595. Why Don't We Have Better Candidates for President? | Freakonomics Radio

Key Takeaway

Treat political frustration as a systems problem, not just a candidate problem. Today, learn how your state and local elections work: whether they use partisan primaries, ranked-choice voting, or independently drawn districts. Then contact one local representative or reform group to ask for a concrete accountability reform. Focusing on voting rules helps you act on the incentives that shape candidates long before a general-election ballot reaches you.

Episode Overview

This updated episode applies business strategist Michael Porter’s competition framework to U.S. politics, arguing that Democrats and Republicans operate as a self-protecting duopoly. Porter, Katherine Gehl, and Andrew Yang describe how primary rules, winner-take-all elections, and gerrymandering limit competition, and they advocate reforms such as nonpartisan primaries, ranked-choice voting, and independent redistricting.

Full Transcript

Transcript of 595. Why Don't We Have Better Candidates for President? | Freakonomics Radio from Freakonomics Radio. Auto-generated from episode audio; may contain minor errors.

If you saw the recent presidential debate between Joe Biden and Donald Trump, you probably thought, “ Seriously? Are these the two best candidates the United States can offer? How did this happen? The episode you are about to hear will help explain how this happened. The basis for this episode was first published in 2018, during the presidency of Donald Trump. This is an updated version, but we also added a new voice. Andrew, this is Stephen. How are you? Hello, Stephen. How are you, my friend? First of all, please introduce yourself .

I'm Andrew Young. I am a well-rounded and curious bon vivant. Andrew Young has been on this show before. It first happened in early 2019 in an episode we called “Why is this man running for president?” Young did run for the Democratic nomination in the 2020 election, and at one time he was everyone's favorite—a businessman with a knack for political research. He offered an apt diagnosis and prescriptions for solving some of our country's biggest economic and social problems. A significant "Yang-geng" emerged in support, and his campaign became very popular for a time .

He made it onto the big stage of the 2020 Democratic debates, but ultimately failed. In 2021, he ran for mayor of New York City . He lost this election too. Shortly thereafter, he left the Democratic Party and founded the so- called Forward Party. Why? Imagine that you have a business, a restaurant, eight out of ten of your customers are dissatisfied, and you have n't changed anything for years. This is how most Americans interact with our political system. Of course. So, you recently gave a TED talk called "Why US Politics Is Broken and How to Fix It." Can you briefly summarize the gist?

Of course. Why are we so irritated all the time ? At least many of us are. And I tried to prove it with numbers. Today, the support level for the US Congress is 15%, and the chance of re-election of current members of the House of Representatives is 94%. So the fiction we've been sold is that leaders have to make 51% of us happy in order to stay in office. In fact, this is not the case for nine out of ten places. The real job of MPs is to stay in good relations with their party's base electorate.

And if they win the primary, everything else is easy, but all their attention and energy is focused on winning the primary. Is it appropriate to call such a system a duopoly? Oh, yes. Of course, it would be fair to call this a duopoly, where two parties have divided the country into blue and red zones, and it is very difficult for anyone else to run and win in the vast majority of districts. And what other duopolies does our political duopoly remind you of? You know, the first thing that came to my mind was, for example, Microsoft and Apple.

I don't know if people can think of any others. Pepsi and Coke, maybe. Pepsi and Coke. Of course. Boeing and Airbus. Yes, definitely. Visa, Mastercard. Discover fans would agree. OK. The episode you are about to hear is called " America's Hidden Duopoly." First published, as I said, a few years ago. We have updated the facts and figures where necessary, but given the current state of affairs, no major updates were necessary. What is new is a conversation with Andrew Young a little later about what can and should be done.

I think this is one of the most important episodes we've ever made, and it's reflected in the amount of feedback we've received on this topic so far, so we decided this episode needed an update. As always, thank you for listening. Imagine a giant industry dominated by just one or two companies. Actually, you don't have to imagine. Google holds over 90% of the global search engine market. So, not quite a monopoly, but pretty close. Such cases are rare, but it is not uncommon to have a duopoly, where two firms dominate an industry, like Intel and AMD in computer processors, Boeing and Airbus in passenger aircraft, the Sharks and Jets—fictional gangs from the 1950s industry.

But probably the most famous duopoly is this one . Coca-Cola. Those who think like youth say, "Pepsi, please." The rivalry between Coca-Cola and Pepsi Cola dates back to the 19th century. Coke dominated for a long time . But in the 1970s and 80s, Pepsi gained ground and actively marketed itself to young consumers. Try it and feel the excitement of the day and feel Pepsi. Coke's internal research showed that most people, even Coke employees, preferred Pepsi. In 1985, they abandoned their classic recipe in favor of New Coke, which tasted more like Pepsi .

That didn't work very well . I'm Don Keogh, president of the Coca-Cola Company. When we brought you a new Coke flavor, we knew millions would love it, and millions did. What we didn't know was how many thousands of you would call and write to us asking us to bring back the classic taste of original Coca-Cola. Eventually, Coke got rid of New Coke altogether. And despite the hesitations, or perhaps because of them and the accompanying free PR, in any case, Coke regained its leadership. Today, even as soda consumption declines, the rivalry continues, with both companies adding juices, teas and water to their product ranges.

