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That's basically proportional representation with added steps:

https://en.wikipedia.org/wiki/Proportional_representation

It's extremely common in Europe, and there are a lot of different precise methods for it. But the point is exactly what you're describing -- every vote has an impact.

I've always been baffled that not only has the idea never taken off in the US, virtually nobody except political scientists seems to be even aware of it.



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