1. Introduction. The Paradox of a Formally Open and Materially Exclusive Democracy

“Harold Hotelling formulated the median-voter paradox in the 1920s to exemplify an economic phenomenon. Arthur Smithies introduced elasticity of demand and Anthony Downs refined it again in the 1950s” (Hotelling 1929; Smithies 1941; Downs 1957; Mott 2004: 166).

The median-voter paradox: “Given the set of rights in society, suppose income inequality still falls outside the region of tolerance. What will governments do in order to ensure social in the short run? Governments could choose to redistribute income until inequality is placed in the tolerance region. The mechanism for this is public choice made democratically, which implies one person one vote (different from the market choice, which is one dollar one vote); moreover, a democratic decision is based on the majority rule, which implies that the choice of the median voter (which is placed at the center of all positions) will decide. Hence, in the case of income redistribution policies, the choice of the median voter will decide. But does the median voter belong to the poor or the rich group? If the voter belongs to the poor group, then the redistribution policy will win. One may thus expect that in a democratic capitalism the majority rule, or the median voter rule, would endogenously move inequality to the socially tolerable region. If the distribution of income was a normal distribution – symmetric distribution or bell-shaped distribution – the mean income would divide the population into two equal parts (50 percent below the average and 50 percent above the average). However, we know that income distribution in the real world is not symmetrical, but assymmetrical: the mean income will divide the population into two unequal parts (says 70 percent below the average and 30 percent above) because income concentration implies that for each rich individual (with income above the average) there will be many poor individuals. Therefore, the median income (dividing the population 50 percent below and 50 percent above) will be below the mean income, which implies that the median voter will have an income that is smaller than the average income and thus will belong to the poor group. Democracy should therefore produce redistribution policies endogenously for income distribution to become a self-regulated process, not by the market system, but by the democratic system. If inequality rises, public policies chosen democratically will bring it back to the socially tolerable region and social disorder will hardly have any significance. However, this is not what we observe in the real world, neither in the First World nor in the Third World” (Figueroa, 2015: 161).

A “(…) faction is a weaker organization at the organizational level, more conjunctural, with a weak political-electoral significance and totally dependent on a personalist leadership. In traditional parties we have been moving from a system of parties dominated by two or more internal fractions of national order to a system of parties totally atomized into personalist factions” (Pizarro 2002: 7). A political faction can be a collective of parties, in which case it would be a collective actor or a single political party, in which case it would be an individual actor.