It is not uncommon to hear grumbles about the harmful effect of the electoral cycle on government economic thinking, the which, it is said, is rendered short term and superficial. In part this accounts for the general public’s acquiescence in Mr Cameron’s astonishingly ill-judged Parliament Act, which fixes the term between elections. – The public thought that this would promote long-term thinking, something that is supposed to be in short supply in politics because of temporary tenure, and in the world of business because the pursuit of profit is, irrationally, to be a matter of weeks and months and not years. Indeed, there is a general public prejudice (it is a step too far to call it a consensus since it is rarely expressed until elicited) that governments must provide what private enterprise cannot, a far-sighted plan with consequent preparation, and that if the political cycle does not favour that situation then the cycle must be extended.
There are several confusions here. The first arises from the curious assumption that long term planning is an unmitigated good. On reflection, it is surely obvious that if we plan and prepare for the distant future we inevitably leave ourselves inflexible, and perhaps poorer to no end, if our preparations prove to be mistaken or needless, as they often will. It is by no means foolish to assert that insofar as we should plan and prepare, we should do so only for the short and, in a qualified way, the medium term.
The second confusion is the view that businesses and private individuals think only in what is, as compared to government timescales, the short term. Again, a moment’s reflection shows that the private sector is fully motivated to defend its interests over time insofar as it can. Thus, individuals and companies prepare very carefully for the short term, and even plan and invest (in a qualified way) for the medium term insofar as it can be seen to matter to their interests, which it often does, and moreover they will do so without cramping the potential for responsiveness to emergent situations.
The third muddle is grounded in the perfectly correct observation that the cycles of political government are too short even for medium term economic planning. However, rather than concluding from this that the cycles should be longer, and forced to be longer, it is, I suggest, more sensible to start with the observation that the short political cycle has emerged as the maximum tolerable length of time to be entrusted to human, all too human politicians, if they are not to run mad with power, or entrench themselves to such a depth that they cannot be excavated except by explosive societal change, which is destructive for all and to be avoided. Thus, if the political cycle cannot with safety be any longer, then medium term planning is not the business of government (any more than long-term planning, which is nobody’s business because the necessary foresight is absent).
The solution to the grumbles with which I started, grumbles that betray a justifiable concern that the balance of plans and preparations for the short, medium, and longer term is not optimal, is indeed to examine the role of the state. But rather than extending the period of political tenure, with all the hazards that brings, we should accept that governments are inherently short-term thinkers, and instead we should leave all longer term decisions to the distributed information processing system of the wider population and its economy, where alone can sufficient information be gathered and evaluated for such plans to be wisely made.
In other words, to facilitate longer term thinking in economy and other matters, and only insofar as we need it, government must do less, and the people more, for not only are governments ill-suited to this forward projection on anything other than the smallest scales, but their dreams and fantasies will be forever abruptly (and in my view fortunately) interrupted by the profoundly sensible precaution of the fickle electoral cycle.
There are some exceptions to this general point, that is to say areas where government can and must assist though not undertake thinking and preparation beyond the political timescale, for example in law, in policing, and in defence. This was achieved even in the relatively recent past by allowing the institutions associated with these activities, the armed services, the legal profession, and in a more modest way the police force, a sense of their own individual past, their own history as distinct from that of the state and the rest of society, and so creating in these bodies a degree of personality and autonomy from the political process which ensured that the institutions functioned more as persons or private companies of such persons. The government is a creature of day, but the Crown’s judiciary and the Regiments of Guards serve for the duration. This personalisation of certain functions of the state permitted them to think as if they were individuals and thus in timescales that without risk exceeded the political cycle. It was, in retrospect, a very satisfactory, and a very illuminating solution.