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July 2022
Ep 12: Changing the incentives of Congress to represent the majority - Katherine Gehl
Entrepreneur turned political reformer, Katherine Gehl, outlines how “Final Five Voting” can break the tyranny of party primaries and enable more choices at the polls.
Unbiased Podcast
Ep 12: Changing the incentives of Congress to represent the majority - Katherine Gehl
Show notes
[1:04] The party primary as the root problem in US Politics
[9:56] Final Five Voting
[20:42] Alaska's primary - a live version of Final Four Voting
[33:48] No longer “wasting votes” on third-party candidates
[40:47] Minority representation in Final Five Voting
[47:09] Getting involved in Final Five Voting efforts
Arjun: Many of the listeners have Unbiased are dissatisfied with both the political parties in the US and wished that there were more options at the polls. But the two party duopoly shows few signs of letting up and most of the increasing gridlock in Congress can be traced back to the setup.

Our guest today has a practical and well- researched solution for introducing more options at the polls and enabling those who are elected to have more freedom to achieve their campaign promise. Katherine Gehl is a former manufacturing executive and founder of the Institute for Political Innovation, a nonpartisan non-profit founded in 2020 to catalyze modern political change in America.

She wrote a paper on a new format of elections called Final Five Voting, which she coauthored with Harvard Business School legendary professor Michael Porter. If you're ever in the business school circles, that guy is very famous. We're going to dig into the rationale behind this model, what it means if it's widely adopted, and what Katherine and her team are doing to make this a reality in the United States.

Welcome Katherine.

Katherine: Thank you so much for having me. I'm super happy to be with you guys today.

Arjun: Excellent, so let's start with that, article in Harvard Business Review on why the US political system is dysfunctional. You said the problem isn't specifically a politician problem. It's not a policy problem. It's not even a polarization problem, which is what a lot of people like to blame. You said it's a systems problem.
Why do you believe that to be true? What's your assessment of the cause and effect of polarization here.

Katherine: Politics is no different than any other human endeavor. Humans do what they're incentivized to do. And we know this from our own lives. We know this from how we try to set up our businesses. We know this from how we try to run things in our homes. and politics is no different, which is to say that everybody in what we call the political industrial complex is doing what they're incentivized to do.

So when we look at politicians and we say why don't, people in Congress work across the aisle to solve our most difficult problems. It's because they're not incentivized to do that. Let's put it this way. The way we elect people right now, the way they get their jobs, the way they keep their jobs, basically forbids them to work together.

It forbids them to solve our problems, because if they do those things, they will be less likely to keep their jobs. It's as if we ran our companies and we gave people a job description, we hired them, we gave them a job description. We said, here's what we need you to do to grow our company and to,get our product to market and please our customers.

And then after we gave 'em a job description and hired them, we whispered in their ear. And by the way, if you do those things really well in two years, we're gonna fire you. So our election system hires people to go to Congress and we need them to do a certain job, solve our problems, and then we whisper in their ears and we say, and if you do we'll fire you, it's just a crazy system.

And that's why we have to look beyond the news that says it's a policy problem, or politician problem, or polarization problem, and just look at the actual system, so that we can understand it. But most importantly, so that we could change it.

Dan: I think anyone who's listened to this podcast before knows that I'm a big fan of electoral reform, but maybe for those of us who aren't as well versed, or those of us who are new to it, can you talk a little bit about what are the aspects of the system that encourage polarization?

Katherine: Yeah. Dan, it's a good question. There are two huge systemic problems in our political system.

The first is we have party primaries. So when we're gonna elect people to Congress in mostly this summer, the party primaries are held and we take one Democrat and one Republican, essentially from those primaries and send them to the November election.

But here's the thing about party primaries. In over 80% of races in the Senate and the house. Those decisions are made, who's gonna win is decided in the party primary. Meaning it's decided in the summer when only 10% of voters turn out how this works is that in a Republican district, whoever wins the Republican primary, in the summer we already know is guaranteed to win in November.

And we know the same in a blue district that whoever wins the democratic primary is guaranteed to win in November. And the people who turned out in those primaries are 10% of voters. And those 10% of voters both on the left and the right tend to be more politically extreme than November voters than voters as a whole.

And so even though we think that these two sides, these primary voters on the left and the right couldn't be more different from one another. There's actually one way where they're really very similar and that is that both sides do not want the people they elect to compromise to give in, to work across the aisle or to, do something other than the orthodoxy.

And so when the decision is made by this 10% of voters on each side in the summer, they send those representatives to Congress with the instruction, to not work together, to say we'd prefer gridlock, we'd prefer dysfunction over a compromise, and that's why we never get any of that behavior. So party primaries, first one, and the second reason, why we have a great deal of dysfunction is that there's no new competition ever.

