Lessons from Switzerland

Almost forty years ago I invented direct democracy – or so I thought at the time. I had been raised in Rhodesia, a racist and mostly fascist country, and had just moved to England. Although England considered itself a fine example of democracy (and still does), I was puzzled how such a fine democracy could have an unelected head of state, and a parliament where more than half its members are unelected. There must be a better way, I thought, so I invented direct democracy and set about writing a political novel based on the idea of a southern African country having a revolution and creating a government that worked in such a way.

The novel was terrible and never saw publication, but the concept of a new democracy stayed with me, and is still with me today. Of course, I now know that I did not invent direct democracy. Some years after my first awful novel I learnt that Switzerland had been using direct democracy for over a hundred years. Far from being disappointed that I was not the inventor of this wonderful concept, I was delighted. It totally validated my belief that such an idea was not only possible, it was already working, and working pretty well. After all, here was Switzerland, one of the most successful and stable countries in the world, that had been using it for ages. It was a country wholly controlled by its people, with high standards of social welfare and enlightened environmental awareness. And it had kept out of wars for almost two hundred years – even when completely surrounded by war, twice. So ever since finding out about Swiss democracy I’ve yearned to visit the place, and see it in action. But Switzerland is an expensive place to visit, and if you ain’t loaded, that ain’t easy.

Then a few months ago we learnt of a cut-price holiday to Chateau D’Oex (pronounced “day”), and I just had to go for it. Although I knew that Switzerland must have its problems, just like anywhere else, I wanted to try to get a feel for what Swiss people think about their country and its relatively exemplar democracy.

I wasn’t especially interested in the beautiful scenery, and it is very beautiful. Many other countries also have beautiful landscapes, and I’ve been fortunate enough to see some of them before. What I wanted was to speak to Swiss people. This is not the easiest thing to do. First of all, although most Swiss people have various levels of competence with the English language, English is not an official language. Swiss children are taught to speak the main language spoken in their region, which means German, French or Italian, and then one of the other two. Romansch, the sort of native Swiss language, is hardly taught at all, which is a bit sad. English is sometimes available to school children as an optional extra.

But the fact that some Swiss people are not very fluent in English was only part of my problem. Mainly I’m always deeply humiliated when visiting foreign countries because I’m so incompetent at speaking their language, or some other mutually understandable language other than English (which obviously instantly associates me with one of the most vile and repressive regimes of all time), so I always feel very uncomfortable about trying to have conversations with people in non-English-speaking countries: I always feel I have to apologise for being English, and say how ashamed I am of our history. However, I did manage to overcome my discomfort a few times whenever I came upon someone who was clearly quite happy to speak English. Fortunately my wonderful wife Lorraine was with me, and she is usually less inhibited than I am about talking to people, and because she is very good at this she initiated many of the conversations we had with local folk.

So my impressions of modern Swiss life were obtained mainly from discussions with three young Swiss people (one of whom said she would rather live in England!). I’ll call them Belinda, Martina, and Stan.

Referendums

The Swiss provide direct democracy through continual national referendums, which they hold more often than any other country in the world, and now have them about once a month. Contrast that with the fact that the UK has only ever had three national referendums, and the US has never had a single one. Swiss attitudes to their government are possibly similar to many other Europeans about their governments. Whereas Martina said she always voted in every referendum, Stan said he never did, and appeared to have a similar casual indifference to politics that is very common in many young people. I asked him if he trusted the information that came with every referendum question, about whether arguments for and against were equally weighted. He said he thought they were, so that obviously wasn’t the main reason for his indifference to the system – although he possibly wasn’t the best person to ask.

Good information is clearly a vitally important condition to the success of any vote, and I didn’t learn enough to form an opinion on the quality of public information in Switzerland. But according to a recent report by Reporters Without Borders, Switzerland has the fifth most independent press in the world; compared with Britain, at 40, and the US at 45. So presumably the Swiss do get pretty reasonable information about the issues they get to vote on.

However, there do seem to be some glitches in the system, admitted by this fine free press. Here we learn, for example, that there are at least seven weaknesses to how referendum results are implemented. It’s basically a list of tricks that the government has learnt whereby it can either minimize the effect of a people’s referendum, or ignore it altogether if it wants to. It can do this, according to another article on the subject, through the fact that Swiss courts are not specifically required to implement the constitution.

