Citizens give surprisingly similar answers when asked ..... Deutsch von Udo Rennert. Hamburg: ... Widerstreit. Modell einer partizipativen Technikfolgenabschätzung zum Einsatz ... http://www.weforum.org/pdf/AM_2003/Trust_in_Leaders.pdf.
The Private Management of Public Trust: The Changing Nature of Political Protest Philipp Aerni Center for Comparative and International Studies (CIS) Swiss Federal Institute of Technology (ETH)
This article argues that political stakeholders in national and international political arenas, and non-governmental organizations (NGOs) and firms in particular, are increasingly investing in 'Public-Attention-Seeking' activities in order to maintain access to scarce public resources in politics. The principal goal of 'PublicAttention-Seeking' is to win the public's favor and trust. As a consequence, public trust is increasingly managed as a private political resource like money and political power. Yet, unlike money and political power, public trust is not tradable (fungible) because it is based on the belief that a particular stakeholder acts in the public interest as opposed to others stakeholders who are assumed to act out of pure self-interest (i.e., interest in gaining money and power). This proposition can help in explaining various new phenomena in contemporary national and international politics, particularly in pluralist societies, such as the success of professional protest, the benefit of non-cooperation in political bargains, the increasing moralization and personalization in politics, as well as increasing costs of political decision-making. We are particularly interested in the effects of such changes in politics on environmental and economic performance, notably, the risk to emanating from an increasing gap between a stakeholders' moral claims in public and their actual (frequently opportunistic) behavior resulting from the necessity to survive in a global competition for public attention.
Introduction
This paper presents a new theoretical approach to explain the rationale of public protest and other forms of public attention-seeking in politics by introducing ‘public trust’ as a third political resource aside from ‘money’ and ‘power’. Unlike money and power which are to some extent tradable among political stakeholders, public trust cannot be exchanged for money and power, because otherwise the public would feel betrayed and immediately withdraw its trust in the respective stakeholder. This first hypothesis helps explaining various phenomena in contemporary national and international politics such as the success of professional protest and the strategic value of political dissent, the incentive for classic lobby organizations to join public protest, the increasing budget for corporate governance and corporate identity in the private sector, the increasing moralization and personalization in politics as well as the increasing decision-making costs in the political decision-making processes. The theoretical concept integrates recent insights gained in the fields of behavioral economics, institutional economics, social psychology, anthropology, sociology and political science. Each field has defined ‘trust’ in a particular way and contributed to a better understanding of human behavior in organizations and society at large. Yet, trust research was hitherto either focused on in-group trust within communities (predominantly in the fields of behavioral economics, anthropology and social psychology) or on outgroup trust in an anonymous society (in institutional economics, sociology and political science), while the interdependence of these two forms of trust remains poorly investigated. This paper addresses this research gap. It basically shows how in-group trust (based on personal reciprocity and fairness) is increasingly superseding out-group trust in politics (based on trust in institutions) and thus undermining the foundations of a complex and multicultural society. This process is identified as the gradual ‘privatization of public trust’ and to a certain extent related to the geopolitical and technological changes since the end of the Cold War1. In other words, public trust in institutions (out-group trust) may
1
The collapse of the Cold War made it increasingly hard for governments to maintain state secrets in the name of national security and forced them to become more transparent. This made it more expensive for
be considered as a public good that lowers the transaction costs of collective action across a heterogeneous, anonymous and complex society. Yet, public trust is also a private good that creates homogeneity, identity and intimacy within a community (in-group trust). If communities become distrustful of public institutions and their representatives, they look for political stakeholders who publicly denounce these institutions and claim to defend community interests. Thus, it reinforces distrust in the representatives of public institutions and increases trust in the political stakeholders who claim to represent community interests. Consequently, public trust becomes a private good that can be used through public-attention seeking strategies to increase influence in politics. For a citizen to trust in an organization that uses protest ‘against the system’ as a political strategy is psychologically rational, because it offers a way to reduce world complexity to a bimodal frame of good versus evil, or we versus them, and helps to deal with increasing uncertainty by relying on certain doctrinal positions and symbols that allow the quick interpretation of new political events at low cost. Even though such a strategy may be rational from a psychological point of view, it may turn out to be irrational from a political and economic point of view because such citizens cease to define their political preferences in terms of expected utility incomes. The second hypothesis is that the growing divergence between psychological and political rationality may increase the potential rewards (in terms of favorable policies and regulation) for distributional coalitions to participate in public attention-seeking activities through protesting or corporate image management relative to classic rent-seeking activities through lobbying and profit-seeking through investments in improved product development. Consequently, political stakeholders with distributional goals tend to invest more in public-attention seeking relative to rent-seeking and other professional activities. The increasing competition in this public-attention seeking market creates economic incentives to dissent and encourages an adversarial culture in politics that often makes public leadership impossible and results in the incapacity of policy decision-makers to respond quickly and effectively to upcoming social and environmental challenges.
corporations and lobbying organizations to secure rents through government regulation and forced them to seek other strategies to increase profits or simply maintain the status quo.
The paper first describes the emergence of professional protest and shows the risks if protesters neglect their role as independent watchdogs and alerters of certain unintended developments and adopt opportunistic strategies in politics in order to extend the natural life-cycle of a protest movement. It then shows how other organizations in politics and business started to learn from successful and professional protest organizations and adopted similar public-attention seeking strategies in the hope of gaining public favor and, as a consequence, money, votes, costumers or simply public legitimacy. The second part of the paper deals with the theory of the private management of public trust in detail and sets forth its political implications.
