Michael Porter presenting at Harvard Business School

The Entrenched Political Duopoly is Ruining Our Democracy

Contest between Democrats vs. Republicans is like a staged wrestling match; the participants cooperate as much or more than they fight

May 7 · 7 min read

Michael Porter is famous for bringing data-driven decision making to industries around the world. As a tenured professor at Harvard Business School (HBS) and a successful consultant in this own right, he has helped thousands of world class enterprises understand their businesses better through data analysis, improving executive decision making materially. Working with a specialist in political systems, Katherine Gehl, he has brought this analytical focus to the industry of politics.

One of the data sets that he looked at came from a horizontal study of opinions of HBS alumni, who reported from around the world on how they see the United States performing compared to other advanced economies. The dimensions of the quadrants were strength vs. weakness, and improving vs. deteriorating (see chart behind Porter in pic above). Tellingly, items in the upper right (strong and improving) — things like entrepreneurship, communications infrastructure, corporate management, capital markets, and others — typically related to private sector activity. Most of those in the lower left (weak and deteriorating) — such as logistics infrastructure, K-12 education, health care, regulation, and others — were from the public sector.

This negative correlation is no error. The success of one comes at the expense of the other. And in the cellar and getting worse is our political system (blue box on the chart), which is also nominally in the public sector.

Explaining our system of elections and legislation as if it were any other industry, Porter and Gehl laid bare its structure in a lecture at HBS April 24, 2019. As they revealed its mechanism, they illuminated our politics, revealing a system at once surprising and, in retrospect, inevitable. That mechanism is no clanking Rube Goldberg. It is well buffed to a high polish and functions extremely smoothly.

That’s right. The first surprise: our political-industrial complex is doing what it was designed to do. A finely tuned duopoly, the U.S. political system operates perfectly for its own ends. Although Republicans and Democrats pose as ideological enemies, it’s all arm-around-the-shoulders time when it comes to doing the business of politics. At the heart of the political ecosystem, the two rival parties represent a central marketplace. Around them is a cloud of suppliers, channels, and customers. Suppliers include candidates, campaign talent, voter data, think tanks, and lobbyists. Channels consist of retail (old fashioned face-to-face shoe leather), paid advertising, new and old media, and social media. The channels supply the final consumer — voters. In addition, potential dynamism comes in the form of substitutes and new entrants, possible competitors to the duopoly.

A duopoly competes in a strange way. The players prefer to divide the voters, control suppliers and channels as much as possible, create high barriers to entry for new parties, and cooperate on rules that shape the industry to their mutual advantage.

This structure leads to edge-case strategies — which favor inflammatory and highly partisan positions, both by candidates and office holders — rather than those that would benefit the majority of the people and represent what most people want. Instead of trying to build a consensus in the middle, pleasing the most voters, the political industry targets minorities on either fringe.

The jerry rig that drives this strategy is the U.S. primary system, during which the parties select their candidates for the general election. In our established system, the primaries often count for more than the general election, since many seats lie in districts clearly either red or blue. Thus, the much smaller base of highly active primary voters becomes the main prize, not some vague idea of the public good.

So, second surprise: for the most part your vote doesn’t count. You, broad middle, are not the target audience. The energized fringe is.

This structure may and often does end up installing the worst candidate rather than the best, as both candidates look horrifying to most voters. Politics turns out to be a team sport, played by rules as refined as football. Despite not liking the top of the ticket, a team player will always play to win. But both teams want to keep random clowns off the field. There’s been no viable new party founded in the United States since 1854. Even Ross Perot, with his billions to finance his own campaign, barely moved the needle.

Evidence of the enforcement that keeps third parties out of elections can be found in government rules, the detailed workings of administration, at all levels. It turns out that rules represent an area where both parties can agree on many things. In Article 1 of the Constitution, the rights, duties, and obligations of the legislative branch are laid out in 10 brief sections, but the House Rule Book is 1,500 pages. This multi-volume tome spells out exactly how the duopoly divides the spoils of power, entrenching partisan advantage over problem solving. And it’s been this way for years.

To illustrate how rules affect the system, note “sore loser laws.” Of the 50 states, 44 have them. These laws, crafted variously, say, if you run in a primary and lose, you can’t run in the general election. The political parties used this mechanism to anoint the primary system as the only avenue to office in most of the country. Thus, the people’s voice was muted, not through the Constitution, but at the level of state ruling-making.

In 2006, in Connecticut, one of six states without a sore-loser law, Joe Lieberman ran as an independent in the general election and won. However, in Delaware in 2010, Mike Castle, a well liked independent, was prevented from running in the general election because of one.

The Hastert Rule, named for former House Speaker Dennis Hastert, lets a speaker, a single individual, keep a bill from coming to a vote — even if the majority of the House is in favor of passing it.

And how about fundraising rules? A single donor can give $847,500 to either party every year, but an individual can give an independent only $5,400 — every other year. This hurdle has kept any viable new party from forming for generations.

Parties collude to set rules in their favor. In her presentation, Gehl enlightened the audience. The parties “work well together,” she said. “They rig rules to protect themselves jointly from competition. Politics isn’t broken, it’s fixed.”

Third surprise: for politicians, there is no relationship between acting in the public interest and getting reelected. Thus, gridlock, the state of the federal government for many years now, is part of the desired outcome. Far from disqualifying a politician, not doing anything is practically a job requirement. Contrary to what intuition might lead you to expect, in the U.S. political system, carrying on the people’s business is not part of the job description.

Like all –opolies in any industry, the two parties enjoy enormous economies of scale. In every election, they run hundreds of campaigns with huge staffs. Underfunded independents, who can’t compete for the necessary talent and access, need not apply.

As he laid out the landscape, Porter was almost despondent. Not only are they not trying to deliver value to the average voter, he said, “they also control the channels.” The two parties have divided all the talent and data services, and, with few exceptions, these suppliers can only work for one side. Thus, the Fourth Estate, the balance the media used to represent as a defense against the depredations of all political branches, the mythical Walter Cronkite, has become a creature of the mechanism. You can say Fox became a house organ of Republicans first, but by now MSNBC represents a counterbalance for the Democrats. “Independents can’t get any of that,” Porter noted.

Like all good consultants, Porter and Gehl offer a solution which, if not easy, is at least simple. Many looking to reform electoral politics look to a Constitutional Amendment to remedy the process, but Porter and Gehl suggest a route with more but lower hurdles: state-by-state voting rules. In order to encourage good third-party candidates and elected officials who do the people’s business, they propose two changes: an open primary and ranked choice voting.

The open primary would let anybody run with equal access, no party affiliation necessary. In their system, the top four vote-getters would move on to the general election. Once there, voters would be asked to rank as many of their choices as they like. On the first count, the lowest first-ranked vote-getter would be eliminated and his or her votes distributed to candidates those voters ranked second. The process would continue until someone got more than half the vote, at which point the winner would have the backing of the actual majority. This process would encourage both moderate and unaffiliated candidates and broad centrist platforms.

These rule changes would have a salutary effect not only on elections but on the process of governing as well. Elected officials would no longer be beholden to the narrow interests of their parties in the next primary cycle, the only win that really matters today. Thus, the motivation to obstruct legislation and produce gridlock would be reduced, and politicians could “do the right thing” without sacrificing their chances at reelection.

Re-engineering the election machinery to get a better outcome is only one facet of Porter and Gehl’s program to improve our political landscape. Others include re-engineering the legislative machinery to eliminate partisan control, instituting counterweights to money in politics, and opening up near-term competition to jump-start progress.

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