The Election's Big Loser Was Denmark's Innovation Power17. Nov 2022
If we want to untie the Gordian knot, in which citizens, politicians, and the business world keep each other in check, we need new solutions that rethink how we manage our future and adapt to new challenges. We need to rethink democracy itself
The recent election campaign in Denmark has not lacked complex challenges. Climate, health, energy, and economic crises top the list of issues that have been discussed. But there have been surprisingly few suggestions on how to solve the problems in new ways. Some politicians point to increased public spending, others point to more legislation – and still others hope that (unknown and unfunded) new technology will save us some time in the future. But no one has pointed out that the very way our democracy works – the way we make collective decisions – needs to be renewed.
We are trapped in an archaic political system that is not designed for either quick or long-term challenges.
Take the green transition: Citizens and businesses are waiting for the politicians to regulate, the elected politicians are waiting for the citizens and businesses to demand more legislation, and all the while, the business world is waiting for green solutions to become competitive with the help of legal requirements, and that citizens will become willing to pay an additional price for green products. It is a Gordian knot that we must untie – quickly. Because global warming does not wait; the clock is ticking.
New, large, and complex problems require innovation. Business leaders know that. In almost all industries, companies that do not renew themselves are dying – and at an accelerating pace. Innovative power – the ability to develop ideas and turn them into value – is measured and figures in the companies’ annual accounts and prospectuses. Innovation makes them more robust and ready for the future.
Without action on innovation, there’s no desire to invest. This applies to entrepreneurs and our small and medium-sized companies, which must fight to remain relevant in a globalized world. Iconic Danish companies such as Danfoss, Novo Nordisk, and LEGO also know that if they strengthen their innovation work, they can win market shares and overtake their competitors.
If, on the other hand, we measure our political parties based on their innovation power, they would likely all fail. (The only exception is the party Alternativet, which ironically is the party the business world has the most challenging time seeing itself in). Put bluntly; the parties survive only because of a stagnant democratic system that rewards stability and predictability over innovation.
The accumulated crises make it clear that our democratic model cannot keep up with and effectively address the pressing issues that challenge our long-term welfare, prosperity, and the planet’s future. Today’s political culture lacks a concept for innovation – it is a culture where new thinking are not taken seriously. Politicians who put forward radically new ideas are easy targets for ridicule.
The future looked almost bright after an election with several new parties and a recalibration of the strength ratios. Still, the new parties in the Danish Parliament have yet to demonstrate any actual renewal. The same old politicians are at the helm and present no new visions and solutions. This is a huge missed opportunity: Smaller, new organizations are precisely the shortcut to radical renewal in the business world. The new parties are disruptive because they change the political power relations and wings. But disruption in itself is not innovation. Creative destruction requires that we implement something new after the old is destroyed. Instead, we are witnessing stagnation disguised as innovation.
The devastation of the election calls for new thinking
If we want to untie the Gordian knot, in which citizens, politicians, and the business world keep each other in check, we need new solutions that rethink how we manage our future and adapt to new challenges. We need to rethink democracy itself. Beginning at the root, we need to rethink democracy itself. Here are three suggestions:
- Dealing with the electoral process: Is the problem of democracy, in reality, the electoral process itself and the resulting opportunism? Traditional electoral processes rarely ensure that ordinary citizens become decision-makers. Democracy must be governed by the people and represent them broadly, but not necessarily by elected politicians. In several places in the world, there have been positive attempts to replace politicians on a random principle, just like a jury at the courts. According to the American political scientist Bernd Reiter, these kinds of “people’s politicians” often find more pragmatic solutions that are not controlled by random popular sentiments or by lobbyists and special interests. Also, they are not afraid of not being re-elected – because it’s not an option anyway – and therefore, they also dare make unpopular, challenging, and long-term decisions.
- Implementation, not advice: The Danish government has prided itself on creating growth teams, commissions, climate partnerships, and other councils that involve the business community in proposing new solutions in everything from digitization to green transition. But in the current division of labor, top managers and experts advise, and then the government can pour it all down the drain or pick individual solutions as they please. The political response rarely corresponds to the level of ambition and the time horizon proposed by the respective committees. Why not create institutions with responsibility for long-term implementation across electoral periods? If we have an independent national bank to secure our economy against political pressure, why can’t we have an independent climate agency to ensure our climate efforts against the same?
- Policy cocktails: The ideological spectrum from blue to red means that it is almost impossible to find sensible political solutions from each camp using compromises. But could one rule across the middle according to other maxims and see combination effects across ideologies? For example, could one, to make public bureaucracy more efficient, combine an apparent blue solution, such as a flat tax, with an apparent red one, such as a citizen’s salary? The Danish flexicurity model is the product of such a cocktail effect. Can its success be methodically reproduced?
Continue to think – the possibilities are endless
The current crises are pressing. Innovation must not lose in another election. Our democracy must be renewed from within and, like businesses, acquire a culture of innovation to survive and improve.
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