So probably a lot of your listeners are in business. I think it's really interesting that politics is the only industry where we're regularly told that less competition is gonna be better for the customer, meaning for the voter, That we're only gonna have these two choices and that we always feel we have the lesser two evils choices.

Whenever you don't have competition, then the players in that industry don't have to worry about making customers happy. And that's what we're seeing in the politics industry is that we have these two parties. And even though 90% of people are dissatisfied with Congress, there's no new entrance, there's no new choices.

Katherine: And that means they can keep doing what they're doing and they don't have to actually adjust in any way.

Arjun before you get to your question, there, are two pieces of information I want the listener to know about. Number one, there's a great piece of research by an organization called Unite America called The Primary Problem. And it actually shows that around 80% of seats in Congress are determined by 10% of the voters. And it's due exactly to what you're saying, Katherine.

Dan: Number two, and I'll give you a real life example. So in my home state Massachusetts district four, their most recent election for Congress was I think something like a five or six way primary, on the democratic side and resulted, I think the winner won by 23% of the vote, I wanna say, in the primary and went on to represent the district.

So again, fine person. Great credentials. I'm not slamming him as a, as an elected official, but I would like to just, hammer home the point as well that you made, which is that very often we have a minority of a district voting for somebody to represent all voters.

Katherine: Almost always we have a minority of a district voting for someone who elects all voters. And to follow up on your point, Dan, that makes it undemocratic. It makes it unfair you could say. And we shouldn't want any of those things, but the real problem is it is that it makes it impossible for the people elected in that system to actually do the work of legislating because they can't deal with the complex trade offs on the big, problems that we have in immigration or healthcare or climate or debt deficit or infrastructure, because they can't make any compromises because the small number of people who elected them are not willing to reelect them if they do that.

So we, talk about this as the tyranny of the party primary. Their behavior is limited by what's acceptable to this small number of voters.

Arjun: This may be a bit of a naive question, Katherine, but why is it that party primaries attract the most extreme segment of the party? I don't know the numbers, but let me say something like 30 to 40% of people are registered as Republicans and 30 to 40% are registered as Democrats.

Why isn't that big chunk showing up to the primaries? And if they did, would some of this problem go away?

Katherine: Its a perfect question. I don't totally have the answer and I don't care that I don't have the answer, which is to say, I don't need to know why they're not coming. I need to know that everything we've ever tried to help to get more people to turn out has never worked. So we just are gonna leapfrog over that problem and go straight to making the general election decide the winners. And then we already instead. So instead of trying to get more turnout in the election that decides the winners, which is the primary, how about we just make the election that already has the turnout, the November general election be the election that picks the winners.

So once I figured out that we could just do that, then I can stop worrying about, primary turnout. Having said that I do predict that with the solution we'll talk about in a little bit once primaries, have more competition and are more fair and democratic, I actually think you'll get better turnout over, over time, but we will with our solution final five voting negate, the worst effects of low turnout in the primaries.

Arjun: This is a good opportunity, let's talk about final five voting. in the resources section of this podcast episode, we will have links to final five voting and the summary and stuff, but just for everyone listening, can you give us the highlights of what this is? what the system is?

Katherine: Yeah. So final five voting is the umbrella term for two changes to how we elect people to Congress. And,I'll run you through them. First, let's just get rid of. These broken party primaries that we've just talked about. Instead, we'll have a first round election. One primary, everybody running is on the same ballot, regardless of party.

And everybody, every voter can participate on primary day. You pick your favorite polls, close, count the votes. And now instead of advancing just one Democrat and one Republican, we're gonna advance five candidates. The top five finishers out of that primary will automatically move forward to the general election.

So now between the primary and the general, we're gonna benefit from five competitors with different visions and candidacy and policy ideas, representing potentially some different constituencies while this diverse dynamic debate. Then the second change we make is in the general election, because now that we've benefited from having five candidates

We need to figure out who's gonna win. And it's not quite as simple as we might think, because what we don't wanna do is accidentally elect one of those five with 21% of the vote, which could happen if the vote's relatively equally. So we need to figure out which one of these five has the broadest support of the most number of voters.

And to do that, we're gonna use instant runoffs. We will use instant runoffs to get down to the final two of the five, and then majority will win how that works is that voters get to, indicate their preferences for these candidates all from their first choice, as in this is my favorite candidate, I really want Dan Sally to be my Senator and then well, if I can't have Dan's, Arjun is pretty great. So I'll take him and all the way down to, my fifth choice, my last choice over my dead body. Do I want Catherine Gehl to be my Senator? And you just indicate your choices in that way. Then when the polls close, we use that information to conduct the rounds of instant runoffs in round one, you count everybody's first choice votes, and then whoever's in last place at the end of round, one gets eliminated from the race.