You can afford such large acquisitions when you have a bunch of cash and are one of two companies sharing a huge market. And there is another advantage to being part of a duopoly— self-replication. This was covered in quite some detail in the media during the so-called " circle wars." This war is beneficial to both of them. I think Coke and Pepsi together, this cola war that they've been in for decades, actually helps them both sell a huge amount of product. There are many reasons why duopolies exist, and they are not necessarily sinister.

In capitalism, scale really matters. There are many advantages to large size, which encourages large companies to become even larger, absorbing smaller firms and effectively dictating the rules of their market. Not everyone likes this trend. There is a strong demand in many circles for smaller scale, family-owned, independent and craft producers . But let's be honest, the idea of ​​a smaller scale is appealing, but it does n't win. Domination wins. Entire industries dominated by just a few giants. We have already given you several examples from different industries.

But there's another duopoly, a powerful one, that you probably don't even think of as an industry. What duopoly am I talking about? I'll give you a few tips. Let's repeat what we just discussed about duopolies. These are large institutions that use their size to become even bigger. I talk to consultants on both sides, many of whom have been doing this for a long time, and they have never seen this kind of money. As we said, not everyone likes this trend, but the opposition will not win.

I would like to see more competition. You know, competition makes a product better. And that leaves an entire industry controlled by just two giants. Ladies and gentlemen, my mother, my hero, and our next president. I couldn't be more proud today to introduce to you and all of America, my father and our next president, Hillary Clinton, Donald J. Trump. Does it surprise you that our political system is called an industry ? This surprised this man. I never thought about it in those terms. And this is Michael Porter, a world-renowned business strategist.

And at the heart of this is what we call a duopoly. Comparing our political system to something like Coca-Cola and Pepsi—that can't be right, right? No. Porter says things are much worse. Coca-Cola and Pepsi do not control their market as completely as Republicans and Democrats. Even among soft drinks, we have many new competitors. Although Coke and Pepsi are so big, they don't have a true monopoly . In reality, Coke and Pepsi only control about 70% of the beverage market. At least they should consider Dr. Pepper Snapple Group.

Whereas as for Republicans and Democrats—you can take all the Libertarians, Independents, the Green Party, the Working Families Party, the American Delta Party, the Pirate Party of the USA, which actually exists. If you add them all together, they don't even come close to Dr. Pepper. And yet, we have been hearing the same complaint from Republicans and Democrats in Washington for decades . Washington is completely broken. Washington is broken. This system is broken. She is not working. Washington is not working. Mr. Speaker, Washington is broken. What if the idea that Washington is broken is just a cliché?

I want to teach the world to sing. Maybe it's even an industry-approved slogan. Yes. What if they just sell and we buy? What if it's not broken at all? The main idea here is that Washington is not broken. In fact, it turns out that Washington is doing exactly what it was created to do. Today on Free Economics Radio: Is Washington really just an industry like any other? How did he become like this and what does it mean? And when a duopoly wins, does that mean everyone else loses?

This is Freakonomics Radio, a podcast that explores the hidden side of everything with your host, Stephen Dubner. Once upon a time, there was a dairy company in Wisconsin called Gail Foods. Ge HL. My name is Catherine Gale. Catherine Gale was the CEO of this company. It was founded over a century ago by her great-grandfather. For years, Gail Foods sold standard dairy products: butter, milk, ice cream. In the 1960s, they began producing puddings and cheese sauces. And lately, Gail Foods has been keeping up with the times.

high-tech food production , meaning low-acid aseptic processing and packaging using robots, which creates long- lasting products without preservatives. This process is also useful for products such as weight loss shakes and iced coffee drinks. Under Catherine Gail's leadership, Gail Foods employed over 300 people and had annual sales of nearly $250 million . But there were many challenges. Why? Because the food industry is incredibly competitive, new players are emerging all the time. Also new technologies and new consumer preferences. So, to pave the way forward, Gail turned to one of the most renowned consultants in the world.

I'm Michael Porter. I'm a professor at Harvard Business School, and most of my time I work on strategy and competitiveness . Porter is now in his 70s. While at university, he studied aerospace and mechanical engineering. He then earned an MBA and a doctorate in business economics. So he understands systems, and also how things are created within those systems. He wrote landmark books called Competitive Strategy and On Competition. He is cited more often than any other scholar in the field . He is best known for creating a popular model for analyzing the competitiveness of various industries.

The model that I introduced many years ago states that there are these five forces. These five forces help determine how competitive a particular industry is. These five forces are the threat of new entrants, the threat of substitute products or services, the bargaining power of suppliers, the bargaining power of buyers, and rivalry among existing competitors. We're not there yet, but if you want to jump ahead and think about how these forces apply to our political system, I'll repeat them again . Threat of new entrants, threat of substitute goods or services, bargaining power of suppliers, bargaining power of buyers, and rivalry between existing competitors.