The professionalization of protest and its consequences in politics and business
New social movements The origins of professional protest organizations reach back to the late 1960s and early 1970s when they were part of the great social movement that emerged at that time to protest against the paternalistic state, the nuclear industry and the Vietnam War. The anatomy of this resistance was characterized by mass mobilization and, as such, symbolized an overall change of societal values (Radkau 1995). This social movement however dissolved during the 1980s mainly because it became too large and heterogeneous. In this context, Mancur Olson (1965: 162) would argue that the main causes of ‘social alienation’ that produced disequilibrium were addressed in politics, and since there was no coercion of membership, nor any tangible selective incentives to stay in the movement, it lost its attraction and political influence. Instead, new political left wing parties (e.g. Green Parties in continental Europe) and new sectoral social movements (e.g. feminist movement, environmental movement, minority movements) emerged in public life. While the left wing parties were forced to follow the formal rules of democracy, the new social movements continued to be an extraparliamentary force. The new sectoral social movements had the advantage of being smaller, more targeted and better organized than the great social movement from which they emerged. The
major goal was to mobilize the ‘forgotten groups’ (Olson 1965: 165) in society that hitherto were not able to organize or defend their interests. Cultural minorities (gays and lesbians, indigenous people, religious communities, etc.) and other unorganized large latent groups (e.g. consumers, youth, women, taxpayers, future generations etc.) belonged to these forgotten groups. Previously, these groups did either not have the resources for collective action, or the gains from group actions would have simply exceeded the costs because one’s own efforts did not have any noticeable impact while the collective benefits others achieved could be enjoyed equally. Therefore, neither coercion nor outside inducements were available to ensure that these heterogeneous groups participate in collective actions to achieve a collective good. Nevertheless, it turned out that these forgotten groups can be organized if there is a political entrepreneur (Frohlich et al. 1971). Such a political entrepreneur is driven either by intrinsic motivation (Deci 1985) may that include idealist motives, fear of loss of identity (Akerlof & Kranton 2000) or personal experience of perceived unfairness due to the failure of reciprocity (Fehr & Gächter 2002), or his principal cause may be extrinsic motivation in form of the prospect of potential rewards in terms of income, power or prestige (Becker 1976). The political entrepreneurs who organized these movements picked up on the latent dissatisfaction of disadvantaged unrepresented groups, and turned out to be skilled coordinators of group mobilization as well as charismatic leaders that induced people to support them passionately. Moreover, the provision of certain benefits whether material (effective advocacy for more legal protection, more issue-specific information channels, a public voice for complaint, etc.) or non-material (sub-culture and identity building, friendship, intimacy, orientation, social status) ensured a continued interest in the existence of the organized movement among its members. These organized new social movements, often associated with the emergence of nongovernmental organizations (NGOs), discovered how much political impact their campaigns can have when covered by the mass media. As a consequence corporations became aware how vulnerable their image is in the face of such protest actions and governments noticed how much votes they can loose if they do not respond to the demands of such organizations. The ‘forgotten groups’ suddenly turned into political stakeholders that had to be taken seriously. With the growing political maturity these
organizations also acquired a more strategic form of thinking: the initial struggle of the organization continued to serve as a myth of origin and a frame in which to interpret new events (Luhmann 1993); in turn, the organization itself had to become more professional and pragmatic in order to survive and expand. It continuously used its weapons of political agitation (e.g. consumer boycott, logrolling with left-wing parties, media staged protests etc.), identified new political topics, maintained the perceived collective and noncollective benefits and created selective incentives to stay and participate in the movement through ostracism of defectors and those who fail the share the burden of collective action. As such, these NGOs continue to play an important role in the political arena as advocates of previously underrepresented social groups. However, the gradual rise in power of NGOs has its roots also in four external influence factors related to the political, economic and social changes of the early nineties: 1. The end of the Cold War caused a transition from ‘state secret’ to ‘public’ as media of communication. As a result politics was forced to become more open and more accountable to the public since there was no more justification for secret actions in the name of public safety and national defense (Luhmann 1993). 2. The increased importance of public opinion in the policy decision-making process also strengthened the influence of the mass media, and this again helped public interest groups to increase their political influence as extraparliamentary forces through the participation in dramatic media events (protests) (Nelkin 1996). 3. The revolution in information and communication technology increased the organizational power of flexible global networks of which consumer organizations, environmental and minority action groups are part of (Nye 2002). 4. The new social paradigms of self-expression, pluralism, difference and individualism in the 1990s (Beck 2000) tended to create a favourable view of such non-economic pressure groups primarily because they symbolized the spontaneity, the liberty, and the voluntary quality of the private association in contrast to the compulsory and coercive character of the state (Luhmann 1993). This public attitude also resulted in a preference for symbolic action compared to informed factual talk. Protests and public parades became a form of life style (The New Republic 2000) that manifested itself in fashion
design, TV adds and increased membership of organizations that emphasized difference (e.g. a slogan of a recent TV ad of Greenpeace is: ‘politically incorrect since 1971’).
Though these organized new social movements generally increased public awareness for the ‘forgotten groups’, the real situation of the groups they claimed to represented, in terms of economic opportunities and legal protection, improved little. Representatives of these organized movements would accuse the organized established interests for having thwarted their efforts to improve the situation of their members. Others, in turn, would accuse the representatives themselves for having pursued self-interested goals of prestige rather than the goals of the people the organization claims to represent, and for having invested too much in advocay and too little in pragmatic political bargaining. This would also be consistent with Olson’s Dilemma (1965) that interests of large-latent groups are hard to organize and Down’s hypothesis (1957) that social functions are usually the byproducts, and private ambitions the ends of human action. The problem is probably best explained by the principal-agent theory which argues that asymmetric information between the principal (members of an organization) and the agent (the representative of the organization) allows the agent to use information in his own interest rather than the group interest (Akerlof 1970, Ross 1973). Since the representatives (or executive committee) of an organization are ideologically and politically better informed than its members, it is easy to dismiss members with divergent views as uninformed or influenced by the wrong sources of information. Members generally tend to keep quiet and be loyal to the organization in spite of potentially having the options of voice (complain) or exit (leave the organization) (Hirschman 1970). Loyalty in this context is probably based on a perceived high price of exit (loss of non-collective benefits such as moral orientation, friendship and identity) and voice (falling in disgrace with the powerful executive committee, stigmatization and eventually exit). The Sociologist Richard Sennett (1976) observed these oppressive tendencies within organized communities already in the 1970s and criticizes them for having become a sort of ‘destructive communities’, which have a focus on emotional relations with other people as a state of being, rather than as actions shared. According to Sennett, such organized communities become akin to an engine which runs only in neutral gear because they
cease to advance their particular causes due to the concern for collective identity and intimacy.
