Алистер Смит - The Dictator's Handbook - Why Bad Behavior is Almost Always Good Politics

To understand how aid works, it is essential to take into account the incentives from the perspective of the leaders who enact policy. Unless aid is restructured to change these incentives, Pakistan has little reason to end insurgency and terrorism. Instead both will be allowed to rumble on and encouraged to expand if the West tries to cut aid. Fortunately, in addition to identifying problematic incentives, our perspective offers the tools to restructure aid to create the incentives to fix problems.

Fixing Aid Policy

The modus operandi of the international community is to give recipient nations money to fix problems. A common argument is that the locals know much better how to address their problems than do far-away donors. That’s probably true, but knowing how to fix local problems and having the will or interest to do so is quite another matter. This policy of giving money to recipients in anticipation of their fixing problems should stop. Instead the United States should escrow money, paying it out only when objectives are achieved.

Consider the problem of capturing Al Qaeda’s former number two, Ayman al-Zawahiri. Suppose the United States thinks $4 billion is a reasonable reward for his capture. Remember: to date the US government has paid $6.5 billion without success. This money could be escrowed, say at a Swiss bank. Upon Zawahiri’s capture, Pakistan could receive a payment of $2 billion, with, say, an additional $1 billion in each of the two subsequent years. The deal could perhaps be done more cheaply if we dispensed with the fiction that the money is for the Pakistani people and paid it directly to Pakistani leaders.

If aid took the form of a reward-in-escrow scheme, then Zardari would need to hand over Zawahiri to receive money. However, unlike the existing incentives, he could deliver without fearing that the money will dry up once his assistance is no longer needed. Zardari might prove unwilling or unable to capture Zawahiri for $4 billion. However, if this is the case then the United States has lost nothing. He would certainly not be more likely to hand him over if all he has to do is pretend to look for Zawahiri to keep the money flowing. That, of course, is the way the current system works.

Undoubtedly there are many operational and procedural problems with implementing an aid-in-escrow scheme. And these problems would be even more difficult in terms of designing escrowed aid relief for disaster management. Yet, it is better to tackle these tricky technical issues within a framework that incentivizes leaders to solve the donor’s problem than to carry on with failed policies.

Nation Building

What, then, are the fundamental incentives for one institution to interfere with the institutions of another? Democracies often claim that they want to democratize other nations. They frequently justify both aid and military intervention on this basis, but the evidence that they actually promote democracy is scant. Those who defend such policies tend to cite Germany and Japan after World War II, but that was sixty or so years ago, and on close examination it took many years before these nations developed (or were permitted to develop) independent foreign policies. The reality is that in most cases democracies don’t want to create democracies.

In 1939, US president Franklin Delano Roosevelt famously remarked about Anastasio Somoza García, a brutal Nicaraguan dictator, that, “He’s a son of a bitch, but at least he’s our son of a bitch.” And herein lies the rub. Dictators are cheap to buy. They deliver policies that democratic leaders and their constituents want, and being beholden to relatively few essential backers, autocrats can be bought cheaply. They can be induced to trade policies the democrat wants for money the autocrat needs. Buying democrats is much more expensive. Almost every US president has argued that he wants to foster democracy in the world. However, the same US presidents have had no problem undermining democratic, or democratizing, regimes when the people of those nations elect leaders to implement policies US voters don’t like.

Undermining democracy was the story behind US opposition to the Congo’s first democratically elected prime minister, Patrice Lumumba. He was elected in June 1960 and he was murdered on January 17, 1961, just half a year later. Lumumba ran into difficulty with Western democracies because of the policies he adopted; not because he usurped power. He spoke out vehemently against the years of Belgian rule over the Congo. In a speech during Congo’s independence celebration less than a week after his election as prime minister, Lumumba announced, “Nous ne sommes plus vos singes [We are no longer your monkeys].”24 In an effort to remove Belgian troops and diplomats from the Congo and to defeat the secessionist movement in Katanga Province led by Moise Tchombe, Lumumba sought Soviet military assistance. That was a big political error. The massive bulk of evidence today points to US and Belgian complicity in Lumumba’s murder. Later the United States would become closely associated with the Congo’s (that is, Zaire’s) Mobutu Sese Seko who, unlike Lumumba, was neither democratic nor pro-Soviet. For a price (totalling billions by the time he fell out of power thirty-two years after his ascent) Mobutu was willing to back US policy. Democratically elected Lumumba was not and that meant he had to go.

Lumumba was not exceptional in his downfall at the hands of democratic leaders. Hawaii’s Queen Liliuokalani was overthrown in 1893. Her sin? She wanted Hawaii and Hawaiians (no doubt including herself) to profit from the exploitation of farming and export opportunities pursued by large American and European firms operating in Hawaii. As these business interests organized to depose her, the United States sent marines ostensibly to maintain peace from a neutral stance, but in fact making it impossible for the Hawaiian monarch to defend herself. And then we ought not to forget the overthrow of democratically elected Juan Bosch in the Dominican Republic at the hands of the American military in 1965. His offense: he liked Fidel Castro. Or Salvador Allende in Chile, Mohammed Mosaddeq in Iran, or US opposition to the democratically elected Hamas government in the Palestinian Authority, and the list goes on. As we write these words, we see this policy of reluctance to promote democracy at work for the US in the Gulf. The United States has a long history of supporting useful autocrats. Indeed, US policy in that part of the world stands as a perfect example of the perils of democratization. The incipient democracies in the Gulf are unlikely to be positively inclined toward US interests, in part because of deep policy differences and in part because we’ve been funding for decades the oppression under which they were governed.

In case after case, the story is the same. Democrats prefer compliant foreign regimes to democratic ones. Democratic interventionists, while proclaiming to be using military force to pursue democratization, have a profound tendency to reduce the degree of democracy in their targets, while increasing policy compliance by easily purchased autocrats.25

Before this chapter you might have been under the impression that democrats were angels compared to their autocratic counterparts. This chapter has tarnished that image and there will be more tarnishing to come. But rather than deplore European and Japanese prime ministers and US presidents on principle, we need to pause for a moment and consider what they are doing and why.

Democrats deliver what the people want. Because they have to stand for election and reelection, democrats are impatient. They have a short time horizon. For them, the long run is the next election, not their country’s performance over the next twenty years. However, as long as we the people want cheap gasoline and an abundance of markets in which to dump agricultural products, and we want that more than we want to see genuine development in poor countries, then our leaders are going to carry out our wishes. If they don’t, why they’ll be replaced with someone who will. That’s what democracy is all about—government of, by, and for the people at home .