The genius Tom Paine clearly identified this problem over two hundred years ago:

A man, by his natural right, has a right to judge in his own cause… But what availeth it him to judge, if he has not power to redress?1

This crucial point about the difference between having civil rights and having the means to enforce them was highlighted in the landmark legal dispute William B Richardson v The United States of America, where Mr Richardson tried, but eventually failed, to force the US government to make public the money spent on the CIA – as required in the US constitution. But it was decided that as a mere citizen Mr Richardson “lacks standing” to actually enforce the constitution.2 So as far as Switzerland is concerned, it appears the people may indeed have this wonderful democracy where citizens are invited to be directly involved in government decision-making, but there may be a big difference in what the people say they want, and what the people actually get. It could be that Swiss referendums are sometimes little more effective than large opinion polls.

Trade Unions

We asked Martina and Stan about Swiss trade unions, and received blank looks on both occasions. I remember Martina saying she thought there were some, but she knew nothing about them. The tour guide we had, Dave, was pretty knowledgeable about Switzerland, and told us that we were his one hundred and twenty fifth tour there. He told us quite a bit about Swiss life but never mentioned trade unions. So when she had the chance Lorraine asked him that question. Dave is the sort of guy who doesn’t like to admit that he doesn’t know something – especially if it’s about Switzerland, but he had to admit that he knew nothing about Swiss trade unions.

This is quite interesting.

Coming from England, which still has a pretty good trade union movement (albeit it a shadow of its former self) it seemed almost incomprehensible to us that a modern western society would have no significant trade union movement – because given the fact that no one we asked seemed to know anything about it that must be the obvious conclusion to be drawn. And if there’s no significant trade union movement, who looks after workers’ rights? Although there are trade unions in Switzerland, as a percentage of population, membership is only about half of what it is in Britain or the US — both of which countries currently have considerably depleted numbers of trade union members from what they once had.

It could be that the Swiss constitution helps the Swiss out quite a bit in this regard. Because although it may not be exactly user-friendly, it does at least establish clear principles of right and wrong. Its opening words, for example, include this line: “The strength of a people is measured by the wellbeing of its weakest members” ((The Swiss Constitution – Preamble.)), and it begins with a fairly comprehensive section on “Fundamental Rights”. In other words, a pretty high ethical standard of society is clearly defined in the country’s single most important document, reducing the requirement for trade unions.

National Service

All young men leaving full time education are required to do national service – unless, one of our informants told us rather cryptically, they’re rich enough to buy their way out. National service can take the form of joining the armed forces, or doing some form of social service. Girls do not have to do it at all, but may do so if they want.

The initial commitment is spread over five years with different types of training taking place in three or four month blocks once a year. After that every Swiss man joins a unit of reservists and is issued with a rifle which he must keep secure at home.

I asked Martina about the boys she knew when she left school, and how many of them joined the army, or social service. She said she didn’t know of any boy doing social service in preference to the army. But she says there is some public resentment to the practice, and a general feeling that too much money is spent on military training, instead of more important public services. That’s probably true of almost every country in the world.

I had the impression from both Martina and Stan that although they both loved Switzerland, they also felt it was too conservative, and that new ideas and innovation were seldom welcome. It was Martina who said she would rather live in England, because it seemed a freer society, and Stan appeared to have a hankering to move to Amsterdam, where he’d once spent a few months working.

Thinking about this very conservative nature for which the Swiss are quite well known, I wondered how much of it might be down to the fact that so many of them do five years of national service. After all, there are few institutions more conservative than the military, who are also extremely good at brainwashing. Forcing a young mind through such a regime is bound to have long-lasting effects on most. So how much, I wonder, of Swiss conservativeness is a product of military brainwashing?

The Economy

Another main reason I had for visiting Switzerland was to get a feel for how their economy works. I have strong socialist leanings, but Switzerland is an unashamedly capitalist country. But unlike so many other capitalist countries, Switzerland does not appear to have slums and ghettoes. No one appears to go hungry or homeless. There is clearly something different about Swiss capitalism, and I wanted to find out what.

Obviously this is not a scientific report, it’s just a short record of superficial impressions, points I picked up which appear different to the capitalism I’m used to.

Minimum wage

Switzerland is an expensive country to live in, therefore wages have to be pretty high. So the minimum wage is about $23 an hour. This is more than two and a half times higher than minimum wage in Britain. Although prices are definitely higher in Switzerland, the prices of most basics are not two and a half times higher than British prices. Petrol, for example – a vital driver of costs – is only about 20% higher than British prices. Apparently the minimum wage is only a very recent innovation in Switzerland. As I have always been deeply suspicious of the principle of a minimum wage, I would not be surprised to see the purchasing power of those who receive it in Switzerland start to fall – just as it did in Britain.

