Ladies and Gentlemen, the opportunity to address the Californian Commonwealth Club is not only a great honour but also represents a very exciting occasion for me. As the government Chief of Staff of a sovereign state, I am visiting one of the 50 member states of the world's number one superpower. And this member state is ten times larger in area than my homeland and has five times as many inhabitants. It is only when it comes to the highest mountain that we in Switzerland come out on top with the Dufourspitze (15'203 feet), which is 708 feet higher than California's Mount Whitney (14’494 feet). But coming out on top doesn't really count; for if we take the lowest point (Switzerland: the shores of Lake Maggiore at 633 feet, California: Death Valley 282 feet below sea level.), then California has the greatest difference in height. So how can I present Switzerland to California? As “Small is beautiful”? That may be a bit predictable, but it may just do the trick...

Switzerland, with its different cultures and language regions, requires a very particular framework. Switzerland needs a great deal of individuality in order to function. And it needs a great deal of mutual tolerance and understanding on the part of the various groups within the population.

Switzerland tackles these challenges with its distinctive form of federalism. With its 7.7 million inhabitants, Switzerland is made up of 26 states of very different sizes. The most populous of our cantons is the canton of Zurich with some 1.3 million inhabitants. The smallest canton is Appenzell Innerrhoden with a mere 15,500 inhabitants. Its population is 86 times smaller.

The various language regions also vary greatly in size. We have four national languages:

- roughly 64 per cent of our population speak German

- a good 20 per cent speak French

- some 6.5 per cent speak Italian

- and 0.5 per cent speak Romansh

- a further 9 per cent have a different mother tongue. The language I am speaking now is part of that 9 per cent.

So given this situation, how do we manage to function as a whole? How, given such discrepancies, can we prevent larger groups from dominating the smaller ones? How can we ensure considerate interaction? How can we protect minorities? What holds us together as a country?

Our cantons have a lot of autonomy. Our federalist structures, which are enshrined in the Federal Constitution, guarantee this. We apply the principle of subsidiarity, whereby the federal government may only carry out those tasks which are explicitly assigned to it by the constitution. Public health and education, for example, are in the hands of the cantons. In the school system this ensures that the cultural and linguistic character of each canton is preserved.

At the national level, there are a host of other measures that serve to achieve balance. The difference in financial power between agglomerations with high value creation and the less affluent mountain regions, for example, is reduced through a system of financial equalization.

The Swiss Parliament is also based on the principle of equalization. We have two equal chambers. In the National Council, cantons are represented in proportion to the number of inhabitants. The largest canton holds 34 of the chamber’s 200 seats, while the smallest holds just a single seat as the guaranteed minimum. In the Council of States on the other hand - state being another word for canton – in our cantonal chamber, or senate, each canton has two seats. Every law has to be passed by both chambers. No chamber has seniority.

Direct democracy is highly developed in Switzerland. Any amendment to the Constitution requires a mandatory referendum, but in order to be adopted it has to achieve a double majority – a majority of the popular vote and a majority of the cantons. A group of smaller cantons can therefore overrule a popular majority.

Protecting minorities means then that smaller communities enjoy a certain advantage over larger ones. In Switzerland, the larger communities are able to ‘endure’ this without too much trouble. This generosity is the price of successful coexistence – a pleasant price, which the smaller groups acknowledge with gratitude.

As you can see, we are at great pains in our country to find balance everywhere. We strive to solve conflicts through consensus and compromise. Even our system of government is based on equation. The seven members of the Federal Council represent the most important and strongest parties. At present, there are five different parties accounting for more than 75 per cent of the popular vote. The president is merely primus inter pares and changes every year. He or she cannot take decisions or govern alone. The Federal Council decides as a collegial body.

The government and parliament are therefore required to seek solutions capable of finding a majority in parliament and among the people. This leaves no room for extreme solutions, only well-balanced solutions backed by all.

Now, to compare Switzerland with the USA or with California may be a bit presumptuous, but it is interesting to try. For in fact, the huge US and tiny Switzerland have influenced each other in more than one respect.

First of all, both countries are, in their slightly different ways, federal states. And it is interesting to note that the United States and Switzerland are by far the two most stable federal states in modern times: they have been federal states for a long time and without interruption, the USA since 1787 and Switzerland since 1848. As such they are prime examples against the widespread theory that federal states are transitional systems which follow the collapse of centralized states or that they enable a federation of states to transform itself into a centralized state. That this theory holds in many places can be shown when we consider that since the French revolution in 1789, almost half of the 195 independent countries in the world today were at one time organized as federal states. But today only 23 federal states are left.