And then if you had selected that candidate, who's now been kicked out of the race, cuz they lost. Your single vote is automatically transferred to your next choice. Who's still in the race. And then we conduct round two with the four candidates. Then we eliminate the person in fourth place and voters who had selected that candidate have their vote transferred to one of the remaining three candidates who still in the race.

And we do that until we're down to the final two majority wins. It's just like a series of runoffs, but instead of having to keep coming back physically for another election, all your votes at once.So in sum, final five voting is a top five primary plus an instant runoff general election. And it results in the winner with the broadest support of the most number of voters.

It ensures that november voters always pick the winner and it ensures that there's a lot of competition to serve the voters in November, which means that it sends people to Washington, DC, author C authorized by a majority of their district or state to actually do the work of legislating. People elected in this system are not forbidden to work with the other side because they won't automatically lose their primary. If they do that, they're not forbidden to vote yes on a bill where they don't get everything they want, but they get a lot of what they want and they think this is the best way forward.

If I could use one more example. Back in, oh what year was it? When we had the Simpson Bowles, it was a debt deficit commission put together by Barack Obama and then led by Paul Ryan on the Republican side, long story short, it was a bipartisan commission and it was the grand bargain of how we were gonna rationalize our spending. And in the front page of the bipartisan report, there was a paragraph where all of the people on the commission, signed on to this paragraph. And it said, no one, none of us agrees with everything in here. But we all think that this is the best way forward. So we're willing to give, some tax increase here on the Republican side, we're willing to give some benefit decrease here on the democratic side, for example. And that is the best compromise solution right now those kind of solutions, in the existing system, nobody can vote yes on them. Whereas under a final five solution, if that, elected representative liked that solution, they could actually vote yes and they wouldn't be guaranteed to lose their job.

Dan: Do you know, the funniest thing about Simpson Bowles is I actually spoke with a uh, with a woman named Maya McGinness...

Katherine: I am a huge fan of Maya and I joined her CEO fiscal leadership council when I was first trying to figure out what the heck was wrong with our system.

Dan: Yep. I spoke with her from my other podcast. You don't have to yell. And one of the things she said is I asked her when did fiscal conservatism die? And she said, Simpson Bowles. And to hammer home your point, the fiscal state of America is I would say probably more dire today than it was during the time of Simpson Bowles. And the incentives are such that Congress could never enact a solution to it.

Katherine: And you know what, Dan, let's talk about something. The last time we had balanced budgets in this country and then ran a surplus was during, the Clinton years. Okay. And what happened then? Ross Perot ran in 1992. So Ross perot died a couple of years ago and, I actually wrote op-ed, although more importantly, Paul Begala one of Clinton's advisors wrote an op-ed about Perot and here's What we can see. Ross Perot got 19% of the vote, zero electoral votes. But what did we get from that competition? We, the country got balanced budgets because that was what Perot ran on. And 19% of the country was willing to waste their vote on that idea and what that did is put competitive pressure on the two parties to address the issue because neither one of those two parties wanted to see that 19% of the electorate to pros, nascent third party.

So they were both pushed to deal with the issue. And I actually wrote about this in the Harvard Business Review article and the Harvard Business Review editors came back and said, oh, you can't say we got balanced budgets because of that was because of economic growth and Clinton's economic advisors. And I said, oh no, go look at Paul Begala's op-ed where he said. And I quote, it's from memory, but essentially it is, this is Paul Begala. It is doubtful that we would have solved that issue without the pressure that per voters brought to the table. So competition drives progress in all human endeavor.

Like in tech, you'll have a new company that creates a new innovation and maybe they're not the ones that win. They're not the ones that get the big market cap, they just get bought or the innovation gets copied. But the consumer benefits because the innovation is happening. If we never have any new competition, there's no pressure on the existing two parties to improve anything. And so again, the last major competition we had based on that issue was the last time we actually got progress on that issue.

And if we don't open it up, it's not beneficial to either party to say we should spend less that's bad for their electoral prospects in the near term.

Dan: I wanna jump back to one thing, which is, you were describing final five is instant runoff, otherwise known as rank choice voting and, and that's a reform that's gained a lot of momentum in recent years. What are the main differences you feel between let's call it raw rank choice voting and what you are proposing final five.

Katherine: Yeah, instant runoffs is, this system of having multiple candidates and having a fast and efficient way to determine who is the majority winner. And to do that, of course, we use this ranked ballot. So that's why many people call it rank choice voting. It has been popular to implement rank choice voting in party primaries and in general elections without getting rid of the party primary as the deciding election. And I used to support that. So I was a big supporter when Maine implemented rank choice voting in, in their elections, both state and federal.