Although taxes are relatively modest, every Swiss resident is obliged to have private health insurance. Martina, who was probably on minimum wage, told us that her health insurance cost her SF350 a month (about US$350). She did not seem happy with the arrangement, and told us that it was about the cheapest insurance she could find, and wouldn’t cover everything. Dental care is apparently very good, but so expensive that many Swiss people travel to other countries to have it done.

So it comes back to the same basic point as always. Although $23 an hour might seem pretty good, money is only as good as what you can buy with it – and in Switzerland you need quite a lot to buy not very much.

Self-sufficiency

Unlike many capitalist countries, Switzerland does not appear to buy into the concept of globalisation with quite as much enthusiasm as most western countries. Although its banking system has long been an important asset to its economy (arguably the most important), the Swiss have never been huge fans of international trade. Both Britain and the US, for example, who both market themselves as champions of capitalism, have both had negative trade balances for many years (i.e. imports exceeding exports), but the Swiss have nearly always shown the opposite trend, with exports usually exceeding imports. In pure business terms, this is like saying Switzerland is a viable business, whereas both Britain and the US are technically bankrupt.

It would seem the key to Switzerland’s success in this regard is the fact that they value self-sufficiency extremely highly. They resist importing almost anything they could produce for themselves. Given that it has precious little in the way of natural mineral resources this is a singularly fine achievement. A brief glance at almost any set of statistics comparing Swiss trade with the rest of the world shows a remarkably healthy economy.

Swiss Cheese

Directly linked to the Swiss economic principle of self-sufficiency is the fact that they take huge pride in home-produced foods and drinks. Consistent with the notion that imported products should be avoided where there are good local alternatives, Swiss farm products too are usually preferred to imported farm products. A fine example of this in practice is the cheese industry.

Dairy farming is huge in Switzerland. The many beautiful mountainsides are invariably adorned with dairy cattle, seemingly happy to graze the plentiful greenery in one of the most beautiful landscapes in Europe. So dairy products are plentiful. However, consistent with the Swiss principle of subsidiarity, local is always preferred to products from somewhere else – even if the somewhere else is in Switzerland. So almost every rural town has its own small dairy producing milk, butter and cheese. As we were quite close to Gruyere, an internationally recognised Swiss brand, we had the opportunity to visit the cheese factory. But as this is not of much interest to vegans, we didn’t bother. We would far rather have visited the local bakery, because unsurprisingly bread-making is something else the Swiss do very well, and something else they do locally in many areas – once again preferring local to some cheap mass-produced rubbish.

Possibly because the Swiss are so protective of their farming industry, vegans can have a fairly bleak time of things. Although our hotel knew we were vegans, and said beforehand they could cater for us, it took them three days to obtain some soya milk, even though it was easily available at a local co-op almost across the road; and all they could produce for our evening meal was rice and vegetable stew, varied on two occasions with a few added mushrooms.

Switzerland is well-known for its cow-bells, which are something of a national symbol, and cows grazing the beautiful hillsides to the sound of clanging cow-bells is supposedly an image of the perfect rural idyll. But walking nearby to such a scene you can’t help but notice how bloody loud those bells are, and my heart went out to the poor animals that are forced to wear the damn things – mostly unnecessarily.

But pigs fare much worse. Dave commented several times on the beautiful rural idylls but observed that you never see pigs in Switzerland, which is very odd, he thought, given that the Swiss apparently eat a lot of pork. It’s not that odd. You don’t see pigs because they’re factory-farmed on a fairly large scale, and the poor creatures seldom see the light of day.

However, the principle of subsidiarity applies to almost everything else in Switzerland – from small local timber mills, to breweries and wine-makers. Wherever local products can be used in preference to goods from anywhere else – even other Swiss goods – the Swiss use them. And providing you’re not a vegan, or a pig, it works extremely well.

One of the most interesting points about all this is that the Swiss policies of subsidiarity and self-sufficiency, which clearly do it no harm whatsoever, could also be called protectionism which, according to the technically bankrupt nations of Britain and the US, is no way to run an economy. But the hard evidence provided by Swiss success shows that their economic policies, coupled to their direct democracy, is a much sounder way to manage a country than Britain or the US manage their countries.