In any case, you can see why someone like Catherine Gale , CEO of a century-old food company, might want to bring in someone like Michael Porter to decide what to do next. It was a classic business strategy exercise. Now, in addition to the family business, Gail had another abiding interest—politics. Yes, I definitely changed my party views. She was a Republican during her high school years. Over time, she leaned to the left. My daughter, when she was six years old, came up to me and said, "Mom, I think I'm a Republican or maybe a Democrat." And I think it gives a good idea of ​​what , uh, is going on in our family.

In 2007, Gail joined the National Finance Committee of Barack Obama's presidential campaign. She became one of his leading fundraisers. A few years after Obama was elected, Gale joined the board of a government organization called the Overseas Private Investment Corporation , which helps American firms do business in emerging markets. And I paid a lot of attention to what was happening in Washington. And Gail didn't like what she saw in Washington. She did n't like it at all. I clearly understood that this struggle was not aimed at solving the problems of the American people.

This fight was about one party defeating the other, and that the parties were more committed to that than to actually solving problems or creating opportunities. In the end, I realized that it doesn't matter who we choose. The quality of the candidates did not matter either. So when I realized this was a systemic problem, I stopped wasting my time looking for the next great candidate and turned my attention to the fundamental reasons in the political system that almost guarantee that we, as voters, will always be dissatisfied.

So she began raising funds for non-partisan organizations working on political reform. And one of the things that became apparent was that there was no theory of investing in political reform and innovation. In other words, people were reluctant to donate money to non-partisan organizations working on political reform. They wanted to give money only to political parties and their candidates. In fact, Katherine Gale found that potential donors had a hard time believing that such a thing as nonpartisan political reform even existed. That's how accustomed they are to perceiving the political system through the prism of two parties.

Around this time, Katherine Gale began dating Michael Porter. She brought him to Gail Foods to help define the company's growth strategy, taking into account his five well-known competitive forces in the industry: new competitors, existing rivals, substitute products, supplier influence, and buyer influence. I kept arguing to Michael that the methods we use to analyze the low- acid aseptic industry—which is the business I worked in—all of these tools are directly applicable to analyzing the business of politics. And, frankly, I knew almost nothing about politics. But the more I heard and the more we talked, the more obvious it became that we really needed to look at this with fresh eyes.

And it was through this combination of analyzing traditional business strategy and devoting so much effort to political reform and innovation that it became clear that politics is an industry. This industry was booming, and all the tools of conventional business analysis were relevant here, and this is where looking at it as an industry starts to have some advantages. Of course. So, you've come to the conclusion that politics is a field very similar to many other fields you've studied throughout your career. You've never thought about it in these terms before.

I absolutely never thought about it in those terms. We have always considered politics to be a state institution whose rules are somehow codified in the law and our constitution. But we saw that politics is actually a competition between mostly private entities. And at its core is what we call a duopoly. A duopoly of Republicans and Democrats. And this competition was built around a series of practices, rules , and sometimes policies , created over time. Mostly by these entities themselves. In fact, the founders left a lot of leeway in how exactly the system's mechanism would work.

But it is interesting that many of our founders expressed a deep fear that parties would take power into their own hands. John Adams once said: " There is nothing I fear so much as the division of the republic into two great parties, each of which, under its own leader, takes measures against the other." And if you look at Washington's farewell address, which he wrote in 1796, he talks about the dangers that could face the republic in the future. And he focuses on just two. The first is foreign influence, and the second is partisanship.

Another danger is the formation of strong parties. Having concluded that the political system operates more like a traditional industry than a state institution, Katherine Gale and Michael Porter outlined their ideas in a Harvard Business School report. It's called "Why Competition in the Politics Industry Is Failing America." When you read this report, there, among the key findings, is this sentence, printed in bright red font. The political system is not broken. It works as designed. In other words, it is no accident that politics has become self-sufficient, self-protective, and self-centered.

They were the blue team and the red team. Almost like Pepsi and Coca-Cola. Essentially, they divided the entire industry into two sides. We eventually saw that it wasn't just the parties that were competing. They have created influence and, to some extent, subordinated other industry players. You have the media, political strategists, lobbyists, candidates, and politicians divided into one of two sides. You see, the system has been optimized over time to favor private profit-seeking organizations—the two political parties and their industry allies, which together we call the political-industrial complex.

This industry has made it a very difficult game for those who don't play by their rules. How does the political industry compare in terms of scale, dollar volume, number of employees, direct and indirect penetration, and impact to other industries you have studied: pharmaceuticals, automotive, etc.? This is a great question, and we've done a tremendous amount of work on it. It turned out to be very difficult to get what I would call a completely comprehensive answer. We estimated that the industry's total revenue over the last two-year election cycle was approximately $16 billion.

It is not the largest sector in the economy, but it is quite significant. It would be another thing if this large industry created value for its customers, which is what we—citizens—should be. But Gale and Porter argue that the political industry is much better at making money for itself and creating jobs for its own while treating its clients with a certain disdain. Imagine cable TV on steroids. And the numbers back up their arguments. Customer satisfaction with the political industry is at a historically low level. Only 16% of Americans today say they trust the federal government.