So the US and Switzerland are stable federal states. But what is the explanation for this shared federal stability? It can’t have anything to do with size - for the USA and Switzerland are as different in size as one could possibly imagine. It could be argued that it is the large number of member states in the USA and Switzerland that has made both countries particularly stable as federal states. The reason why there is federal stability in numbers is because the more member states a state has, the smaller the risk that the same population groups and the same member states will always find themselves in the minority. It is remarkable that among the world's federal states, those that have fewer than six member states have the most serious problems with internal cohesion, a problem that is most apparent in federal states with only two or three member states. In these states, linguistic, ethnic or religious conflicts are particularly difficult to resolve.

While the USA numbers 50 member states, most of which are very large, little Switzerland has just a bit more than half as many, 26 to be precise. In terms of its surface area, Switzerland is the fourth smallest federal state in the world, but at the same time, it is the federal state with the fourth largest number of member states. In Switzerland, which is a tenth the size of California, any of the 26 member states or cantons, as we call them, is on average smaller than California's 58 counties. One could go so far as to say, in Switzerland a new canton begins around the corner of just about every second house. Would this mean Small is beautiful? Absolutely!

Now, if direct democracy in Switzerland guarantees equality before the law and a clear say in government, then federalism guarantees a maximum amount of freedom. Let me illustrate this by taking the example of our languages: in Switzerland four languages are spoken: German, French, Italian and Romansh. Of the 26 cantons, 4 are exclusively French-speaking, 1 only Italian, 1 has three official languages (German, Italian and Romansh), 3 have two official languages (German and French) and 17 cantons are German-speaking. But everyone in Switzerland is allowed to use a national language of his or her choice when dealing with the federal authorities.

The demographic distribution of languages in California and in Switzerland, incidentally, shows fascinating similarities. In California the largest language group is English-speaking with just over 60%, in Switzerland the German-speaking population represents a similar majority with 64%. The first and largest minority language in California is Spanish with around 26%; in Switzerland it is the French speakers with just over 20%. A similar picture emerges when we look at the distribution of the 3rd and 4th minority languages, Chinese in California and Italian in Switzerland, or Tagalog and Romansh respectively.

However, it is not only in the area of demographics of language distribution that show parallels. There are remarkable parallels in terms of political rights. These similarities stem from a wide variety of historical roots, not the least of which were the reciprocal influences between the "New World" and the small country in the heart of Europe. A comparison of these diverse roots reveals striking similarities that have made California and Switzerland so receptive to an exchange of our historical experiences:

In the United States, the Protestant Anglo-Saxon immigrants established small fortified settlements that were therefore easy to manage, simply in order to survive. These settlements fulfilled all the requirements for direct democratic self-government: where they were concentrated around one central location, decisions could be taken at town meetings; if this was not feasible, then arrangements could be made in writing. The lack of a monarch meant that the original immigrants and their descendants had to decide on all matters of importance themselves, and they had to do so democratically. And in the century that saw the widespread settlement of Midwest and Western America, those settlers had a lot of decisions to make!

When, towards the end of the 19th century in California, the Southern Pacific Railroad Company began to dominate state politics and the justice system, a coalition of middle-class publishers, businessmen and freemasons, known as the "Progressives", was formed in opposition. Doctor and physicist John Randolph Haynes (1853-1937), husband of the suffragette Dora Haynes, founded the "Direct Legislation League", which influenced the constitutions of the cities of San Francisco (1899) and Los Angeles (1903). Prior to this, Haynes had visited Switzerland - small was thought to be beautiful, even then - to study the direct democracy at work in my homeland. In 1904, shortly after the new city constitution of Los Angeles come into force, "Recall John" - as he was popularly known - for the first time petitioned successfully for the removal of an elected official.

Six years later, the Republican Hiram Warren Johnson was elected Governor of California, and committed himself wholeheartedly to the fight against the corruption. For a limited time, he had the support of a "progressive" parliamentary majority. This provided California with an era in which the direct democratic rights of referendum, popular initiative and recall were introduced and endorsed by the overwhelming majority of the electorate in a vote on 10 October 1911.

Swiss political science professor William Rappard, active in the USA, who later became a National Councilor in Switzerland, our equivalent of Representatives, reported on these events in an essay entitled "The initiative, referendum and recall in Switzerland". The essay caused a sensation as it brought together the testimonies of numerous American champions of democratic rights, all of whom supported the claim made by B. J. Hendrick from Oregon that "that there would be no modern revival of the initiative and referendum had it not been for the Swiss example."

