Political Development of Western Europe

44 How We Got Here

later, would give their arguments greater resonance, because it would be-

come harder for American realists to use the confl ict with the Soviet Union

as a reason to prop up pro- Western dictators like Marcos or Mobutu, or for

Western Eu ro pe an realists to advocate their own détente with the nations

of the Warsaw Pact.

Wolfowitz and his allies had argued during the Manila protests that,

in the long run, the global spread of democracy would be in America’s

interest. Demo cratization, they believed, would minimize the possibility of

global confl icts that might necessitate American intervention, reduce the

corruption and rent- seeking that added burdens to American companies

investing abroad, enlarge the sphere of countries committed to free trade

and free markets, and generally enhance America’s prestige abroad. It was

an idea that already had begun to gain traction in the Carter administration,

which had made human rights a focus. The rhetoric of demo cratization also

appealed to Carter’s successor, who usually sought broad visions rather than

policy details, and it gained traction in Washington and other Western capi-

tals. As Reagan declared in a speech to the American Conservative Union,

“America’s foreign policy supports freedom, democracy, and human dig-

nity for all mankind, and we make no apologies for it. The opportunity so-

ciety that we want for ourselves we also want for others, not because we’re

imposing our system on others but because those opportunities belong to

all people.”15

The democracy advocates had help. In 1983 the National Endowment

for Democracy (NED) was founded in Washington, funded through an

annual congressional grant and given a mission to support demo cratic insti-

tutions around the world, including free media, unions, and po liti cal parties.

Partner democracy- promotion organizations like the National Demo cratic

Institute and the International Republican Institute, also established in the

early 1980s, were designed to augment NED’s overseas work.16 From the

beginning, much of NED’s work was pop u lar with civil society organiza-

tions in developing nations, and extremely unpop u lar with rulers, though

by the 2000s that would change: as American democracy- promotion efforts

during the George W. Bush era became increasingly unpop u lar in regions

like the Middle East and South Asia, NED grantees from civil society

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How We Got Here 45

organizations would hide their affi liation with the group.17 But earlier on,

NED grants helped speed transitions to democracy in countries like Poland,

where the group invested heavily in the Polish trade unions that played a

major role in criticizing the communist regime.18 Private organizations that

performed similar functions, like George Soros’s constellation of Open

Society initiatives, also would add to the investments in demo cratization in

the third wave nations.

With the end of the Cold War, demo cratization moved to the forefront of

American policy making, and the third wave of demo cratization expanded

beyond the post- Soviet states to include parts of Latin America and Asia

and even some African nations. Democracy advocates on both the right

and the left gained infl uence and power. Some, like Madeleine Albright,

took high- profi le positions in the administration of President Bill Clinton.

The United States, now an unrivaled superpower with a soaring economy,

enjoyed the luxury of making democracy promotion a central pillar of for-

eign policy; America could embark on armed foreign interventions to save

nations trying to build new democracies, even when those countries were

tangential to American strategic interests. The American public, riding the

economic boom of the mid- and late 1990s, would tolerate a more interna-

tionalist foreign policy; American liberals, who since the Vietnam War had

linked military intervention to overaggressive, even brutal, American power,

could now support the use of force to prevent crimes against humanity and

to save beleaguered potential democracies like East Timor or Kosovo. And

if the United States wanted to promote democracy and help build a new

class of po liti cal leaders, even close to the traditional spheres of infl uence of

Rus sia or China, who was going to stop it? By the mid- 1990s, Moscow was

on the verge of bankruptcy and Beijing still had not fully recovered from

the stain of the Tiananmen massacre.

As president, Clinton decided to make democracy promotion a core

part of his foreign policy. Searching for a theme that would convey a foreign

policy for the post– Cold War era and would be remembered by history,

Clinton had settled on one phrase: demo cratic enlargement.19 Demo cratic

enlargement, he decided in meetings with his National Security Council,

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46 How We Got Here

would form the center of his foreign policy and would be a successor to

the containment policy of the Cold War. It would capture the optimism

and hope of the post– Cold War era and would wed optimism to strategic

purpose. Enlargement would mean that America’s priority now would be

to help expand the number of free states in the world, because, as National

Security Advisor Anthony Lake told historian Douglas Brinkley, “as free

states grew in number and strength the international order would become

both more prosperous and more secure.”20 The Clinton administration, he

said, would help consolidate young democracies, help counter the aggres-

sion of states hostile to democracy, and support the liberalization of undemo-

cratic nations.21 Of course, there would be exceptions, such as China and the

Middle East, but from early in his fi rst term, and even in his speeches on the

campaign trail, Clinton aggressively highlighted democracy promotion as

vital to American national interests. His fi rst National Security Strategy

stated that “all of America’s strategic interests— from promoting prosperity

at home to checking global threats abroad before they threaten our territory—

are served by enlarging the community of demo cratic and free market

nations.”22 In studying the Clinton administration’s record, Thomas

Carothers, of the Carnegie Endowment for International Peace, found that

Clinton had for the fi rst time institutionalized democracy promotion in the

U.S. foreign policy bureaucracy— every U.S. embassy now had to submit

an annual report on its democracy promotion efforts— and the White

House, in its bud geting requests, clearly made democracy promotion one of

its strategic priorities.23 Between the early 1990s and 2000, U.S. government

spending on democracy promotion grew from around $100 million annually

to over $700 million annually.24 Clinton attempted to support what he con-

sidered the most important nations on the verge of demo cratization, includ-

ing Rus sia and Mexico; under Clinton, the United States became Rus sia’s

largest investor, American democracy- promotion organizations like NED

expanded their Rus sia programs, and the Clinton administration pushed

the International Monetary Fund, G7, and World Bank to use their re-

sources to foster demo cratization in Rus sia.25 The White House drastically

expanded funding for demo cratic institution building and market reforms

in the newly free nations of Eastern Eu rope, and, on the campaign trail in

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How We Got Here 47

1996, Clinton boasted, “With our help, the forces of reform in Eu rope’s

newly free nations have laid the foundations of democracy.”26

East Timor, which in 1975 had shown the limits of what Washington

would do to protect a nascent democracy during the Cold War, served as an

example again in 1999. As in 1975, a brutal bloodletting exploded in Timor.

After the majority of Timorese voted to separate from Indonesia, militias

with links to the Indonesian armed forces began a campaign of slaughter

that would not have been out of place in the Rwandan genocide. Gangs of

militiamen wielding machetes and automatic weapons hacked, disembow-

eled, and beheaded known in de pen dence supporters, aid workers, journal-

ists, and anyone else who happened to be in their way. Thousands died, and

70 percent of Timor’s infrastructure was destroyed. But this time the world

responded. Despite having minimal strategic interests in East Timor, major

powers like the United States, the United Kingdom, and Australia backed

an armed humanitarian intervention that, under the auspices of the United

Nations, ultimately stemmed the violence, allowed relief workers to avoid a

total catastrophe in East Timor, and ultimately helped Timor to fi nally

break from Indonesia and build a fragile and in de pen dent democracy.27

The Timor triumph, along with successful Western intervention in

Kosovo, only further emboldened Washington. With the end of the Soviet

Union, Western fears that democracy would not survive and that commu-

nism would last forever suddenly vanished. Few had predicted the Soviet

collapse, but in its wake a Western triumphalism quickly emerged. Francis

Fukuyama later protested that he never intended his “End of History” arti-

cle to express this conviction that liberal democracy had triumphed forever,

but the piece captured the victorious Western mood. Democracy, Clinton

administration offi cials now argued, had a universal appeal, and would

spread, well, universally— a belief, as Robert Kagan noted, rooted in the

Enlightenment concept of the inevitability of progress, of history constantly

moving forward toward human improvement.28 In aid conferences and

missions to developing nations in Africa, Asia, and Latin America, offi cials

from the World Bank, the International Monetary Fund, the United Na-

tions, U.S. government agencies, and other Western organizations preached

the new gospel of economic and po liti cal liberalization.

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48 How We Got Here

Kishore Mahbubani, a former se nior Singaporean foreign ser vice offi -

cial, remembered meeting a top Belgian offi cial in 1991, the year that prob-

ably marked the apex of post– Cold War triumphalism. Before a group of

Asians, the offi cial declared, “The Cold War has ended. There are only two

superpowers left: The United States and Eu rope.”29

Post–Cold War haughtiness even fi ltered into bilateral relations with

powers like Rus sia and China. In the 1990s Western scholars like Gordon

Chang predicted the coming collapse of the Chinese Communist Party and

took bets on when it would fall to a demo cratic uprising. American offi cials,

seeing in Yeltsin’s Rus sia the opposite of the Soviet Union— Russia would

now be a close friend, an American- style democracy— pushed to expand

NATO closer to Rus sia’s borders, ignoring warnings from experts that

Rus sian nationalism had hardly just vanished, and that Russians— and

Chinese— might resent this dramatic American intervention in their

backyard.30

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Yale University Press

Chapter Title: The Fourth Wave

Book Title: Democracy in Retreat Book Subtitle: The Revolt of the Middle Class and the Worldwide Decline of Representative Government Book Author(s): Joshua Kurlantzick Published by: Yale University Press. (2013) Stable URL: https://www.jstor.org/stable/j.ctt32bh31.6

JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide

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Yale University Press is collaborating with JSTOR to digitize, preserve and extend access to Democracy in Retreat

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T he outskirts of blantyre, the commercial capital of Malawi,

are some of the most forlorn suburbs on earth. Years of on- and-

off drought and famine in the countryside have gradually de-

stroyed Malawi’s farming families, driving many people to settle in Blantyre,

where the men take odd jobs as guards at stores or as part- time bus drivers.

Rows of shacks made from scraps of metal and scavenged wood cover the

denuded hills outside the city, and, at night, if you are brave enough to walk

in these neighborhoods, you can see young men posted as guards in front of

the families’ tiny dwellings, since Malawi’s urbanization and deep poverty—

GDP per capita is roughly $800— have sparked a rise in violent crime. In

wealthier parts of the city, residents employ private security companies and

equip their houses with “panic rooms,” which don’t always work— home in-

vasions remain common, and the thieves often seem to be in cahoots with

the security guards assigned to watch the properties.

In the early morning, the sides of the rutted roads are so thick with

people walking to their jobs from the shantytowns that cars can fi nd these

routes diffi cult to negotiate. Nearly all the land outside Blantyre has been

ripped up. Wood has been stripped for houses, and edible plants taken for

food on the formerly lush hills above the green valleys of Thyolo, the tradi-

tional tea- growing region north of the city. In se nior housing in Thyolo,

el der ly planters, who settled in Malawi from Britain when it was still a

colony, still take afternoon tea and tiny British- style fi nger cakes. But out-

side of the carefully tended gardens of these residences, and beyond the lush

tea plantations owned by large companies, across Thyolo one can see only

arid scrub, razed buildings, and fruit plants ripped apart in search of food.

The Fourth Wave

3

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50 The Fourth Wave

Women with babies tied on their backs with brightly colored chitenge cloths

jostle for space on the sides of the road with sickly vendors carry ing bat-

tered trays of avocados and bananas.

Children are everywhere. Malawi has one of the highest birthrates in

the world, and its fi fteen million people are jammed into a country the size

of Pennsylvania, with cities that resemble the packed metropolises of South

Asia more than the archetypical open landscapes of Africa. It also has a

staggeringly high rate of HIV/AIDS infection. The United Nations’ AIDS

program estimates that 14 percent of Malawians are infected, an epidemic

that, even in the era of antiretrovirals, has orphaned many kids, leaving

them to be cared for by grandparents, or by no one.1 At intersections in

Blantyre proper, packs of orphans clad in torn clothes and with matted hair

often waylay stopped or slow- moving cars to beg for food or a few kwacha,

the nearly worthless Malawian currency that piles up in stacks in mer-

chants’ shops.

And yet, for all its destitution Malawi was, until recently, a demo cratic

success story. After the country’s longtime dictator stepped down in the

early 1990s, the country held free, multiparty elections. The fi rst demo-

cratically elected president, Bakili Muluzi, was later accused of massive

corruption— but after Malawi’s top court upheld the constitution and barred

him from seeking a third term in the 2009 presidential election, he complied

with its ruling. His former protégé, Bingu wa Mutharika, now leading an

opposition party, won the presidency.

Beginning in the late 1990s and early 2000s, Malawi also developed a

culture of largely peaceful, vigorous po liti cal campaigning. The presiden-

tial election of 2009 exemplifi ed this trend. At one point during the winter

campaign a large crowd dressed in red, the color of John Tembo, was hol-

lering wildly for their candidate in front of an overgrown soccer fi eld next

to a divided highway. Across the road a smaller group of Mutharika back-

ers, all dressed in his party color, blue, had taken position, screaming into

the sky, clapping and singing, and thrusting massive posters of their candi-

date’s face at passing cars, nearly causing an accident. After a while some

Mutharika supporters crossed the street toward the Tembo group, yet they

didn’t make any effort to stir up violence— a common occurrence during

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The Fourth Wave 51

election campaigns in neighboring nations like Zimbabwe and Zambia.

Instead, several of the younger men dropped their Mutharika posters, pulled

out a ragged soccer ball, and started an impromptu dribbling exhibition

with two Tembo men. Later that year, Malawi would hold a relatively peace-

ful presidential election, marking another seeming transition to stable

democracy. The campaign was covered extensively in the local newspapers,

which suffered from lack of resources— reporters were paid little, and the

papers themselves often looked like they had been printed on rags— but

which reported on the candidates with boldness and style, chronicling nearly

every po liti cal battle that went on across the country. Despite some threats

from angry politicians, reporters rarely backed down, and each day’s paper

usually contained a scandal sheet rapping all the major politicians’ foibles.

Even as Malawi welcomed democracy, its leaders, and its citizens, also

came to associate po liti cal change with promises of economic prosperity.

Throughout the fourth wave of demo cratization, in the late 1990s and early

2000s, foreign donors and many local leaders who pushed the “Washington

Consensus” prescriptions of open markets and open societies, increasingly

made this association. But it was a dangerous link. No evidence had really

shown that open societies were more likely to create economic growth. In

fact, Kevin Hassett of the American Enterprise Institute has shown that, in

recent years, many authoritarian nations have outperformed freer coun-

tries.2 But in the late 1980s and 1990s, many developing world leaders—

and their advocates in the West— linked the two.

In the late 1980s, Malawi might have seemed a remote prospect for democ-

racy, but it was joined by many other demo cratizing nations from similar

levels of development. The fourth wave of global demo cratization, which

built on the gains of the third wave, began to crest in the late 1990s and con-

tinued into the early 2000s. While the third wave had swept through South-

ern Eu rope and parts of Eastern Eu rope, Latin America, and Asia, the

fourth wave included much of sub- Saharan Africa and many other coun-

tries that were poorer, more prone to confl ict, and, often, more remote, than

those in the third wave: East Timor, Cambodia, Mexico, Mozambique, and

Malawi, among many others.