In terms of popularity, it ranks lower than any private sector. This includes the healthcare and pharmaceutical industries, airlines, and, yes, cable television . Typically, in industries where customers are dissatisfied but market players are thriving, a new entrant appears. You will see a new company emerge to serve these customers. A new company like Netflix , Hulu, Amazon Prime, Sling TV or, well, you get the idea. So in today's world, most voters in polls say they would prefer to see an independent candidate. In a conventional industry, a whole new competitor would emerge, pushing for independence to meet this demand.

But we don't see any new entrants in politics. Why is that? It turns out that our political parties cooperate well in one area, namely, by colluding behind the scenes to create rules and practices that erect barriers to entry and keep out competitors. In their report, Gale and Porter identify five key resources of modern political competition. Candidates, electoral cadres, voter data, idea suppliers, and lobbyists. This is what they write. Increasingly, everything needed to run a modern campaign and govern is tied to or heavily dependent on one party or another , including think tanks, voter data, and staffing.

What happened was that the parties divided the key resources of political competition among themselves. And if you're not a Republican or a Democrat, you'll have a hard time even finding a campaign manager, let alone the best up-to-date voter data, analytics, etc. Monopolizing the electoral machine is not enough. Gale and Porter argue that the political industry has effectively taken over the media, which distributes their messages for free. to the president. This is helping Donald Trump tonight . This is the big, big beginning of the end of what has been a witch hunt that Trump is watching.

The man in the White House is now behaving like a character from the old detective series "Columbo." Perhaps most importantly , the two parties are rigging the electoral system against potential troublemakers. The rules they set allow for party primaries, gerrymandering of constituencies, and winner-take- all elections. Each side of the duopoly, Republicans and Democrats, and the players representing those teams, have worked over time to improve the fortunes of their respective sides. But collectively they also came together to enhance the ability of the industry as a whole to defend itself against new competition from third forces that could threaten either side of the duopoly.

What the parties did was very, very clever. They are not competing head-to-head for the same voters. They are not competing for the center. It is likely that we have a much more powerful center, a much more powerful group of moderates, than our current duopoly suggests. They understood that the competition for the center is a kind of destructive competition. It's a kind of zero- sum game. So the parties have divided the voters and to some extent ignore those in the middle because they don't need to worry about them , because if the voter in the center is dissatisfied , and most of those voters in America today are, then what can they do?

The only thing any party needs to thrive and win the next election is to convince the public that they are hated at least a little less than the only other choice the voter has. This gives these two companies, Democrats and Republicans, an incentive to prioritize other customers. Their target audience on each side is special interests and partisans, and they get a lot of resources, campaign contributions, and huge amounts of lobbying money trying to get , you know, support for whatever needs those partisan or special groups have.

There is now an entire industry of politics that moves forward regardless of whether it solves the problems of the American people. What has happened is that the barriers to entry into this industry and to providing a different type of competition have been raised to enormous heights, allowing parties to structure the nature of the rivalry between themselves in a way that maximizes their benefit as institutions but does not serve the public interest . Well, that's depressing, is n't it? Insightful, perhaps, but depressing nonetheless. So, do Catherine Gale and Michael Porter have any good ideas for solving this problem?

Yes. Yes. Of course. Oh, yes. My God . More about this right after the break. Business strategist Michael Porter and former CEO turned reformer Katherine Gale argue in a Harvard Business School report that our political system has become an industry without real competition. The main beneficiaries of this industry are the industry itself and its many associated participants, including the media. But the vast majority of moderate Americans feel very dissatisfied. The lack of stiff competition, they argue, has allowed Democrats and Republicans to form diametrically opposed political bases—rather narrow and extremely partisan.

Many years ago, we introduced party primaries to take the process of selecting candidates out of the so-called " smoke-filled offices " and give citizens the right to choose their party candidate . This was designed to give citizens more control. As it turned out, this had a very detrimental effect on competition and strengthened the power of parties. And parties, Gale and Porter argue, use these party bases to serve the needs of the real customers of the political industry and its wealthiest special interest groups: health care , real estate, and financial services.

Also unions and lobbyists. In this duopolistic business model, polarization is a feature, not a bug. Our report includes a chart that selects some of what we call landmark legislation from the last 50-60 years. And if you look back, say, 20 or 30 years ago, landmark laws were passed based on consensus. For example, the Social Security Act of 1935 had 90% support from Democrats and 75% from Republicans. The Civil Rights Act of 1964 had 60% support from Democrats and again 75% from Republicans. Now, over the last ten to twenty years, the opposite picture has been observed.

The only way to pass landmark laws is when one party has enough votes to vote for them alone. The Affordable Care Act, also known as Obamacare, was passed in 2010 without a single Republican vote in Congress. President Trump's 2018 tax reform bill—no Democratic votes. So, your diagnosis suggests that this industry is serving itself perfectly. This shows that it is serving us, the citizens, very poorly. And it also shows that more competition would improve the industry, as it does in almost any other field. But simply having more competition between parties doesn't seem to be the only solution.