Now I don't support it because what we understand as we really look at the system is if you put rank choice voting into the existing system, it does make it more fair. You could say more democratic, like the primary you referred to in your Massachusetts district, where someone won with only 23% of the vote. You would've had rank choice voting there and you would've figured out which of those candidates, was gonna get over 50%. And that might be more fair and definitely more democratic. But it wouldn't change what that candidate could do because the path to getting elected to Congress would still be to win your party primary when only 10% of the more politically, extreme turnout. So we feel better about the person who's elected, but they can't do anything more for us as citizens because they still only answer to that very intransient

Arjun: That's right.
That'sside of their respective parties, they're still forbidden to actually make deals, negotiate, innovate, reach across the aisle. There's still forbidden to legislate. So the use of instant runoffs is much more helpful when you combine it with getting rid of the primary and you get yourself five candidates.

and now I just say we shouldn't bother. I'm pretty, dogmatic about this. We should not bother putting all kinds of effort into rank choice voting on its own because it won't change the results we get. I say, it'll change who wins. It won't change what winners do. Yeah.

Arjun: So one of the reasons that I find your solution particularly interesting is because it's not purely theoretical. We actually have, some examples and most recently in Alaska special election for a house seat, where, the Congressman I think had died, suddenly. And so there was a election. So it's similar.

I think it's effectively final four voting there that just happened. Katherine. Tell us about what happened in this and did some of the theories that you have, did it play out the way you thought or did not play out the way you thought? How much? Yeah. what was the real life example that, that happened here?

Katherine: So you are right. The system in Alaska is a system of final four voting, which is exactly what I just described, except it's the top four finishers advancing out of the primary to the general election. And that's because, back in 2017, when I first published on this work, the best thinking was to use four. And I've since updated, the thinking to go to five.

Long story, short , an amazing man named Scott Kendall, read my 2017 work. And based on that and his other expertise, he designed a valid initiative in Alaska to implement final four voting for all their state races, their state legislature, governor, Lieutenant, governor, and their entire congressional delegation, which is two senators and one congressperson. And the voters of Alaska passed that in November of 2020. So now their first elections are taking place under this new system. So we're gonna see it in process of the election. And then we're gonna see how the people elected out of it behave when they're in, Congress.

And what you're referring to Arjun is the fact that the first election is already underway there. Their Congress person, Don Young, the longest serving Congress person of 50 years passed away earlier this year. And so there's a special election for his seat. They just had the primary for that and where they've had no competition for 50 years now, they had 48 people in the primary. And, they had the highest primary turnout they've had in, I don't know how many decades, and they got it down to the final four. And the general election will be in August. Now, interestingly, in the final four, there were two Republicans, one independent, and one Democrat.

highly likely that in Alaska, they're gonna elect a Republican because it's a red state, but what is really cool is that now the general election voters are gonna choose which of the two Republicans they would like, because we all know there's different flavors of Republicans.

there's different flavors of Democrats. So why shouldn't all the voters in November have the choice of multiple people from the same party to reflect really the diversity of views, even within the parties? one sort of detail just to get it correct. Is that the independent in the Alaska race did actually pull out of the race.

Katherine: So now we are unfortunately down to three candidates in this. but we will see in November, all the other races in Alaska will be the final four races. And I expect, we'll see four candidates in almost all of those. So it'll be real competition in November. And they'll get majority winners out of all of them. And those people will be free to serve their whole districts. It's really quite amazing. it's incredible because I think about so many theoretical ideas and papers that get written and I feel like they just collect dust and this one actually, got implemented. And I'm curious, especially in anything in the realm of politics where we have so many brilliant political scientists who have so many ideas to improve things, but it feels like it never happens.

Arjun: How did this happen? isn't there a sort of a, a default by the parties to resist change and resist the systems that got them into power. How in, in the world did Alaska decide, you know with the old we're gonna change

Katherine: Yeah, let's not just blame it on the, parties. I think humans resist change right in general, but, you're correct. Yes. in an existing system, a lot of the existing will resist change even though I would argue real good for them. It's another discussion. how it happened in in alaska though is that Alaska is one of half the states in this country who have the ability put questions directly to voters.

So, actually both of you, so Arjun you in California and Dan you in Massachusetts, you have ballotinitiatives too. So referendums initiatives and,that's what they did in Alaska. They collected the signatures and they put the question to the voters. So the voters chose, and that is a a huge opportunity to bypass the institutional preference to keep this existing, super dysfunctional system because people are optimized around it.

Arjun: I see. Okay. That's very good to know. I should tell you, by the way, we have multiple other campaigns happening now. So Nevada, which also has ballot initiative, we're going to know very shortly whether they have qualified for the ballot inNovember. And we have legislative campaigns in Wisconsin, where I'm from. In Georgia we

Katherine: have nascent, ballot initiative campaigns in five to seven other states in different stages.so by 2024, we expect to run a couple. I will see how many we end up with in 2024 ballot initiatives. And we actually hope we'll have some legislative victory, one or two by then as well.

