The Rational Voter

"I can't see how anyone can be a rational voter without some grasp of how economies work. This has been brought home to me by the miserably low level of debate about the Scottish referendum.
"Very few people seem to know the difference between the pound and the Bank of England. The UK government hasn't said that Scotland can't use the pound. Anyone can use the pound. What it has said is that Scotland can't use the pound and, outside a formal currency union, use the Bank of England as a lender of last resort and set monetary policy. This key point appears to have been passed by many voters. So have the mechanisms by which interest rates are set; the difference between government deficits and government debts; and the way countries raise money in the international markets. This means that far too many people will be voting on something hugely important on 18 September without the tools to understand the implications."

Merryn Somerset Webb, MoneyWeek Issue 707, Editorial.

Merryn is arguing for better financial education, but surely the same rationale could support the view that there shouldn't be referenda because the electorate aren't educated enough to form a rational view. I disagree, but I'll come to that in a moment. First, here's another perspective:

"7 out of 10 Members of Parliament think that only the government is able to create money"

Ben Dyson (Positive Money) on August 19, 2014.

In fact the banks create and destroy money by providing loans in a fractional reserve banking system. So, maybe the political elite aren't as savvy about theeconomy as we may have hoped!

It is my view that good quality debate educates voters. Perhaps that is the single biggest advantage of direct democracy. But I'm not talking about the shouting match that televised debates sometimes descend into. I propose that Interactive Democracy should facilitate written debates where points and counter points are raised and promoted or demoted by the approval of voters. Prior to the referendum you can read the main points or drill into the topic, reading the reference material provided. To encourage this, the debate summary would be presented to you before you reached the voting page on the ID web site. Furthermore, I propose that there be sanctions against lying in public life, to resist the demagoguery that can undermine any democracy.

Taking the Scotland Referendum as an example, I'd hope that debaters would reference the comments made by Economics Nobel Prize winner Joseph Stiglitz, amongst others. And that each side provided properly rigorous financial forecasts, showing their assumptions for scrutiny.