Democracy is an imperfect form of government – no question. As the 1784-1830 Tories successfully demonstrated, a property franchise with a low qualification is a much better way of selecting representatives, but since that is not one-man-one-vote, it is not technically a democracy. Yet genuine democracy, while it often leads to sub-optimal economic policy, nevertheless contains intrinsic safeguards that prevent property and other rights from being too egregiously violated. Those rights are now in severe danger worldwide in several states that are still nominally democracies; I would like to explore where the line should properly be drawn.

Three countries that call themselves democracies but are clearly the wrong side of the line are Russia, Ukraine and Venezuela. In Russia, regular elections are held, and indications are that Vladimir Putin may even have majority support or close to it. Property rights are surprisingly well observed, and there is a flourishing stock market and a sensible income tax system. However, most opposition political parties are banned, opposition politicians are locked up and the election results may well be cooked, though they are managed so as to look plausible.

In Ukraine the Castroite Volodmyr Zelenskyy has cancelled elections altogether, despite his massive support from the West. One would think it would be simpler to hold elections, as was done in the wartime United States and even South Vietnam, manipulating the results if necessary (as may well have been done in Ukraine in 2014 and 2019). Like Putin, Zelenskyy has locked up many of his opponents, and he has now by decree proscribed the Russian Orthodox Church, the ancestral faith of many of his people.

Venezuela is the furthest removed of the three from democracy; its recent election result appears to have been entirely fictitious, the opposition (which had been deprived of its best leaders) is being locked up and government seizures and rampant hyperinflation have rendered property rights nugatory.

None of those three countries can reasonably be termed democracies, even though elections have been held within recent years – all three fall firmly on the wrong side of the line. Yet there are other examples where the case is not so clear. Beyond the security and integrity of elections (which is fairly solid in Britain, for example, but less so in the United States, because of the different electoral systems used) there are several other factors we can use to determine whether or not a “democracy” is truly democratic:

• Freedom of Speech (in the United States, the First Amendment). In several countries, opposition speech is now being punished by imprisonment. The attempted French prosecution of Pavel Durov, CEO of the Telegram social messaging app and the British imprisonment of various dissenters to Kier Starmer’s leftist orthodoxy (while an actual assault on Nigel Farage in June has been spared jail time) show that democracy in both countries is by no means perfect. To be fair, the British legislation allowing prosecution of speech dates back to the “anti-terror” hysteria of the Tony Blair years, but 14 years of “Conservative” government disgracefully failed to repeal it.
• “Lawfare.” In many nominally democratic countries, leftist governments have taken to prosecuting their political opponents. Most notoriously, the various Biden administration prosecutions of former President Trump are a disgrace to the U.S. legal system. This tactic is common in Latin America (where Jair Bolsonaro of Brazil and Alberto Fujimori of Peru have been subjected to lengthy periods of imprisonment) but also in Eastern Europe, where Slovenia’s Janez Jansa and Ukraine’s Yulia Tymoshenko have both spent lengthy periods in prison while the wholly admirable Nikola Gruevski of Macedonia is in exile in Hungary, unable to return home because of legal persecution by his enemies, egged on by leftists at the U.S. State Department.
• Property rights. Democracy includes property rights, otherwise the freedom of the individual is nugatory – their omission from the U.S. Declaration of Independence was Thomas Jefferson’s greatest error in an error-filled life. Violations of property rights take many forms, their variety increasing with each new socialist that grabs the reins of power. Rent controls, popular with Vice President Harris, expropriate the property of landlords as well as blighting the housing market. Nationalization destroys property rights, since the buyer of the nationalized property always sets the price paid for it. Wealth taxes and taxes on unrealized capital gains destroy property rights in the way that ordinary income taxes (except at marginal rates above 50-60%) do not. Finally, inflationary monetary policies, pursued everywhere today, destroy the property rights of savers who are generally taxed on nominal income and gains, and receive no credit for inflationary erosion of value (the retroactive prohibition of private Gold Clauses by FDR was an egregious violation of property rights and should have been struck down instead of ratified by the Supreme Court in 1935).
• National borders are essential to democracy; allowing those borders to be violated routinely, and even allowing some of the illegals to sneak onto the voting rolls is a grotesque violation of democracy – this should be obvious.
• Election interference as well as outright election-stealing has also proliferated recently, with the deliberately sloppy regulations surrounding the Covid-19 epidemic, the “Zuckerbucks” manipulation of election registration, so that voting is encouraged only in heavily Democrat areas, the censorship of important election related information, such as the Hunter Biden laptop contents in 2020, and the censorship by Twitter in 2020 and other social media on an ongoing basis are all democracy violations of disturbing severity.

The United States, Britain and most countries in Western Europe are all sliding rapidly towards the point at which they will no longer be democracies – in the case of the United States, November’s election will tell us much (yes, Kamala Harris may win, but if she wins in circumstances as murky as in 2020, a rational observer would fear that the light of U.S. democracy was flickering towards extinction.) For one interesting borderline case, however, I would suggest looking at Mexico.

By far the best government in Mexico’s history was only marginally democratic: the 35-year rule (with a nominal 4-year interruption) of the great Porfirio Diaz in 1876-1911. Diaz held elections but took a rather Putinesque approach to opposition parties and their validity; however, he had few of Putin’s vicious enforcement mechanisms. Economically, his rule represented a Golden Age for the Mexican people, however much he was resented by the inevitable leftist intellectuals.

The Mexican Revolution ushered in a lengthy period when Mexico was wholly undemocratic. The PRI seized power in 1929 and instituted a socialist one-party state, albeit in most periods without the repression of the Soviet Union. After the economic collapse of 1982, there were moves towards reform, with some generally corrupt privatizations and elections that were more freely contested. From 2000 to 2018, with first the opposition PAN in power and then a reformed PRI, Mexico could genuinely claim to be a democracy, if a mismanaged and socialist-dominated one – it even had some leaders such as Agustin Carstens, Secretary of Finance, 2006-09, Governor of the Banco de Mexico, 2010-17 and since 2017 General Manager of the Bank for International Settlements, of high quality.

Since 2018, Mexico’s democratic credentials have been much shakier. Its President Manuel Lopez Obrador is an authoritarian leftist, who has used every tool he can muster to restrict the rights of his opponents. The June 2024 election result was deeply suspect, Putinesque in its apparent support for Lopez Obrador’s lackluster successor Claudia Sheinbaum and for their Morena party’s Congressional slate, which was close to a supermajority that could negate the Mexican constitution.

Now Lopez Obrador appears to have an opportunity between the September 1 convening of the new Congress and the October 1 Presidential handover, to abolish all the remaining Mexican constitutional safeguards, notably the Supreme Court, the Election Commission and the Mexican constitutional prohibition against Presidents succeeding themselves (which was in force for the entire PRI dictatorship since 1929). By October, Mexico may no longer be a democracy.

The dividing line between democracy and tyranny is a very thin one. Leftist governments, the main transgressors against democratic norms, who nevertheless wish to preserve democracy must be taught to avoid approaching it, because it may become impossible to find a way back.

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(The Bear’s Lair is a weekly column that is intended to appear each Monday, an appropriately gloomy day of the week. Its rationale is that the proportion of “sell” recommendations put out by Wall Street houses remains far below that of “buy” recommendations. Accordingly, investors have an excess of positive information and very little negative information. The column thus takes the ursine view of life and the market, in the hope that it may be usefully different from what investors see elsewhere.)