I mean, there are many multi-party systems in the world where there are similar cases of dysfunction, corruption, and nepotism as we have . So, how direct a step or a direct recipe can this be? I believe that in our system, where there are only two, they were able to establish rules of competition that increase partisanship, dividing voters and so on. More competition, in my opinion, would be extremely valuable. But this has to be a different kind of competition. This cannot be just another party that will divide our electorate into three party groups.

So in our work, we focus on what needs to be done to make competition less divisive among voters, and how we can make competition more about expanding choices for voters and finding solutions. By the way, let me clarify. We are not against parties as such. We are against the nature of competition that our current dominant parties have created. When you assume that these rules were carefully crafted, I think, if I were thinking outside of politics, the first thought that comes to mind is conspiracy, right? If I am one of the members of a duopoly, I hate my rival much less than the thought of anyone else who might interfere in this rivalry, because we share the spoils.

So do you have evidence of collusion between parties to create a system that essentially excludes others? First of all, it's the right word. This is a conspiracy. There is probably a legal definition of conspiracy that I don't know. I'm not a lawyer, but the effect is exactly the same . The parties have agreed on a set of rules that benefit the duopoly and maintain this nature of competition . You can divide the rules into several categories. There is a legislative mechanism, as we call it, which is how the Senate and Congress work.

And then there are election rules regarding what the primary process looks like, how to get on the ballot as an independent candidate, and various campaign finance issues surrounding the election. Has anyone ever considered filing, seriously or not, an antitrust lawsuit against Republicans and Democrats? You know, Stephen, that's a great question. We have put considerable effort into finding out whether this is possible, what the law says, by looking at the antitrust statutes. But this is exactly what antitrust policy is needed for. It is about creating open, effective competition that serves the customer and the public interest .

And this industry needs it more than anything else. OK. So, in the report you discuss the numerous advantages that these two parties have. And I think we all understand that size gives real power and advantages, especially when you create the rules for your industry. And you're right that they use these advantages to maintain control and limit competition and so on. But it seems to me that Donald Trump has really bypassed many of these advantages. You write that parties, quote, "control the resources for modern election campaigning and governance," but he didn't really rely on that .

You wrote that the parties had intercepted channels of communication with voters, but he allegedly intercepted or perhaps used his own channels, including free media and his own social media accounts. You write that parties, and I quote, " are erecting high and rising barriers for new competitors." But in the case of Trump, you know, his own party tried its best to raise the highest barrier and couldn't stop him. So on these fronts, it seems to me that the parties have failed, they have not been able to limit a certain competitor.

So I don't know how you personally feel about President Trump. But given these advantages and his ability to work around them, it seems like he is at least one example of a solution to the problems you describe. Well, yes, I think that's definitely a good question and we should consider it. I would say a few things. First, President Trump's best choice was to run for the party. He had to choose one side of the duopoly because he knew he couldn't win as an independent candidate. He did consider running as an independent in previous years, but in the current system, that is not considered a winning strategy .

Another thing I would say about him is that he had the resources in the end. He didn't have to use them much, but he could almost be self-financing. And he was appealing to a certain segment of his supporters, perhaps a somewhat neglected segment of right- wingers. And it had a very strong existing brand. So he was able to get a lot of recognition and coverage without spending a lot on advertising. It represents a personalized campaign within the party, but we do not believe it will fundamentally transform the competitive structure of the industry.

So far, Trump is only the third president in a row who may have said he would do things differently, overcome differences, etc., but frankly, he hasn't . Obama didn't , and President Bush didn't. Although President Obama and President Bush campaigned on the slogan of bipartisanship and uniting the people, they failed. So, I think these recent examples provide food for thought. Okay, remember this conversation was in 2018, just so you understand the context. But let's get back to the main problem. Some political scientists argue that Gale and Porter's analysis of party power is flawed.

These scholars say that our political system is in bad shape because parties have weakened over time. They argue that stronger parties could help contain special interests and promote compromise and moderation. Want some interesting evidence in favor of the argument about the weakness of parties? Remember the 2016 presidential election. There was one national party, the Democrats, that tried their best— even to the point of manipulation—to pre-select their candidate, Hillary Clinton, who then lost. And there was another national party, the Republicans, who tried their best to keep a certain candidate out of the election, but they failed, and he won.

It is true that parties are not as strong as they were in the past. But both sides of the political industrial complex, Democrats and Republicans, are stronger than ever. It's just that power can be concentrated not only within the party. If the parties were stronger, this does not mean that they would become moderate forces . That's what some people say. I really don't understand this argument. The stronger they are, the less moderate they will be, given the nature of the competition that has been created. I think we're asking too little when we say, let's just trim the edges and make the parties stronger so we can, you know, have a little bit of a cleaner process.