Political Parties at the fringes of the political spectrum The new left and, to some extent, new right wing parties that emerged in the 1980s and 1990s often as the political arm of a new social movements, were particularly successful in the European multiparty systems in which parties tend to have sharply differentiated programs (each closely integrated around one ‘Weltanschauung’ or ‘ideology’). Ambiguity and compromise are only introduced on a secondary level whenever coalitions are formed (Downs 1957). Moreover, at least some voters treat elections in such systems as something other than devices for selecting government (e.g. social protest, election conceived as a preference poll). Thus an extremist party can gain votes from protest voters who simply trust them to act in the public interest, as well as from voters who really agree with their doctrinal positions. The rise of green parties on the extreme left in Europe in the 1980s followed the rise of xenophobic right-wing parties on the extreme right in the 1990s. These right-wing parties also conceive themselves as a movement that claims to defend the public interest against the interest of the political establishment, and they too get their votes mainly from protest voters. As a result, the distribution of votes became characterized by a few large clusters and little scattered ones. In such a political landscape conflict tends to predominate over cooperative achievement, and society loses its vital core of harmony. The danger of such a development is that the premise of equal power may lead to a cancellation of policies rather than a mutual reinforcement of them (Downs 1957). In a two-party system (e.g. United States) the situation is slightly different: Voters might be more inclined to vote for the mainstream party that is more likely to win than for the fringe party that may match the personal world view better but is unlikely to lose, and, indirectly, might even help the other unwanted mainstream party to gain power. Each of the two mainstream parties uses ideology more clearly as a mean to an end, namely to win the elections. Ideologically, mainstream parties face the constraint that they may please only a limited number of social groups, since its appeal to one may implicitly antagonize the others. Because of uncertainty, it is not obvious which combination of
social groups yields the largest number of votes. As a consequence, each party casts some policies into the other’s ideological territory in order to convince voters there that its net position is near them. Both parties find it rational to be ambiguous, because neither is forced by the other to show more clarity and to take a more precise stand. In other words, competition forces both parties to be less than perfectly clear for what they stand for. This makes it more difficult for each citizen to vote according to his political preference. The voter has a hard time finding out what his ballot supports when cast for either of the two main parties. As a result, voters are encouraged to make decisions on some basis other than the issues at stake, i. e. on the personalities of the candidates, traditional family voting patterns, loyalty to past party heroes, etc. or decide either to abstain or to vote for the fringe party as a sign of protest against the ideological fuzziness of the two major parties. According to Downs (1957) only the parties’ stance on political issues would be relevant to voter’s utility incomes from government; therefore the voting decisions that are made on any other basis may be called politically irrational. Nevertheless, such voting behavior can be rational from the point of view of citizens who face time and financial constraints to be properly informed about the views of the competing parties regarding the different political issues and how these views may potentially affect their utility incomes. In view of great uncertainty and the ongoing division of labor the voter tends to focus more on the ideological statements of the parties, because this allows her to reduce uncertainty and the cost of information acquisition, since the more confident a person is about her ideological position, the less she believes to gain from further information. Downs calls such voters dogmatists because they look at doctrines rather than behavior when choosing to support a particular party. There is some indication that the share of dogmatists in elections is increasing even in the United States with its two-party system as the recent success of Ralph Nader’s Green Party (as left-wing protest party) in the presidential elections of the United States in 2000 shows. The Green Party represents the voters that are increasingly dissatisfied with the ideological ambiguity of the Democratic Party. As the party that ruled the United States throughout the 1990s, the Democratic Party felt forced to make significant compromises to the Republican Party that dominated the legislature during this period. As a consequence, it had to abandon certain ideological principles in order to maintain its capacity for collective action in the policy decision-
making process. In turn, the Republican Party, forced to be in opposition during this time, increasingly emphasized its doctrinal positions and over time tended to act like a protest party that casually assumed even positions of the extreme right. This emphasis of ideology over policy helped the Republican Party to attract voters who previously voted for the far-right wing Reform Party that gained a significant share of the voters in 1992 under its leader Ross Perot. As a consequence Pat Buchanan (the successor of Ross Perot) and his Reform Party lost influence in the elections 2000 and, together with Ralph Nader’s Green Party, indirectly helped the Republican Partyto win the electoral vote.
Civil Society and Politics Interesting in this context is that the extreme right and as well as the extreme left claim to represent civil society and to establish the renewal of civic virtues. This is not astonishing if we consider that the notion ‘Civil Society’ has conventionally meant to distinguish the milieu of free humanity from the milieu of reification produced either by nature or the state (Tester 1992). Civil society is mainly based on the myth of the social contract, which is presumed to turn men in the state of nature into citizens of civil society that would have its basis in the mutual consent by individuals who had voluntarily entered into symmetric reciprocity with each other (Locke 1689). The symmetric reciprocity of action is only possible in relatively small and homogeneous communities, therefore the increasing size, heterogeneity and mobility of large modern societies, makes civil society appear to be an increasingly ambiguous notion for it is increasingly based on exclusion of those who do not share the same values, world view, race or religion or, generally, are not in a symmetric relationship. Civil society today is widely perceived as a global social movement that introduces more reflexivity into modern democracies (Giddens 1994) but in reality it has become a fashionable political notion on the e right and the left to explain the presumed superiority of their small homogeneous communities of mutual trust, responsibility and symmetric reciprocity that defend their culture and identity against a hostile outside world that has destroyed the social contract that is assumed to have existed before. Contemporary election outcomes often puzzle because they do no more reflect a material utility maximizing behavior in which voters look at economic and social indicators and
judge whether they are materially better or worse off. One explanation could be that rationally acting political parties may have learned that in times of uncertainty, more existential aspects such meaning, orientation and identity may become as important to voters as material happiness. Consequently, it may be more promising for a political party or public interest group to occupy identity-providing notions such as civil society (as a demarcation from the largely ‘bad’ society at large), and to focus on basic worldview and personal appearance rather than a clearly defined political program to win more votes. Making voting less rational (from a material utility-maximizing point of view) does not have to render it absolutely useless but may merely reduce its efficiency as a government-selection process. But, at the same time, citizens that increasingly make up their minds through doctrinal positions make protest and deliberate abstention from political consensus a rational strategy to increase political influence. As a consequence seemingly irrational political behavior (e.g. to refuse any sort of compromise of interest and ideals) may suddenly turn out to be rational as a political strategy. At such a stage a democracy may cease to work at all (Schumpeter 1942: 296) or lead to institutional sclerosis (Olson 1984).
