Why Decentralize Power in A Democracy?
By Larry Diamond
Presented to the Conference on Fiscal and Administrative Decentralization
Baghdad, February 12, 2004
You are hearing today many outstanding analytical and technical presentations about the elements, advantages, and problems with respect to federalism and the decentralization of power. I would like to speak briefly here to some of the broader political and philosophical issues.
As you have heard this morning, a growing number of countries are moving to adopt federal systems that devolve significant governing authority down from the center to lower levels, or at least for decentralizing some significant elements of government responsibility down to local government.
I want to address three questions today. First, why are more and more countries moving to devolve and decentralize governing power? Second, what has this trend meant for the quality of democracy and governance around the world? Third, what has it meant for the ability of countries to hold together peacefully as a unified state?
Why the Trend Toward Federalism?
There are three broad reasons why so many countries are adopting federal systems, or greater political and administrative decentralization. In some countries, federalism is adopted as a means of giving different ethnic and regional groups some autonomy and control over their own affairs. The thinking is that if different ethnic and regional minorities have some autonomy, some ability to determine their own local affairs with respect to education, culture, and economic development, they will feel more secure, and be more willing to accept the authority and legitimacy of the larger national state. I know there are concerns about this issue in Iraq, and I will return to it in a little while.
Second, federalism or devolution of power is adopted as a means of sharing power among lots of different political parties, which may or may not have some basis in ethnic or regional ties. If democracy is to survive, it cannot be a winner-take-all system, particularly not one in which one party is always going to win, and thus take all. When some governing responsibilities and resources are devolved to lower levels of authority, and when there are a lot of different provinces and municipalities whose governments will be chosen through elections, parties and groups that cannot win control of the central government may win the opportunity to exercise power in some of the lower-level governments This increases their confidence in and commitment to the political system, and the sense among citizens generally that the system is fair and inclusive. If groups with strong bases of support in the country are completely and indefinitely excluded from any share of political power at any level, they are likely to question and even challenge the legitimacy of the system.
Third, democracy has swept throughout the world as a basic value and framework of governance over the post three decades. And decentralization is increasingly coming to be seen as a fundamental democratic principle. It is not enough for people simply to be able to choose their national leaders in periodic, free, and fair elections. In countries of moderate to large size, a good democracy requires that people be able to elect their own local leaders and representatives, and that these local governments have some real power to respond to the needs of the people. In short, decentralization is increasingly being demanded from below, through pressure from the grassroots, and is embraced for its potential to enhance the depth and legitimacy of democracy.
How Federalism and Decentralization Enhance Democracy
I have already begun to suggest, then, how federalism and other forms of decentralization can strengthen democracy and enhance its stability. They may help to hold the country together by giving each group some control of its own affairs. They may help to sustain the political system by distributing power among a wider array of political parties, each of which finds that it has some tangible stake in the system. And it speaks to the aspirations of people and communities who simply want government to be closer and more responsive to their needs.
Let me continue with the functions that decentralization serves. When government is closer to the people, it is more likely to be held accountable by them for its successes and failures in the provision of basic services, the maintenance of order, and the fair resolution of local issues and disputes. Government tends to be more responsive when it is closer to the people. That is why democracies are more and more embracing the principle of subsidiarity: that each government function should be performed by the lowest level of government that is capable of performing that function effectively.
When there are multiple layers of elected government, as in a federal or politically decentralized system, there are other benefits for democracy. Lower levels of elective office can constitute an arena for training and recruiting new political leaders, including women and young people who have not previously had a role in political life. And these lower levels of democracy provide a more accessible means for citizens to become active in public affairs: to question their local officials, monitor what they do, present their interests and concerns, and learn the skills and values of democratic citizenship. Typically, it is difficult for most citizens and organized groups to get access to the national parliament or the central ministries. They need decentralized opportunities for access to decision-making power. And those points of local access are more likely to be responsive if they are accountable to the people through elections.
Finally, decentralization of power provides an additional check against the abuse of power. Of course, checks and balances are needed within the central government itself. This is why there must be an independent parliament and judiciary, and effective auditing and counter-corruption mechanisms. But federalism can provide an additional bulwark against the concentration and abuse of power.
What is Necessary for Federalism to Work in a Democracy
I do not mean to suggest that federalism, or even more limited decentralization of power, is without risks and dangers for democracy. In many democracies, old and new, local and provincial governments become not outposts of grassroots democracy but local fiefdoms, dominated by political bosses who do not play by democratic rules or respect citizens’ rights. As local autocratic leaders enhance their power, they can rig elections and intimidate the opposition, creating a one-party state at the provincial level, even if the national system remains vigorously competitive. I have seen this happen in countries like Nigeria. But this is far from inevitable.
There is a way to prevent or correct this problem. A federal democracy must establish that the national constitution, and the national judicial system, is supreme over local and provincial authorities. Prosecutors, investigators and commissions at the national level must have the authority to investigate abuses of power, violations of rights, and charges of corruption in local and provincial governments. Violators must be held accountable in the national courts, if they cannot be tried and punished at lower levels. And levels of government below the center should not be allowed to maintain their own armies or militias. That should be a national function.
There is also the problem of capacity for self-governance at the local and provincial level. This can be a particular problem in terms of the ability to raise, budget, and expend resources. In a country like Iraq, where the central government receives large streams of revenue from petroleum exports, a system can be developed to allocate some portion of this revenue automatically to the lower units of government, by a formula, perhaps largely based on shares of population, that is mutually negotiated and generally accepted as fair. But still, lower governments must develop the capacity to administer the revenue and provide the necessary services. Often, this requires a period of training and a phase-in of responsibilities devolved down from the center. One of the most important lessons from other country experiences is that local governments should not be burdened with obligations to perform functions and provide services for which they do not have adequate revenue or training.
Is Federalism a Slippery Slope downward to Disintegration?
A very legitimate fear of many who are wary of federalism is that, in a context of deep ethnic and regional divisions, it can lead to the break-up of the country, as in the former Soviet Union or the former Yugoslavia. These fears are real, but they are based on a mistaken reading of other experiences. Divided countries have disintegrated at crucial moments precisely because they did not develop over time democratic means for the devolution of power that knitted groups together in a more authentic, voluntary, and legitimate political union. When groups are held together in one nation mainly by force and fear, anxious minorities may seek to secede at the first sign of a weakening of central government power. By contrast, when the national government, under the fresh political circumstances that attend the formation of a new democratic system, makes an early and sincere grant of autonomy, the consequence is almost always greater stability and unity, rather than secession. This has been the case in India, Spain, Mexico, and Nigeria, for example. By contrast, countries like Sudan and Sri Lanka have paid a heavy price in civil war and massive violence for the failure to accommodate aspirations for devolution.
I know many Iraqis fear that federalism is just a stalking horse or vehicle for the eventual break-up of the country. As a political scientist who has studied group conflict and institutions to manage conflict in democracies, I sincerely do not believe that will be the case. Federalism—as negotiated and structured by Iraqis in their process of constitution making during the coming year—will provide the means to hold Iraq together permanently, democratically, and peacefully.
As an independent academic who sympathizes with your concerns and aspirations, permit me a final reflection. We in the United States do not wish for a divided or shattered Iraq. There is a strong consensus within the U.S. that Iraq should be a unified and democratic state, and that federalism or devolution of power in some important ways will provide an important means toward those other two goals. Remember that a century and a half ago we in the United States fought a civil war to hold our own country together, around basic principles of democracy, equality, and fairness. We do not wish for other countries and peoples anything less than what we have, at great cost, achieved for ourselves.