But how had these rights developed in Switzerland? It certainly was not the case that large numbers of hopeful immigrants came here to settle! But in different ways Switzerland had had ample opportunities to work towards a practice of direct democracy in the course of several centuries. We can see how this evolved in several places, for instance in the alpine valley of Glarus - where in the 14th century, local Bauernlandsgemeinden (farmers' assemblies) were set up to debate the burning issues of the day; the participants, all men, naturally, would debate and then decide whether they were "more or less" in favour of the one solution or the other for their communities. Small was indeed beautiful!

Another development of direct democratic self-government came about by necessity in Switzerland in the 14th century. At that time the lower nobility sank into poverty and the farmers in many mountain villages shrewdly recognized the predicament of their rulers. With great presence of mind, the farmers offered to pay their landlords ten years of tax in one year if they were then discharged completely from paying any further taxes. The noblemen were up to their necks in debt, and they readily accepted. The farmers scraped the money together, paid up and were free! But now they had to manage their own affairs. And here the topography of Switzerland came to play an important part. The mountains, which protected the small communities from armed invaders and thus guaranteed independence, also presented a serious obstacle. How were the inhabitants of these regions to organize a democratic decision on whether to build a road linking two villages that were two miles apart as the crow flies, but separated by a mountain range, which meant that the journey on foot would take several days? In my own canton, Graubünden, the farmers devised a mechanism similar to the one which the fathers of the American Constitution chose 300 years later for the election of their president: in a central gathering the village elders and scribes negotiated arrangements. The various village representatives would then put the related documents in their backpacks and take them home to their communities. In other words, literally the arrangements had "to be carried back", in Latin ad referendum, hence the name, still in use today. The proposals would then be read out after church on the following Sunday to all men fit to bear arms, and these men would debate them. The proposals would then either be accepted as they were, rejected, or made subject to changes or conditions. All the village representatives then congregate again in the central location, compare the decisions of their villages and record the decision that were favored by the majority of villages. In other words, if it had not been for the mountains, this federalist system of village referendums in Graubünden would not have come into being. And it has been working in similar ways for 400 years.

But whereas many of these arrangements were in place without being fully institutionalized, a big change came about in 1798. France conquered Switzerland and liberated the French-speaking regions, most of which had until then been subject territories. As a result of the French Revolution, the moral values of great American political thinkers such as Thomas Jefferson and Thomas Paine found their way into Swiss hearts and minds. These included:
●   the need for a written constitution;
●   a collegial system for the executive;
●   the concept of a constitutional referendum;
●   the direct election by the people of the legislature and executive;
●   a parliament with two chambers and
●   a declaration of fundamental rights and of equality before the law.

In the Restoration Period from 1830 onwards this began to produce results. In fact, Switzerland has the American example to thank for helping it find an exit strategy in 1848 from its Civil War (Sonderbund War) between the conservative catholic cantons favouring a loose federation states that would guarantee a large measure of independence and the liberal protestant cantons, who favoured a much closer alliance. The solution to the impasse was the compromise of a federal state and in particular a bicameral parliament with one chamber representing the member states, the other reflecting the distribution of the population in the states. In this way, the stability of the Swiss constitutional system is a direct result of the American model. In a typically Swiss move, however, the compromise was further sweetened for the conservative minority by the decision to continue to refer to Switzerland in French and Italian not as a Federation (a federal state), but as a Confederation (an alliance of states) - a title that applies to this day. And the trick works!

In the fledgling Swiss federal state, the pioneers of victory in the Civil War were the first to take charge - not altogether different from California - where it was the pioneers of the railroads, of mobility and of the economic boom. And while a future Swiss defense minister (Emil Frey) was fighting in the Battle of Gettysburg as an officer on the Unionist side, my predecessor in the Federal Chancellery was making preparations for the first mandatory federal constitutional referendum. Also at the same time, the democratic movement began in the cantons, a movement that was soon to oust the pioneers of the founding generation. One of them, by the way, was Alfred Escher, a railway baron and the founder of the bank that later became Credit Suisse. This movement succeeded in winning a range of new democratic rights: the popular initiative, the referendum and the right to remove public authorities from power.

It is thus interesting to reflect that quarter of a century later, when California's Recall John studied the workings of direct democracy in Switzerland he was in reality analyzing nothing less than the democratic evolution based on concept of town meetings by American pioneers. But that this American system had been able to gain a foothold in Switzerland was due to the fact that it had already existed in an early federalist form of the referendum I mentioned earlier. Thus it seems fair to day that the interaction between the great USA and little Switzerland, despite the differences in historical root causes, has triggered advances on both continents that can be seen today as a kind of dialogue.

