There aren't many examples of direct democracy whereby 'people vote on policies and laws themselves, instead of electing politicians to do it on their behalf.' In a representative democracy, we elect people to make those decisions. There used to be many practical reasons for this: canvassing opinion was technically difficult and expensive, education levels were low, governing is complicated and requires many people to set up systems and oversee them. As well, people in government genuinely believe they can do a better job of governing than ordinary people and, for that reason and others less edifying, do not want to relinquish their power. But with rising educational levels, government becoming ever more powerful and intrusive, and with the widening gap between our elected representatives and ourselves, I think it may be time to reconsider how certain decisions are made - and who makes them.
Many of the biggest decisions that government could make, are made implicitly, reactively or without deliberation. Decisions about how much to spend on health versus defence, for example. Short-term considerations dominate. But the broad, long-term policies that fall out of the current system need not actually be made by politicians and bureaucrats. It's now feasible that they be made by those who are most affected by them: that is, ordinary citizens.
I've written much about Social Policy Bonds and how they would direct the market's incentives and efficiencies into the achievement of society's long-term goals. (For more, see here.) But the other main feature of a bond regime is that it would oblige us to frame policy in terms of these goals, and it reward the achievement of these goals rather than activities or bodies that are supposed to achieve them.
Policy expressed in terms of broad outcomes, with the decisions about who shall achieve them and how they shall do so left open, could be best made by ordinary citizens. Most of us nowadays are fairly well educated and could inform ourselves about broad policy goals, and choose which of them should have higher priority. So, under a bond regime, government, in its new role as synthesiser of the public's policy priorities, could present us with a range of policy goals, with approximate costings that we could rank (see Efficient costing of objectives, in Chapter 5 of my book for why they need only be approximate.
We'd be able to choose between various goals. For instance, at the national level, we could choose to target a reduction in crime; or an increase in physical health; or reduced unemployment; or improved air quality. Approximate costs could be given, along with targeted percentage changes. We could then rank them according to which we'd like to see most.
There would be many benefits from such an approach. Apart from the efficiency gains that would result from allowing non public-sector bodies to compete for the work, there'd be:
- a long-term approach to policymaking, with much greater stability of policy goals,
- more transparency about these goals,
- more buy-in from ordinary citizens, and
- more widespread appreciation of the notion of trade-offs inherent in policymaking.
There are various steps along the way to moving toward this - radically different - form of democracy. Some forms of direct democracy are already in use: referenda or proposals initiated by citizens in eg Switzerland or New Zealand, subject to their being supported by a significant number of signatures. A less familiar example is:
...Taiwan’s experiment with deliberative democracy, which has generated fast and flexible policy responses to many issues, including social media. ... Taiwan’s minister for digital affairs ... has been central to this deliberative democracy initiative. She points to the island’s success in tackling deepfakes and disinformation by inviting 447 citizens to discuss appropriate responses. These 45 citizens’ assemblies suggested community notes should be attached to suspicious posts, that social media companies should share liability for deepfake scams and that their services should be progressively “throttled” until they complied with such requests. As a result of collective efforts, Taiwan’s Ministry of Digital Affairs reported a 96 per cent fall in online scam ads last year and a 94 per cent reduction in identity impersonation. Want to solve deepfakes? Ask citizens what to do, John Thornhill, 'The Business Times' (Singapore), 30 January 2026
I think we can now be entrusted with deciding on bigger issues, such as deciding on the relative importance of health versus defence but also goals that are currently not explicitly or meaningfully quantified and for that reason and others remain untargeted: one example would the numbers of people made homeless by natural disasters over a period of, say, 30 years. A bond regime would require that government take a hands-off approach to the achievement of these goals, and let all bodies, public- or private-sector compete for funding on the basis of efficiency, at all steps along the way to achievement.
While government would relinquish some of its powers, especially over the funding of public-sector bodies, it would still have the responsibility of articulating society's wishes coherently, and in raising the revenue for their fulfilment. These are functions that our democratic governments can do well; they are not so good at efficient achievement of long-term societal outcomes. Under a bond regime, that would be done by market forces: in economic theory - and on all the evidence - the most efficient means of deploying society's scarce resources. Social Policy Bonds would represent a radical transformation from current policymaking systems; but it's one that is now practical, has huge advantages, and would close the gap between government and the people.
