Fukuyama, “The Imperative of State-Building PDF

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PSC 10001 with Professor Mitchell article summary...

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Weak/failed states are close to the root of many problems: poverty, AIDS, drug trafficking, terrorism How to transfer strong I situations to developing countries? ● We know how to transfer resources, people, and technology across cultural borders AIDS crisis: ● Matter of resources ● government capacity to manage health programs Lack of state capacity in poor countries has came to haunt the developed world directly ● End of cold war left many failed or weak states ● Created many major humanitarian crisis and human rights disasters ● Radical Islam terrorism

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Governance and Modernity Poverty is not the proximate cause of terrorism Modern world offers an attractive package, combining the markets economy material prosperity with liberal democracies heritage of political and cultural freedom Inefficiencies and unanticipated consequences led to a vigorous counter trend in the form of Thatcherism and Reaganism Collapse of the most extreme form of statism - communism - gave extra impetus to the movement to reduce the size of the state in noncommunist countries Friedrich Hayek suggested that there was a connection between totalitarianism and the modern welfare state - taken more seriously in the late 20th century Reduce the degree of state intervention in economic affairs - advice offered by the US government, IMF, and World Bank : Washington Consensus ○ States needed to be cut back in certain areas but they also needed to be strengthened in others Measuring the State: Scope v. Strength Scope: Different functions and goals taken on my government's Strength: Ability of states to plan and execute policies and to enforce laws cleanly and transparently Is the U.S. a strong or a weak state? ○ Weak: Constraints on state power, American welfare state, U.S. markets less regulated ○ Strong: Enforcement: Plethora of police and other agencies ○ Has a system of limited government that carefully restricts the scope of state activity, state has ample power ○ World Bank 1997’s World Development Report - one plausible list of state functions: minimal, intermediate, activist ■ U.S. - High strength, low scope ■ France - High strength, low scope ■ Sierra Leone, Low strength, low scope

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Turkey/Brazil - Low Strength, high scope

Scope, Strength, and Economic Development Neopatrimonial: with political power used to service a clientalist network of supporters Shaking up the Washington Consensus East Asian economic crisis of 1997-98 Financial crisis in Thailand and South Korea were directly related to premature capitalaccount liberalization ○ foreign short-term capital suddenly flooded into domestic banks while regulatory institutions lagged in effectiveness ○ Economic reform in Russia: Privatization of state-owned enterprises ○ A strong positive correlation exists between tax extraction and levels of development New Conventional Wisdom Institutions are the critical variable in development...