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I like your question to students, “how are decisions on various levels of importance are made?” I agree that the capacity to “throw the rascals out” is essential.
But I also am convinced democracy is not only about decision making. It is about co-creation and a feeling of ownership – where “culture” comes in.
Some years ago I had an exchange with two distinguished academics, Eric Olin Wright and Archon Fung, about their “Deepening Democracy” essay, later published in Politics and Society (my response, “Reconstructing Democracy,” is also on the Havens site).
They were interested in developing “transformative democratic strategies,” larger than local experiments or single issue movements. Drawing lessons from large scale examples which they called “empowered deliberative democracy,” from habitat conservation planning under the Endangered Species Act to participatory budget discussions in Brazil, they developed a model which could be adapted to schools.
They distilled three principles: Issues have a practical focus on specific, tangible problems; all involve ordinary people affected by the problems and officials close to them; all rely on deliberative development of problem solving. They noted three design features – decentralization of state decision making to local units; creation of formal linkages that connect local units to each other and to more central authorities; and ways to support and guide problem-solving efforts.