Innovative Governance for the 21st Century

Voting at the ballot box is the most traditional form of political involvement

There are three types of voting: at the ballot box, with your dollars and with your feet. 

In an election, you are supposed to give your vote to your preferred candidate. However, in recent times, it’s more likely that you’re choosing which candidate you detest less. Voting at the ballot box is the bare minimum; you show up once every few years, choose a name and leave. There is no cost to ballot voting aside from the opportunity cost of foregoing whatever activity you could’ve done on Election Day. It is a low form of committed civic engagement because of the minimal effort it requires, but ballot voting is still important. If we don’t vote, we have no say on who gets to wield the frightening powers given to governments. 

Voting with your dollars by donating to a candidate shows a bit more commitment. According to Quartz, a vote cost Donald Trump around $5.80 in 2016 and cost Barack Obama around $12.80 in 2012. If in addition to voting in one of those elections, you also contributed just $20 to one of the candidates, you would’ve doubled or tripled your reach by influencing the votes of others. You also exposed yourself to more risk if your candidate lost, losing both the election and $20. This is a crude metric, but the basic insight holds: putting your money at risk for something, whether that is contributing to a political campaign or buying a company’s stock, is a form of voting that contains more signaling power because you’re internalizing risk. 

Voting with your feet is the most impactful way to vote. Unlike filling out a ballot or using your money to buy only Fair Trade products, moving requires you to uproot your life and invest significant sums of money in order to relocate. Foot voting requires fundamentally altering your life for some reason, whether it be to live with a partner, find better economic opportunity, flee violence or escape persecution. 

According to 2020 moving company data, the state that saw the most outward foot voting was California, while Tennessee, Texas and Florida gained the most foot votes of confidence. While these Californians weren’t escaping oppression, many of them were surely fed up with the state’s onerous taxes, high cost of living adjusted poverty rate, high rate of homelessness, increasing crime, rolling blackouts from failed energy policy, wildfires and poor air quality, underperforming public schools and the recent outflow of top tech companies like Tesla. While the state just reached the required 1.5 million signatures for a recall election of Governor Gavin Newsom, many were tired of living under Democratic rule and decided to move to Arizona, Texas, Tennessee and Florida (all controlled by Republicans). Why vote at the ballot box in elections you will surely lose when you can move and get governance more in line with your preferences? 

For generations, Americans have mostly thought of voting only in the ballot box variety. This is beginning to change as our increasingly connected world allows us to leverage technology to gain better information and act in better accordance with our preferences. For example, a young person working remotely in the northeast need not stay in a locality with strict coronavirus regulations and can instead get an Airbnb where the weather is more enjoyable. One co-worker originally based on the east coast recently Zoomed in from Denver and Salt Lake City, working in the morning and skiing in the afternoon. 

Modern technology has greatly improved our ability to exit and vote with our feet. But, unfortunately, this progress has not spread equally across society. Not everyone can pack up their lives into a few suitcases and a laptop. 

As David Goodhart eloquently put it, if your life is “Somewhere” instead of “Anywhere,” you are grounded and have much less exit--you can vote at the ballot box and with your dollars but are disenfranchised at the foot voting level. 

Nevada recently took a step at rectifying this disparity and re-democratizing foot voting for the 21st century. In January, Governor Steve Sisolak announced a new proposal for “Innovation Zones.” These jurisdictions would essentially be new counties founded by a tech company focused on innovative technology, governance and economic development. At first, these zones would be governed by a board jointly appointed by the company and the governor, but then would quickly become democratic once the city reaches certain benchmarks. 

These special zones also bear a resemblance to charter cities, which the Charter Cities Institute defines as “new cities with a special jurisdiction to create a new governance system focused on enabling economic development.” While charter cities are different from the innovation zones that Nevada has planned, they are similar enough that this new policy could serve as an early test of some key concepts and bring the charter city conversation into mainstream discourse.

While limited, the Nevada model is the first step toward achieving charter cities organized around specific governance models that will compete for people to live there. Charter cities start from scratch, meaning if they don’t attract citizens, they will fail. By competing for your citizenship, charter cities are incentivized to find innovative governance frameworks and rules that best promote human flourishing or risk people foot voting and exiting to another charter city that better aligns with their preferences. While these cities will have democratic governments, they will also be subject to greater market forces than our current systems, forcing them to innovate or decline. We are already seeing the basics of this incentive structure with Miami’s recent efforts to attract California expatriates and become a new tech hub or Singapore’s immigration-based economy. 

The Charter City Institute has written, “governance is the most important determinant of long-term economic outcomes.” I would extend the point further: governance is the key determinant for human flourishing. If you don’t believe me, just think of the difference between North and South Korea. They shared all of the other most important factors for development but divided 75 years ago along governance into a communist state and democratic-capitalist state. The results speak for themselves. 

Utilizing new models, like the Nevada Innovation Zones and charter cities, we can apply these lessons and promote human flourishing by giving everyone the right to vote at the ballot box, with their dollars and with their feet.