Professional Protest Organizations Unlike the organized new social movements, professional protest organizations do not represent a specific ‘forgotten group’, they do not directly participate in political bargains to get access to public resources, and they are not interested in forming a new political party that would allow them to influence policy from within the political system. Professional protest organizations may once have been part of the great social movement in the 1960s and 1970s, which then reflected a change of societal values. Their initial function as public watchdogs (that expose corporate wrongdoers and complicit governments) and alerters of unintended social and environmental side effects of modernization were of great importance in bringing more transparency, accountability and public concern into politics. However, with growing political maturity, they also became aware of the private benefits resulting from their spectacular protest actions. These protest actions attract the attention of the mass media which covers the political event as a personal drama with protesters as resource-poor heroes fighting against the
powerful organized interests and, consequently, enhance the prestige and political importance of the organization (Nelkin 1996). As the undeterred ‘Rainbow warriors’ Greenpeace activists almost gained the status of pop-stars, and their popularity enabled them to exert influence on public opinion and, indirectly, the political decision-making process. Over time, they gradually improved their spectacular performance skills on television, increased their portfolio of different protest topics, and created a huge social network that enabled them to quickly mobilize other public interest groups (including other traditional lobby organizations) for local, national and international campaigns. Besides, they made membership a question of world view, moral conviction, lifestyle, fun (colourful protests, pop concerts), and civil disobedience (being different). As such professional protest organizations serve as a kind of chief political entrepreneurs who guarantee the success of a campaign through the quick mobilization of public interest groups and opposition parties, the successful staging of media events, and the design of slogans that are able to capture public attention (Gerhards 1993). With the raising anti-globalization movement, Greenpeace has become just one out of many professional protest campaign organizers. None of these new ones, however, managed to create a similarly powerful public image (though the French protest organization ‘Attac’ comes increasingly close). In fact, Greenpeace has adopted many characteristics of a global franchising corporation such as McDonalds (Wahl 1999). It gets its financial support from other public interest groups but also from membership fees and large individual donors. Greenpeace has today an annual budget that almost equals the one of the World Trade Organization (WTO). The concepts of equality, justice and balance with nature, which professional protest organizations use as orientation, are utopian and therefore offer a perpetual source of causes of protest against the decision makers in business, science and government for not complying with the utopian ideals (Luhmann 1993). It also ensures that a certain protest topic does not have to be abandoned after being addressed by the established economic interest groups and policy decision-makers, since every time corporations and governments move a step towards the demands of a protest organization, the protest organization moves a step backwards into a more radical position. Moreover, new factual information on the controversial political issues are sometimes deliberately ignored by
protesters if they do not confirm their general claims regarding the respective problem and are artificially amplified if they confirm their claims. By their very nature, it is not possible for protest organizations to show great interest in seeking public consensus, since by agreeing to such a consensus they may have to sacrifice their role as an intervenor group on the respective issue. Moreover a consensus would force them to cooperate with the ‘established’ stakeholders and assume responsibility for the potential outcome of the joint action (van den Daele, et al. 1996). Since they claim to represent those who may potentially be affected by political decisions, they cannot take part and assume responsibility for political decisions without being questioned as representatives of those who feel affected by such decisions (Luhmann 1993). This would endanger their public image as a group that acts ‘from outside the system’.
Initially the main and exclusive purpose of a protest organization was the detection and disclosure of specific shortcomings and abuses of power by business and government (Luhmann 1993). However, during the 1990s, protest organizations did not always turn out to be reliable watchdogs. Instead of directly exposing specific political actors that were caught in the act of polluting the environment or exploiting the poor (and then constantly monitoring them), their focus turned more towards the identification of scapegoats that are assumed to be responsible for the general social, economic, cultural and ecological uncertainties of globalization. As such, they managed to lower the relatively high costs of serious investigation and increase the returns by reaching nevertheless the maximal emotional impact in public. There is indeed a market for global scapegoats. Scapegoats help to reduce world complexity, enable the transference of blame and provide meaning and moral orientation (Douglas 1995). It also helps to strengthen community identity that is often based on a common enemy. According to research findings in evolutionary psychology and neuroscience, scapegoating and tribalism have their origin in ancient human instincts. These instincts fulfilled an important function in the fight for survival in stone age communities and continue to play a major role in contemporary life (Damasio 1994). The mass media, as well as populist political parties and protest organizations of both political extremes may all have noticed that scapegoating can still be used as a low-cost/high-impact strategy in politics in a
world that is characterized by rapid social and technical change and thus constitutes a threat to existing social and cultural entities as well as individual and group identities. Protest organizations did also respond to the ‘Zeitgeist’ of the 1990s by increasingly mingling with the emerging fun movement. Protest actions served as an act of selfexpression, and participation in the public discourse was mainly used to express and repeat the official statements of ‘the movement’. The dramatic action increasingly replaced the content (The New Republic 2000). From this can be concluded, that the main non-collective benefit that attracted the public has become ‘identity’ mostly in the form of a well-prepared ‘world view’-package that is devoid of uncomfortable uncertainties and ambiguities but nevertheless sounds convincing and feels morally right in the mental frame that is shaped in the context of ‘Zeitgeist’. As a consequence the targets of protest became less specific and the effort to gather evidence for the general accusations was increasingly abandoned. Nevertheless, this did not affect the reputation of protest organizations but actually expanded their influence in the emerging anti-globalization movement. Citizens give surprisingly similar answers when asked about the behavior of protest organizations: ‘I know that they are exaggerating but they are doing it for a good purpose’ (Renn 2000). Obviously, protest organizations are not judged by their actual performance as watchdogs and defenders of the public interest and the environment but by their motives: protest organizations continue to be perceived as the selfless, resource-poor heroes that fight against the powerful globally organized interests.