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52 The Fourth Wave

In many ways, the uprisings in the Middle East in 2011 seemed to fi t in

with that fourth wave. The Middle East revolts took place in countries like

Yemen or Egypt— nations that were often as poor, authoritarian, or confl ict-

ridden—or all three— as those in the fourth wave nations. Before the Arab

Spring, just as in sub- Saharan Africa before the 1990s, many observers, and

indeed many Arabs, had all but written off the prospect of real change in

the Middle East for generations.

Just as in the third wave, a kind of positive diffusion effect took place

in which demo cratic change— sometimes backed by powerful advocacy by

established democracies, as in East Timor— in one fourth wave country

spilled over to neighboring nations. The revolts in Tunisia in December

2010, broadcast on satellite tele vi sion and social media, inspired reformers

fi rst in Egypt, and then in Bahrain, Syria, Libya, and other nations in the

Middle East. The dramatic end of apartheid in South Africa in the early

1990s, as well as liberalization in neighboring nations like Mozambique

and Zambia, helped create currents of change that autocratic leaders like

Malawian dictator Hastings Banda ultimately could not ignore. Throwing

off most of the remaining postcolonial dictators, many other poor African

nations, like Benin, held multiple free and fair elections.

In the former Soviet sphere, the progress toward democracy of former

communist states like Poland and Kyrgyzstan began to spill over into harder

cases, like Ukraine, Central Asian nations, and Georgia. New states carved

from the Soviet Central Asian republics, some of the poorest and most

ethnically heterogeneous parts of the former Soviet Union, held elections.

After the vicious Balkan wars of the 1990s, nearly every part of the former

Yugo slavia held real, competitive elections, with several, like Slovenia, ap-

proaching Western Eu ro pe an standards of stable democracy. Overall, by

the early 2000s, nearly half of the world’s population lived in countries that

were either full or partial democracies, up from less than half in the mid-

1970s.3

Sub- Saharan Africa made perhaps the greatest demo cratic gains in the

1990s and early 2000s, seemingly disproving arguments, sometimes made

by African leaders, that the region was too poor, too ethnically divided, and

too uneducated to make democracy work. From Malawi to postapartheid

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The Fourth Wave 53

South Africa, the continent disposed of so- called big men, held elections,

and paid lip ser vice to new demo cratic norms. Long- ruling parties in many

countries fi nally lost elections and willingly transferred power. Western

leaders, including President Bill Clinton, touted a “new generation” of Afri-

can leaders, men like Uganda’s Yoweri Museveni and Ethiopia’s Meles

Zenawi, who would commit themselves to reform and to priorities that

the fi rst postcolonial generation had often ignored.4

In Kenya, the era following Daniel arap Moi had begun exuberantly

in 2002 with the frenzied inauguration of former longtime opposition

leader Mwai Kibaki, who vowed to clean up, and open up, Kenyan politics.

At Kibaki’s inauguration, where the new president declared, “The era of

anything goes is now gone forever: Government will no longer be run on

the whims of individuals.” Africa journalist Michela Wrong tried to pay a

small bribe to a local driver, but he refused her money, saying that a new,

cleaner era had come to Kenya.5 Kibaki appointed John Githongo, a prom-

inent, outspoken local journalist who had bitterly criticized Moi’s autocratic

and venal style, as his anticorruption czar.

Like Kibaki, Olusegun Obasanjo, a former general with a relatively

clean reputation who won the Nigerian presidency in 1999 after the dictator

Sani Abacha died, took offi ce amid a wave of optimism. Obasanjo touted

himself as a reformer after the predation and outright thuggery of the

Abacha era; the day of his inauguration was called “Democracy Day,” and

a national holiday was declared.6 In the following months U. S. Secretary of

State Madeleine Albright called for greater American aid to Nigeria, prais-

ing Obasanjo for launching a demo cratic revolution that could rival “the

Czechoslovak ‘Velvet Revolution’ and South Africa’s long walk to freedom”

in its power and infl uence.7

The fourth wave of demo cratization, which had seemed so improbable

just a de cade earlier, cemented in many Western leaders’ minds the idea

that democracy eventually would come to every country. If a place as poor

and as confl ict- ridden as Malawi or Mozambique could build a viable demo-

cratic system, what nation could not? Critical international developments,

including the rapid expansion of communications technology, the end of the

Cold War, and the birth of Western democracy promotion, also seemed to

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54 The Fourth Wave

foster the global spread of democracy. By the beginning of the 2000s, this

belief in the essential triumph of democracy had become a kind of religion

among Western leaders.

The color revolutions of the early 2000s capped off the fourth wave,

and only added to Western leaders’ demo cratic triumphalism. Beginning

with the Rose Revolution in Georgia in 2003 (some would add the protests

in Serbia in 2000), the term “color revolutions” came to mean peaceful,

pop u lar movements for demo cratic change, initially in the former Soviet

Union and old Eastern bloc.

To be sure, some fourth wave nations seemed, even in their best moments,

to be the “illiberal democracies” that prominent intellectual and writer

Fareed Zakaria has described— places like Cambodia, whose leaders never

really upheld what Zakaria calls “constitutional liberalism,” meaning pro-

tections of individual autonomy and dignity against coercion, including

the potential tyranny of a demo cratic majority.8 As Zakaria outlined in his

book The Future of Freedom: Illiberal Democracy at Home and Abroad,

many young democracies, led by popularly elected leaders who had little

interest in creating demo cratic institutions, trampled on minority rights,

religious freedoms, and economic rights. “In many developing countries,

the experience of democracy over the past few de cades has been one in

which majorities have— often quietly, sometimes noisily— eroded separa-

tions of power, undermined human rights, and corrupted longstanding

traditions of tolerance and fairness. . . . Demo cratization and illiberalism

are directly related,” he wrote.9 In India, where Zakaria was born, the mid-

1990s BJP government, popularly elected and supported by many Hindus,

fostered pogroms against Muslims, a religious minority, in states like Guja-

rat, and apparently set back India’s commitment to liberalism, which had

been enshrined at the time of in de pen dence by unelected Indian elites or by

leaders, like Jawaharlal Nehru, who were far more tolerant than most Indi-

ans. In Indonesia, where for thirty years relative interreligious and intereth-

nic peace had prevailed under Suharto’s iron grip (though, when he came to

power in the mid- 1960s, Suharto unleashed massive bloodshed), demo cratic

change in the late 1990s led to new waves of violence between Muslims and

Christians, Javanese and non- Javanese, and many other groups within In-

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The Fourth Wave 55

donesian society.10 Unlike leaders like Suharto or Singapore’s Lee Kuan

Yew, who could “make shrewd choices for the long term,” demo cratic lead-

ers also would inherently be pulled into populist economic policies focused

on short- term gains at the expense of development.11

Zakaria argued further that the problem with these “illiberal democ-

racies” was not that they were insuffi ciently democratic— that their institu-

tions and po liti cal cultures needed to continue to mature, like those in the

West that had developed for de cades. This was a critique that had been made

by many demo cratization specialists, and even by demo crats in many devel-

oping nations themselves. Instead, he argued that they had too much democ-

racy, and that the only solution was authoritarian rule, or at least a kind of

oligarchic rule by the “best people”— the elites, like Nehru and other Indian

founding fathers, who had attended En glish boarding schools and then

Oxford or Cambridge. He celebrated leaders like Indonesia’s Suharto and

Pervez Musharraf, the military ruler of Pakistan throughout most of the

2000s who, by Zakaria’s reckoning, instilled greater tolerance of religious

and ethnic diversity than any civilian politician in that country could or

would have done.12 He seemed to even suggest that no Muslim- majority

nation was capable of real democracy, since illiberal Islamists would always

dominate an election and crush people’s freedoms— thus, a “liberal” dicta-

tor like Musharraf or Tunisia’s Zine Al- Abidine Ben Ali was the best alter-

native. He longed for earlier periods even in American history, when politics

was essentially decided by a small group of men who came from the “right”

background, attended the “right” universities, and then governed together at

the State Department, CIA, and the White House.

Some of Zakaria’s argument about illiberalism made inherent sense,

such as the critical observation that democracy means more than simply

elections; U.S. policy too often has focused on one relatively free election in

a developing nation while ignoring other signs suggesting that demo cratic

institutions are not being put into place. As we will see later, some “elected

autocrats”— popularly elected leaders in fragile democracies like Rus sia or

Thailand— have shown little commitment to the rule of law or to freedoms

of association, press, or religion, and a democracy promotion policy focused

primarily on elections, or a one- size- fi ts- all type of pro cess, can hardly be suc-

cessful. And in some instances, development- minded dictators like Suharto

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56 The Fourth Wave

or Augusto Pinochet of Chile were able to pass economic reforms that set

the stage for sustained growth.

Yet a wide range of comprehensive studies has shown that it is impossi-

ble to fi nd a clear link between autocracy and growth. These dictators also

usually did little to set the stage for any demo cratic transition, since the

foundation of their rule was a desire to stay in power for life— when Suharto

was overthrown, he was focused on concentrating more wealth and power

into the hands of his family, not liberalizing the po liti cal environment or

opening up Indonesia’s cartelized markets. More important, these elected

autocrats alone, whom Zakaria despises, did not undermine these democra-

cies; as we will see, when this fourth wave crested these nations were neu-

tered by a combination of poor leadership, weak institutions, a complacent

middle class, slow growth, and corruption. This fourth wave also was not

helped by Western democracy promotion strategies heavy on rhetoric, elec-

tions, and pro cess, and it was light on actual funding on the ground, or an

understanding of how to make democracy more attractive to both middle

classes and working classes in the developing world.

But despite Zakaria’s legitimate concerns about young democracies,

some of which are echoed in this book, and even though many of these

elected autocrats often took their countries’ democracies backward, they

almost never left their nations more repressive than they had been under pre-

vious true dictatorships. In Thailand, for instance, Thaksin Shinawatra did

set the rule of law back during his prime ministership between 2001 and

2006: he intimidated the Thai media, bent the court system to his priorities,

and essentially sacked supposedly in de pen dent bureaucrats who defi ed his

policies. But only someone with no historical memory would argue that

Thaksin’s period as prime minister even began to compare to the bloodiest

days of Thailand’s past dictatorships, such as the late 1940s, when dictator

Phibul Songkram disappeared or simply murdered po liti cal opponents,

or the mid- 1970s, when under a series of right- wing regimes state- backed

vigilantes attacked Thammasat University, the Thai equivalent of Har-

vard, where they raped female students and then doused students with

gasoline and immolated them, leaving their charred bodies swinging

from trees.13

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The Fourth Wave 57

Indeed, even if they were incomplete democracies, all of the fourth wave

nations that later regressed were freer in every respect during their more

demo cratic periods than they had been earlier, during their truly authoritar-

ian periods. Vladimir Putin, in the 2000s, did indeed set back Rus sian de-

mocracy, often with the consent of many Rus sians; its scores on Freedom

House rankings fell compared to the Yeltsin era during the 1990s. But the

country hardly had reverted to the terrors of the Soviet Union, in which

none of Zakaria’s individual liberal rights received any protections.

Zakaria’s notion of illiberal democracy is inherently fl awed in other

ways. He chooses many examples in his book that do not even fi t the defi ni-

tion of democracy at all, countries like Kazakhstan that, according to the

international monitoring or ga ni za tion Freedom House and other ranking

organizations, are simply autocracies. For every Pinochet or Lee Kuan Yew,

there were tens of Mobutus or Malawi’s Hastings Banda, who used their

cults of personality to signifi cantly restrain personal freedoms and individ-

ual liberties. In nearly every country he surveyed, many of the problems he

outlined were indeed a result of not enough, rather than too much, democ-

racy. As Harvard’s Sabeel Rahman writes in an analysis of Zakaria’s book,

“On closer inspection, one fi nds that the culprits [in illiberal democracies]

are not the public, who are the supposed benefi ciaries of demo cratic em-

powerment, but rather special interest groups”— groups that could be

minimized through greater, not lesser, democracy.14

Meanwhile, as they have become more autocratic, the fourth wave na-

tions have not developed any of the supposed positive attributes of authori-

tarian rule that Zakaria writes about: benign dictators promoting liberal

social and economic freedoms that would have been impossible in a pop u-

lar democracy, or making farsighted economic decisions, since they are not

accountable to the broader public. Instead, after the coup in 2006 Thailand’s

new military leaders badly bungled economic policy, sparking panic among

investors and leading to runs on the Thai currency. In Cambodia, where the

prime minister has suffocated the demo cratic reforms of the 1990s, the

government has done little to promote sustained economic growth, instead

turning into a kind of mafi a state designed to enrich se nior government

offi cials and their allies.15 Overall, a comprehensive study of fourth wave

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58 The Fourth Wave

nations by Council on Foreign Relations researchers found that economic

growth did not improve as they veered back toward autocracy, and that

protection of these types of liberal freedoms also did not improve, even

under supposedly “enlightened” autocracies like the Thai generals who de-

posed the elected autocrat Thaksin, or Musharraf.

In earlier demo cratic waves, countries had pursued a wide range of develop-

ment strategies. Many third wave nations, especially those in East Asia,

actually pursued highly state- directed strategies of economic growth, which

some economists later would call the East Asian model. Eventually, these

countries, like Taiwan and South Korea, also built vibrant democracies.

While participating in global trading regimes, nations like Taiwan, Thai-

land, Malaysia, South Korea, and, earlier, Japan protected critical industries

until they were more internationally competitive, invested heavily in primary

education, and directed banks and other fi nancial institutions, including citi-

zens’ pension plans, to support certain sectors of the economy. Some of

these high- powered economies, like Malaysia (and later China), used capital

controls to protect themselves from international capital markets. In Thai-

land, a small cadre of government bureaucrats in the Bank of Thailand and

Ministry of Finance oversaw these government economic plans; in Japan,

the powerful bureaucrats of the Ministry of Economy, Trade, and Industry

played this role. In Thailand, import substitution and protections of critical

industries would ultimately be responsible for nearly half the growth in the

export manufacturing sector, while in South Korea such supports and

protections nurtured a generation of companies that would become world-

beaters, including automaker Hyundai and technology giant Samsung.

These state- directed mea sures were actually not so different from those

employed by earlier, fi rst wave democracies in North America and Western

Eu rope when they, too, were developing economies. During the early years

of its existence, the United States, for example, used high tariffs and other

import restrictions to protect many of the young country’s industries from

competition with Eu ro pe an fi rms.