Arjun: Very nice. and by the way, we'll also put at the end of the podcast links and the resources, if you want to get involved in your state and help drive these initiatives, if anything that you thought here was interesting. And you're wondering, Hey, could this happen in my state? We'll give you some, resources for that as well. All right.

Katherine: Yeah. And can, is this a good time for me to push Dan to found this effort in Massachusetts? And we can just get you a lot of volunteers right now. Dan, you can put on the ballot in '24 final five voting Massachusetts.

Dan: You are a closer, Katherine, let me tell you. Yeah, I would say, Hey now, is this good a time as any, um, the statement I'm gonna make is going to be kind of politically charged. So listener just kind of bear with me. I'm not taking a stance one way or the other. If you look at how Lisa Markowskibehaved in the Senate. And this is again Republican Senator from Alaska. Uh, she made a lot of decisions that would be political suicide in many other states. I mean, she, very, very openly opposed, Trump, when he was president and yet she has the ability to act independently now, again, depending on where you fall on the political spectrum, that could be a good thing or a bad But I think every American is going to agree that they want their Senator and their representative to represent them and not represen t the national party. And so I would say again, if you're interested in having your opinion heard, this is a method to ensure that your representatives act independently and really keep local concerns in mind, when they act. Lisa was, as we say, freed from the tyranny of The party primary. And she took advantage of that. And look, even in final five voting, it doesn't guarantee that Markowski wins again. What a guaranteed is that the general election voters. In November in Alaska are going to get to choose. And if they would like Lisa Markowski to be their Senator, they can have her. And if they would like Kelly Shabaka who Trump has endorsed as a challenger to Lisa Markowski, they can have Kelly Shabaka, but they get the choice. Whereas previously it was gonna be a done deal that Murkowski was gonna lose her primary.

Katherine: And the November election voters were not gonna have the choice of who they really wanted. So this is just a super democratic, way of electing people. That also turns out to be really helpful because the people elected from the system have a lot of agency in Congress. They can be the deal makers.

Dan: And I wanna flip that one on its head too. Cuz getting back to the origin of the primaries, they actually came to prominence during George Wallace. So when George Wallace , he was pro segregationist presidential candidate broke off from the democratic party, due to their embrace of civil rights and almost through the presidential election, into the house of representatives.

And at that point, the primaries were instituted to give the candidates, quote, unquote legitimacy. And, and I guess the, the lesson we can learn from this- when change is in their best interest to preserve power is when they're most likely to embrace it. And, and a question I have for you, Katherine, is, are there any signs that the current primary system is maybe causing problems for elected officials and that final five might be preferable to the system they use now.

Katherine: people as business people. Again, I think this party primary system is crazy bad for the parties because it means that they don't actually get to control their own products and services and platforms in a sense. They have to take who this small number of voters giveswhich doesn't always put them in the best position to win in November. And it certainly doesn't put them in the best position to solve problemsaccording to their, ideology.They're not allowed to, you know, make a deal to move anything forward. they're only under this system allowed to be, sort of polarized.

let's see what's happening today in Illinois. We're voting today in Illinois. I voted yesterday early voting and there's a fight in the republican primary for who should take ongovernor Pritzker,the democrat. And the illinois republican establishment, I guess we could say as, led by Ken Griffin, who is a big investor in G O P politics overall. He and others had really supported a particular candidate that they thought would be the most able to beat JV Pritzker in the fall and have a Republican win in what's supposedly a blue state. But the person who's likely and predicted to make it out of the primary today is a candidate that is further to the right, who will have it is believed, and I believe this too, a much harder time to beat the Democrat in the fall. some Republicans are actually saying, they'd rather just move the party further to the right and consolidate this rightward tilt than actually be competitive in the general election. So this primary is gonna cost about a hundred million dollars. I think that's the collective democratic Republican, but the Republican primary alone is costing over 50 million in Illinois. And they're probably not gonna get a candidate that's likely to be competitive in the fall.

Katherine: Now, what I like about final five voting is that it doesn't take a side. It's not Pro establishment Republicans and anti, further right populist Republicans, shall we say. It says, let November voters decide. So instead of wasting all that money in the primary Republicans could have advanced both a populist Republican and a more moderate Republican to the general election and then seen, and then one of them could have consolidated the Republican vote and been competitive.
This happens by the way, this will happen. The same on the left, where, voters on the left may voters and party primaries may elect candidates outta that primary who are too far to the left to be competitive in a general election. And again, what I love about final five voting is there's something inherently wrong with being further to the left or the right. Innovation doesn't arise from the squishy middle. We don't wanna split the difference on everything. So you can have those views present in the general election, but then you can see if the general electorate wants to coalesce around someone, more moderate or. At the very least allow those elected, even if they were not totally moderate to do moderate things without guaranteeing that they would lose their election.
So the parties are really hurting themselves and they're both being driven further, away from each other, which means they're being driven further away from being able to get anything done.
I think they'll figure, I think they'll figure this out. I keep telling some partisans, I say, whichever one of you, like you Republicans, or you Democrats figure this out sooner than the other, you will be nominating candidates who are going to be more powerful, more likely to win and more powerful when they're legislating, it's gonna be a competitive advantage for a party that gets, gets this figured out in quote, red states first or blue states whatever.
I like that framing. I'm hoping that the entrenched, parties and, and representatives in them see the logic that you're saying and, and hopefully are more receptive to it. let me take a slight tangent, here, former democratic presidential candidate, Andrew Yang. I don't know if you've been following him very much, but he's got this new thing called the forward party.