Institutional Responses If the public increasingly judges perceived motives of political actors rather than their actual performances, then this is likely to cause moral hypocrisy, wrong economic incentives, new opportunistic stakeholder strategies to get access to scarce public resources and, ultimately, bad public policy. Government Responses: The American public’s continuing support of President George W. Bush defies a rational (personal utility-maximizing) voting-behavior: Incompetent domestic economic policy, crass diplomacy failures in foreign policy, a decrease of
public transparency in policy decision-making, and the huge gap between rhetoric and action in fiscal policy contributed to the fact that the average American today is materially worse-off, more likely to be unemployed and more fearful and distrustful toward his or her social environment than before. The reason why this has not significantly affected political support for George W. Bush is related to his person and the construction of his image. During his mostly negative campaign he was portraying himself as an outsider from Texas who wants to stop the federal government in Washington from spending tax-payer’s money. The general perception was that he may not be very knowledgeable but has good motives. His straightforward and simple attitude to look at complex issues in a bi-modal frame of good and evil appealed to many people who resented the ambiguity and complexity of the modern governance. Even though George W. Bush was neither a political outsider nor a poor man who was ripped off by the federal government (Texas continues to be one the biggest beneficiaries of federal pork, and the Bush family members are by origin East Coast aristocrats) the people identified him as ‘one of us’. When he became President of the United States, he used and nourished this perception by showing the public that his heart is in Texas, not Washington and that he feels not comfortable with Washington pundits and insiders (assuring the public that he does not belong to ‘them’). In this context, one may argue that his spin-doctor Karl Rove may have learnt a great deal from successful political entrepreneurs on the far-right and the far-left side of politics. What counts in an uncertain and complex world is perception of personality and motives and a capacity to make things look simple. This insight was also heeded by governments in Europe especially in Germany, France and Italy and it shows that it is a strategy that can be applied independent of ideological orientation. Multinational corporations have become a main target of protest and caused a serious corporate image problem for many of them. They quickly noticed that they are increasingly attacked for their profit-making motives, rather than specific actions that were shown to be harmful to people or the environment. As a response they invest now increasingly in corporate governance and corporate identity’. Codes of Conducts and Codes of Practices are developed, international initiatives to put ‘people before profit’ are signed and technologies are donated to developing countries as an act of charity. The goal
is to gain the public’s favor again by portraying themselves as responsible actors in a globalized world. Moreover, they also increasingly sponsor sub-culture events in sports and music where the ‘we versus them’ community feeling is strongest. These actions give them arguments against protesters who attack them for their profit-making motives. The goal is to make people believe that their motives are to improve people’s lives rather than making profits. There are certainly undeniable positive aspects in this commitment of multinational companies to self-regulation, global standard-setting and responsible action. But there are also some negative side effects that indicate that such behavior is not as selfless as it first appears. As is well-known in public choice, self-regulation often serves to keep competitors out of the market. Small innovative companies and companies in developing countries often don’t have the means to comply with the high standards designed by the big corporate players and, as a consequence, face more constraints to stay in business and barriers to entry to get in business. So the unintended consequence of protesting against the profit-seeking motives of big business may be more concentration in big business. The primary goal lobbying groups or distributional coalitions (such as labor unions, farmer organizations and professional organizations) is to defend the status quo against structural changes by mainly seeking government protection from competition and access to scarce public resources. In other words, lobby organizations participate as rent-seekers in a market for regulations (Niskanen 1971, Peltzman 1976). In this market, the regulated offer votes and financial support to the regulators in return for the supply of regulations that allow the regulated to extract a rent from a political measure that limits competition and strengthens his or her position in the respective private market. The optimal rent (or collective good) of a lobby organization is reached when the marginal costs of rentseeking (organizational costs, information costs, influence costs, image costs) meet the marginal revenue of rent-seeking (rents expressed in monetary terms) (Frey 1985). After the Cold War, the political process was forced to become more open and transparent and public opinion gained more influence in policy decision-making. This made political decisions on regulations that would negatively affect public welfare (particularly the welfare of taxpayers and consumers) increasingly difficult to justify, and political bargains between the regulated and the regulators behind the curtains became
increasingly difficult due to the demand for more transparency. Moreover, the global commitment to more free trade and the increasing competition for foreign direct investments made it more difficult for policy decision-makers to provide traditional lobby organizations with the usual protective measures that breach with free trade agreements or strongly disadvantage new players in the domestic market. This development also lowered the costs of counter-lobbying for political actors such as the export-oriented industries and innovation-oriented entrepreneurs that favor free trade and market liberalization. The unfavorable change of circumstances forced labor unions and farmer organizations re-orient their strategies in order to prevent the loss of benefits achieved through the Cold War period. In this context, many of them regarded the rise of popular protest against globalization as a good opportunity to portray themselves as victims of globalization and decided to join the movement. As a consequence, they increasingly shifted their actions gradually from lobbying (rent-seeking) towards protesting (or public-attention-seeking). Even though their interests and world views are quite different or even contradict those of the main-stream anti-globalization movement, it made nevertheless sense to join them because they enjoyed public sympathy and were perceived to have good motives. It allowed them to pressure employers and policy-makers not just from inside (through the classic political bargaining process) but also from outside (through protest). Moreover, to be part of this movement gave them a positive image in public as preservers of national identity and culture and defenders workers’ and farmers’ rights - whereas before they were just regarded as a burden for taxpayers, consumers and people in the developing world. Intergovernmental bodies such as the United Nations as well as supranational organizations such as the European Union, who lack the political legitimacy of elected national governments are particularly eager to show their good intentions and gain a favorable public image. Their response to the success of professional protest organizations and other international advocacy groups is to increasingly allow them to participate in advisory boards, embed them in their global governance structures and let them shape the political agenda. The consequence is often that each international organizations wants to cover all issues related to international development at once and
immediately, skipping all efforts to set priorities according to lowest input/highest output assessments (e.g. UN Millenium Goals). Since all international organizations, national development agencies and big international NGOs have the same intentions they decide to focus to co-operate as partners rather than compete as competitors. Yet, the result is a global cartel of good intentions that hardly serves the need of those who are claimed to be the beneficiaries. Ultimately, actual performance of these international bodies can no more be measured while the motives can no more be criticized (Easterly 2003).