Other second and third wave nations pursued different strategies of

growth, with less success, yet managed at the same time to build solid de-

mocracies. After in de pen dence, India created a highly protected economy,

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The Fourth Wave 59

using a wide range of tariffs and nontariff barriers to keep out foreign

investment in most sectors, and to actually hinder domestic companies

from growing too large. Many other postcolonial states also adhered to a

socialist economic strategy, with highly mixed economic results— India

grew by around 3– 4 percent most years, and many African nations barely

grew at all in the 1970s and early 1980s. Yet some of these nations, such as

Greece and India, still managed to consolidate their democracies. Very few

nations in the second or third waves adopted wholly free market policies—

even countries later championed by free market advocates, like Chile, still

used a sizable degree of state planning and support to buttress certain sec-

tors. The one place often cited by free market advocates as an example of

the power of economic liberalization, Hong Kong— annually ranked as the

“freest” economy in the world in the Heritage Foundation think tank’s In-

dex of Economic Freedom— was neither a country nor a democracy, and its

prosperity actually depended, in no small mea sure, on a massively infl ated

local property market tightly controlled by the government.

But in the fourth wave Western leaders, policy makers, and institutions

like the World Bank were caught up in a kind of post– Cold War hysteria.

The West’s triumph over communism was proof, as Francis Fukuyama fa-

mously argued in The End of History, that liberal democracy, combined with

market economics, represented the direction in which the world would in-

evitably evolve. The hard sell of democracy barely took account of the uncer-

tainty about the actual conditions for growth in developing nations. It did

not seem to matter that earlier wave nations had employed many different

economic models of growth, or that many of the governments that collapsed

in 1989 and in the early 1990s did so not because of economic liberalization

but for a variety of reasons, ranging from international pressure (apartheid

South Africa) to internal leadership dynamics that spiraled out of control

(the Soviet Union under Gorbachev). At the time, this nuance was ignored:

economic change was linked to po liti cal change, and a program of free mar-

kets and free politics was the only item on the menu. As candidate George

W. Bush declared in 2000 on the presidential campaign trail, “Economic

freedom creates habits of liberty. And habits of liberty create expectations of

democracy.”16 The man he was hoping to replace, Bill Clinton, made essen-

tially the same point many times. In one typical phrase from his book- length

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60 The Fourth Wave

vision for America, Between Hope and History, he wrote, “Just as democracy

helps make the world safe for commerce, commerce helps make the world

safe for democracy.”17

By the 1990s a large cadre of development experts, housed at the World

Bank, the International Monetary Fund, ministries of Western govern-

ments, and universities and think tanks, were ready to dispense advice about

the proper route to po liti cal and economic liberalization. The model advo-

cated by many of these experts became known as the “Washington Con-

sensus.”18 Its author, economist John Williamson, originally intended it to

mean a discrete and limited set of economic initiatives particularly devel-

oped to address many of the economic problems facing Latin American

nations in the late 1980s and in the 1990s, including fi scal discipline, tax

reform, liberalizing exchange rates, privatization, and trade liberalization,

among other changes. But the term soon took on a far broader meaning

among many development experts and world leaders: it came to signify

broad reforms, promoted not only for Latin America but for the entire devel-

oping world, and designed to open markets, increase fi nancial transparency,

and reduce government intervention in the economy, along with po liti cal re-

forms that would also foster freedom by shrinking the role of the state.19

Proponents of the Washington Consensus made swaggering boasts about

the potential results, and brooked little criticism of their proposals. In per-

haps the most famous example, World Bank offi cials throughout the 1990s

promised that these policy reforms, if implemented throughout the devel-

oping world, would slash global poverty in half.20 Later, in an internal as-

sessment of its policies during this de cade, the Bank admitted that it still

didn’t know “how to improve institutional per for mance [i.e., how to pro-

mote economic growth]” and that the Washington Consensus had been “the

dominant view, making it diffi cult for others to be heard,” even though

these proposed reforms actually had had a mixed impact on growth and

po liti cal change.21 Another retrospective comprehensive analysis of the

Washington Consensus, by former World Bank chief economist Joseph Sti-

glitz, found that proponents of its reforms made little effort to tailor its pre-

scriptions to individual countries and, even if it produced growth, actually

paid little attention to whether that growth alleviated poverty or really ad-

dressed in e qual ity at all. Worse, Stiglitz also concluded that the Washington

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The Fourth Wave 61

Consensus failed to even promote signifi cant growth in most of the nations

where it was applied, even as it ignored the balanced, important role that a

state can play in development.

The lack of another obvious alternative model in the late 1990s and early

2000s only emboldened advocates of free markets linked with free politics.

Compared with the Cold War, no major powers now dissented loudly from

this new orthodoxy. After the 1989 Tiananmen crackdown, China adopted

a more modest public approach to foreign policy and spent most of the 1990s

and early 2000s wooing foreign investment, building its own industries

(using many of the statist models pioneered by other Asian nations), and

refusing to publicly offer any alternative to the Washington Consensus. Rus sia,

decimated eco nom ical ly by the fall of the Soviet Union, and nearly bankrupt

in the mid- 1990s, also was in no position to offer any alternative.

The sheer number and diversity of countries in the fourth wave of

demo cratization, as compared with earlier waves that took place mostly in

the West, also added to pressure among many leaders and donors to de-

velop a single model that could be applied in developing nations. After the

fall of the Berlin Wall, many leaders, both in the former Soviet states and in

the West, feared that if radical mea sures were not taken rapidly in the old

Soviet bloc, these states would be unable to jettison the legacy of communist

economic planning, and might wind up with hyperinfl ation and highly

uncompetitive economies, which could lead to a stalling, or even a reversal,

of po liti cal reforms and potential links to the West. These countries, many

economists and donor agencies believed, needed to embark on quick trans-

formations. Led by economists such as Jeffrey Sachs, many IMF and Bank

offi cials promoted a kind of economic shock therapy, consisting of rapid

freeing of the economies of countries like Poland.

The Bank was hardly alone in its hard sell of free markets and free

politics. Sub- Saharan Africa and much of Latin America had suffered

badly in the 1980s, a period of capital fl ight and economic policies that too

often saddled Latin American and African nations with greater debts. In

the worst years of the 1980s, sub- Saharan Africa’s total GDP actually

shrank, and even in the best years overall growth in Africa barely topped 4

percent; many Latin nations also ended the de cade of the 1980s poorer than

they’d begun.22 By the early 1990s, most African and Latin leaders were

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62 The Fourth Wave

looking for any solutions that would halt a death spiral of underdevelop-

ment and isolation from the global economy. Many had failed with the social-

ist economic planning and import- substitution strategies of the postcolonial

era, and at the time few understood the potential of the gradualist approach

of the East Asian nations, which slowly weaned themselves off of many of

the state subsidies and protections they had used in the 1960s and 1970s.

(Later, as we will see, as China became a major world power again, and

began highlighting its growth model, many other developing nations would

try to copy the gradualist approach.) Compared with the weak growth and

stasis of the 1960s and 1970s, and facing balance of payments problems,

weak growth, and high unemployment, many developing nations as-

sumed that the Washington Consensus could not help but improve their

economies.

The savviest leaders of developing nations also realized that decent

growth rates could bring stability to a young democracy. Growth, after

all, would mollify members of the old regime— friends of the old dicta-

tor, the military, se nior civil servants used to comfortable lifestyles, local

traditional leaders— by expanding the pool of potential spoils and, possi-

bly, convincing the most recalcitrant former regime insiders to support a

demo cratic transition.

Malawi, like many sub- Saharan African nations, received the full mea sure

of Washington Consensus advocacy. Stephen Carr, an economist, worked

for the World Bank for years, and then retired to Malawi, where he lived

on a small mountain outside of Blantyre. He had worked at the Bank dur-

ing the height of the Washington Consensus era and then watched, even

after he had left, as Bank specialists continued to descend upon the country.

“You’d have economists come in here, never been to Malawi, knew nothing

about how the country worked, and they’d make predictions, projections. . . .

No follow- through, but if anyone disagreed with them, well, you just

couldn’t,” he said. “It would be put that there was no other choice, really.”23

In the 1990s and early 2000s, Malawi was confronted with one crisis

after another: declining world prices for its staple crops of tea, coffee, and to-

bacco, and growing competition from new producers like Vietnam. Between

1980 and 2000, global prices for eigh teen major commodities plunged by

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The Fourth Wave 63

nearly one- quarter. Several times in the 1990s, droughts in the maize-

planting regions, possibly caused by shifting global climate patterns, caused

famines. Many Malawian families were left without enough maize even to

feed themselves the staple porridge of nsima, much less enough maize or

any other crop to sell; the ever- present deep- fried potatoes sold by street

vendors throughout the country were luxuries they could not afford.

The World Bank’s specialists proposed that Malawi privatize its agri-

cultural sector, slashing state subsidies for fertilizer and feed. These policy

recommendations came on the heels of Bank- and International Monetary

Fund– led structural adjustment policies for Malawi, begun in the late 1980s,

and they have launched a wave of privatization and macroeconomic liberal-

ization in the country. Some Malawian government offi cials wanted to tell

the Bank, politely, to shove off. They worried that, with even less of a gov-

ernment cushion of maize surplus and seeds, a drought would leave average

Malawians in an even more precarious position. But Malawi relies on donors

for more than half of its annual bud get, and so the Bank, and other Western

donors, wield enormous infl uence over government policy. “There was not

much [of a] way they [the Malawian government] could really stand up to

the donors,” said Carr. In the late 1990s, the government did begin to imple-

ment many of the Bank’s recommendations. As it did so, both Bank offi cials

and many Malawians politicians who realized that strong growth was needed

to maintain social stability aggressively advertised these policies.

Then, in the 2000s, disaster struck. Each season seemed to bring a

drought worse than the previous one. Malawi’s farms withered, and the

country had to start importing food from neighboring nations. Maize pro-

duction dropped by nearly half between 1998 and 2004, and in October

2005 Malawi’s president declared that the famine was a “national disaster.”

Malnutrition soared in a country where many people already could not

obtain enough food, and in the early 2000s hundreds died every year from

starvation. But the government had sold off much of its grain reserves, and

so it could do little to help its suffering farmers; it had to rely even more

heavily on handouts from aid agencies and other African nations. Private

traders who had amassed stocks of grain jacked up prices, and farmers

complained bitterly. Malawi’s economy contracted by nearly 5 percent in

2001, and by another 4.4 percent in 2002.

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64 The Fourth Wave

Eventually, the devastating famine forced the Malawian government to

reassess its strategies. Defying the Bank’s recommendation, the government

instead launched a program in which roughly half of Malawi’s small farm-

ers were given coupons that allowed them to buy fertilizer and seed at a rate

far below the market price. World Bank experts initially disdained the

Malawian government’s strategy, and the Bank may even have threatened

to cut assistance if Malawi went forward with its plan.24 Still, the Malawian

government insisted on its strategy and ultimately was seemingly proven

correct. The subsidized fertilizer and seeds helped Malawian farmers

produce some of their best harvests in the late 2000s. Once the farmers pro-

duced, the Malawian government created funds designed to buy a percent-

age of the maize crop and store it for future emergencies, thereby averting

the threat of empty grain silos in a future famine. Leaders from other Afri-

can nations, and even from some Latin American countries like Costa

Rica, began traveling to Malawi to study its turnaround. At one point, Ma-

lawi’s farmers became so productive that some government offi cials wor-

ried whether they might be producing too much, and thereby driving down

the price of their crops. Eventually, by the late 2000s the World Bank’s own

internal watchdog concluded that the demands by the Bank and other aid

donors to privatize agriculture in countries like Malawi had actually hurt

African nations. The Bank, and other Western donors, decided to cautiously

back the Malawian subsidies.25

But by the time of the Bank’s reevaluation, donors already had pursued

more than a de cade of in effec tive and dangerous policies in Malawi, despite

many warnings by local specialists that the donors were actually making

the situation worse.26 And even with the new subsidy policies, years of

privatization, combined with changing climate patterns and new competi-

tors for coffee, tea, and tobacco, weakened the country’s economy and led

to far greater fl uctuations in unemployment than that in the 1960s, 1970s,

or 1980s. As the economy stalled and hunger grew, further worsening the

HIV/AIDS situation in the country, many Malawians began to wonder

whether democracy, which had been promoted as part of the new economic

model, was not also to blame.

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Yale University Press

Chapter Title: It’s the Economy, Stupid: The Consensus Fails

Book Title: Democracy in Retreat Book Subtitle: The Revolt of the Middle Class and the Worldwide Decline of Representative Government Book Author(s): Joshua Kurlantzick Published by: Yale University Press. (2013) Stable URL: https://www.jstor.org/stable/j.ctt32bh31.7

JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide

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Yale University Press is collaborating with JSTOR to digitize, preserve and extend access to Democracy in Retreat

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B y the early 2000s, outside donors and many fourth wave nations like

Malawi had little to show for the linking of rapid economic and po-

liti cal liberalization. The tough reforms of democracy and the tough

reforms of market capitalism supposedly went hand in hand. Together, they

would bring freedom of speech and free elections but also growth, which

would trickle down to working class men and women. But in reality, the

correlation, or lack thereof, between democracy and economic growth has

been the subject of many studies, which have yielded inconclusive results.

Harvard economist Dani Rodrik has examined a wide range of case studies

and concluded that democracies historically neither outperform nor under-

perform dictatorships in promoting economic growth.1

Rodrik’s fi nding is supported by most other macroscopic literature stud-

ies, though other researchers, like the American Enterprise Institute’s Kevin

Hassett, have found short- term advantages for dictatorships.2 Another re-

cent comprehensive study analyzed countries that shifted from dictator-

ship to democracy, and vice versa. It found that the average rate of GDP

growth for the dictatorships was 4.37 percent a year and the average rate for

the democracies was 4.49 percent— virtually no difference.3

Authoritarian regimes can offer some advantages for growth if the

leadership, such as Lee Kuan Yew in Singapore or Augusto Pinochet in

Chile, pursues consistent and wise economic policies: dictatorships tend to

suffer less po liti cal instability, allowing authoritarian regimes to pursue

more farsighted economic policies without being captured by the po liti cal

pro cess. These policies can also impose more hardship on more people,

since they do not have to survive the test of elections— think of China’s

It’s the Economy, Stupid: The Consensus Fails

4

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66 It’s the Economy, Stupid

willingness to implement infrastructure projects that force people to move,

a far harder feat in demo cratic India, where every new infrastructure project

requires signifi cant po liti cal negotiation.