Arjun: And actually just this morning he tweeted something about his support for open primaries and rank choice voting. So I think it's very similar to what you're saying. I'm curious what you think about what he's doing with the forward party, which is trying to add choice, but in a whole new party umbrella, it seems like. what are your thoughts on what he's doing and how it might affect or improve choice for us?I love that Andrew loves, top fiveinstant runoff, although call it open primaries, rank choice voting. and he does, cite my work extensively in his book and everything. he actually called me up when he was writing his book and he called me up to tell me that I changed his life because, you know, helping him see that this is the system problem.

Katherine: He had that same aha moment, that so many of us do when we realize that it's the system. So, having said that, then I'm super supportive of that what he's doing with the forward party, trying to provide choice. I of course support more choice as well, because I'm saying we need competition and competition drives innovation, results and accountability. There's a bit of cart before the horse. In the case where people are trying to start third parties or run independent candidates because the existing rules of thereally mean that those are facing a real uphill struggle because a third in the existing system is often a spoiler.
So let's go back to like the presidential campaign. Well, any presidential campaign where if you're a Democrat, you're told, even if you really like, the green party candidate, you can't actually vote for the green party candidate because you'll just take votes away from the more establishment Democrat, and you'll inadvertently help elect let's say Donald Trump.
Okay. So let's use names. So you can't vote for Jill Stein. The green party can cuz you'll take votes away from Hillary Clinton and help elect Donald Trump. And then on the right you're told, and you can't vote for Gary Johnson, the libertarian candidate, even if he's your favorite, you just can't vote for him because you'll take votes away from Trump and inadvertently help elect Hillary. When you don't have instant runoffs and you don't have majority winners, you can't really have a lot of effective third party competition because they are spoilers. As soon as you have final five voting, then you could run candidates as independence, green party, libertarian forward party. And they would not spoil anyone else's race because they could just be ranked.
On that same ballot and they don't waste votes or take votes away from other candidates. So you really need to have real traction for any efforts like Andrew's forward party. You need to change these rules of the game so we can have this competition. And by the way, let me be clear. I don't really have any problem with having just two parties. The problem we have is not that there's only two it's that the current two are guaranteed to continue to be the only two re ongoingly regardless of what they do or don't get done on behalf of the customers, the voters. What weneed is the threat of new competition.
So it's, as long as they think that. If they're not doing a good job, someone's gonna come in and take their business away from them. They will then be incentivized to do a good job.So we don't need five parties and then all will be well. We need the current two to feel that they better get their act together or someone else is gonna enter.

Arjun: I think that's a really, really important point to reiterate because. When we've talked about this issue on so many previous episodes, it seems easier to just throw out I hate this phrase, but pardon me, the baby with the bathwater. Right? So, we spoke with mark Cuban a little while ago, and he's very sharp and astute about a number of things. And one of the things he said is I wish political parties disappeared entirely because they're terrible for, our political system. And there's certainly a very good intellectual debate to be made around whether that's true or not. when we talked to Lee Lee Drutman and he the United States is so strange with the only country with like two major parties.
Canada has at least three, you could argue. And the UK fine it's two three-ish, but everyone else has 4, 5, 6. But then you look at systems like Israel, where they've got so many and are constantly being dissolved and coalitions that don't go anywhere. And so what I think is interesting about what you're saying. It's not fundamentally that you need more parties, it's even competition within the parties and addressing a larger segment of the general population that trying to get rid of just two parties and have a real viable third party is a tough, tough battle. Of course it would be great if we had it. Wow. Wonderful. But because that's a tough battle. What I like about what you're saying? It's okay. We can keep the two party, no problem. But let's change how we elect from those parties and who competes for those parties and what they can do when they're in power. And that feels more realistic and viable in our lifetimes than sort of pie in the sky. Let's have 3, 4, 5 party kind of things. Is that a fair sort of recap?