Public Attention-Seeking to gain Public Trust
‘Public trust’ in a certain political actor is based on the belief that this actor has “good” motives and acts in the public interest, as opposed to other stakeholders who are presumed to act only in self-interest (i.e. interested in obtaining more money and political power) at the expense of the public at large (Lipset and Schneider 1982). Thus, seeking public attention and convincing the public of one’s good motives has ultimately the purpose to gain public trust as a political currency apart from money and power. Public trust has become a valuable asset in a world that is perceived to lack meaning, orientation and identity. It can therefore be assumed that those who lack it, would be willing to exchange it for other political resources such as money and political power. However, unlike money and political power, public trust is not tradable (fungible) in politics. If a stakeholder was willing to exchange public trust for money or political power by striking a deal with its political opponents (who epitomize money and power) the public would feel betrayed, and withdraw its trust immediately and thus deprive the stakeholder of its public legitimacy. Maturing professional protest organizations whose main currency in politics is public trust have gained momentum especially after the Cold War. As shown, their success affected the strategies of other political stakeholders such as government agencies, political parties, religious organizations, consumer and environmental organizations, professional associations and corporations. As a consequence, public attention-seeking strategies (to win the public’s favor and trust) often turned out to be less costly and politically more effective than classic rent-seeking strategies (that also bear the risk of
becoming unpopular) in the struggle to secure access to scarce public resources. The success of public attention-seeking is also related to the fact that the public felt increasingly uncomfortable with the uncertainty and complexity of an accelerated technology-driven globalization and therefore, tended to identify and sympathize with the complaints of public attention-seekers regarding the downsides of globalization (even if the reasons for opposing it vary widely). Moroever, the eventual reward of public attention seeking, the possession of public trust, increases the freedom of action in politics and helps ensuring access to scarce public resources. In short, the economic and political value of public trust has increased particularly with the loss of cherished uncertainties and the significant increase of world complexity that characterized the first decade after the Cold War. Even though plenty of academic literature was produced in recent years on ‘trust’ in all fields of social sciences, hardly any article can be found that seriously analyses the strategic use of public trust in politics. In fact, one gets the impression that public trust was deliberately ignored as a political resource in politics that is managed on a private basis, because it did not fit the framework of public choice theory. The success of those political actors who have built their political career mainly on the private management of public trust in recent years (populist politicians, professional protest organizations), is well-documented in daily media coverage analysis, parliamentary elections and opinion polls .
In-Group and Out-Group: Two forms of trust and two forms of rationality
The core of our general theory on the private management of public trust is the distinction between trust and rationality on the community level (in-group trust, psychosocial rationality) and on the societal level (out-group trust, political-economic rationality). This distinction helps explaining how ‘in-group trust’-based informal rules come into being on the community level and how these rules are superseded by ‘outgroup trust’-based formal rules designed to manage the process of economic, political and technological modernization on the societal level. The assumption is that people in a complex and uncertain society tend to prefer in-group trust relationships because they are
based on symmetric relationships among people with mostly homogenous world views. In turn, out-group trust relationships face the principal-agent problem of asymmetric information and therefore cannot provide the reassuring awareness of being embedded in a community that shares similar values. These two forms of trust (and its implied rationalities) are part of a larger theoretical framework that shows how these two forms of trust can either work in harmony (promote political compromise) or against one another (leading to political deadlock – and the private management of public trust). Empirical research revealed that those political stakeholders who are believed to act in the public interest are likely to be trusted in public (Lipset and Schneider 1982). If the formal rules designed in a democracy are commonly accepted and the government is trusted to enforce these rules in the public interest (Hardin 2002), public interest groups (representing communities built on in-group trust) are likely to cooperate with government and, consequently, in-group is in harmony with out-group trust. As a consequence, public trust becomes a sort of public good which benefits everybody and cannot be appropriated by anybody (Hirsch 1978); it facilitates co-operation across a heterogeneous and complex society, helps to reduce transaction costs in political and economic bargaining processes (Williamson 1985) and allows for public leadership (by enhancing the government’s scope of action). It becomes very much ‘social capital’, that is not just defined as the closed-nit social network but also includes trust in the formal rules and anonymous institutions of society. In turn, if the public does not trust (deservedly or undeservedly) in the formal rules, or the government that is supposed to enforce these rules in the public interest (respectively corporations that are supposed to respect these rules), new political stakeholders who express public discontent and claim to act in the public interest will gain public trust at the expense of the formal institutions. They become the social or political entrepreneurs that respond to public discontent and public fears (Kirsch 2002). Consequently, out-group trust is to some extent replaced with in-group trust in politics (the public tends to trust those public figures or groups who they believe share similar values and are not part of the political and economic establishment, who is considered to be responsible for the public discontent). As a result, the government as the main representative of the political establishment needs to address the
public concerns in its public policy. If the new stakeholders are then willing to participate in the political decision-making process and eventually find a political compromise that is acceptable to all parties, out-group trust is likely to be restored and the new political stakeholders, as the agents of social change, retreat or become formally embedded in the establishment. In turn, if the new stakeholders prefer not to compromise with the establishment but to continue to act outside of the political system, they start using public trust as a political resource by remaining distrustful toward government. As long as the public trusts their motives to act in the public interest, they are likely to stay in the public arena and expand their political influence. It shows that the claim to act in the public interest (without a political mandate) and the refusal to bargain with political opponents may also be linked to the private interest of an organization to survive in politics through the private management of public trust. It also shows that democracy as such can never be an end but only a means for the various stakeholders to achieve their particular ends. Consequently, no one can claim theoretically to act in the public interest. The pure public interest can only be expressed through the generally approved ‘rules of the games’ or constitutional rules .