But despite the similarities there are some interesting differences between the respective democratic rights in the two states, Switzerland and the US or, in this particular case, California. In California, democratic rights have become established as rights to counterbalance distrusted authorities. Although it would be legally possible, there are no preliminary considerations of popular initiatives in the political institutions and their debate in government has never become an established procedure. By the same token, the authorities never work out counter proposals. If proposals are forth-coming, they are the result of popular initiatives of opposition groups in a civil society. Thus Californian popular initiatives could be considered relatively confrontational, and not aimed at achieving consensus or compromise. Also they are never withdrawn and they are completely successful in a third of all cases. Contradictions in the law due to the adoption of several opposing initiatives are avoided through a system in which the highest number of Yes votes decides. In Switzerland, on the other hand, thanks to the referendum, a strong culture of consensus has developed: there is usually an institutionalized search for a compromise. This usually means that the authorities draw up direct counter proposals to most popular initiatives at constitutional level. Similarly, at statutory level, they draw up so-called indirect counterproposals. The counter proposal address the same concerns that led to the popular initiative in the first place, but they do so normally at a subsidiary statutory level. In practical terms this means that behind the scenes, initiative committees and the authorities engage in a process of bargaining that may be hard but it is also fair.

As a result, of the 58 popular initiatives dealt with in Switzerland in the past 15 years, in no less than 36 cases there was an indirect counter-proposal and in a further 5, a direct counter-proposal; 11 popular initiatives were ultimately withdrawn. While in California, around a third of all popular initiatives are approved by the People, in Switzerland just under 10 per cent win popular approval. The culture whereby the authorities attempt to accommodate the concerns expressed in popular initiatives often heads off a direct show-down; the initiative committees are often satisfied with the response of the institutions to address their concerns that they eventually withdraw their request. This concept, the possibility of withdrawing a popular initiative, was developed in Switzerland shortly before the introduction of democratic rights in California. However, Recall John visited too early to find out about this!

Nevertheless, the essential consequence of this cultural difference is that considerably longer periods of time are allotted in Switzerland for the handling of popular initiatives. Moreover, the Federal Chancellery manages to avoid the situation in which two contradictory popular initiatives or other bills are put to a referendum at the same time. This is achieved without exercising any special powers, but simply by conducting an early analysis of the initiatives and the concern that created them and by alerting the politicians to them. The result is that no internal contradictions can ever occur within the legal system. This is important because in Switzerland popular initiatives, if they are accepted always result in as constitutional amendments.

Let me come to some concluding observations. Often Switzerland is regarded as the cradle of direct democracy. Nothing could be further from the truth. To use a different but also a nurturing image, Switzerland is not the mother, but the daughter of direct democracy.

It is true to say that Switzerland has influenced some constitutional developments overseas - in California, not to mention in Uruguay or Australia. Often these developments have been based on personal connections that Swiss people had with the country concerned.

But in the case of the USA and California, the opposite applies: the Swiss constitutional reality of the 19th century was decisively influenced by American political thinkers and their experiences. They helped to originate the federal concept that enabled Switzerland to reshape the federalist referendum into direct democratic rights while preserving freedom. For, as we know in both our countries, federalism brings freedom.

So it is no longer a great surprise that, despite the enormous difference in size between the USA and California on the one hand and Switzerland on the other, all three have nonetheless enjoyed a comparable degree of political stability albeit using slightly different strategies. The US Constitution - the oldest constitution of a sovereign state still in force - has been amended a total of 27 times in 233 years. Well over 10,000 attempts to amend it have failed. In Switzerland, by contrast, we have had a Federal Constitution since 1848; it was completely revised twice, once in 1874 and once in 1999. Over the same period the Federal Constitution has been amended on around 200 occasions.

This is quite striking: in its brevity and conciseness, the US Constitution expresses the stability of the political system. The Swiss Constitution is the opposite: it is probably the most unstable constitution in the world; permanently undergoing amendment, it nevertheless guarantees a stable state, because the pressure to reform is constantly being reduced to what one could call homeopathic doses.

As a result, if anyone in the USA wants a printed copy of the Constitution, he or she can buy it leather bound, just like the Bible. In Switzerland, however, you are best advised to subscribe to the Swiss Federal Constitution like you would to a periodical. This is because potentially every three months a referendum will result in another amendment! Such frequent changes are all consequences of direct Swiss democracy and of the constant bargaining going on between groups putting forward initiatives and the authorities. , It seems long, long ago that our Constitution has sadly lost that brevity and conciseness of the US Constitution. It is intriguing to consider, therefore, that what has emerged as a thread running through this talk for once applies not to something Swiss but to something American. In terms of our respective constitutions it is yours about which we can say small is beautiful!

Flexibility and stability in the constitutional structures