Democracies, meanwhile, offer other advantages: They can create more

rule- based economies and can offer investors and local businesspeople more

outlets to pursue grievances, including outlets that are less opaque and easier

for foreign companies to navigate. Of course, some authoritarian states,

such as Pinochet’s Chile, or even today’s China, have welcomed foreign

investment and have created a relatively hospitable environment for it, but

overall democracies tend to provide the rules- based environment that facili-

tates investment. Several studies also have suggested that democracy tends

to reduce population growth, since demo cratic governments invest more in

public education, thereby boosting women’s earning potential by giving

them access to a greater range of jobs, expanding the country’s potential

workforce, and also likely helping bring down high fertility rates since

women’s growing education tends to be linked with declines in population

growth. Still, as Rodrik found, it can be diffi cult to trace economic success

to any clear policies adopted by a government.4

Some states in the third and fourth waves of demo cratization did pros-

per after opening up their po liti cal systems, but many of these countries—

including Taiwan, South Korea, and Chile— already had been succeeding

under authoritarian rule, and so continued economic growth did not help

much in selling the public on the merits of democracy. In other new de-

mocracies, the 1990s did become an era of decent growth— overall, Latin

America grew by just over 3 percent annually during the de cade, and Af-

rica grew by 2.2 percent— but these modest gains were not enough to make

up for the enormous losses suffered in the 1980s, especially with high fertil-

ity rates resulting in more and more young people entering the job market.

And, in Africa and parts of Asia, increased government and private sector

revenues quickly were consumed by the costs of a spiraling HIV/AIDS

crisis, which had not abated well into the 2000s.5

By the end of the 1990s, fi nancial crises in Rus sia, Argentina, and East

Asia reversed many economic gains made earlier in the de cade by young

democracies; overall, the Washington Consensus failed to deliver on many

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It’s the Economy, Stupid 67

of its promises of higher growth, or it produced growth that still did not

make signifi cant inroads into unemployment in the developing world. In

fact, growth overall was lower in the developing world in the late 1990s and

early 2000s than it had been in the 1950s and 1960s, the postcolonial era of

import substitution and protectionism. Rus sia’s GDP shrank in 1998, as did

that of the Philippines and Malaysia; Argentina’s GDP shrank in 1999 and

2000; Thailand, where the Asian fi nancial crisis began with attacks on the

Thai currency in May 1997, suffered huge economic reversals as well. Latin

America and sub- Saharan Africa began to grow somewhat more strongly

in the late 2000s, but again much of this growth wound up being absorbed

by rising costs for pandemic disease— particularly HIV, which hit working

class men and women hard— spiraling prices for essential items, and declin-

ing terms of trade for many primary commodities produced in the poorer

fourth wave nations, which faced many nontariff barriers from Eu rope, the

United States, and other wealthy nations. Sub- Saharan nations like Zambia,

Mozambique, Malawi, and many others saw the economic gains they had

made further diminished.

When another global economic crisis hit in the late 2000s, many of

these fourth wave nations would be battered again, while the privatizations

of the 1990s and early 2000s had left states with fewer resources to absorb

this latest economic downturn through large- scale social welfare programs

or job creation schemes. In Central and Eastern Eu rope, growth averaged a

solid 4– 5 percent between 2003 and 2007, these nations were then decimated

by the global economic crisis. In the fourth quarter of 2009, the height of the

crisis in Latvia, the country’s economy shrunk by over 10 percent year- on-

year, and unemployment rose to over 20 percent. In neighboring Estonia,

the economy contracted by 9 percent year- on- year in the fourth quarter of

2009 alone. Asia’s developing nations, many of which were highly dependent

on exports to the West, suffered too: Singapore’s economy contracted by

nearly 20 percent in the fi rst quarter of 2009, in the wake of the global

economic crisis, with Malaysia, Thailand, Bangladesh, Cambodia, and the

Philippines hit hard as well.

Meanwhile, in many of these fourth wave countries, radical economic

restructuring in systems that still had not developed strong rules of law often

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68 It’s the Economy, Stupid

resulted in old regime insiders morphing into fl ashy new oligarchs con-

trolling former state companies. This was particularly true among former

Soviet states, where the rapid economic liberalization frequently led to the

stripping of state assets and other dubious types of privatization. In Rus sia,

polls showed that the public had an intensely negative view of the oligarchs,

the big businessmen who had taken control of state companies in the post-

Soviet period, often gaining the assets at fi re sale prices. In one study, by the

ROMIR polling agency, only 19 percent of Rus sians held positive views of

the oligarchs’ actions in the 1990s, the height of the post- Soviet privatiza-

tion.6 In a more telling, and sad, statement, a Pew Research poll of many of

the former Soviet and Eastern bloc states taken to coincide with the twenti-

eth anniversary of the fall of the Berlin Wall found that, “in many nations,

majorities or pluralities say that most people were better off under commu-

nism.” Other studies by the New Eu rope Barometer survey group found

rising levels of dissatisfaction with government in most former Eastern bloc

states in the two de cades after the fall of the Berlin Wall, often because of

dissatisfaction with their governments’ economic per for mance, a dissatisfac-

tion that would, for many, refl ect poorly on democracy as a po liti cal system.7

Even when the demo cratic era produced decent growth, various factors—

rising in e qual ity in a more globalized world, a decrease in state social welfare

policies in most nations, disease, urbanization, environmental degradation,

migration, and other changes wrought by the pace of modernization— often

made working class men and women’s lives harder, in some ways, than they

had been during earlier years of authoritarian rule. Overall, the United Na-

tions Human Development Program reports, the 2000s witnessed rising

income in e qual ity in nearly every developing nation. As a result, perceptions

that the standard of living was declining— or, at least, that it was not keep-

ing pace in countries that were becoming more unequal— often mattered

more than the actual facts of a par tic u lar nation’s economic growth or

decline. “A crucial paradox— that of growth without prosperity— besets

Africa’s new democracies,” writes Peter Lewis of Johns Hopkins University.

Macroeconomic reforms instituted by governments in Africa, Latin Amer-

ica, and parts of Central Asia, did deliver stronger economic fundamentals

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It’s the Economy, Stupid 69

and higher growth. Yet except in a few rare exceptions like Brazil, which

combined macroeconomic stabilization with an innovative cash transfer

antipoverty program, in most of these developing nations growth seemed

to mean little to the lives of average citizens, and governments also cut social

welfare programs that, in the 1970s and 1980s, had helped prevent hunger

and homelessness.8 In Ghana, Kenya, Nigeria, South Africa, and Tanzania,

Lewis concluded, indicators of public well- being—such as a rising incomes,

decreasing infant mortality, or home buying— lagged in the 1990s behind

strong overall economic per for mance in all of these new democracies.

And though politicians often expected that citizens would “evaluate po liti cal

and economic ‘goods’ separately,” in Lewis’s words, as we have seen this did

not happen— with such high expectations, many citizens of developing

nations judged the two “goods” together, and increasingly concluded that if

democracy could not deliver economic per for mance and public well- being,

its strengths had been greatly oversold.

Expectations seemed to matter enormously in Central and Eastern

Eu rope as well. The Eu ro pe an Bank for Reconstruction and Development’s

(EBRD) survey of the region in 2011 found that the economic crisis batter-

ing Eu rope in the late 2000s and early 2010s led to a decrease in support for

democracy among much of Central and Eastern Eu rope. Many house holds,

it found, had linked markets and democracy, and blamed the two for the

decrease in their living standards. But the EBRD also found that people

living in countries that had experienced previous serious downturns, and

that seemed to have lowered expectations for the relationship between de-

mocracy and growth, were less dissatisfi ed with the downturn of the late

2000s and early 2010s, and tended to remain stronger supporters of both

democracy and free market systems.9 In other words, if they had not linked

the “goods” of democracy and markets together so explicitly, they were less

likely to condemn democracy when the economy soured.

In Malawi, the 2000s contained several years of solid growth, at least

according to year- end economic fi gures. In 2005, Malawi grew by over 4

percent; two years later, it grew by over 8 percent. These fi gures suggested

that the country actually was becoming one of the stronger economic per-

formers in Africa.

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70 It’s the Economy, Stupid

But few working class Malawians felt they had benefi ted much from

this growth; almost to a person, they complained that their standard of

living had declined, whether or not the national economic growth fi gures

showed such a decline. And few understood that, whether Malawi liked it

or not, its government could not, in a globalizing world, keep the economy

closed and provide the type of social welfare it had delivered in the 1960s or

1970s. Back then, Malawi, willing to defy other black- run newly in de pen-

dent nations, had benefi ted from the largesse of apartheid South Africa, had

a much smaller population, and had enjoyed high world prices for its to-

bacco and coffee. Now, working class men and women saw that economic

liberalization had undercut the prices for their maize, tea, and tobacco, and

po liti cal liberalization had allowed more freedom of movement in the 1990s

and 2000s from farms to urban areas. This movement was resulting in

intensive crowding in Blantyre and other cities, where all land was being torn

up by squatters arriving every day, trucks choked the sky with unfi ltered

diesel gas, and new roads and truck routes linking Malawi to the rest of

Africa contributed to the spread of HIV, which killed brothers, fathers,

mothers— nearly every Malawian personally knew someone who had died

from an AIDS- caused illness. The Malawian government, which had por-

trayed itself as a paternalistic, caring father during Banda’s time, could do

little for most of these suffering people. “The government has no resources

to take care of people, with all the problems that are coming up,” said Peter

Kazembe, a well- known and outspoken Malawian doctor who worked at

times for government agencies. “We are more open [in politics] but that

doesn’t mean we are able to deal with all these new, modern problems. . . .

But people can talk more than in the past [than under the dictatorship] so

maybe it also seems like there are more problems.”

A country with very little economic in e qual ity during the 1960s and

1970s now had become more unequal, and the in e qual ity far more visible

than in the past, when the country had been a primarily rural society, and

foreign consumer goods had been diffi cult to obtain. Imported cars, cell

phones, computers, and other items were coming in from South Africa and

put on display to average Malawians in a way they had not been during the

1960s or 1970s— but few could afford these new luxuries. Outside one com-

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It’s the Economy, Stupid 71

puter and electronics store on a main street in Blantyre, young boys dressed

in rags peered into the windows, where inside a tiny group of wealthy Indi-

ans and Malawians pored over torn- apart keyboards, wireless mice, and

motherboards. Across town, at the upscale Blantyre restaurant Greens, a

favorite watering hole nestled in the hills above the city, obese businessmen

and local offi cials, their bellies hanging over the waists of their too- tight

polyester slacks, ate skewers of lamb and chicken and other grilled meats

dripping with fat, and washed them down with South African wines. Later

in the eve ning, their drivers would shuttle them, in Range Rovers, over to

the South African– owned Protea Ryalls Hotel, where they could sip scotch

at the long bar or lounge on pillows on the terrace outside. Meanwhile, as

birthrates soared and HIV decimated families in the early 2000s, the United

Nations estimated that roughly 65,000 Malawian children were malnour-

ished, more than 10 percent of the country’s children. These hungry chil-

dren gathered outside the Ryalls Hotel or the upscale South African– owned

Shop Rite supermarket on the outskirts of town, where the sons and daugh-

ters of wealthy Malawians stocked up on cell phone cards and low- fat yo-

gurt imported from South Africa, as well as on other items they could now

see advertised on satellite TV stations airing shows from South Africa, fi lms

from Nigeria, and other programming that never would have been available

during the dictatorship. Outside the supermarket, guards wielding trun-

cheons shooed away the children.

Perhaps, Malawians remembered, the era of authoritarian rule had

been po liti cally harsh, but at least they had enjoyed stability and a decent

quality of life— regular meals, land to farm, government handouts for the

very poorest. Of course, part of the past quality of life simply had to do with

a smaller population, and thus more arable land— something that was hardly

related to the type of government running Malawi. Part of this memory was

simply a willful forgetting of the past: as years separated them further

from the era of the dictatorship, many Malawians forgot its most repressive

elements. They remembered instead— somewhat oversympathetically— a

simpler time, in the way that people all over the world often romanticize

the past. “It might have been more repressive, but at least under [former

dictator Hastings] Banda we always had enough to eat, and the country

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72 It’s the Economy, Stupid

was safe,” one Malawian offi cial said, a sentiment echoed by many of his

peers who actually once fought the dictatorship as opposition activists.

Numbers revealed this shift in attitudes toward Banda’s dictatorship,

especially among the poorest Malawians, who believed they had fared the

worst as the country had become more open, and also more unequal. In-

deed, in the 1980s, when Malawi was still ruled by Banda, more than 80

percent of Malawians rejected the idea of authoritarian rule, though they

were still living under it. By 2005, that number had fallen dramatically:

only about half the population rejected the idea of authoritarian rule as the

best solution for the country.

When asked why they had become willing, again, to consider the

possibility of authoritarian rule, many Malawians said, like the government

offi cial, simply, that under Banda the country had enjoyed more stable and

prosperous growth. This was not necessarily true: During Banda’s time,

GDP growth fl uctuated from over 13 percent in the mid- 1960s, in the early

days of in de pen dence, to as little as roughly 1 percent annually in the early

and mid- 1980s. After in de pen dence Banda, like many other postcolonial

leaders, pursued a policy of import substitution designed to make Malawi

self- suffi cient in many industries. Banda’s policy worked, for a time, but in

the 1970s and early 1980s, as it became clear that Malawi could not indefi -

nitely protect its industries, and as the price of oil and other inputs rose,

Malawi’s economy weakened. Still, the smaller population at that time, and

the lack of environmental degradation, meant that even the poorest Mala-

wians usually had some family land to farm, and could raise a few chickens

for eggs, or some fruit trees. In a less globalized world, without donor agen-

cies pushing for privatization, and with signifi cant aid fl owing in from

South Africa, which built the country an entire new capital in the town of

Lilongwe, Banda could afford to cushion any economic downturns with

job creation programs or price supports for farmers’ crops.

What ever the reality, Banda, like many leaders in the developing world

in the 1960s, 1970s, and 1980s, also had not tied growth as closely to his po-

liti cal legitimacy as would later occur with the wave of Malawian demo-

cratic politicians who emerged in the late 1990s and early 2000s, or with the

donors who funded the country’s bud gets. Like many other postcolonial

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It’s the Economy, Stupid 73

leaders, Banda, unlike his successors, also could rely on his credentials as an

in de pen dence leader to build pop u lar support for himself. He created a kind

of new Malawian nationalism, albeit one closely centered around him and

a fabricated new Malawian national culture, one that might tie together

the country’s language groups, tribes, and regional differences. In this way,

Banda’s efforts echoed those of many other postcolonial leaders, from

Ghana’s Kwame Nkrumah to India’s Jawaharlal Nehru, who could use

their history as in de pen dence campaigners, as well as their po liti cal ideolo-

gies, to shore up their government’s legitimacy. Some postin de pen dence

leaders, such as Zimbabwe’s Robert Mugabe, were able to utilize the legiti-

macy they obtained from fi ghting the colonists to remain in power even as

they ran their nations’ economies into the ground.

