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Representative democracy is no longer the agency of popular will. In the US, elections are controlled by big money. In developing countries, the undemocratic imposition of neo-liberal economic policies has forced governments to dismantle basic services like health and education. But Porto Alegre presents an apparent alternative. Through its experiment in participative budgetmaking over the past decade, this city has institutionalised the direct democratic involvement of ordinary citizens in deciding spending priorities. The Porto Alegre Experiment asks the difficult questions. Can local participation in public management really strengthen its efficiency? Is genuine participation possible without small groups monopolising power? Can local organizations avoid becoming bureaucratised and cut off from their roots? Can neighbourhood mobilisation go beyond parochialism and act in the general interest? It also raises the bigger question about the lessons to be learned from Porto Alegre to renew democratic institutions elsewhere in the world.
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