The decentralisation and centralisation of power is a subject that tends to create division between the political and economic establishments, depending on which school of thought one comes from. Probably the decade we live in provides the perfect scenario for such discussion to happen.

History has also showed us extreme examples of both, where the end results were not exactly beneficial to society. We can look back, starting with the old communist ideals, where decision making on social and economic matters was left in the hands of the few, leading to harsh and long-standing dictatorships, to the times of the ‘Reaganomics’ or extreme deregulation and decentralisation, which, according to many, led to the financial crises we have endured and which, in many ways, we are still processing.

One must not forget that both ideologies were shaped by luminaries of the calibre of Von Mises, Von Hayek, Marx, Mandel, Horowitz and others, sponsoring either one or the other and, sometimes, both at the same time.

It is also significant to consider the context into which each ideology was born. One cannot draw any conclusions without considering such context.

It is common knowledge that the greatest ideologies and theories were developed in a period of disillusionment, poverty, war, you name it.

The good thing is that, several decades later, we can look back and analyse what worked and what did not work and why.

These are extreme times, in which crises and disparities are mushrooming everywhere

With all this wealth of experience, my biggest fear is that we learn on paper but we hardly practise what we’ve learnt. The tendency is to keep making the same mistakes by taking drastic action or by believing that policies are immutable and that one size fits all.

We also assume that we can foresee and control what will happen 10 years down the line, and we all know that none of us can.

Furthermore, decisions are tied up to a particular legislature, and there is hardly continuity or building on the ‘good’ foundations that were previously laid. Funnily enough, ‘new’ democracies may seem better equipped when it comes to continuity.

Not only that, recent history has shown us that governance seems to be too close to the financial power houses and that, too many times, economic decisions have given too much leeway to the financial institutions.

I believe that extremes are counter-productive and reducing the discussion to an ideological battle is very dangerous, because the results are divisive and not unifying. I’m afraid that, right now, we live in such times.

The social fabric is under threat due to the exaggerated disparities that exist. The spending power of the middle class is constantly being eroded.

If the middle class stops spending, the economy stops.

An interesting fact is that those involved in the financial sectors have much bigger spending power now than 10 years ago, while the middle class is riding an opposite trend. One may argue that this is due to the fact the financial sector is hardly in line with the ‘real’ economy.

Simply put, the financial sector doesn’t really create ‘value’. Some imply that the beneficiaries of the wealth generated by the financial sector are single individuals who amass wealth and don’t spend to create. I tend to agree with this interpretation.

These are extreme times, in which crises and disparities (social and economic) are mushrooming everywhere, leading to a worldwide instability.

When stability is at stake, governments resort to extreme measures to counteract a scenario of fluidity.

Too often, decisions made impact upon civil liberties, pushing democracy back in time.

I also firmly believe that, fundamentally, it’s up to the citizens to make sure that change happens in the right direction.

We are responsible for who we elect to guide us and on the policies that are adopted, whether these are in favour of centralising power or decentralising it.

But first it is us who have to change by rejecting ideologies and focusing more on how to achieve the common benefit, and a significant step to this is to be informed and to communicate.

Economics and policies are tools to achieve the common good and should never embody who we are or be an element of division.

robertbusuttil75@gmail.com

Robert Busuttil is an engineer