In the 1990s and 2000s, Banda’s demo cratic successors could not call

upon their credentials as in de pen dence heroes, and in a far less ideological

era than the 1960s, they could hardly fashion grand po liti cal ideologies de-

signed to remake the country. So, they did make the explicit link between

growth and their po liti cal system, over and over again, and thus rested

much of their legitimacy on the ability to deliver that growth. “Malawians

thought that these types of changes would raise their standard of living, so

it was these higher expectations that couldn’t be lived up to,” said Stephen

Carr, the longtime World Bank economist who lives in Malawi. Even if, in

reality, the demo cratic era had produced decent growth, high expectations

had gone unmet. And so, many working class Malawians wondered whether

po liti cal openness really was best for their country, a question that would

be repeated increasingly among people in other fourth wave nations.

In the early 2010s, Malawi’s leaders seemed to draw on this authoritar-

ian nostalgia. President Mutharika, who had been elected as a reformer,

turned increasingly authoritarian, sometimes justifying his more autocratic

rule by claiming he needed more power to right the economy. When demon-

strators gathered in July 2011 to protest in the streets of the capital, Lilongwe,

and in other cities about the rising cost of staple foods and fuel, Mutharika

had hundreds of them arrested, with many badly beaten and reportedly

shot by security forces. At least eigh teen people were killed in the crack-

down. The government banned broadcasters from showing the protests,

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74 It’s the Economy, Stupid

and after the crackdown Mutharika toured the affected cities and vowed

that any future opponents would feel the “wrath of government.” Although

many Malawians protested this crackdown, particularly in urban areas,

Mutharika seemed to believe— with some reason— that if he could get the

country’s economy under control, while amassing more power for himself,

many people would forgive his abuses. Though ultimately Mutharika died

in the spring of 2012, the autocratic culture he had instilled survived, as his

supporters at fi rst refused to acknowledge his death publicly, apparently

hoping to launch a coup or some other intervention that would prevent the

vice president, not known as a Mutharika loyalist, from succeeding him in

offi ce as president.

Across the developing world, when economies did not take off, the sales

pitch of the Washington Consensus worked in reverse, actually subverting

demo cratic progress. The failure of growth fell hardest on working class

men and women, who often were barely getting by under the old authoritar-

ian regime, and who did not have the skills, education, and capital to take

advantage of international trade and economic liberalization. Often, as in

Malawi, the working classes were employed almost solely in agriculture, and

so were also hurt badly by declining terms of global trade for developing

nations’ textiles, commodities, and other products, as Western nations used

tariffs and subsidies to support their own farmers, and to keep out cheaper

agricultural goods from places like Africa, Vietnam, or Thailand.

These working class men and women began associating economic fail-

ures with democracy, even though economic globalization, changing terms

of international trade, or many other factors also could explain weak growth

in the developing world. To be sure, middle classes and elites also were

unhappy with weak growth, but they could more easily take advantage of

economic liberalization and freer trade, and they tended to reap what ever

economic gains were made in developing nations. Over the past de cade

they would turn against democracy for other reasons.

For working classes, though, the failure of growth, or at least the fail-

ure to live up to the kind of expectations created in Malawi, was critical. In

Latin America, for example, the Latin Barometer surveys showed that, in

the early 2000s, support for democracy across the region closely tracked per

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It’s the Economy, Stupid 75

capita growth; when regionwide growth went up, support for democracy

rose, and when it declined, support for democracy did as well, particularly

among lower- income men and women.10 In Ukraine, one of the most

notable examples of this working class alienation, the country’s economy

shrank by a staggering 15 percent in 2009, the victim of the global eco-

nomic crisis as well as the poor national leadership by Viktor Yushchenko,

the hero of the country’s 2004 and 2005 Orange Revolution. By the end of

his term, in 2010, Yushchenko was, according to polls, the most unpop u lar

leader in the world, in large part because Ukrainians were im mensely dis-

satisfi ed with how poorly he— and Ukraine’s democracy— had done in fos-

tering growth.11 The urban middle classes of Kiev still generally supported

Yushchenko and other Orange Revolution leaders, despite the tepid growth;

they were still faring relatively well eco nom ical ly. But among lower- income

Ukrainians Yushchenko had essentially become a pariah. In 2010, Ukraine

would elect a new president, Viktor Yanukovych, who would roll back many

of the nation’s freedoms. But he seemed, to many Ukrainians, a better bet for

promoting lasting growth, a fi gure modeled on Vladimir Putin, who had

slowly whittled away Rus sians’ po liti cal and social freedoms in the 2000s

while presiding over a period of strong growth. On the campaign trail, Yanu-

kovych promised that he would bring Ukraine stability and sustained growth,

the kind of growth that the previous, more demo cratic government had

failed to provide. He did not exactly hide his po liti cal intentions. Kremlin

aides advised Yanukovych’s campaign. Many Ukrainians understood that,

if Yanukovych were elected, their country would both move closer to Rus-

sia and also probably see its po liti cal freedoms curtailed— a tradeoff that,

by voting Yanukovych into offi ce, many accepted in exchange for what they

believed would be stronger economic growth. Indeed, after Yanukovych

won he was able to negotiate more favorable terms on energy imports from

Rus sia.

In fact, by analyzing a range of surveys from the Barometer series, results

of local polling organizations in developing nations, and the Pew Research

or ga ni za tion’s regular results, Council on Foreign Relations researchers, in-

cluding myself, found that nearly every study of developing nations reported

that, by the end of the 2000s, satisfaction with democracy had dropped, even

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76 It’s the Economy, Stupid

in countries where citizens still preferred democracy to other alternatives;

they also found that in most of these countries the majority of survey re-

spondents, and particularly those from lower- income house holds, thought

that transitions to democracy had brought no improvement to their lives.

In Africa, where foreign donors probably exert the most infl uence, and

the link of growth and po liti cal liberalization was pushed the hardest, sat-

isfaction with democracy also dropped in large part because of perceptions

that democracy had not brought promised material gains. In a broad study

of African nations taken between 2000 and 2006, satisfaction with democ-

racy fell from 58 percent of the population to 45 percent; over roughly the

same period, the percentage of Africans saying the economy in their nation

was fairly good or very good fell to only 28 percent.12 Overall, my analysis of

the 2009 data from the Afrobarometer surveys, the most recent data, re-

veals that satisfaction with democracy is negatively correlated with “present

living conditions.” In these surveys, people who thought their living condi-

tions had become “very bad” were most likely to say that their nation was

not becoming a democracy and that they were unsatisfi ed, while those

people who said that their living conditions had become “very good” were

much more likely than anyone else to say that they were “very satisfi ed” with

democracy.13 As we will see, just as in Ukraine, this dissatisfaction would

provide an opportunity, in many of these developing nations, for a more

authoritarian leader who could promise better, more equal growth, to make

inroads.

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Yale University Press

Chapter Title: The Middle Class Revolts

Book Title: Democracy in Retreat Book Subtitle: The Revolt of the Middle Class and the Worldwide Decline of Representative Government Book Author(s): Joshua Kurlantzick Published by: Yale University Press. (2013) Stable URL: https://www.jstor.org/stable/j.ctt32bh31.8

JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide

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Yale University Press is collaborating with JSTOR to digitize, preserve and extend access to Democracy in Retreat

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I n the late 1990s and early 2000s, the lack of economic growth began

to sour working class men and women on demo cratization. But in

many developing nations the middle classes turned against democracy

too. The Washington Consensus prescriptions had been, in many ways,

predicated on the modernization theory of experts like Huntington and

Lipset; for economic liberalization to be linked with po liti cal liberalization,

an economic opening had to produce a middle class that then would help

push for po liti cal change. Yet over the past de cade, the middle class has, in

many developing nations, subverted those predictions, just as the growth–

political change linkage has, more broadly, subverted demo cratic progress.

Perhaps nowhere has the middle class turned so clearly, and disas-

trously, against the modernization theory’s predictions as in the Philip-

pines. To a traveler arriving from more orderly cities in East Asia, dropping

into Manila feels like descending into some combination of Blade Runner

and a Broadway musical. Rutted roads lead into the city, many lined with

twisted pieces of discarded metal that could be confused with modernist

sculptures. “Jeepneys”— converted jeeps overstuffed with paying passen-

gers and decorated with garish murals of Christ— crowd each other in the

traffi c, which stretches for miles in the polluted and soupy air. The jeepneys

meander past mountainous garbage dumps and hastily erected slums of tin

shacks and tiny wood homes that look like they were made from packing

crates. Occasionally, amid the slums sits a heavily guarded gated commu-

nity where Manila’s elites can live as if they were in suburban Los Angeles

or Houston, ignoring the squalor as they head off to shop at nearby air-

conditioned malls.

The Middle Class Revolts

5

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78 The Middle Class Revolts

With turbocharged economies surrounding it, the Philippines has in

recent years grown at only 3 or 4 percent per year, a rate not high enough to

provide jobs for all the new workers in a country with one of the highest

birthrates in Asia.1 In a country naturally blessed with abundant fi sh and

produce, nearly 15 percent of Filipinos do not have enough to eat. Virtually

every other nation in the region has made strides in eradicating poverty and

hunger, but the Philippines has made none.2

Most Filipinos would not have anticipated this failure back in 1986,

when they thronged the streets of Manila not only to force out the dicta-

tor Ferdinand Marcos but to demand a better life for themselves and their

countrymen— a protest led, as we have seen, by the city’s urban middle

classes. Benigno Aquino, the opposition leader whose assassination by Mar-

cos security forces set off the People Power movement that carried Aquino’s

wife to power, had made “The Filipino is worth dying for” his motto.3 Amid

the jubilation of that era, many Filipinos, and particularly the urban middle

classes who possessed skills and college educations, thought that with Marcos

gone, all aspects of their lives would improve. “The optimism of that time, it’s

hard to imagine now,” remembered Roel Landingin, a Filipino journalist

who has worked for years in Manila. “It wasn’t just getting rid of Marcos, we

really thought those things that seemed unchangeable in the country would

change now.” 4

After Marcos fl ed, and after his successor, Corazon Aquino, survived

numerous coups as president, the country did enjoy solid growth and rela-

tively stable government under her successor, President Fidel Ramos—

growth that generally boosted the incomes of middle class professionals and

small businesspeople. But in the de cade and a half since Ramos left offi ce,

the economy has stagnated badly. Though the Philippines always had been

a stratifi ed society— a legacy of Latin America– Spanish colonialism— in the

post- Ramos era the in e qual ity has become far worse, with a tiny elite gar-

nering an ever- larger share of the wealth, and both the poor and the middle

class falling further and further behind. Homelessness and violent crime

have skyrocketed, turning Manila into one of the most dangerous cities in

Asia— a condition made worse by a corrupt and incompetent police force.5

This crime falls harder on middle class businesspeople, who cannot afford to

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The Middle Class Revolts 79

live in the gated communities of the rich, with their armed guards and high

walls topped with barbed wire. One politician after another has succumbed

to corruption scandals, and an annual study conducted by the Asia Founda-

tion found that fewer than 20 percent of businesses in the country reported

paying their taxes honestly.6 The speaker of the Philippine House of Repre-

sentatives undertook a charity drive for the national trea sury, asking people

to donate to the state bud get like it was a Salvation Army fund drive. The

Philippine ombudsman’s offi ce reports that the country lost $48 billion in

revenue in graft over the past twenty years, and companies needing contracts

roam the halls of Congress there with envelopes full of cash to stuff into con-

gresspeople’s desks. In such a climate, vote rigging becomes the norm: a sur-

vey before the 2007 Philippines elections found that nearly 70 percent of

voters expected vote buying in the election, and more than half anticipated

that the vote counting would involve cheating.7

Though Aquino’s son, Benigno, was elected in 2010 partly on a mandate

to clean up corruption, in offi ce he could do little to halt such entrenched

practices. His government fi led several high- profi le corruption cases, and

he made numerous speeches about addressing graft, but payoffs and hand-

outs remained the norm throughout the po liti cal system. After only one year

in offi ce, Aquino’s popularity ratings had fallen, partly because of his failure

to fi ght corruption. The head of one of the country’s biggest business groups

dedicated to good governance admitted, “[The Aquino] administration has

failed in its fi ght against corruption.”8

For years, leaders of the Philippines’ neighbor Singapore, essentially a

one- party state, have publicly contrasted Manila’s chaos and stagnant growth

with their gleaming, high- tech city, where every roadside shrub seems to have

been manicured by a gardening master, and you can whiz from the airport to

the central business district in minutes. The difference is more than superfi -

cial. Though the two countries had relatively equal standards of living in

1965, today Singapore boasts a GDP per capita more than ten times that of

the Philippines.9 In a speech in the Philippines in 1992, Lee Kuan Yew, mod-

ern Singapore’s founding father, delivered a direct insult to the host country.

“I do not believe that democracy necessarily leads to development. . . . The

exuberance of democracy leads to undisciplined and disorderly conditions.”

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80 The Middle Class Revolts

Lee did offer a backhanded compliment: “The Philippines is im mensely bet-

ter off compared to Af ghan i stan or Lebanon or Sri Lanka”— three states

decimated by bloody civil wars.10

For years, many middle class Filipinos, proud of their hard- won de-

mocracy and their free— if wild— media, shrugged off Lee Kuan Yew’s

barbs. But as the divide between the two states has turned into a chasm,

and as more and more Filipinos head overseas just to fi nd jobs— more than

10 percent of the population lived abroad in 2009, and their remittances

keep the country’s economy afl oat— they can’t ignore the criticism so eas-

ily.11 In surveys taken by the Asia Barometer project, which primarily inter-

views urban middle class men and women, nearly half of the respondents

in the Philippines now agree with the statement “The nation is run by a

powerful few and ordinary citizens cannot do much about it.” Most Filipi-

nos, the survey showed, distrust virtually every institution of the state and

have little hope that it will improve.12 “Middle- class Filipinos who’ve been

outside the country, who see what’s happening in other nations in Asia,

they come back here, and it’s just disappointment, hopelessness,” says Land-

ingin. “We have too much democracy here,” agreed Jose Romero Jr., a for-

mer Philippine diplomat who, along with other educated Filipinos, had led

the revolt against Marcos.

