OGF:Politics and Economics primer

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The information in this article refers to real-world systems and tendencies, however all of it may be applicable to OGF countries. The author has attempted to be politically neutral but would appreciate any corrections of bias.

Politics

'Left' and 'Right'

The terms left and right in politics (and also 'centre') are used to describe broad economic policies. Generally the left is concerned with the redistribution of wealth amongst the general populace, and the right with an individual's ability to retain the wealth they have created for themselves. Centrist politics tend to fall somewhere between the two.

Left politics tend to be characterised by:

  • Higher taxation of individuals and companies
  • Greater spending on public services
  • Liberal/progressive social attitudes
  • More regulation of business activities
  • More action on green issues
  • Liberal immigration policy

Right politics tend to be characterised by:

  • Lower taxation
  • Reduced spending on public services
  • More traditional social attitudes
  • Little regulation on economic activity
  • Less action on green issues
  • Restrictions on immigration

Historically, it was the case that the wealthier an individual was, the more to the right their political stance would be. However, nowadays this traditional model is less likely to apply to the population.

Extreme left- and right-wing politics have radically opposing policies, but in history so far, most of them ended up in some form of a dictatorship. The main difference is:

  • the extreme left is based on the idea that wealth imbalances need to be abolished, and that workers need to be liberated (even by force, if needed). In the modern era, the extreme left also advocates for equal rights for other marginalized groups and minorities (against sexism, racism, homophobia, etc.)
  • the extreme right revolves around either of these two (sometimes both):
    • Extreme nationalism (possibly racism)
    • Complete freedom of corporations with no regulation

We know very little on how extreme ideologies work long-term, so be careful if your OGF country is based on one of them.

Types of political system

Democracy is the most common political system. It operates on the principle of 'one person, one vote.'

  • Direct democracy is where the population vote directly on the passing of new laws. It means the opinions of the people are directly involved in the decision, but can be very time-consuming as every issue causes a referendum (also known as a plebiscite: where everybody votes to decide how to resolve an issue) to be held.
  • Semi-direct democracy is the most common system. The populace elect representatives to make decisions on their behalf, and a few important decisions are subject to a popular referendum.

Monarchy is where a heredatory individual of either gender is the head of state. Historically they may have been the highest authority and able to rule as they wished, but today the position is often ceremonial.

A dictatorship is where one individual is able to rule as they command. It differs from monarchy in that the dictator is not heredatory (sometimes elected democratically), and the term is often used to imply a repressive regime, whereas a monarch my be unelected but not rule in a tyrannous way.

A one-party state is similar to a dictatorship but whereby the population can vote, but only for candidates from one political party. A central committee makes all the decisions.

Heads of Government and Heads of State

The Head of Government may be called the Prime Minister, the Chancellor, the State Minister, or similar title. They will be an elected representative and will usually be the leader of the largest party in government.

The Head of State may be a monarch, President or the same person as the Head of Government. They may or may not hold political power or office depending on their role.

Parliaments

All democratic government will feature some kind of national assembly, known variously as a Parliament, Senate, Assembly, Thing, Duma, etc. The majority of governments have just one body of representatives, or 'house' (some have two, a very few three). These houses may be all elected, unelected, or a mixture of members. In systems with two houses, generally the assembly referred to as the 'lower house' has more power and will usually be where the Prime Minister sits. The upper house may have equal power or may simply act in an advisory role.

Political parties and philosophies

In order to function as a unified block, most democracies have a system of political parties rather than lone individuals standing for election. Each party will have a leader and other governing figures, and will try to ensure all its candidates agree on the same policies and political stance. In general, the party in power in most democracies will be either the left-of-centre (often called Labour, Socialist, Social Democrats, Reform etc) or the right-of-centre (often called Conservative, Christian Democratic, Liberal, etc). Most Labour parties had their roots in the nineteenth-century trade union movement for workers' rights and will still be seen as representing the manual trades in lower economic tiers, although in recent decades they have moved to appeal to more wealthy voters and focused on social welfare and public services. Conservative and Liberal parties will often be older and traditionally represent the landowning, trade-owning and entrepreneurial classes. However nowadays there are plenty of working-class conservative voters who appreciate the traditional values these parties tend to follow.

Green parties tend to have been formed in the environmental movements of the 1970s and are concerned with sustainability, animal rights, environmental protection and human rights. They will generally be economically left-wing.

Communism, Marxism or Bolshevism is a political philosophy on the radical left, originating in the theories of Karl Marx, Frederik Engels, Vladimir Lenin, Leon Trotsky, Mao Ze-tung and others. It advocates the complete abolition of private property, complete equality, union between the workers of all countries, a strong one-party state, all industries being under state control, and the eventual abolition of money. In practice most Communist states where they existed were more about the complete power of the rulers and there was still a hierarchy of wealth and repressive regimes.

Fascism is the far-right equivalent of Communism. It tends to also involve complete power in the hands of a state or individual, but unlike communism tends to also involve the idea that one race or country is superior to others. Hitler's Nazi Germany, Mussolini's Italy and Franco's Spain are notorious examples from the twentieth century.

Many Communist and Fascist movements were and have continued to be banned in democracies.

Independent candidates can also stand, not affiliated to any party. Sometimes an party elected individual will resign from a party and re-stand as an independent in order to fight a policy they do not agree with.

Types of Government

Single-party majority: common in the United Kingdom and Australia. One party has the majority of the votes and forms a government exclusively from its own members. This has the advantage that it is easier to pass new laws, but may not be so representative of the electorate.

