Corruption

Controversy and Afghan President Hamid Karzai continue to cross paths.  Today there is news that high-level officals in Kabul and Karzai's relatives may be involved in an illicit money-transfer business.  Ted Galen Carpenter and I argue today in the Los Angeles Times that Washington's support for Karzai reveals a troubling pattern in U.S. policy:

Amid growing debate about whether the United States should stay in Afghanistan, one issue of agreement is that Afghanistan's president, Hamid Karzai, is both the central figure in the war and its weakest link.

Recent embarrassing controversies between Karzai and Washington — including a move this month by the Afghan leader to hinder U.S.-backed anti-corruption investigations in Kabul — reveal a troubling pattern in U.S. foreign policy. U.S. leaders have a tendency to hail flawed foreign leaders as the saviors of their countries, only to publicly disparage them later for not meeting America's lofty expectations.

In dealing with the erratic and unreliable Karzai, Washington is replicating the pattern of exaltation and subsequent blame-shifting it followed five decades ago with South Vietnamese leader Ngo Dinh Diem. That episode produced famously disastrous results.

You can read the entire op-ed here.

From the November/December issue of The National Interest.

TWENTY YEARS after the fall of the Berlin wall, Russia remains as Sir Winston Churchill described it: "a riddle, wrapped in a mystery, inside an enigma." Russia's complexity has contributed to an American debate in which policy preferences too often shape analysis rather than analysis driving policy. It's not a sound basis for decisions when key American interests and goals are at stake.

One doesn't need to be a Russian domestic radical or a foreign Russophobe to see major flaws in the way Russia is ruled. The country's president, Dmitri Medvedev, has catalogued its problems: "an inefficient economy, semi-Soviet social sphere, fragile democracy, negative demographic trends and unstable [North] Caucasus," not to mention "endemic corruption" defended by "influential groups of corrupt officials and do-nothing ‘entrepreneurs'" who want to "squeeze the profits from the remnants of Soviet industry and squander the natural resources that belong to us all."

IN THE last 15 years, there has been growing recognition that corruption-including bribery, extortion and misappropriation-has a particularly insidious impact on developing nations. It distorts markets and competition, breeds cynicism among citizens, stymies the rule of law, damages government legitimacy and corrodes the integrity of the private sector. It is a significant obstacle to development and poverty reduction. It also helps perpetuate failed and failing states, which are incubators of terrorism, the narcotics trade, money laundering, human trafficking and other types of global crime. Despite strong reasons for addressing these issues, the developed world's efforts to stop emerging market bribery by its own corporations have been uneven at best.

In one of the worst examples, Prime Minister Tony Blair announced in December last year that, for national-security reasons, the British government had stopped investigating bribery allegations involving British Aerospace Systems' (BAE) lucrative Al Yamamah contracts for the sale of British fighter planes to Saudi Arabia.

According to news reports, several billion dollars may have been paid by BAE, the UK's largest defense contractor, to members of the Saudi royal family to secure past and present fighter orders, quite possibly with the knowledge of the British government. Then-Attorney General Lord Goldsmith pronounced infamously: "It has been necessary to balance the need to maintain the rule of law against the wider public interest."

Perhaps it is a conceit of Americans' self-image as one of the greatest powers in history that motivates comparisons with ancient Athens and Rome in seeking to explain a singularly disastrous foreign escapade. Or maybe the hubris of earlier empires really does offer better insight than the omnipresent Munich and Vietnam analogies into a folly that swiftly took us from "America's greatest strategic triumph" in the Cold War to "our greatest strategic blunder" in Iraq. Yet unexamined is still another perspective-that the Cold War's end is not just a reference point for how fast and how far our influence has fallen, but is the very episode whose misunderstanding lured us into such a colossal misadventure in the first place. Put differently, rather than the lessons of classical Greece and Rome, or of mid twentieth-century Central Europe and Southeast Asia, we might more profitably have pondered experience much closer to hand-that of contemporary central Eurasia. Instead of wondering how our leaders could have been so misguided we might instead ask, "Didn't they learn anything from the Cold War's end and aftermath?"