Katherine: It is. Although once you're final five voting, you could easily have four parties. there won't be, you can get rid of the two party system easily. Once you have final five voting, you may not need to, meaning competition will drive the number of parties that voters want to get the results that they wanna see out of congress. So all the discussions are focused on the wrong thing. They're saying five is the right number four is the right number or more is better.
That's not the right way of looking at it. Ease of entry into the marketplace, low barriers to entry to serve the voter is what will drive progress, whether or not they're called Republicans or called Democrats, or whether, you start to see two Republican parties or two democratic parties. it's just this dynamic competition that is the real key. So I don't, think we'll see many more new entrants and more upstart parties. Whether they get as big as these current two is what competition will take care of.

Arjun: Got it.

Katherine: like any industry, We see new entrants and then there's consolidation and someone wins, someone loses, but the customers are benefiting whole time.
One question that just came to mind Katherine, I was thinking about isthere are definitely a lot of downsides to the system we have now. And I think the system we have now really empowers ideologicalminorities to hold outsized, sway over policy. one question I have for you and, and I'm thinking especially about racial and ethnic minorities in the United States is, one could argue that our system has also given people whose views might not be representeda, a larger platform, because if I'm a candidate who's running strictly on consensus, those voices might get drowned out. have you thought about that? Do you have any thoughts on that?

Katherine: We actually have a paper where, we commissioned independent research to look at the effects of final five voting the predicted effects of final five voting oncommunities that oftentimes are marginalized in the political system.and that came up, positive for final five votings so that, that the marginalization is actually not predicted to occur.
I'll actually say is I predict this will be great for diversity of participation. And we see it. So in Alaska, in this first race that we just had, let's just pretend it was gonna be the top five candidates, even though they just have top four, but the system now and going forward, we're gonna be moving forward top five all the time. They had the two most well known people at the top, Sarah Palin and Nick Begich. So Sarah Palin was endorsed by Trump. And of course we all know her. And then Nick Begich was endorsed by the Alaska Republican party. And they're in the first two spots. Then there was an independent Al gross, who ran as a Democrat in the last race and had spent millions of dollars so had widespread name recognition. and I think, I don't know, Sarah ended up at like 28% and then maybe, I don't know what Nick Begich was, but the mid twenties to low twenties and then Al Gross is like at 19%, something like that. And then the next two spots, the next two spots went to the new entrants.
So there was a Democrat getting about 7% of the vote or so in the fourth spot. And she is an Alaska, a native Alaskan. And arguably a new political entrepreneur, right? She's not known, but she got into that fourth spot. And then the fifth spot in the fifth spot, you have another native Alaskan woman, a Republican,in the vein of Lisa Markowski like maybe a moderate, Republican, but who didn't have any name recognition. So you have these two new entrants who, if you had final five voting, were going to then be able to make their case starting at only single digits, but getting now earned media between the primary and the general, and that gives them a huge opportunity be on the stage. And, and over time to get the name recognition and maybe next time come in in a higher position. Plus there's nothing actually that keeps one of those people. let's say that Republican who was in fifth place, the moderate Republican being the one who would, roll up all of the disparate Republican votes, you could go from fifth place in the primary to winning the primary if that's what a majority of general election voters want. So by lowering the barriers to entry, you're going to let these new entrants come in and they will often be people who could not be given the top down blessing to enter the existing system.
Yeah, I wanna ask you a question. It's a little bit of a tangent, but it's, important because you have a unique background of being, a former business executive. You come from manufacturing sector. and so I'm curious with this change, and focus that you have. Have you thought about what the role of business should be in government?
there's a lot of angst around this: lobbyists and the revolving door between government and business and campaign donations and all these kinds of, is that something you've thought about having been on sort of, I guess, both sides in a, in a sense.

Katherine: certainly thought about it a lot. And we actually, with my co-author Michael Porter, we did write about that, to some degree in our Harvard business review article. Although in my book, the politics industry, we really don't focus on that very much. I focus very much just on this system of incentives.
I, I believe as my co-author has famously said, strategies about choosing what not to do. I focus squarely on the system. I focus squarely on these incentives of how we're gonna get people in Congress who can do the job that we need our Congress people to do, which is deal with these complex problems. And, and the other stuff that is problematic will take care of itself when you right the fundamental incentives that drive, how people get and keep their jobs and grow their power in this existing political industrial complex.
So sometimes you can't go after the symptoms, you have to go down to root cause.And, that's where, that's where I'm at now. I think business people as citizens, they need to speak up and they should be speaking up on this issue. And this issue is as nonpartisan as any issue you have, they should be saying, we need healthycompetition in politics. Why shouldn't people in politics, be subject to competition. why is the free market system good for just us and not for the people in politics? So I actually call final five voting free market politics because it delivers the best of what free markets deliver in any human endeavor, this innovation results in accountability. And I think business people could make a great case for that.