Some middle class Filipinos even yearn for the return of the dictator,

seemingly having forgotten the thuggery and personality cult of the dicta-

tor’s later years and instead remembering the order and growth of his early

period in offi ce. According to the Asia Barometer study, the Filipino public

had a high degree of “authoritarian nostalgia” for the Marcos era.13 The old

dictator is still around, but he doesn’t get out much: His waxy body is dis-

played in a refrigerated mausoleum, like a Southeast Asian Lenin, in the

family compound in Ilocos Norte, the Marcos’s home province. Still, even

though Ferdinand cannot serve anymore, in 2010 Filipinos elected his son,

Ferdinand Jr., to the Philippines Senate, and his daughter, Imee, as gover-

nor of Ilocos Norte.14 Ferdinand Jr. might well seek a higher offi ce in the

next election, completing the Marcos restoration.15

The Philippines middle class has, in another important way, demon-

strated its growing disillusionment with the lack of growth and the in e qual-

ity, graft, and poor governance of the country’s young democracy. In 1998,

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The Middle Class Revolts 81

after the end of Fidel Ramos’s presidency (Philippine presidents are allowed

only one six- year term), the presidential election was won by Joseph Estrada,

an actor- turned- politician famous for his many roles playing action heroes.

Estrada was beloved by the poor in the Philippines for his rugged charm,

his easy, down- to- earth manner, and his promises of populist policies, but he

was hardly a deep thinker, and in offi ce he soon proved both incompetent

and corrupt. His administration squandered many of the economic and

management reforms made under Ramos, foreign investors fl ed to other

countries, and graft allegations soon swirled around his administration and

around Estrada himself, who was known to be personally friendly with sev-

eral or ga nized crime leaders. By 2001, three years into his presidency, the

Philippine defi cit had nearly doubled since 1998, and Estrada stood accused

of taking payoffs from illegal gambling syndicates while serving as president.

(After leaving offi ce, he would later be convicted of plunder and sentenced

to a maximum of forty years in jail, though he was ultimately pardoned after

serving six years in detention because of his age and infi rmities.)

Urban middle class Filipinos, many of whom had not voted for Estrada,

instead supporting other candidates, could have stuck to demo cratic means

to try to remove the president for his many alleged crimes. Indeed, the Phil-

ippines legislature did begin impeachment proceedings against Estrada.

But middle class Filipinos had little patience for them. They had watched,

during Estrada’s term, as the country’s democracy produced an incompetent

and corrupt president. They had seen how Estrada could maintain support

from the poor masses who constitute the majority of voters, and they wor-

ried he might whittle away both the rule of law and the economic, social,

and po liti cal privileges long enjoyed by the middle class. True to his macho

fi lm image, Estrada had pursued increasingly tough policies, toward both

dissent in urban areas and separatist movements in the country’s Muslim

southern provinces, launching a massive offensive against one of the Muslim

rebel groups, the Moro Islamic Liberation Front, that ultimately resulted in

a bloody stalemate.

So, in late 2000 and early 2001, middle class Filipinos took to the streets

of Manila, launching large scale street protests designed to push Estrada

out. In some ways, these protests mimicked the 1986 People Power move-

ment that ultimately overthrew the Marcos regime. Many Filipinos took to

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82 The Middle Class Revolts

calling the 2001 protests “People Power Two,” except that now the demon-

strators were trying to remove an elected president, by resorting to the

street, a practice that ultimately would only weaken the country’s demo-

cratic institutions like the legislature and the judiciary, which had been

designed to address just such serious breaches by the president.

As protests swelled in the streets of Manila, hundreds of thousands of

people, mainly middle class, university- educated Filipinos, joined in. Many

demonstrators, who once had battled Marcos’s armed forces for years, and

who had stood up for Corazon Aquino in the face of coups, now called for

the military to resolve the situation. And indeed, behind the scenes the

armed forces made clear to Estrada that they were withdrawing their sup-

port for him, implicitly threatening that, if he did not leave, the army

would make a move. Estrada’s supporters, later learning of the army’s deci-

sion, called it a kind of silent coup, but at the time the president realized

that he could not hang on to power. He agreed to vacate the presidency. His

vice president, Gloria Macapagal- Arroyo, a U.S.- trained economist and tech-

nocrat preferred (at the time) by the middle classes, quickly was sworn into

offi ce, before Estrada’s large base of poor supporters around the country

could mobilize in response.

Though the anti- Estrada protests did force the president to fl ee, spark-

ing a short period of jubilation in Manila, they hardly quieted the Filipino

middle class’s anger over incompetent and corrupt government, or its fear

of losing its rights and privileges to a populist president. Three years later,

middle class men and women camped in the streets of Manila once more,

trying again to use protests— rather than demo cratic institutions like the

ballot box or legislative maneuvering or impeachment— to force the presi-

dent to leave offi ce. Though Macapagal- Arroyo once had seemed a compe-

tent technocrat, she too had earned the ire of the urban middle class after

she allegedly had overseen highly corrupt national elections and increas-

ingly had cracked down on any opposition, proposing tougher legislation

akin to martial law and arresting many civil society activists. After Iraq the

Philippines became, under Arroyo, the second most dangerous place in the

world for journalists; in some years more than thirty were killed, in murky

circumstances in which the murders seemed to be linked to the journalists’

critical reporting.16

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The Middle Class Revolts 83

Unlike Estrada, the savvier and smarter Macapagal- Arroyo survived,

partly through maintaining the support of the army, but she was not yet safe.

Filipino middle classes returned to the streets again and again in the follow-

ing years in attempts to make her resign or even possibly provoke a coup.

Even Corazon Aquino herself, the old symbol of Filipino democracy, joined

the protesters trying to oust Macapagal- Arroyo, marching in the streets to

push out the president.

In some areas of the city these protesters became a kind of permanent

encampment, though the president would manage to serve out her term.

“The people in Manila are just giving up on democracy, that’s why they

take to the streets to try to force out an elected leader,” said Landingin, the

longtime Filipino journalist who had covered People Power One as well. “It

seems like a demo cratic protest, but it’s actually hurting.”17 And as we will

see, in many other developing nations, middle class men and women are

turning against democracy in similar ways, striking perhaps the biggest

blow to democracy’s survival.

In the Philippines, it took fi fteen years for the urban middle class to move

from leading the country’s battle for democracy to leading the battle against

democracy. In other developing nations, across Asia, Latin America, and

Africa, the shift has taken place even faster, as Huntington’s theory has

been turned on its head. Now it appears that once that po liti cal transition

began, a sizable middle class actually became a primary impediment to

demo cratic consolidation.18

If the middle class can no longer be taken for granted as a force for

demo cratic change, it will mark an enormous shift that will challenge the

accepted wisdom about demo cratization. This new understanding of the

middle class calls into question predictions that powerful authoritarian states

like China will eventually demo cratize, and forces policy makers and democ-

racy activists to question who their real allies are.

The middle class in emerging markets is still growing rapidly. The

World Bank estimates that, between 1990 and 2005, the middle class tripled

in size in developing countries in Asia, and nearly doubled in Africa. Today,

according to an estimate by Goldman Sachs, roughly seventy million people

worldwide begin to earn enough to join the middle class (defi ned as making

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84 The Middle Class Revolts

between $6,000 and $30,000 annually) in emerging markets each year. By

2030, Goldman estimates, the global middle class will have added another

two billion people, with particularly strong growth in Brazil and other large

emerging democracies. While $6,000 a year may be a poverty- level income

in a wealthy democracy like the United States or Japan, in developing

nations like Thailand it puts a family in the middle class. And unlike, say,

the United States, where more than 50 percent of adults classify themselves

as middle class, the middle class in most developing nations remains a

minority— usually no more than 30 percent of the population.19 Yet in these

nations the middle class does not mean the wealthiest elites, either— the top

1 or 2 percent of the population that actually controls the largest companies

and enjoys lifestyles that would be considered rich by any standard. Instead,

these middle classes normally comprise professionals, small businesspeople,

and other educated men and women.

The fact that the middle class does not actually constitute a majority

of the population in these nations matters greatly, since it means demo-

cratization often empowers the poor more than it empowers the middle

class. At the same time, though, the middle class is not so small that demo-

cratization threatens to foster intense hatred against it, in the way that ana-

lysts like Yale’s Amy Chua believe po liti cal change can boomerang against

wealthy ethnic minorities.20 Chua argues that entrepreneurial but demo-

graphically tiny minorities— the ethnic Chinese in Southeast Asia, or the

Lebanese in West Africa— face physical danger, and even massacres, in

countries that demo cratize rapidly. There are examples of this trend, such

as the killings of Lebanese in West Africa or of Chinese in Indonesia after

the fall of longtime dictator Suharto— but these mass killings have tar-

geted small groups of elite minorities, and not the broader middle classes.

Still, in many emerging democracies, the middle classes have valued growth

over freedom and stability over change, giving little reason to believe these

middle class men and women have any real commitment to democracy.21

In theory, educated middle class people in most developing nations possess

strong commitments to democracy: recent polling by the Pew Research

Center found theoretical support for democracy especially strong among

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The Middle Class Revolts 85

the global middle class.22 But that theoretical commitment to democracy has

meant little in practice.23 In many developing nations, middle class reform-

ers have been badly let down by the fi rst generations of demo cratic leaders.

Some, like Viktor Yushchenko of Ukraine, have demonstrated woefully

poor economic management, alienating not only working classes but also

middle class businesspeople who need economic stability to thrive. But be-

sides managing the economy poorly, the fi rst generation of elected leaders

has not demonstrated much real commitment to democracy— a lack of

commitment that has resonated among urban middle classes. Urban mid-

dle class men and women who had spent years fi ghting an authoritarian

regime simply assumed, perhaps naively, that when opposition leaders fi -

nally gained power, they would govern more inclusively than the deposed

autocrats. The Demo cratic Progressive Party (DPP) in Taiwan, made up of

many former po liti cal prisoners from during the Nationalist dictatorship of

Chiang Kai- shek and his son Chiang Ching- kuo, had fought for two de-

cades to challenge the power of the ruling Kuomintang. The party also had

stood up for Taiwan’s separation from, and even formal in de pen dence from,

the People’s Republic of China, in part because it believed that only real

separation could guarantee Taiwan’s demo cratic freedoms. Many DPP poli-

ticians had deep ties to labor unions, environmental groups, and other pro-

gressive causes, and in opposition had suffered badly for their beliefs. DPP

leader Chen Shui- bian himself had served time in prison for his beliefs, and

in 1985 his wife became paralyzed after being hit by a truck in what Chen

and his supporters believed was an attack by progovernment forces.

As Chen rose up the po liti cal ladder in an increasingly open and demo-

cratic Taiwan, from local councillor to mayor of Taipei to, eventually, presi-

dent, he brought with him a bright young circle of advisers who had also

suffered as opposition activists. These DPP politicians, many educated in

America’s Ivy League schools, promised, if they were elected, to usher in

Taiwan’s most open era. They vowed to work for equal rights in a country

with a highly patriarchal traditional culture, to reduce in e qual ity after Tai-

wan’s long economic boom, and to guarantee women a certain number of

cabinet seats, putting them at the policy- making table in Taiwan for the

fi rst time. “The DPP is for progress— on women’s issues, on labor rights— it

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86 The Middle Class Revolts

can be slow, but it’s far better than it was a de cade ago,” said Hsiao Bi- khim,

one of the DPP’s leading minds and, in the early 2000s, one of the youn gest

members of Taiwan’s legislature.

When the DPP fi nally won the 2000 election, opposition politicians,

activists, labor union leaders, and journalists rejoiced. Taiwan’s po liti cal

system seemed to have morphed into a stable two- party democracy, con-

tested between the Kuomintang, no longer a dictatorial regime but a nor-

mal po liti cal party, and the DPP, which now held the presidency for the

fi rst time. Many also believed that having come from po liti cal exile, and

suffering themselves at the hands of an oppressive government, the DPP

would strengthen Taiwan’s young democracy. Thousands gathered after

the election results were in to hear Chen speak. In the country’s fi rst legisla-

tive elections after Chen was elected president, a record number of women

won seats. The party quickly passed a series of progressive environmental

and labor laws.

Several weeks after Chen’s victory he was sworn in as president on May

20, 2000. During his inaugural speech he shouted “Long live freedom and

democracy!” as if he were still leading a street rally rather than giving a

formal address. During the inauguration, DPP activists danced at parties

in strongholds in Taipei and the south, its base in the country, while foreign

observers, from the New York Times editorial board to American diplomats

stationed in the country, praised Taiwan’s transition as a model of democ-

racy. When Chen traveled to America in spring 2001, he was greeted in

New York City and Houston by an outpouring of support from Bush

administration offi cials, and he held meetings with se nior American

congressmen— even though nearly every previous Taiwanese leader since

the U.S. had cut diplomatic ties with the island in 1979 had been treated like

pariahs even if they stopped in the United States only to refuel their plane.

In some cases— though not, unfortunately, in Taiwan— longtime opposi-

tion leaders who fi nally gained the presidency or the prime ministership

did remember past struggles and made real attempts to foster compromise

and tolerance, even toward their old enemies. Nelson Mandela famously

reached out to South Africa’s white minority as president, not only publicly

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The Middle Class Revolts 87

supporting their beloved rugby team but also retaining se nior offi cials who

could reassure white businesspeople and investors. More often, however, the

fi rst generation of elected leaders only fueled middle class rage. From Ven-

ezuela to Bolivia to Kenya to Thailand to Taiwan, these leaders too often

have turned into elected autocrats, dominating young democracies whose

institutions are not strong enough to restrain a powerful leader uninter-

ested in compromise, negotiation, and tolerance of opposition. To this fi rst

generation, many of whom came of age po liti cally under authoritarian re-

gimes, votes are referendums on their rule; having triumphed, they can

then use all the powers of the state to crush opposition and favor their per-

sonal, po liti cal, and ethnic allies.

In other words, these elected autocrats, though fulfi lling one function

of democracy— winning the most votes— do not uphold constitutional

liberalism, or ensure that the rule of law is maintained and that individual

liberties and minority rights are protected. They follow the form of democ-

racy but are weakening its practice.

It is not hard to see why this fi rst generation of elected leaders so often

regressed in this way. Holding an opposition movement together in the face

of a repressive regime requires a high degree of cohesion, even autocracy,

within that movement; serving in opposition for so long also can make a

leader intensely fearful. In South Africa during apartheid rule, the African

National Congress viciously attacked, and sometimes even killed, members

of its own movement whom it perceived as too conciliatory toward the gov-

ernment, or as simply working against the ANC’s aims. (Nelson Mandela

was in jail on Robben Island during much of this internal bloodletting,

but his wife, Winnie, was accused of promoting the beating and murder of

ANC members accused of being government informers.)24 Chen Shui- bian,

the Taiwanese DPP leader, exhibited many of the same traits while the

DPP was in opposition— tight control of his party and paranoia regarding

outsiders. These were survival skills in opposition during the Kuomintang

dictatorship, when Chen could never trust whether anyone beyond his inti-

mate circle had been coopted by government agents, but later this course

would doom his administration once he gained the presidency and the

country had transitioned to democracy.

