote innovation, research and development, to name but a few. As such, not only is human development about people, and the role of the State about institutional mechanisms, but institutions cannot be understood without the key element of civic engagement.
As such, clearly institutionalism has two sides: the more instrumental which is based on arrangements, procedures, rules and norms, and the more human based on individual and/or collective motivation to commit to, and achieving public goods. In essence, an institutionalist will have to have the ability to understand not only the dynamics of these two dimensions, but most importantly analyze their interaction, and what this articulation and engagement produces. What this does is argues against a narrow view of institutionalism, and focuses instead on a broader notion that advocates for strong institutions as mediators, but also for including additives such as deliberation and engagement as espoused by the likes of Jon Elster, Seyla Benhabib, and Jurgen Habermass among others. It is between the instrumental and human dimensions of institutions where the epicenter of democratic politics lies.
Institutions are a systems’ factor for democratic governance. They are not pure, perfect or static, but they hold the ecosystem of democratic governance together. Institutions provide a basic platform from where this system can be expanded, adapted and reformed in response to changing conditions. They provide the infrastructure, the rules, and norms for the interaction of State and non-State actors, and of network. Through various mechanisms institutions can help manage the supply-demand dynamic at all levels of government, and in different policy spaces (national, or sub-national), and create complementary policies and services to address the needs of an ever-changing and heterogeneous community. However, the energy that flows through the democratic governance ecosystems is obtained primarily from people and civic engagement. Collective action, deliberation, and policy dialogue play an important role in sustaining the institutional energy.
Civic engagement is necessary for democratic governance to grow and take root, and to provide energy to keep the democratic governance atmosphere alive, including the growth and expansion of active citizens’ participation. Civic engagement promotes accountability and transparency of politics and policy. As such, the basic institutional platform has to be rooted on individuals who are not only willing to actively participate alone or as group and invest resources (money, time, knowledge) to sustain the ecosystem, but also on individuals who believe that benefits they obtain by participating in the ecosystem exceeds the costs of the resources they invested in the task. As such, the development and strengthening of institutional systems come from human efforts, as explained by Mary Douglas in her classic book, How Institutions Think. Douglas argues that institutions need to be based on a foundation of shared knowledge, and that conversely all knowledge implies and rests upon a particular institutional base.
The institutional aspect of democratic governance is of utmost importance today, as we are witnessing the return of populism and authoritarianism. The argument that a new turbulent society, with different people, problems and ideas, more disconnected with its internal reality, and more interconnected with global elements, have all been used to explain the rise of populism and authoritarianism as protectors of the status quo or a traditional way of life. Similarly, the declining trust in democratic governance institutions is often used to show how the system is broken and biased in favor of the 1%, and how this contributes to the rise of inequality. Distrust in democratic governance institutions is even linked to people’s perception that their countries are not moving in the right direction, and why they have no confidence in current leaders or traditional politicians. Therefore, in this context people can make an argument in favor of outsiders taking power. Unfortunately, the same people who help elect populists find out later once these outsiders are in power that they are instead charlatans, ideologues, racists and simply inept at governing. While some of the challenges mentioned above need to be tackle as there is evidence to support the claims, not all of these challenges are the result of lack of trust in democratic governance institutions alone. What these challenges show is a more complex reality, which reflects attitudes about democratic governance that are in themselves only part of the explanation of the dynamics of democratic governance in the Twenty First Century.
A recent study by Edelman of 28 countries shows evidence of the current state of affairs, and how much more complex reality is, supporting a more comprehensive approximation that speaks to a systemic crisis, not only to one aspect of the system. The study shows that we are in a perfect storm that sustains itself on the basis of a vicious circle. As is illustrated in Figure 1, trust in institutions is not just a function of how governments perform relative to the expectations that people have. It is also a function of a number of other elements, such as a lack of, or eroding belief systems and growing economic and social fears. In turn, more people are vulnerable to fear, which further erodes trust in democratic governance institutions and unwillingness of people to have a vested interest in their democratic political systems and processes. All of these nourish the perception of bad government performance, and makes government look distant from most citizens’ daily experiences and needs. Today these perceptions are further intensified by the media (press, television and social media), which has found more channels and modalities of expression and information, but without necessarily ensuring veracity, objectivity, substantive analysis, and pedagogical content.
As such, democratic governance today seems to be trapped, because people do not want to participate in elections anymore as they see no incentive or gains and find it more difficult to participate in policy decision processes. And, if they participate in elections, many are voting on their fears and not on assessing the validity of promises or the impact on their economic interests. This paradox is giving an opportunity to populist demagogues to seek and take power, using the only currency they have, which is fear and division. This is allowing the rise of leaders and policies that weaken the democratic institutional systems and strengthen personal rule.
We are experiencing a moment of pessimism no doubt. But let’s be clear, populism is not about institutions. It is not about human development, finding a constructive role for the State, or about civic engagement. Precisely, the ideal world for populists is one without institutions and active civil society, where chaos and polarization can thrive. Yes, authority is disperse today, communities are more diverse, inequality and exclusion are real, and of course complexity and uncertainty remain high. However, populism, much less the personal version of populism, is not the answer to the challenges of democratic governance today in the world. We need to search and find a new way to manage complex societies, one that is not centered on the bias assumption that institutions are only relevant for the business of government or the instrumental part of governance. We need to bring back the human and social dimensions to the institutional approach. The source of change cannot come only from government, nor can elections bring change by itself. It must include much more than governments and politicians.
The future is open to rebuild institutions. This unease and unhappiness should lead into creative changes. A new vision for humanity, community and inclusive public goods is needed. One that brings back a moral compass for government, ensuring check and balances, a public service ethos, and accountability. But that will not happen from within government, as many have found ways to live comfortably of government and do not want to change it. It will happen only if citizens act collectively, and demand in mass, and if citizens find new micro places to recreate and live democratic life, such as the local space, the small city or the large city. Greed, narcissism and hostility have no place in democratic governance, and they need to be replaced by a localized and restless energy of citizens so that it can nourish and usher a new wave of democratic institutions.