Carnegie Mellon University
March 07, 2016

Alumnus Gives Voters A Better Way to Decide

Karel Janeček was upset.

The latest political scandal in his native Czech Republic had reached an all-time low. The mayor of Prague was allegedly colluding with a Czech businessman to use the city's budget to influence sales of city and state property, fix office appointments and give expensive gifts to officials.

Karl Janecek"I was so disappointed in the Prague mayor and these people in the Prague council," recalled Janeček, who has always felt a need to do something about the things he doesn't like. As the founder of RSJ, a top market maker of derivative exchanges, he was in a position to affect change in Prague and around the country. In 2011 he created the Anti-Corruption Endowment to provide financial and moral support for whistleblowers who expose corruption in government.

While the Anti-Corruption Endowment was successful in bringing cases of corruption to light, Janeček, who earned a Ph.D. in Computational Finance from Carnegie Mellon University in 2004, started to realize something.

"The core of the problem is not corruption — corruption is a consequence," he said. "The problem is the people in power."

True to his nature, he started thinking about to how change things for the better. He focused on the Czech Republic's voting system, which, like many other European countries, enables the parties to hide corrupted and other wicked individuals behind closed party lists. This system also very often forces voters to vote for the "lesser evil" option.

But what if voters had more options? Using some simple math and basic logic, Janeček created an innovative voting system that gives voters that and more. Called Democracy 2.1, voters get multiple votes — and sometimes a minus vote.

Let's say voters were at the ballot boxes to elect two members of the city council. Twelve candidates are vying for two seats. Using Democracy 2.1 (D21), each voter would have four votes, allowing a Democrat, for example, to vote for her party's two candidates while also giving her the freedom to cast her remaining votes for other candidates whose ideas she also likes. She also may have the opportunity to cast a minus vote for a candidate that she absolutely does not want to sit on the city council. The effect of multiple votes supports consensual and democratic candidates, and makes the selection of leaders more just.

"The most important ingredient, dare I say the revolutionary idea of D21, is the effect of multiple votes," Janeček said.

According to D21's website, offering multiple votes almost doubles voters' satisfaction with the final choice because there is a higher probability that one of the options someone voted for will be chosen as one of the winners.

Although Janeček's initial motivation for developing D21 was to revamp the political election process, he's found that D21 has widespread appeal.

"I have been so surprised at the universal applicability of D21 not just for politics but for any situation where people make decisions out of many options."

Program in Action

One of the most exciting uses of D21 so far has been in participatory budgeting, where community members directly decide how to spend part of a public budget.

Earlier this year, residents of several New York City districts voted to decide how they wanted the city to spend over $31 million of the budget. They were offered a number of choices in each district, which ranged from buying an air conditioner for a school cafeteria to making specific streets greener.

D21 consulted in cooperation with Stanford University on developing a digital ballot for the vote and implemented it in five districts. The D21 voting algorithm was tested in two of them. The voters' results revealed which projects had the most consensus and which were the most divisive. The D21 team is continuing its collaboration with New York City for next year's vote.

"The amazing thing is that it's not just about voting — it's also about feedback," said Janeček, who was present for the community vote in New York City. "The city council can learn so much more from people. This is an amazing thing, this information flow. That I didn't expect."

D21 is also being implemented in elementary schools and companies to query student and employee opinions, respectively. On the political front, Janeček and his D21 team are currently working as consultants to the electoral parliamentary commission of the Tunisian parliament, which will soon (in a few years time) have its first regional elections.

While D21 keeps Janeček busy — he recently received a research fellowship from Cambridge University to work on D21 — he's still involved with RSJ, serving as chairman of its supervisory board. He also is engaged with his many philanthropic endeavors, including the Anti-Corruption Endowment, the Karel Janeček Foundation, the Foundation Aid Fund and Neuron, which supports scientific research in the Czech Republic.

Janeček points to his education as a mathematician — and his experience at Carnegie Mellon — as the root of his success.

"Mathematical thinking is extremely valuable. Mathematics teaches one to think logically, to argue, to be able to understand others and the logic of their arguments so as not to be manipulated," Janeček said. "Of course, on top of that, the education I got at CMU has influenced my life in a major way. It combined deep mathematics with practical applications — finance and modeling of derivatives — that can be very nicely applied in practice in finance and investment. I am certain that, if it wasn't for CMU, RSJ wouldn't have been as successful."