Both Nikolas Gvosdev's Vexing Questions of Democracy and Irakly Areshidze's A Western-style Two Party System, Not "Managed Democracy" is Georgia's Only Hope, view the same phenomenon-the development of two Newly Independent States (NIS) of the Former Soviet Union (FSU). Yet their well-reasoned articles that emphasize the development of political institutions before economic institutions reach different conclusions.

While the above articles focus primarily on political institutions, I argued in the spring 2002 issue of The National Interest that the "commercial DNA" bequeathed to the economic enterprises of the post-Soviet successor states are worthy of consideration as well. In other words, reality is contextual; understanding the political development of NIS countries has more to do with economic determinism than the evolution of social infrastructure. From a simple Maslowian perspective, people will address their need for food before social interaction.

Some background is useful. The FSU was a hierarchical structure that provided enterprises with detailed organizational charts and procedure manuals for the production of all goods and services. Prices were set through command-and-control processes, not buyer-and-seller negotiation. In business terms, the Soviet Union might best be understood as a "firm" or, more appropriately, as a massive "corporate continent". Joseph Stalin was a robber baron Chief Executive Officer ("CEO"), and the Politburo was an overly compliant board of directors. (1) When the burden of the state bureaucracy became too costly and caused inefficiencies, gray market (offshore and underground markets) realities prevailed. When the burden of corruption from gray market activities rendered governance ineffective and the FSU could no longer sustain itself under communism, it reorganized in a series of mass privatizations to embrace capitalism.

Adam Bellow, In Praise of Nepotism:  A Natural History (New York: Doubleday, 2003), 576 pp., $30.

Frank K. Salter (ed.), Risky Transactions: Trust, Kinship and Ethnicity (Oxford: Berghahn Books, 2002), 288 pp., $79.95. 

The United States currently confronts foreign policy challenges
involving such highly disparate foes, friends and in-betweens as
North Korea, Syria, Saudi Arabia, Indonesia, Azerbaijan, Jordan,
Morocco, the Congo and the Philippines. All these countries, however,
possess one striking common denominator. Although dynasticism is
supposed to have died and been buried by meritocracy, these countries
are all led by the children of former heads of state.

The same is true of America, whose president is not just the son of a
president, but also the grandson of a senator and brother of a
governor. Americans tend to be willfully blind to the crucial subject
of nepotism. We disapprove of it, so we feel we ought not to think
about it--a dangerous illusion as we pursue a more activist foreign
policy that brings us in touch with cultures that approach the topic
quite differently.

The return of family rule should not surprise us. Nepotism and its
more formal offspring dynasticism have provided the basic organizing
principles of politics for much of human history. For example, in the
early 20th century, the ruling aristocracy of Mongolia, which
comprised 6 percent of the population, still consisted of the
descendants in the direct male line of Genghis Khan, even though he
had been dead for almost 700 years.

The events of September 11, 2001 have led, among many other things,
to the revival of an old debate about the relationship between
poverty and political extremism. To get at the root of apocalyptic
terrorism, many new initiatives to reduce global poverty have been
proposed. British International Development Secretary Clare Short
advocates a massive international effort to stop poor countries from
becoming breeding grounds for terrorism: "The conditions which bred
their bitterness and hatred", she has said, "are linked to poverty
and injustice." Britain's Chancellor of the Exchequer, Gordon Brown,
has called for a fifty-year Marshall Plan that would disperse aid in
exchange for an end to bad government, in his words, for "the
developing countries pursuing corruption-free policies for stability,
opening up trade and encouraging private investment." Some advocates
call for spending targets to be directly linked to the GDP of donor
nations, overlooking selectivity or effectiveness. Even more
ambitious proposals call for an international tax to limit the
adverse consequences of globalization by financing global public
goods.