Coalition: Common in many European countries such as Germany and Scandinavia. Several parties with fewer seats than a majority may form a pact to serve together. This will often involve compromising a party's specific policies, but arguably serves the views of more voters. However a government may collapse if a coalition cannot agree and split up.

Minority government: If a party has the largest number of seats but not enough for a majority, they may in some systems be able to rule as a minority government. In theory they are able to pass decisions, but can be outvoted if other parties all oppose them.

Government of National Unity: In times of crisis such as a major war, all parties agree to work together.

Local government

Smaller areas may often have their own forms of government with a great variation in powers. In federal countries, each state may have substantial control of many lawmaking and financial issues. A local council, by contrast, may only be able to decide local business tax rates, some transport policies and spending within a budget set by a national body. Local governments may be elected by different methods and at different times to national ones.

Supra-national governments

Some bodies are made up of representatives from more than one country and make decisions affecting several countries. The most notable in the real world is the European Union, which has its own parliament in Brussels and Strasbourg, can pass laws for all members states, allows free trade, and in which most states have agreed an open-border area. They also have some military collaboration. Other bodies include the United Nations, the African Union and Arab League.

Methods and frequency of elections

In a democracy, elections may be held at national/federal, state, or local level. In general the whole country will vote in comparable elections at the same time, although not all bodies operate on the same cycle. In the UK, it is the custom for one third of seats on a city council to be balloted every year, so the council members will never change all at once.

The time an individual or party can spend in office is called a term. In most democracies this is between three and five years - enough time to implement all its policies, but not so long the members become exhausted, run out of ideas or risk becoming dictatorial. There may be limits on how many times an individual can stand for office - the US president can only serve twice.

Methods of voting include:

First-past-the-post

All the votes are counted and the candidate with the most wins. This is simple and produces a clear winner, but may not be truly representative of the electorate. If there are seven candidates and the winner gets 16%, the next four get 15%, the next gets 14% and the other 10%, the majority - 84% - of the voters are unrepresented by the winner. It is the only possible system where there can only be one winner.

In many FPTP elections, the voters only directly vote for their local or 'constituency' candidate. Contrary to what some voters think, they are not directly voting for which government will be formed from the elected candidates, just who will represent their area and indirectly how many representatives that party will have nationally.

AV/Proportional Representation

A system which attempts to translate the proportion of votes into the proportions of elected candidates from each party. Only works where there is more than one seat to be decided. It is more complex, but produces a more representative result. There are several sub-systems:

  • Simple or closed list: There is a list of one or more candidates listed for each party. The voters mark which party they vote for (but cannot show a preference for any candidate), the votes for each party are counted and the seats allotted according to the percentages of votes as closely as possible (up to the number of candidates the party can field). In a 10-seat vote, if party A gets 36% of the vote, party B 51%, party C 10%, party D 3%, the seats would allocated A:4 seats, B:5 seats, C: 1 seat and D none. The party chooses which candidates fill the seats won.
  • Open list: As above, but the voter can also rank the candidates within each party in order of preference.
  • Another open list method is that the voter ranks all the candidates and/or parties in order of preference. The first-choice votes are counted and the candidates win the first round of seats proportionally. Then the second-choice votes are counted and given any remaining seats proportionally, and so on for as many rounds as it takes to fill all the seats.


Economics

Capitalism, broadly speaking, is a system where any individual or group can sell legal goods or services for profit. They are allowed to keep whatever remains of the profits after paying any applicable taxes.

  • Free-market or liberal capitalism is where economic activities are subject to little regulation by central government. This usually means that some individuals can become very wealthy, and is attractive to foreign trade, but where there is little effort to redistribute wealth.
  • Third Way economics was devised in the 1990s, most notably by Tony Blair's New Labour government, whereby the state sub-contracted public industries out to private companies, who would be paid to run them out of public funds. In theory it meant combining the control of state ownership with the efficiency of private profit-making business, but the reality was often that the private companies cheated on their end of the contract to maximise profits.
  • A command economy is where a central government decides what the country's production efforts will concentrate on. Usually found in dictatorships, Communist and other one-party states. It tends to be synonymous with extensive military and industrial production and less on consumer goods. Often this meant spending resources on vanity projects rather than necessarily addressing the country's main needs.

Taxation

The main source of money for a government to spend comes from levying taxes and enforcing their collection. Taxes are usually paid on individual income, either as a percentage of all of it, or just above a certain amount; on luxury goods (eg alcohol, automobiles, hot food, valuable items, jewellery, clothes, property trading) usually called Value Added Tax (VAT) because the amount is a percentage of the item's value; inheritances; financial transactions, imports and exports; insurance policies and other. There may also be taxes on activities which are considered harmful to the public or the environment as a deterrent, such as fuels, flights, tobacco, alcohol, gambling, and use of roads.

Some countries like France do not tax earned income as much as assets, particularly property.

Local authorities also have to ability to collect tax for spending on public services.

There are usually also taxes on business activities and profits. However, there are often many ways in which businesses can legally reduce the amount of tax they pay by exploiting loopholes in the law, such as moving money to subsidiary businesses.

A few countries have a rate of personal income tax which is nil or nearly nil. They may also have low business rates. Such countries are known as tax havens and often have to rely on such schemes to exist as they have few natural resources and rely on economic activity.

Public Spending

Public spending is how much a government chooses to spend on providing services to the general population. These might include healthcare, law enforcement, fire service, military forces, education, libraries, arts and culture, building projects, transport and others. The level of public spending is directly related to the level of taxation. A country with high taxes will generally also have a high level of spending on public facilities, and will also generally be considered on the left of the political spectrum. In general the population will not be persuaded to vote for one without the other.