In turn, if the public does not trust (deservedly or undeservedly) in the formal rules, or the government that is supposed to enforce these rules in the public interest (respectively corporations that are supposed to respect these rules), new political stakeholders who express public discontent and claim to act in the public interest will gain public trust at the expense of the formal institutions. They become the social entrepreneurs that respond to public discontent . Consequently, out-group trust is to some extent replaced with ingroup trust in politics (the public tends to trust those public figures who they believe share similar values and are not part of the political and economic establishment, who is considered to be responsible for the public discontent). As a result, the government as the main representative of the political establishment needs to address the public concerns in its public policy. If the new stakeholders are then willing to participate in the political decision-making process and eventually a political compromise that is acceptable to all parties, out-group trust is likely to be restored and the new political stakeholders, as the agents of social change, retreat or become formally embedded in the establishment. In
turn, if the new stakeholders prefer not to compromise with the establishment but to continue to act outside of the political system, they start using public trust as a political resource by remaining distrustful toward government. As long as the public trusts their motives to act in the public interest, they are likely to stay in the public arena and expand their political influence. It shows that the claim to act in the public interest (without a political mandate) and the refusal to bargain with political opponents may also be linked to the private interest of an organization to survive in politics through the private management of public trust. It also shows that democracy as such can never be an end but only a means for the various stakeholders to achieve their particular ends . Consequently, no one can claim theoretically to act in the public interest. The pure public interest can only expressed through the generally approved ‘rules of the games’ or constitutional rules.
The changing nature of protest
These insights indicate that protest can no more be considered as just a temporal phenomenon that emerges spontaneously to express public outrage related to a particular harmful or unfair action committed by a powerful stakeholder, or related to a general change of social values (associated with people’s empowerment). A protest organization that wants to continue to exist after its issue of concern is addressed properly by business and government needs to manage ‘public trust’. Public trust is the political resource the protest organization has acquired by exposing unfair or harmful practices committed by institutions that seek to gain money or power, the traditional political resources. Public trust, mostly ignored as a political resource in public choice, proves to be a very valuable asset in a world that is characterized by uncertainty and complexity and it can be assumed that those who lack public trust would be willing to exchange it for money or power. Yet, if a protest organization wants to continue to exist and eventually expand, it cannot agree to any deal with stakeholders that represent money and power, because the public would likely to feel betrayed, withdraw its trust immediately and thus deprive it of public legitimacy. Public trust as a political resource has to be used strategically by pretending
to seek consensus and dialogue but never actually accept a compromise with those who are accused of pursuing only goals of pure self-interest since a large part of public trust is based on mistrust towards other stakeholders. Moreover, additional protest topics have to be identified and media campaigns have to be staged on a regular basis in order to remain in the short-attention span of the public (Luhmann 1993). The mass media, which tends to portray complex political events in form of a personal and moral drama to be continued (Nelkin 1996) recognizes the entertainment value of a protest action and portrays protesters as idealist heroes who defend the community interests against the powerful interests of big business. As a consequence a protest organization tends to become increasingly professional by shifting from providing general social benefits through the public exposure of perpetrators caught in the act (of polluting the environment, engangering people’s health) and presenting hard evidence, to providing general psychological benefits by offering people a reduction of complexity, as well as meaning and orientation. This is achieved by offering symbols to interpret a complex world in a binary code of good and evil (of victims and scapegoats) (Douglas 1992, Damasio 1994). From an economic point of view, this strategy proves to be cost-saving because it costs less and promises more media attention to identify certain scapegoats for global problems and expose them skillfully in public not for what they do but for what they stand for. The success of this political strategy is already imitated by various other political stakeholders (e.g. lobby organizations, political parties, development agencies, environmental agencies etc.) and is likely to be imitated more in future.
Political Implications
Schumpeter (1942) and Tullock & Buchanan (1962) have argued that constitutional democracy and the free market economy are twins (from an intellectual point of view): the rules set out in both concepts are based on the assumption that people pursue different goals and interests in life and always seek their personal advantage. Therefore constitutional democracy as well as the market economy cannot be regarded as ends in themselves but only means to achieve certain goals and interests. The rules of the games
of both systems are based upon a negatively defined form of freedom (all are free to pursue their political goals, passions and interests as long as they do not stop others from enjoying the same liberties). Therefore, it is in the interest of the individual to respect the formal rules designed for society as a whole so that society also respects the interests and protects the rights of each individual. Constitutional rules need to be considered as fair and accepted by all citizens involved. Their main goal is to minimize the interdependence costs of society in daily political and economic bargains. Interdependence costs consists of external costs (the costs incurred on those who do not take part in the political decision-making process but nevertheless have to bear its consequences) and the decision-making costs (the costs that accrue in the process of finding a compromise among those who take part in the political decisionmaking process) (Buchanan und Tullock 1962). Adequate constitutional rules also minimize the frictions and misunderstandings of daily interactions and increase public trust (out-group trust) in a heterogeneous and complex society without necessarily undermining trust within homogeneous communities (in-group trust). Consequently, public trust assumes the characteristics of a public good which benefits all and cannot be appropriated by anybody (Hirsch 1978). However, the rules of the game are not fix but are constantly adjusted to changing perceptions of the circumstances and new knowledge. Theoretical condition for the change of constitutional rules is the consent of all political actors, while a change of operational rules may require only simple majority rules. Therefore, the operational level is dominated by barter transactions in which interest groups in business and politics bargain within the frame of the given constitutional rules. Barter in politics is often quickly denounced as logrolling. However, if one looks closer at it, a restricted form of logrolling between a political majority and political minorities can be beneficial to both sides and allows political compromise (Buchanan & Tullock 1962). As many famous political economists have pointed out (Smith 1776, Schumpeter 1942, Hayek 1952, Downs 1957), it is the pursuit of the short-term advantages in business and politics within the commonly accepted rules of the game that has the positive side effect of creating social and economic welfare on the long run. It is therefore not a zero-sum game with one loser and one winner but eventually helps to make everybody better off, politically and