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88 The Middle Class Revolts

Like Chen, many former opposition leaders can fi nd it especially diffi -

cult to jettison these survival traits when the transition to democracy is ex-

tremely rapid, as happened in many African nations in the 1990s. These

circumstances leave little opportunity for former opponents to forgive the

crimes and mistakes of the past. Instead, having fi nally attained power, lead-

ers who’d seen authoritarian rulers enrich their own tribes, ethnic groups,

families, and supporters would then often use their new power simply to

reward their own— who can justly claim that they were shortchanged under

the previous regime. By comparison, in a more gradual transition, such as in

Spain after the death of Francisco Franco in 1975, conservative and liberal

po liti cal opponents had more time to build trust and jointly agree on the

norms and rules that would govern Spanish democracy.

Taking offi ce in 2000, Taiwan’s DPP movement soon dashed hopes

that it would usher in an era of greater democracy and freedom on the

island. True to its election promises, the DPP did take a harder line against

China, defending Taiwan’s right to govern itself, and to protect its free-

doms. (China initially responded harshly but eventually came to a kind of

frosty détente with the DPP leaders.) But on the island itself, Chen Shui-

bian, and a circle of party leaders around him who had developed a siege

mentality in exile, brought their almost authoritarian style to governing in

Taipei. Two years into Chen’s term as president, party activists who op-

posed anything Chen did soon found themselves ostracized, cut off from

circles of power. Some DPP insiders began to murmur that Chen and his

wife were increasingly using the power of his offi ce, which is one of the

strongest presidencies in the world, to direct favors, jobs, and cash to family

members and friends.25

Later, Chen’s wife would admit to laundering over $2 million from a

government contractor. Chen himself would go to jail on corruption charges,

after allegations that he had personally stolen millions in campaign money

and other government funds. And as we will see later on, Chen and his

wife’s corruption were hardly unusual— in Taiwan and in new democra-

cies, graft seems actually to worsen as the po liti cal system opens up, at least

at fi rst, further alienating average men and women, and besmirching the

concept of demo cratic reform.26

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The Middle Class Revolts 89

In the early 2000s, stories of Chen’s corruption were only whispers;

DPP supporters were far more shocked to witness his insular, domineering

style. Many believed that, once in offi ce, Chen would naturally give up some

of the secrecy and paranoia that had served him during his time in opposi-

tion, but they were wrong. Chen angrily fi red aides who refused to carry out

his wishes, and he brought family members into his inner po liti cal circle—

at least eleven family members would face corruption charges similar to

those made against the president, and his son would face charges of insider

trading. Several se nior ministers, including the foreign minister, would

resign after charging that Chen’s high- handed, self- dealing style had seri-

ously impaired Taiwan’s ability to hold on to its few remaining formal

allies, and had allowed Taiwan’s government to be taken advantage of by

unscrupulous middlemen with ties to Chen. “People feel humiliated by the

government’s incompetence,” George Tsai, a po liti cal analyst at Chinese

Culture University in Taipei, told the New York Times, referring to a scandal

in which one of the middlemen apparently had taken $30 million in gov-

ernment money. “It’s a joke to the outside world— how could the govern-

ment be cheated like this?”27 By the mid- 2000s, the once- supportive Bush

administration, furious with Chen’s incompetence and arrogance, simply

refused to let him stay overnight in the United States.28

In other cases, the fi rst leaders of young democracies come not from long-

time opposition movements but from within the former regime, where they

also received little education in demo cratic norms. Nearly every former So-

viet republic, for example, transitioned to a government run by former

Soviet bureaucrats; few of these leaders, save for a handful from the Baltics

and Georgia who’d lived for years in the West, had experience with democ-

racy. For them, politics had always been a zero- sum endeavor. Losers within

the Soviet hierarchy lost everything— their power, their prestige, sometimes

their lives. Had the transitions been more gradual, this lack of demo cratic

experience might have mattered less; newer, younger leaders with fewer ties

to the Soviet era might have emerged, and even old Soviet bureaucrats might

have learned that a defeat in the new po liti cal system did not send one to the

gulags. But in such a rapid transition, the former Soviet bureaucrats simply

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90 The Middle Class Revolts

brought with them the po liti cal mindsets and strategies that had served

them well in the Soviet Union.

Throughout the former Soviet Union, nearly everywhere except the

Baltics, the fi rst generation of elected leaders has revealed itself to be auto-

crats at heart. Kurmanbek Bakiyev, who was one of the leaders of Kyrgyz-

stan’s 2005 Tulip Revolution against the autocratic regime of President

Askar Akayev, proved himself in offi ce to be nearly as authoritarian as his

pre de ces sor, and his tough policies ultimately sparked another bloody revo-

lution in 2010. In Georgia, Mikheil Saakashvili was also a leader of a color

revolution. But as president in 2007, faced with demonstrations against him,

Saakashvili unleashed overwhelming force against the protesters and later

declared a state of emergency, allowing him to close down media outlets,

detain opposition journalists, and silence much of the protest.29 Today he ap-

pears likely, after ending his term- limited presidency in 2012, to try to run

for the prime ministership, and make parliament the center of his power,

much as Vladimir Putin shifted from president to prime minister but re-

mained the most important actor in Rus sian politics. And now, in the Middle

East, a similar pattern is emerging, with many leaders of transitional gov-

ernments and, possibly, future parliaments, coming from within systems

that for de cades allowed no dissent, and where winner- take- all internal poli-

tics were the norm.

Beyond the shock and anger that elected politicians are undermining

reforms and ignoring the rule of law, many members of the middle class

have begun to grasp democracy’s downside: If the franchise is extended to

everyone, and if the poor, who make up the majority of the population in

most developing nations, band together behind one candidate, they could

elect someone determined to reduce the economic, po liti cal, and social privi-

leges enjoyed by the middle class.

Hugo Chavez, the charismatic Venezuelan military offi cer, certainly

grasped the notion that, with the support of the poor, a politician could gain

im mense power in a developing nation. Born to a working class family him-

self, Chavez seems from an early age to have developed a deep distaste for

Venezuela’s traditional capitalists, the large landowning families and busi-

nessmen of Caracas. Chavez went into the army partly, it seems, as a means

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The Middle Class Revolts 91

of rising up into politics. As a young soldier, he traveled through Caracas

and witnessed the severe poverty of the city’s slums— the country was, at

that time, one of the most unequal in the world. It made a profound impact

on Chavez. Early in his career, he founded a group called the Revolutionary

Bolivarian Movement- 200, which aimed to topple the country’s traditional

politics, which were nominally demo cratic but also dominated by powerful

business interests and traditionally rich families.

In 1992, as Venezuela’s ruling party implemented painful neoliberal

reforms pushed by donors, including cuts in social welfare spending, Chavez

tried to seize power in a coup. His putsch failed and he was sentenced to jail,

but he had gained nationwide fame as a man willing to stand up to neoliberal

reforms. Following his jail term, Chavez launched his own po liti cal party,

and in 1998, riding massive support from the poor, who had fared poorly as

Venezuela had pursued the Washington Consensus reforms, he was elected

president.

Though Venezuela, like many Latin countries, had long been domi-

nated by politicians from a few powerful families, in 1998 the country did

boast strong demo cratic institutions and culture, including an in de pen dent

judiciary, a vibrant print and broadcast media, and a healthy tradition of

po liti cal debate.30

Chavez would change that. He soon set about advocating for the inter-

ests of the poor and the lower middle classes against the interests of the ur-

ban middle classes and the elite, while also amassing more and more power

to himself and a close circle of allies. Chavez nationalized many key indus-

tries, with private businesspeople often getting what they perceived as unfair

compensation for their assets. He launched a program called “Plan Bolivar,”

in which the state would help upgrade the physical infrastructure of poor

areas, while also providing highly subsidized health care and food, and

cheap credit to the poor to start up community projects around the country.

He launched communal councils, an experiment in direct democracy that,

in many poor neighborhoods of the country, gave the poor a greater voice

in policy making, though these council also undermined legislators in

parliament.31 While announcing these policies, he clearly positioned them

as tools for the poor and as attacks on the middle and upper classes, often

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92 The Middle Class Revolts

during rambling addresses on his pop u lar weekly radio show, Alo Presidente

(Hello, President). Using his powerful, mercurial speaking style to its fullest

extent, on his show Chavez repeatedly fulminated against his favorite

targets— local businesspeople, whom he claimed were trying to take over

the country, as well as the United States and other Western powers.

The longer Chavez remained in offi ce, the more populist his economic

policies became. In 1998 he still retained some more moderate economic

advisers, and he traveled to the United States and other countries to adver-

tise that Venezuela was still open for investment, particularly in the oil and

gas sector. But by the mid- 2000s Chavez had jettisoned most of the advisers

who had links to middle class urban businesspeople, and he had thrown out

many foreign investors, particularly in the oil sector. Government spending

continued to increase, boosting Venezuela’s debt, and Chavez handed con-

trol of many important companies to a small circle of close friends, making

them rich, even as his government’s laws, price controls, and economic mis-

management made it tougher and tougher for average small businesspeople

to earn a living.

Chavez’s policies had a mixed effect. At fi rst, they did help slash pov-

erty signifi cantly, which only further bonded the poor to him, and they also

did initially bring more of the poor into the po liti cal pro cess, clearly reduc-

ing the po liti cal power of the middle and upper classes. But they also hurt

the overall macroeconomic environment. Foreign investors bailed out of the

country, and the national oil company could not meet its production quotas

and saw its aging infrastructure deteriorate. Whenever the price of oil, the

major export, dropped, Venezuela had trouble providing even basic ser vices

to its people. By 2011, even as the price of oil had recovered and its Latin

neighbors, including Brazil and Colombia, were growing strongly, Venezu-

ela was limping, posting some of the worst growth rates in South America

and relying on loans from China to survive. Electricity blackouts hindered

business in the cities, infl ation soared, and in many parts of the country

staple goods became harder and harder to fi nd. As the economy worsened,

violent crime rose, and by 2011 Caracas had the highest murder rate per

capita of any city in the world— a staggering 233 per 100,000 inhabitants—

higher than the killings per capita in war zones like Kabul and Baghdad.

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The Middle Class Revolts 93

Many human rights organizations believed that the offi cial fi gures actually

were understated.32

Still, Venezuela’s poor repaid Chavez with their loyalty, even as he

slowly strangled the country’s relatively strong demo cratic institutions. When

Chavez toured slums in Caracas and other cities, tens of thousands turned

out to greet him like he was a god. He won election after election— united

and engaged in politics, the poor by far constitute the majority of Venezuelan

voters. Chavez kept offering job creation programs and other populist mea-

sures to keep them happy, along with new nationalizations, price controls,

and other mea sures hated by many businesspeople and other professionals.

Toward the middle classes and upper classes, Chavez practiced a harsher

style of politics. He used his domination of broadcasting licenses to replace

private tele vi sion stations, which tended to favor the urban middle class

opposition candidates, with state TV. Eventually he forced the most critical

private channel off the air.33 He introduced legislation making it a crime

for critics to offer “false” information that “harms the interests of the state”;

he locked up judges who issued rulings he did not like and packed the

courts with his supporters. Chavez and his backers in the National Assem-

bly passed laws that essentially allow Chavez to rule the country by decree,

making the Assembly meaningless.34 By the end of the 2000s, the inter-

national monitoring or ga ni za tion Freedom House ranked Venezuela, one of

the oldest democracies in Latin America, as only “partly free.” In 2010, the

Or ga ni za tion of American States (OAS), a regional grouping that included

several Latin states with left- leaning governments favorably inclined to-

ward Chavez, issued a report condemning Venezuela for widespread abuses

of media freedom, human rights, freedom of association, and other free-

doms. “The state’s punitive power is being used to intimidate or punish

people on account of their po liti cal opinions,” declared the OAS’s human

rights watchdog.35

Chavez had not totally destroyed the country’s freedoms. In the early

2000s, some newspapers and tele vi sion stations remained in private hands,

critical of the president’s policies, and if opposition politicians had been able to

unite around one platform and one anti- Chavez fi gure, they might have been

able to dislodge Chavez. But instead, many middle class Caracas residents,

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94 The Middle Class Revolts

and middle class politicians, took the easy way out. They launched street

demonstrations, general strikes, and marches on the presidential palace

starting in 2001 and 2002. Many protesters openly called for the military

to intervene and push Chavez, authoritarian but also elected, out of offi ce.

During the protests, and the run- up to the military intervention, at least

eigh teen people were killed.

In April 2002, the armed forces responded, launching a coup and threat-

ening to bomb the presidential palace if Chavez did not step down. When

he did, they took Chavez hostage on a Ca rib be an island. While Chavez was

jailed, the coup makers installed a prominent businessman as interim pres-

ident. The George W. Bush administration seemed to tacitly condone the

coup, with press spokesperson Ari Fleischer essentially blaming Chavez for

the situation; later the Central Intelligence Agency was discovered to have

known that the military was planning a coup against Chavez but did not

provide a serious warning about the plot.36

Rallying his support among the poor, who massed in the streets of the

capital, and within lower ranks of the armed forces, Chavez would prevail.

Unable to win much support outside the capital, the coup government col-

lapsed. With the president’s backers thronging the streets, he emerged from

incarceration some forty- eight hours later at the presidential palace.

From that point on, the Venezuelan leader would only sharpen his

attacks on the middle class and elites, further dragging down the country’s

democracy. But by backing the coup— and then stepping up the number of

street protests designed to force Chavez out— his middle class opponents

had showed that they cared little for the institutions of democracy, either.