Banking

Switzerland has been known as a haven for dodgy offshore banking and financial services for a very long time, and most infamously for laundering Nazi gold during WW2. But there is a very huge difference between Swiss offshore banking and the basically criminal enterprises operated by other capitalist giants such as Britain and the US. The Swiss National Bank is in full control of money supply, and is also under direct control of the state – which is itself largely controlled by the people through their system of routine referendums. Article 99 of the Swiss constitution states that “A minimum of two thirds of the net profits made by the Swiss National Bank shall be allocated to the cantons.” (My emphasis) In other words, unlike British and American banks, vast quantities of bankers’ profits are distributed throughout Swiss cantons for local development.

Model of capitalism

No self-respecting socialist would put up an argument for capitalism as the best way to manage a country’s economy. However, there’s no escaping the fact that Switzerland is both a capitalist country, and a very successful economy, and has high levels of social care, and has high standards of environmental protections. In other words, if anyone wanted to present a reasonable argument for the virtues of capitalism, they would be hard-pressed to improve on the Swiss example. And yet this is not the model most preferred by the self-appointed champions of capitalism, Britain and the US. Why might that be?

Unlike Britain and the US, Switzerland appears to try to run itself like an honest business enterprise, whereas Britain and the US both manage their economies in much the same way as if they were being run by Al Capone. Adam Smith, credited as the father of capitalism, would most likely approve of the Swiss model, but would certainly abhor the economic practices of Britain and the US. In fact, the two economic systems are so different they really should have different names.

How is it then that Swiss capitalism has managed to escape the traps that British and US capitalism have fallen into? Why have Britain and the US turned into the biggest criminal enterprise on the planet whilst the Swiss tick along as a comparatively decent, honest, solvent society? The answer, surely, lies in the fact that Switzerland is, relatively speaking, a real democracy.

Whilst there’s no doubt there are some glitches with Swiss democracy, it’s leaps and bounds better than the British and American models. Whereas British and American so-called democracies are thoroughly corrupt, basically criminal enterprises wholly controlled by the world’s wealthiest gangsters, the Swiss people have a fine national constitution which provides them with a mechanism whereby they could easily control their government if they had to. In Britain or the US the super-rich controllers of politicians know they can literally get away with murder because there’s no mechanism to stop them, but in Switzerland there is, therefore super-rich Swiss must be far more careful in what they try to get away with.

The British academic R.H. Tawney once observed:

That democracy and extreme economic inequality form, when combined, an unstable compound, is no novel doctrine.3

In other words real democracy and extreme economic injustice are not compatible. You can have one or the other, but not both. Britain and the US resolved this problem by ensuring that real democracy does not exist, which allows extreme economic inequality to thrive. The Swiss on the other hand, with their very different version of democracy, are not only relatively free from economic injustice, they also have a highly successful economy.

So it seems fairly obvious to me that extreme constitutional reform of western so-called democracies – to provide real direct democracies – is the essential first step for eliminating global economic injustice.

Here’s Tawney once more,

Democracy is unstable as a political system as long as it remains a political system and nothing more, instead of being, as it should be, not only a form of government but a type of society, and a manner of life which is in harmony with that type. To make it a type of society requires an advance along two lines. It involves, in the first place, the resolute elimination of all forms of special privilege which favour some groups and depress others, whether their sources be differences of environment, of education, or of pecuniary income. It involves, in the second place, the conversion of economic power, now often an irresponsible tyrant, into a servant of society, working within clearly defined limits and accountable for its actions to a public authority.4

Socialists are unlikely, with good reason, ever to trust any form of capitalism. But the inescapable fact is that when capitalism is managed in the way the Swiss do it it is a reasonable and perfectly workable model. It helps to see that Swiss democracy and the version of so-called democracy that’s practised by most western countries is as different as socialism and capitalism. For me the most perfect economic model is one where the state, directly controlled by the people, is wholly responsible for providing all essential public services, but where the private sector (properly regulated by the state) is free to provide non-essential services for whatever profit it can make.

But the Swiss model is a reasonable alternative.

  1. Rights of Man, Tom Paine, p. 120. []
  2. Blank Check, Tim Weiner, p. 226. []
  3. The Vote – how it was won, and how it was undermined, Paul Foot, p. 340. []
  4. The Vote – how it was won, and how it was undermined, Paul Foot, p. 306. []
John Andrews is a writer and political activist based in England. His latest booklet is entitled EnMo Economics. Other Non-Fiction books by John are: The People's Constitution (2018 Edition); and The School of Kindness (2018 Edition); and his Non-Fiction novel The Road to Emily Bay Read other articles by John.