Dan: I love it. I absolutely love it.
someone who was my lead on my transaction when I sold my company years ago, I told him about what I was working on. I said in the first minute or something about free market politics. And he said something to the, um, you know, you had me at hello, that? was the Renee Zellwegar right. so free market politics. And he was like, okay, I'm good. I'm in. I was like, all right, that's good.

Arjun: Welcome to consumer marketing. It just takes the right word.

Dan: So final question then. So if I've been listening to this and I'm a hundred percent team Katherine, how can I get involved? And, and how can I help enact final five voting in my state, aside from hosting a podcast with you and getting recruited right on, right on the recording. What, what else can I do aside from that? Cuz that might not be scalable. actually I think these people can come to your website as soon as you have it up for final five voting Massachusetts, and they could contribute to final five voting Massachusetts. but seriously, you can Dan start a final five voting campaign in your state. come to our website, which is political-innovation.org. And we can, help you get started. And the second thing is that there are existing campaigns out there that you can contribute to. And two senators freed from the tyranny of the party primary is two senators freed from the tyranny of the party primary. They don't have to come from your state. So feel free to help us out in Georgia at georgiansunited.org in Wisconsin, democracy found.org. In nevada, which website I can't think of off the top of my head.and this, the second thing is please spread the wordthat it doesn't have to be like this. have a ted talk. So if you Google my name, katherine Gail, G E H L, or just Gail And ted talk, you will find it. And it is 15 minutes on final five voting. And We want people to know that we are in charge of these rules of our elections. And we can change them state by state And go from believing that things are never gonna get better to suddenly being like, wow, I didn't realize actually that with this one change, it could really make a big difference in what Congress delivers. so, spread the word, found the campaign, donate to the campaigns that are there, those three things, all of them would be amazing.

Arjun: Fabulous. well, thank you very much, Katherine. Maybe one last question if I can just sneak it in. like I said, I find your background very interesting coming from business and then really changing to do this thing, this political thing, which, you know, in the business world, we're used to things moving fast and quick and we can, and you. know, this is slow and laborious. Why are you doing this? What's driving you. Yeah. Are, are you gonna eventually run for Senate or something? Like what? What's

Katherine: yeah. Totally not running.I did look at running. I, filmed some, some little like short commercials and focus group them. This was years ago. I wanted to run for Senate as an independent, but guess what? They can't get elected.and then eventually I realized, it's the system. Why would I ever say that? Oh, all these people in Congress are sort of prisoners of this party system and this election system that we have. And that's why we can't get anything done, but somehow I, Catherine should go to Congress and then I would get things done. That would be like the ultimate of ego. So no, I have no plans of running. This is my highest and best use, to, to work on this system.
I could run though, because I would say what politicians say, which is, I do this for my children. Because the fact is that I do this for my kids. My son is five. We just had COVID together and we, therefore we watch a lot of movies. and one of the things he was watching was schoolhouse rock. And anybody who's my age knows the schoolhouse rock. we grew up with this on PBS and there're these little songs and there's one, I'm just a bill on Capitol hill and it talks about our system and it made me think when he was watching it.

Katherine: Wow. When I was young, I was brought up with this great love of country and believing that America was, the best place ever. And essentially that America had it figured out and that democracy was ascendant. And I describe it as a, it was almost like that. I was given this gift in democracy and our country was tied up with a big red bow. And I thought it was done and watching my son, I'm reminded of the fact that it is not done. Is not guaranteed. Our democracy is not given to us as a wrapped package. It is given to us as something that we own and that we have to protect and defend in the same way that people have protected and defended this at other points and times of crisis in our country. And I can't think of anything that I would rather be doing than doing my part to reinvigorate this great American experiment for my kids and your kids and for the world really.

Arjun: That's amazing. I'm sure everyone listening can, can, hear the emotion in Catherine's voice and, uh, yeah, I mean, isn't that what we're all doing, right. We want a better world to leave for our kids. We want a better world. Dan and I have talked about this a lot because I'm an immigrant to the United States and I can tell you that a lot of immigrants are very, very thankful to the United States because we know where we came from. And we came here and this country gives us a lot. So a lot of us, especially immigrants really, want to give back and make this country stronger. And so listening to you, Katherine, what you're doing, it's inspiring. I'm really, really glad that you're doing this. Dan, and I are proud of you. We're going to do our part to support these efforts, get the word out, get these initiatives going in more places, increase competition, increase choice, and strengthen this, this wonderful democracy, this nation that we have. thank you.
Thank you so much for your time for all of your insights and more power to you. This is, this is great. Something very, very good is coming out of this. Uh, thank You very, very much.

Katherine: Thanks you guys. It's been super great to be with you and thank you for your interest and your support. It's definitely not something that I am doing is something we are doing. So I believe maybe now I'm counting you among the we, and I'll be right there.I'll make my, I'll make your first donation, Dan, to the Massachusetts campaign. You tell me when it's set and I'll be there with my credit card.
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