Mancur Olson and the Decline of Nations

Mike Newland

Why do great and powerful nations which appear unbeatable decline and fall? One might immediately conclude that they are simply overcome by the growth of inevitably superior forces despite all the advantages in resources which being powerful has brought them.

The best known example is Rome which enjoyed extraordinary abilities in organisation and in the technology it could apply by the standards of the day yet still collapsed.

Mancur Olson (1932-1998) was an American economist who addressed this question from the point of view of how things work in societies as a result of the formation of groups pursuing particular interests. How do incentives to combine together in self-interest affect what happens? See his book “The Rise and Decline of Nations.”

The virtue of democratic government at first sight is that any group which feels itself disadvantaged can form a coalition and lobby to improve its position. That is certainly the version of democracy purveyed by politicians on the stump. It’s in principle correct if you ignore the obstacles placed in the path by a system protecting its power interests against interlopers.

But there is a paradox here, Olson argues. It is logical to think that if enough people are discontented and agree on a common interest that they will act in concert and influence how things work. In reality they often do not.

For more than a generation nationalists have tried to organise resistance to mass immigration among a population within which it enjoyed growing support in principle. Yet the numbers coming forward to actually do anything have been minor. This was, of course, smugly explained by those in power as meaning that the population were happy with what was being imposed on them. Nationalists, on the other hand, often interpreted inability to draw large numbers as meaning that the people were asleep. Neither analysis is correct.

The reality, Mancur Olson says, is that the incentive to combine together against a perceived evil diminishes the larger the number affected by the evil. Whew! Let’s just say that again while we get our bearings. The more people are affected badly by something the more difficult it is to get anything done. Surely that can’t be true!

The reason is incentives. An individual opposing mass immigration or indeed pursuing any other cause concerning millions has little inducement to get involved. His time risk, and trouble may be great and yet if successful he will only enjoy the tiniest proportion of the gains to the group as a whole. Why not ‘let George do it’, as Olson says, then sit back and enjoy the benefits having contributed nothing.

Economists call this the ‘free rider problem.’

When attempts were made to form unions in the 19th century, at a time when workers were often treated abominably, it took a very long time for them to generate any effective power or to form a successful political movement in the form of the Labour Party. The state was also ready to remind anyone who did participate that it would not make resistance to its policies an easy ride – as the Tolpuddle combinationists discovered.

mancur olson

Mancur Olson

Experienced nationalists know very well that Tolpuddle feeling! Every obstacle including arrest – if any pretext can be found – is thrown in the path of the activist. The campaigner will have it indicated to him by the state that he should restrict himself in voicing his complaints to approved and useless methods. One wonders whether policemen are told on training courses to tell people who are unhappy with the way the country is run to ‘write to their MPs.’ Is it worth it will be the thought in the minds of those asked to join the fray.

But the position of small groups of people with a cause to pursue and plenty to gain is quite different from that of mass concerns. This is the core of Olson’s analysis as to how societies actually work looking behind the veil of what appears at first obvious – that numbers are power.

The fact is that minority groups with a common interest can often gain enormously by combining together. Politicians are a prime example. Professional groups, employers and all manner of special interests likewise. Participants can see a huge personal benefit from their efforts in combination. The costs of what they can seize are however spread over the mass of the population left without a similar individual degree of incentive to resist the encroachment. In left-wing terms, the capitalists have more worthwhile lobbies than those of the masses.

We are left with the bombshell conclusion that the social bargain which actually emerges can leave out the majority! Nowhere can this be seen more clearly in our time than in regard to the effects of immigration. Our people are en masse being systematically replaced.

We are foreigners in our own capital city yet where is the mass movement one might expect to have arisen in response? Mostly at home muttering ‘let do George it.’ This is actually, and in strict terms, logical behaviour by the individual. Few humans are self-sacrificing beyond the minor socially approved gesture like putting a coin in a collecting box. The wealthier Romans became increasing unwilling to serve in the army as time went on. Some even had a thumb cut off to avoid military service at one point.

The brutal fact is that democracies tend not to oppress the minority but that the mass end up being oppressed by the minority. It’s all a question of incentives and the workings are all too horribly clear in Britain where the ‘minority’ is worshipped as a God to the exclusion of the welfare of the whole.

What can or will ever upset this increasing incrustation of a society by coalitions of minority groups that will ultimately destroy the whole edifice? That is certainly our position in Britain. The movers and shakers cease to worry about filling the wine cellar. They merely concern themselves with drinking as much as possible of a declining stock of bottles.

We are told that one of the glories of Britain is its political stability. That, combined with a tradition of giving everyone a vote, must mean that we have a system rightly envied by the world. But too much political stability, argues Mancur Olson, is not a virtue at all. It’s very bad news. It means that vested interests can increasingly dominate life to the point of suffocating the entire project.

Radical political upsets helps to reboot a society. It rids itself – at least for a while – of incrustation by distributional coalitions trying to get more of the cake without earning it. This can explain rapid recovery from the war by Japan and Germany.

To complete the picture there is something else which requires explanation. How can it be that mass movements which originally struggled endlessly to establish themselves in the face of the individual incentive problem become parasitical over time?

English school

The eradication of the White working class.

The Labour Party, which was started to represent working people, has in fact in recent years done everything it could to damage them. In the case of the white working-class, eradication is the policy. Quite of few of them can’t believe it and suppose what they see to be a misunderstanding. So they still vote Labour. Astonishing!

Once established, mass movements tend to fall into the hands of narrow interests. The operators of these groups are far nearer the incentives bowl than the ordinary members. The very fact of their establishment brings power and resources to keep them in business however far they drift from their original purpose.

In a situation of chronic decline and decay like ours the astonishing thing is that everyone is behaving rationally from their own perspective. The majority have little wish to resist personally since they have too much to lose and only the small hope of personal gain. The minority meanwhile is happily drinking from the remaining stocks of wine.

This is actually a classic ‘prisoner’s dilemma’ as game theory calls it. If everyone cooperated all could be better off but there is no incentive to do so.

How societies can extract themselves from this paralysis is that, once decline reaches a certain point, the impact upon the ordinary person becomes big enough to provide an incentive to change things. We may now be in that position in Britain. We may be in with a chance at last.

But nothing is guaranteed. Roman society was perfectly unable to reform itself until it was too late. Rome did not however have flash communication systems like ours which can spread ideas like wildfire. We do and those in charge fear it.

Originally published at the website of the British Democratic Party.