We are convinced that structural reforms need to be implemented that would better align the electoral and legislative processes with the needs of the average citizen. Good. So you diagnosed the problem in a very interesting and insightful way, applying a template that is more often applied to firms to the political industry. And of course, this theoretically leads to a different set of solutions than the ones we usually hear about. So next you discuss four main solutions. Let's look at them point by point. First, you are talking about restructuring the electoral process itself.

Give me some very specific examples of what that would look like . I would also like to hear whether you see evidence that these examples are already being implemented, because it seems that some electoral reforms have already taken place in the states and regions of the country . Yes. Well, when we think about reforms, we have to think about two issues. First, is the reform effective? Will it really change the competition? And a lot of what people are proposing now won't actually bring about much change.

Term limits are a great example. We are not in favor of term limits because we believe that if we don't change the root causes and incentives, we will simply see new faces playing the same game. So, first, we need to redesign the electoral processes, the electoral mechanics themselves. There are three important electoral reforms. We call this the electoral triumvirate. The first, and perhaps the most effective, is the transition to non-partisan, single- ballot primaries. Now, to vote in the primary, you come in and get a Democrat or Republican ballot, and then you choose who will represent the party in the general election.

Usually the most left or right candidate wins, because only a small fraction of even the party itself turns out for the primaries. These are people who come because they are ardent party members, have special interests, and want to see "their" candidate on the ballot. In nonpartisan single- ballot primaries, all candidates for any office, regardless of party affiliation, are listed on a single list. We propose that the four candidates who received the most votes advance to the general election. The reason why these joint primaries are important is that to win, you need to attract as many voters as possible.

Therefore, candidates will try to appeal not only to their extreme electorate. The second part of Gail Porter's electoral reform is ranked voting. Here's how ranked voting works. You will have four candidates who have qualified for the primaries. All four will be on the ballot in the general election, and you vote for them in order of preference. It's simple. This is my first choice. This candidate is my second choice. This is my third choice. This is my fourth choice. During the vote count, if no one received more than 50%.

Then the candidate who took last place is eliminated, and the votes for him are redistributed according to the voters' second preferences, and the counting continues until one of the candidates scores more than 50%. This forces candidates to appeal to a wider range of voters and, crucially, removes one of the biggest obstacles to competition in the current system—the “ spoiler” argument. So, what's happening now is this: if , say , an attractive outsider or independent candidate appears, both Democrats and Republicans will start to convince that they shouldn't vote for him , because he will simply take votes away from the Democrat or Republican and, thus, spoil the election for one of the duopoly candidates.

When ranked voting is introduced, everyone can choose whoever they want as their first, second, or third choice. No vote goes to waste or spoils the election for another candidate. And the last part of this triad is non-partisan redistricting . Gerrymandering should be a thing of the past. When parties control the drawing of districts, they can create districts that are likely to lean in their party's favor, resulting in a disproportionate number of so-called "safe" Republican or Democratic seats because of how they draw them. And we want to end this.

In addition to electoral rule reforms, Porter and Gale would like to see changes in governance rules. Congress itself establishes the rules of its own operation . Over time, these rules, customs, and practices have been implemented in a way that gives enormous power to the party that controls the chamber. And this is a kind of conspiracy, because when another party comes in, it does everything the same way. Therefore, we propose moving away from partisan control over day-to-day lawmaking in Congress, as well as in state legislatures. The third point of their reform program concerns money in politics.

But their analysis led them to a conclusion that differed from the views of many other reformers. We differ from many people who support these reforms in that we do not consider money in politics to be the main problem. The problem really lies in the very nature of competition that leads to partisanship, and it is not a purely financial issue. This is a structural problem. If you take money out of politics without changing the rules of the game, you simply make it cheaper for those who use the existing system to get results that benefit them, without changing the incentives to actually solve the problems of the American people.

At the same time, we believe that there are benefits in increasing the impact of small donors. Therefore, the reforms we propose focus primarily on empowering small donors. For example, state co-financing of donations from small donors. It's worth noting that most of the ideas Gale and Porter present here aren't anything entirely new if you've been following electoral reform even a little. We even explored quite a few of them in an episode called "10 Ideas to Make Politics Less Rotten." Perhaps this is an indicator of how successful and dominant the political duopoly is: a lot of seemingly sensible people have a bunch of seemingly sensible reform ideas that, for the most part, find almost no support.

This is definitely difficult. This is a game of attrition. We won't be able to do this in a year or in one election cycle, because the resources that the current duopoly can use to play its game are enormous. Despite the rather depressing, or at least sobering, picture you paint throughout your report on the political industry, you express considerable optimism, and I want to know why or how, because I don't see a path to optimism. Well, you know, I think we have a basic optimism. We are under no illusions that the rules of this game will be easy to change, for a number of reasons.

But the good news is that we are making some progress. We now have states with non- partisan primaries, including California. You know, we have ranked-choice voting in Maine. There is a growing demand and awareness in America that this system is not working for our country. I think the younger generation is particularly outraged, concerned, and open to all sorts of new ideas, but I think it takes time. So that was our 2018 episode of " America's Hidden Duopoly." Several updates. In 2020, Michael Porter and Catherine Gale published a book called The Political Industry .

