If ancient Greeks could balance a budget, why can't we?
In times of war, Athenian voters agreed to spend 15 times more on the armed forces than they did on state pay or festivals.
Is democracy good for balancing a budget? For many, today, the answer is a resonating no. This answer is easy to understand. In the birthplace of democracy, Greece, the state's budget is a mess. For too long the politicians of modern Athens feared voters would not tolerate the financial truth. To pay for unaffordable election promises, they borrowed irresponsibly instead of raising taxes. They lied to voters about the ballooning public debt. It all ended in a huge sovereign-debt crisis.
Even in the midst of this crisis, Greek politicians were afraid to tell voters how the country could escape it. They left it to Greece's creditors to dictate harsh austerity policies, which have caused enormous personal suffering. Greek voters did not vote for them. Not without reason, they are incredibly angry with their politicians.
Politicians do not believe voters can tolerate the financial truth. They assume that democracy is not good at managing public finances. For them it can only balance the budget by leaving voters in the dark.
Greece's crisis might be exceptionally severe but the problem behind it is not unique to Greek democracy. Two other modern democracies, Australia and Britain, were also forced to take drastic budget measures in response to the global financial crisis. In each democracy, centre-left politicians borrowed heavily to pay to prop up the banks and maintain private demand. In each country, these expansionary policies minimised the crisis's human impact. But in the elections that followed, the left-of-centre politicians who had introduced these policies refused properly to justify them. They feared that voters would not tolerate frank public debate about public finances.
The centre-right politicians who opposed them were no better. In these elections they promised to bring budgets back into surplus without new taxes or major public-sector cuts. But these promises again turned out to be lies. In office these conservative politicians have introduced austerity policies without clear electoral mandates. They too continue to face the wrath of their electorates. For good reasons the voters of Australia and Britain have lost a lot of trust in what politicians say about public finances.
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In all these democracies there has been a common underlying problem. Politicians do not believe voters can tolerate the financial truth. They assume that democracy is not good at managing public finances. For them it can only balance the budget by leaving voters in the dark.
As an historian of ancient Greek democracy, this assumption strikes me as plainly wrong. Certainly the politicians of ancient Athens did not share it. Ancient Athens was an incredibly successful state. It developed democracy to a higher level than any other state before the modern period. It was the leading cultural innovator of its age. Athens became one of the ancient world's greatest military powers. These successes did not come cheaply. They depended on Athenian democracy's ability to raise new taxes and control public spending. What made these successes possible was the sound management of public finances.
That the democracy of ancient Athens was good at this will come as a surprise. Germans have been critical of Greek public spending for a very long time. In 1817, August Bockh famously criticised ancient Athens for spending more on public-sector pay and cultural festivals than on its armed forces. For this German professor, this wasteful spending weakened ancient Athens's armed forces. It made it possible for Greece to be conquered by Macedonia.
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If ancient Greeks could balance a budget, why can't we?