economically. According to this view, there are no public interest- but only special interest groups in politics; while only the commonly accepted rules of the games can be regarded as in the public interest. There are certainly organizations that focus on protecting the public interest and they fulfill an important function in society as watchdogs and critical voices that introduce more reflexivity into a highly specialized and short-term benefit-oriented society. These early alerters force policy decision-makers to respond to new social and environmental challenges with incentive-based and target-oriented regulation. Yet, these public interest groups also have self-interests (that increase with the growing maturity of the organization) and are not immune against moral hazard. This is reflected in the increasing focus of these political actors on highly emotional public-attention-seeking activities and the private management of public trust to gain political influence and loyal donors. Their highly moralist attitude often induces them to generally condemn the pursuit of selfinterest in business and politics. Such an attitude cannot tolerate even a restricted form of logrolling because someone might draw a private benefit from the participation in the political decision-making process. It also produces political polarization and converts politics essentially into a zero-sum game because of their focus on the private management of public trust makes them unwilling to seek a political compromise with those who are condemned for pursuing their self-interest rather than the public interest in politics. In addition, the increasing moralization of politics also led to an increasing politicization of ‘risk’. Risk is increasingly used in politics to mean danger from future damage, caused by political opponents or anyone who is thought to be responsible for causing uncertainty. As a consequence, political pressure is not explicitly directed against taking risks, but against exposing others to risks. In other words, politics is increasingly populated by groups that do not participate in the political decision making process but feel be affected by the potential risks that might be caused by political decisions. As a consequence, the decision-making costs (the search for a political compromise) increase while the external costs decrease (more people participate in the decisionmaking costs and these people are less willing to accept the external costs of political decisions they do not support). Even though the avoidance or postponement of political
decisions may limit external costs on the short-run, the external costs resulting from inaction are likely to increase for society as a whole on the long run. Mancur Olson argued in his book ‚The Rise and Decline of Nations’ (1982) that effective collective action requires an interest group to provide internal selective incentives to its members and acquire material resources to organize and mobilize external action. Once such a special interest group has managed to establish itself in politics and gets access to scarce public resources, it is easily able to keep its position in the political arena even when the collective good they initially fought for has become redundant. His conclusion is that maturing societies tend to accumulate such special interest groups who focus on the defense of the status quo through rent-seeking. As long as the economic output continues to grow, there is hardly anybody willing to criticize such growing distributional coalitions. In fact, many will desperately try to be part of such coalitions. For many companies it is then even cheaper to achieve a monopoly in their respective market through rent-seeking (investment in lobbying) rather than profit-seeking (investment in innovation). However, over time, Olson predicts an increase of frictions in the economy and a decrease of the economic and political regeneration capacity (new entries in regulated markets are increasingly difficult, innovation is smothered by bureaucracy). In other words, the pie stops growing and consequently the fight over its distribution becomes ever more acrimonious. Olson, who published his book in the mid 1980s could not yet anticipate the end of the Cold War, which forced policy decision-makers to become again more accountable to taxpayers and consumers and consequently made classic rentseeking by special interest groups more expensive. Even though this change does not amount to the complete destruction of distributional coalitions that often happens after wars, it could have been expected, according Olson’s theory, that the general efforts to deregulate markets, privatize state enterprises and liberalize trade at the beginning of the 1990s would have negatively affected special interest groups that are mainly focused on preserving the status quo. Even though it is true that these political efforts initially questioned the chances of distributional coalitions to survive in politics, it soon became clear that the public at large was not happy with the resulting acceleration of social and technological change. Even though most of the benefits of the reforms in the 1990s were
reaped by consumers and taxpayers, they increasingly resented the complexity and uncertainty of life that was perceived to be a result of this acceleration of change. This gave special interest groups who mostly lost their privileged relationships with politicians and struggled to maintain their status quo through increasingly costly rent-seeking strategies, to jump on the bandwagon of public protest and the private management of public trust. In other words, they increasingly invested in public attention-seeking in order to replace the loss of capacity to create internal political pressure (through rentseeking) with an increase in capacity to create external pressure (through public attention seeking and the private management of public trust). While in the case of rent-seeking one could at least assume that both sides, the regulated and the regulator, are interested in a compromise, this does no more apply to the case of public attention-seeking. A group or person can gain public trust through public-attention seeking by claiming to fight for the victims of globalization (left-wing scenario) or for the rights of private citizens against immigration or tax increases (right-wing scenario). If the undertaking succeeds and the respective group becomes popular, it may be reluctant to put its earned public trust at stake and negotiate with the policy decision-makers who are publicly accused for not acting in the public interest. At the same time, policy decision-makers are nevertheless expected to respond to public pressure (created by these public attention seekers) and respect their demands in their political decisions. As a result, political consensus becomes ever more difficult in spite of efforts to develop new participatory and consensus-building models in politics. Public participation initiatives often serve policy decision-makers to re-gain public trust by giving citizens the feeling of being heared and understood. Policy decision-makers may show great affection for their concerns, but political strategies frequently remain unchanged and political decisions are just postponed. In this context, this sort of therapeutic politics does often not have the purpose to establish political consensus but merely to calm down concerned citizens scared up by public-attention seekers (Furedi 2000). Mancur Olson predicted gradual institutional sclerosis and paralysis of political decisionmaking processes due to the increasing maturity of societies that lived in peace and prosperity for a long time and therefore have become more absorbed in defending the status quo and prevent change through rent-seeking. The experiences after the 1990s
might prove him right if one looks at the fact that many distributional coalitions managed to defend their privileges successfully: in spite of liberalization efforts, the state quote in Switzerland increased by 4.7 percentages from 1990 to 2000, the strongest increase in all OECD countries after Japan (Schwarz 2002), and in the United States the conservative Bush administration is poised to complete the biggest increase in government spending since the 1960s', according to the Washington Post (Kessler 2002). The conclusion is that special interest groups were successful in thwarting institutional change and survive well in the political arena, not because of classic rent-seeking but public-attention seeking and the private management of public trust.
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