And Gale, in particular, is still involved in electoral reforms. And Michael Porter never filed that antitrust lawsuit. After the break, Andrew Young's look at the duopoly in 2024 and some signs of change. I'm Stephen Dubner. This is Freconomics Radio. We will be back soon. Since we published the original episode you just heard, " America's Hidden Duopoly," one of the major reforms championed by Michael Porter and Catherine Gale, has begun to gain some traction. Alaska and Maine used ranked-choice voting in state elections. It was also introduced in local elections, including the 2021 race in New York City, where a new mayor was elected .

One of the candidates, Andrew Young , was the most ardent supporter of ranked-choice voting, but it didn't seem to help him. He finished fourth in the competitive Democratic primary . This is despite widespread recognition thanks to his presidential campaign. So, apparently there is something about candidate Andrew Young that voters don't like . But that's fair, because there are many things about the electoral system that Andrew Young doesn't like . So, what has he been up to lately ? I am the co-chair of the Forward party, the third largest political party in the country by resources, although there is a very large gap between second and third place .

What is that gap between second and third place in whatever metrics you want to measure—whether it's people, dollars, etc.? If you take dollars, I would say there is probably about a 98.5% gap. So, what is the Forward party? What are you trying to achieve, especially in this current election cycle? The Forward Party is a movement of independent- minded Americans who are trying to reform our political system so that it truly responds to us and the challenges of this era. And we do this by promoting electoral reforms and supporting positive candidates, no matter what letter is next to their name.

It could be a Democrat , it could be an independent candidate, it could be a Republican. Does the Forward party already support any Republicans? We recently announced our support for a guy named John Curtis, who is running for Mitt Romney's old or soon-to-be former Senate seat. There are 11 candidates in this race . Eight of them supported Donald Trump. John Curtis did not support Donald Trump and actually created the so-called Conservative Climate Caucus in Congress, so he believes in climate change. This is such a surprise.

But a lot of Democrats will look at it and say, "Oh, he has an "R " next to his name, so, you know, we can't support him." But we believe this is shortsighted. So, you are not only a politician, you are also a real businessman, and you, I would say, understand quite well how the economy works. What are the disadvantages of duopoly in the broad sense, whether in the economic or political system? Because you could say: well, maybe that makes sense, because if there are too many choices, it becomes too complicated.

And also, the bigger and more powerful you become, the more resources you have, the better you know what you're doing. So maybe we should be in favor of a duopoly? Well, in the political sphere, the interesting thing is, Stephen, that the vast majority of us, about 70% of Americans, do not live under a two-party government, but under a single-party government. It's not like Democrats are really trying to run and win in rural Missouri. It's not like Republicans are really trying to run and win in San Francisco.

You only have these 5–10% of truly “ swingy” districts. And then the main exception to this is the presidential election . Even in the presidential election, your vote won't matter. My vote won't matter. The only votes that will matter are the votes in Michigan, Pennsylvania, Wisconsin, Arizona, Nevada, and Georgia. And this is something that most Americans just shrugged their shoulders at, saying, well, that's probably how it is here . But a duopoly is effectively one-party rule for about two-thirds of the country. So if, as you say, turning most districts into single-party districts is the root cause of all this, then what will a third, fourth, or fifth party bring?

The goal of any independent party, if it's smart, is to try to reform the electoral system to ensure real accountability and feedback between the people and the leaders. Alaska has introduced party-wide primaries, where voters can vote for a candidate from any party, and the top four advance to the finals, where the winner is chosen through ranked-choice voting. Yes, little-known former vice presidential candidate Sarah Palin was on the 2022 ballot. Under the usual system, she would win the Republican primary and probably the general election, because it is a state where people sympathize with Republicans.

But under the new system, there was a general election with several candidates, including a fairly moderate state legislator, Mary Peltola, who was very pleasant and welcoming. And a critical mass of Alaska voters put Mary Peltola in second place, thus beating Sarah Palin. If Sarah Palin returned to Washington, we would see videos of her making crazy statements every week, because the television cameras would be on her constantly. We were deprived of this because they changed the voting system in Alaska. In the Senate elections of 2022, Lisa Merkauski ran for re-election.

She voted to impeach Donald Trump, which is taboo. This forces you to go against the party line. Eight of the ten Republican House members who made the same choice did not make it through the primaries. But Lisa Merkauski passed because Alaska effectively replaced the Republican primary with a party- wide primary. So Lisa Merkauski was able to win the general election because a critical mass of Alaska voters gave her second place. So, a few points . Are party- wide primaries the same as open primaries? Open primaries are different.

Open primaries are when you , as an unregistered voter, come out and vote. You can come and vote in the primary once, and in some cases you need to register as a supporter of that party to vote, and then you can unregister. Closed primaries mean you have to register 4 months or so before the election . Nonpartisan primaries—what they did in Alaska— are the most radical step: everyone comes to the same primaries. You vote for your candidate, I vote for mine. We can all vote for the candidate we want.

