The Conflict Between Formal and Effective Power

We live in a world that is becoming increasingly unpredictable and self-organizing. From the explosion of information technology to the dominance of “free-market” economic policies, the development of our civilization seems more than ever to be beyond the control of any single leader or institution. While presidents and CEOs wield significant influence, they are subservient to larger forces like technology and, perhaps most importantly, capitalism. While one might expect to be worried about the uncontrollable world that is being created, many embrace our loss of control as the natural and desirable way for the world to progress. Libertarians and free-market conservatives believe in an idealized vision of the world that is both naive and dangerous. To ignore the many systemic problems faced by the modern global capitalism, which are becoming more apparent each year, is to engage in wishful thinking for the sake of preserving obsolete ideas and assumptions.

Embracing the current system is particularly dangerous because the system tells us that we, as individuals, need not worry about systemic problems at all. The message sent by mainstream media and popular cinema is “be yourself” or “live a full life”, but not “question authority” or “change the world”. There is usually a clear narrative with a black-and-white struggle between good and evil, rather than a struggle against a broken system in which everyone is a loser. We are taught to fight corrupt individuals but not corrupt institutions. So the conservatives are defending a system which not only has failed to solve the world's problems, but prevents us from even trying to solve those problems. In order to understand the world's problems, we must have a better understanding of how society is organized. Specifically, we need to understand the how power functions today, and the difference between formal power and effective power.

Power, which can be defined as the ability to influence the behavior of others, can be divided into two categories: formal and effective. Formal power is derived from titles and status within an abstract power structure, while effective power is derived from the actual capabilities of individuals to influence each other. For example, a king has formal power because he is at the top of an abstract power structure, but he may also have effective power if he is strong, persuasive, or rich. Similarly, someone who lacks any formal power may still have significant effective power if he is able to influence the behavior of others through whatever means. When such an imbalance between formal and effective power is widespread, the true organization of society becomes difficult to identify. When the wielders of formal power are effectively powerless, their decisions are either inconsequential or corrupted by the interests of those with effective power.

There is a kind of feedback loop in society between formal power and effective power. Formal power influences effective power insofar as it can control the distribution of resources, wealth, information, and status. However, effective power also influences formal power, either directly, through bribes or threats, or indirectly, through its influence on other individuals. This two-way interaction is constantly going on, giving rise to distorted politics that are often more complex than they appear. The populist rhetoric of a modern politician is an effort to reconcile the idealism of formal power with the reality of effective power. In other words, politicians are forced to speak in a way that satisfies both his electorate, the source of formal power, and his campaign donors, the source of effective power. The more conflict there is between the interests of voters and the interests of money, the more distorted, deceptive, and corrupt politics becomes. It is also possible for effective power to change formal power much more abruptly and radically than formal power can change it, because effective power is material while formal power is merely abstract. This is what happens in a coup or a revolution, after which the formal power of the past becomes meaningless.

The problems faced by the world today, which have at their root a crisis of global capitalism, are the result of an excess imbalance between formal and effective power. We live in a formal power structure that claims to be democratic and egalitarian, and yet our society (and the distribution of effective power within it) is more unequal than ever. When our politicians protect the interests of corporations against regulation and control by the government, they are attacking the ability of formal power to influence effective power. At the same time, with the Supreme Court ruling that “money is speech”, corporations have more influence on politics than ever. The result of this imbalance is that our formal power structure has been co-opted by a small number of individuals that wield enormous effective power. Politicians no longer work for the public interest, but rather to convince the public that the corporate interests are also their interests. This situation is unsustainable, and will likely be resolved in one of two ways: either the formal power structure will be changed to more accurately reflect the effective power structure, or the holders of effective power will be brought back in line by a restored formal power structure that acts in the true public interest. In political terms, this means the difference between a new kind of corporate fascism and a “New Deal”-like reaction to corporate dominance.

When the stakes are this high, it is important that we, as a nation, maintain control over our future. Without a formal power structure that acts in the public interest, those with the most effective power are free to shape the future to their advantage. The solution to a corrupt government is not an ineffective government. If you're in a car that's driving in the wrong direction, the solution is not to rip off the steering wheel. Instead, you should kick the driver out of the car and turn it around completely. What the world needs for the 21st century is a radical restoration of formal power structures to their intended purposes.