We can even have multiple candidates from the same party, and then true popular will and representation will be revealed, instead of dividing us into one party or another. Are the results in Alaska due to the general primaries or ranked-choice voting, or did they complement each other perfectly? You know, this is the case where one plus one equals three: non-partisan primaries are a significant improvement, ranked-choice voting in the general election is too, but together they produce a candidate who is truly supported by more than 50.1% of the people.

So here's the thing. I know you a little. We've talked a few times on this show. We talked several times off- air. And I know you as a sincere, intelligent, and, um, decent person who, I think, wants the best for a lot of people. But you seem a little crazy to me right now, because you're fighting giant windmills. You speak sincerely, and I believe you. But do you hope to achieve any real impact on the political system, whether in 2024 or in the next 10 years with this Forward party?

Oh yes. We already have dozens of elected officials who support the Forward party. Two state senators in Pennsylvania, Lisa Boscola, and Anthony Williams, the mayor of Fort Collins, Colorado. That is, these are elected officials who have already spoken out and said: "You know what, I want to represent my constituents and I don't want to report to a megaparty that may not coincide with what the people I represent believe in and value." And this despite the fact that we have only a tiny amount of resources compared to any of the major parties.

So, if you could be a kind of king , although historically our country does not welcome kings , and you could change the political and electoral system without doing it drastically or by draconian methods overnight. Let's say you could build a 10-year plan. What would be the first three to five main principles of this 10-year plan ? We need elections that make representatives truly accountable to us. This is the most important thing. We have accumulated a bunch of negative problems, and our leaders are not responding.

If we had an effective feedback mechanism, then our leaders would suddenly say: " Wait a minute." What? Like young people can't afford housing? This is a problem. The cost of living for the middle class—housing, transportation, education, healthcare—is rising relentlessly, and it's causing despair. Let's look at the root causes. And to make this realistic in an era when it is difficult to imagine elected leaders acting against their own interests, we need to turn to states where there is an opportunity to change the electoral system. Say, “ Look, guys, let’s make it so that everyone can vote for any candidate from any party, like in Alaska or hopefully Nevada in November,” and march through as many states as possible, freeing leaders from the party primaries that are currently preventing them from making real progress.

That's the thing about Andrew Young. He is enthusiastic about ideas that I think are generally good . But is he overly optimistic about the chances of successful reform? What do you think about his prediction that someone like him could steer our political system in a positive direction? No offense, Andrew Young, but your track record as a political forecaster isn't the best. Last year, he told me that Dean Phillips, the Minnesota congressman who challenged Joe Biden in the Democratic primary , would do very well in the early states .

So good that it will shake up the entire 2024 election. But Phillips failed, returned to the embrace of his party, and endorsed President Biden. Want to know why Phillips even ran? He feared that Joe Biden was too weak a candidate to win, and that supporting Biden would pave the way for Trump to win, which Phillips, as a Democrat, did not want. So, back to Andrew Young's prediction: he was wrong to believe that Dean Phillips would get a lot of support in the primaries by attacking Biden.

But after Biden's terrible performance in that first debate, many Democrats and their supporters, including the editorial board of the New York Times, are demanding that the president be replaced on the Democratic Party ticket . So maybe Andrew Young was right after all. That's all for today . Sorry about the sore throat. Thank you for listening. I would love to hear your feedback on this issue, the political duopoly in general, or anything else you want to say. Our email address: radio@freconomics.com. Next on the program: Daniel Kahneman is perhaps best known as the author of Thinking Fast and Slow, but he also helped revolutionize the fields of psychology and economics, and his influence has been enormous.

Kahneman recently died at the age of 90. A group of his colleagues, friends, and students recently got together to find out what exactly this influence is, and we were there with microphones. He believed this was the right way to do science. I mean, Danny was partly to blame, even though he didn't find out until after he passed away. In contentious collaborations, the arbiter is a research assistant, a dispute resolution expert, and sometimes a therapist. Did you get paid for this? I get paid the same as you, Maya.

That's next time on the program. In the meantime, take care of yourself, and if you can, take care of someone else. Freakonomics Radio is produced by Stitcher and Renbud Radio. You can find our entire archive on any podcast app, as well as on freakonomics.com, where we publish transcripts and episode notes. This episode was created by Greg Roskoski and Zach Lewinsky. Our team also includes Alina Coleman, Augusta Chapman, Dalvin Abuaji, Elelanar Osborne, Elsa Hernandez, Gabrielle Roth, Greg Ripen, Jasmine Klinger, Jeremy Johnston, Julie Kaner, Lyric Bovich, Morgan Levy, Neal Coote, Rebecca Lee Douglas, Sarah Lilly, and Theao Jacobs.

Our music screen saver is “Mr. Fortune" by The Hitchhikers. Our composer is Luis Gara. As always, thank you for listening. I see myself. But is it just audio? This is audio only. You can take off your pants if you want. Steeply. This is the plan. Freakonomics Radio Network. The hidden side of everything. Stitcher.