Despite the early euphoria of the Arab uprisings, middle classes in the

Middle East appeared to be just as conservative as their peers in East Asia

and Latin America. Though many of the groups that helped overthrow

Hosni Mubarak’s government fear the continuing power of the military,

some Egyptian middle class men and women actually have welcomed the

army’s continued po liti cal power. Increasingly they view the armed forces as

a check against Islamists and against growing instability, crime, and urban

violence, and wonder whether the country might not be better off under

another authoritarian regime, at least one less corrupt than the Mubarak

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The Middle Class Revolts 95

regime. Though Cairo historically had been a relatively safe city, after the

downfall of Mubarak, and with much of the Egyptian police on strike or

simply at home because they are not getting paid, armed robbery, gang war-

fare, and more petty crime has become common in the city, deterring in-

vestment and scaring many businesspeople.37 Consequently, some liberals

have come to support continued military rule even after security forces killed

Coptic Christians during the October protests, provoking a wave of anger

among Egypt’s Christians. Other liberals and some minorities simply have

fl ed the country during the Arab Spring: the New York Times reported that

the number of Egyptians who successfully obtained passports doubled in

the fi rst fi ve months of 2011, compared to the previous year.38

Indeed, by the autumn of 2011 many in the Egyptian middle classes

seemed to be scared of the prospect of free elections, which, they were

convinced, would make the chaos worse, or lead to a victory by the Muslim

Brotherhood, as Islamists had triumphed in the fi rst postuprising election

in neighboring Tunisia. Some Egyptian middle class men and women even

expressed concern that the country’s military actually was moving too quickly

in turning over power and or ga niz ing elections before secular, liberal parties

could build their strength and seriously compete with the Muslim Brother-

hood and other Islamist parties that had built strong organizations under-

ground during the Mubarak era.39

Given the wariness of the middle class in Egypt and in other Middle

Eastern nations, the Arab uprisings easily could stall before countries even

or ga nize regular elections. “There seems little doubt— as protesters tire and

as the general public tires of them— in what direction the balance will tilt” in

the Arab world, write analysts Robert Malley and Hussein Agha in the New

York Review of Books.40 The militaries in these nations have the or ga ni za-

tion, po liti cal experience, and power to dominate any postdictator era, and

they will be at the forefront of the Arab experiment, they write. Meanwhile,

they note, crowds that once fervently backed the anti- Mubarak, anti- Qadaffi ,

and anti– Ben Ali protesters have become more equivocal, as Islamists, who

have built their parties for de cades, have shown themselves to be the most

capable organizations in the new po liti cal climate as law and order has bro-

ken down in places, and as ethnic and tribal divisions fl ourish. So, to many

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96 The Middle Class Revolts

Arab middle classes, a military- backed counterrevolution, an antidote to the

revolutions of the Arab Spring, does not look like such a bad idea.41

As they did in Venezuela, once the middle classes turn against elected leaders,

convinced they are actually protecting democracy, they seem willing to use

virtually any means to topple presidents and prime ministers. As we saw in

the fi rst chapter, nearly half of the military coups launched in the past twenty

years either enjoyed middle class support or were openly called for by middle

class protesters. This trend shows no sign of waning: as recently as the middle

of 2011, Thai urbanites, furious that Thaksin’s party had won yet another

national election, again were calling on the military to step in and annul the

poll. When this did not happen, the middle class anti- Thaksin groups in

Thai society relentlessly attacked Thaksin’s sister, the prime minister. Even

when massive fl ooding swamped the country in the fall of 2011, submerging

many parts of Bangkok and killing hundreds, the Thai military seemed

unwilling to cooperate with Thaksin’s sister, the new prime minister.42

This promilitary sentiment was repeated in 2011 in places as diverse as

Mexico, Pakistan, and Syria. In the case of Syria, urban middle classes and

religious minorities, like Christians, have continued to back the armed forces

and Bashar al- Assad even as the security forces have unleashed a brutal cam-

paign of violence against peaceful protesters in many parts of the country.

As we have seen, middle classes and elites in many other Middle Eastern

nations also have become more confl icted about whether to continue sup-

porting demo cratic reform, with many putting their trust once again in the

armed forces.43

Many of these elected autocrats, from Putin to Chavez to Thaksin, also

tend to be savvy politicians, retaining sizable popularity with the majority

of their country even as they undermine the rule of law, usually by embark-

ing upon populist policies that help reduce poverty, stirring up nationalism,

or some combination of the two. The endurance and survival of these lead-

ers have made urban middle class men and women only angrier, more des-

perate, and more willing to use extreme tactics, from violent protests to coups,

to remove an elected autocrat.

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The Middle Class Revolts 97

To take one example, in late 2006 and early 2007 Bangladesh’s military

essentially staged a coup, maneuvering into power an unelected “caretaker”

government that then declared a state of emergency and assumed signifi -

cant powers. During the state of emergency, the government arrested Sheikh

Hasina, one of the two powerful women who for years had dominated Ban-

gladeshi electoral politics but who allegedly had been implicated in massive

graft and extortion. But eventually the government just dropped its charges

against the po liti cal leader, who clearly retained enormous popularity among

poor Bangladeshis. In the next free election, following the demise of the

caretaker government, Sheikh Hasina’s party dominated the poll, delight-

ing Bangladesh’s poor but infuriating Dhaka’s urbanites, many of whom

had supported the military intervention.

Even in Taiwan, which, during Chen’s rule, was still considered one of

the strongest democracies in Asia, middle class activists, many of them vet-

erans of the long struggle against the authoritarian Nationalist regime, be-

gan to turn. Increasingly furious at Chen’s incompetence, alleged corruption,

and crushing of protest, thousands of demonstrators, and then hundreds

of thousands, gathered in front of the presidential palace in Taipei in Sep-

tember 2006. They were led by a man named Shih Ming- teh, himself a

longtime democracy activist who once had greatly admired Chen, and

who had been beaten badly in jail during prison stints under Taiwan’s

authoritarian rulers. In the mid- 1990s, Shih actually had served as chair-

man of the DPP, Chen’s po liti cal party. Shih had fought so long against

the dictatorship that ruled Taiwan until the 1990s that he enjoyed enor-

mous moral authority among average Taiwanese. As many reporters noted,

Shih often was locally referred to as the “Nelson Mandela of Taiwan.” 44

Still, there Shih was, in September 2006, at the front of the crowd,

made up primarily of middle class and upper middle class Taipei men and

women. Shih led the crowd in chants and catcalls at the mention of the

president’s name, and in choruses of “Chen Step Down!” before they

marched from the palace through the business district. Later, the protest-

ers fanned out into other parts of the city, holding red sparklers— red be-

ing their color of anger. In Chen strongholds, they started fi ghting with

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98 The Middle Class Revolts

his supporters, and eventually crashed several meetings Chen held with

foreign offi cials.

Although Chen had twice won elections, the demonstrators hoped to

recall him from his post, a strategy of dubious legality— but one that

some protesters had tried earlier, in 2004, holding violent demonstrations in

the capital in a previous effort to get Chen to leave. At that time they had

faced off against armored troop carriers in front of the palace and taunted

the police, daring the offi cers to attack them. The president was not in

residence— he had traveled to his heartland in southern Taiwan to ask his

supporters to pray for him and to vow never to step down— but the demon-

strators did not relent. Some openly hoped for a repeat of the silent coup that

had, in the Philippines, removed Joseph Estrada, though Shih later insisted

that he had no desire to provoke a military intervention. Still, during the

demonstrations in 2004, and ones held earlier, some 300,000 people calling

for Chen’s ouster had skirmished with police, leading to battles in front of the

presidential palace. Some of those demonstrators carried clubs, steel pipes,

bats, and other weapons to the protest, clearly looking to start violence.45

This time, in 2006, the protesters promised to turn out a million people

in front of the palace, in a rally called “Million People Depose A-Bian”

(A-Bian was Chen’s nickname). Ultimately, for all their rallies and attacks

the demonstrators did not force Chen out despite his popularity ratings,

which had fallen below 20 percent. Chen could still call on his support in

working class southern Taiwan, and he was savvy enough to evade, prevent,

or stop any larger demonstrations. He eventually was indicted and convicted

of corruption, in a decision his supporters saw as po liti cally motivated— but

the protests only added to the vitriol and distrust in Taiwanese democracy.46

To be sure, middle classes have not uniformly turned against democracy.

Within many countries still struggling for democracy, middle classes remain

the locus of reform movements. To take just two examples among many, in

Iran, middle class urbanites form the core of the opposition Green protest

against President Mahmoud Ahmadinejad and the authoritarian/clerical

regime, while in Burma middle class men and women, including students

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The Middle Class Revolts 99

from Rangoon and Mandalay, have continued to push for democracy as the

country begins to change.

But when they do turn against democracy, the middle classes’ interven-

tion can prove utterly destructive. By inviting the military back into politics,

the middle class potentially undermines civil/military relations for generations

and sets the stage for the army to undermine civilian leaders repeatedly, a

recurring cycle from Pakistan to Thailand to Venezuela. By legitimizing the

use of street demonstrations to oust elected leaders, the middle class delegiti-

mizes elections and other legitimate demo cratic institutions. This is partic-

ularly dangerous when the middle class uses protest to oust an elected leader

pop u lar with the majority poor of a country, who themselves now have be-

come more po liti cally engaged and convinced that only street demonstra-

tions, rather than demo cratic institutions, can work to fi ght back against the

middle classes. In Thailand or Taiwan, Venezuela or Bolivia, the revolt of

the middle class has left a bitter divide that is unlikely to be healed any-

time soon— the poor, feeling disenfranchised, store up their rage for a

future showdown.

Indeed, while working class men and women in many developing na-

tions already have grown disillusioned with democracy because of the lack

of growth, the middle classes’ willingness to abrogate democracy in order to

protect their privileges only further alienates working classes. “Why do they

have the right to just outlaw our party whenever they want?” said Noppa-

don Pattama, a minister in the populist Thai governments run by Thaksin

Shinawatra, who was forced to fl ee into exile after his party was banned.47

Empowered by populists like Thaksin, Joseph Estrada, or Hugo Chavez,

and no longer willing to simply hand over po liti cal power to middle classes

and elites, as they might have done ten or twenty years ago, the voting poor

in country after country have fought back after their mandates have been

overruled. In Thailand, for example, poor supporters of Thaksin formed

the United Front for Democracy Against Dictatorship, a mass or ga ni za tion

whose members, wearing their trademark red shirts, targeted middle class

and elite institutions with demonstrations and violent protests in 2009 and

2010. They held massive rallies drawing tens of thousands of people, but

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100 The Middle Class Revolts

they also attacked government meetings, pelted the motorcade of then prime

minister Abhisit Vejjajiva, and launched rallies in the center of Bangkok

that deteriorated into brawls with middle class shop keep ers in certain neigh-

borhoods. Ultimately, it seemed, the red shirts had decided that, if Thai-

land’s middle classes could ruin the country’s democracy, so could they.

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Yale University Press

Chapter Title: Graft, Graft, and More Graft

Book Title: Democracy in Retreat Book Subtitle: The Revolt of the Middle Class and the Worldwide Decline of Representative Government Book Author(s): Joshua Kurlantzick Published by: Yale University Press. (2013) Stable URL: https://www.jstor.org/stable/j.ctt32bh31.9

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F or many first- time visitors to Jakarta, capital of Indonesia and

the largest city on the intensely crowded island of Java, the metropo-

lis seems to be in constant motion, its incessant activity and brutal

equatorial heat wearing down travelers. Alongside the wide boulevards of

the central fi nancial district, where glass- and- steel skyscrapers jostle for space

with fi ve- star hotels, vendors peddling sticks of satay and clove cigarettes

and copies of the Indonesian tabloids push their carts past mobs of local

offi ce workers dressed in Western suits. Away from the grandiose fi nancial

areas, in the cramped side streets of newer districts that have sprung up to

accommodate migrants from other parts of the sprawling archipelago of

17,000 islands, motorcyclists weave through gridlocked traffi c, their exhaust

stinging the throat and mixing with soupy air already polluted by cars,

buses, and haze from forest fi res burning out of control across other parts of

Indonesia.

Yet compared with the late 1990s, Jakarta today has become so placid it

could resemble Oslo. At that time, the collapse of longtime dictator Suharto

and the Asian fi nancial crisis had battered Indonesia’s economy and simul-

taneously released the cork that had repressed religious, ethnic, class, and

other divides in the staggeringly diverse archipelago. The result was a po-

liti cal and social meltdown. At the time, many frequent visitors to Indone-

sia wondered whether the country was going to disintegrate into a Southeast

Asian version of Pakistan or Nigeria, a giant failing state poisoning its neigh-

bors and, potentially, the international community. The Indonesian econ-

omy shrank by 13 percent in 1998, tens of millions of Indonesians fell below

the poverty line, and rioters ransacked and burned large areas of the capital.

Graft, Graft, and More Graft

6

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102 Graft, Graft, and More Graft

Long lines formed for handouts of staple goods like rice and cooking oil,

and the value of the rupiah, Indonesia’s currency, plummeted by about 75

percent in the end of 1997 and the beginning of 1998.1

Outside Jakarta, the violence could actually be worse. Besides violent

anti- Chinese sentiment, other ethnic and religious fault lines exploded in

the late 1990s and early 2000s. In the Malukus, the famous “Spice Islands”

where Western colonists once had competed for access to valuable nutmeg

and cloves, Christians and Muslims attacked each others’ villages, burning

them to the ground and beheading survivors, whose heads were left on

skewers like a tropical Vlad the Impaler. Outlying regions like Aceh, East

Timor, and West Papua threatened to secede, potentially breaking up the

country.

To people who lived through the late 1990s and early 2000s in Indone-

sia, the turnaround to the situation today seems, on the surface, to be re-

markable. The sprawling country, with the fourth- largest population in the

world, appears to have achieved stability and defused the violence that had

threatened to tear the archipelago asunder. Rather than disintegrating into

Nigeria or Pakistan, Indonesia, to some observers, has become the demo-

cratic success story of the de cade. Indonesia has devolved much of the central

bud get and empowered local offi cials, increasing nationwide participation

in politics. It has fostered a broader and more inclusive civil society, and

has increasingly tolerated public protest, po liti cal opposition, and legisla-

tive horse- trading. Local areas have gained greater control over their natu-

ral resources and their social welfare systems, and have introduced new

forms of local- level elections and other types of voter feedback. Jakarta’s

Indonesian and English- language newspapers now give a daily roundup—

right next to the weather pages— of planned (peaceful) protests that will be

held on the capital’s streets, a sign of how normal and routine such public

participation has become.

Unlike po liti cal leaders in other countries such as Pakistan, who are

reticent to confront militancy for fear of seeming like tools of the United

States, Indonesia’s recent leaders have utilized the bully pulpit to condemn

militants, while also integrating Muslim parties into the mainstream po liti-

cal sphere. “I would like to emphasize that the country must not, and will

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Graft, Graft, and More Graft 103

not, be defeated by terrorism. . . . To the whole of the Indonesian people, let

us collectively unite in the fi ght against the acts of terrorism,” Indonesian

President Susilo Bambang Yudhoyono declared in one speech.2 Indeed, by

combining this public outreach with effective police work, Indonesia has

shattered Jemaah Islamiah, once the most powerful terror network in South-

east Asia, responsible for the bloody 2002 Bali bombings, which killed over

200 people, as well as for numerous attacks on Western hotels and embassies

in Jakarta. According to the International Crisis Group, the most authorita-

tive analyst of Jemaah Islamiah, the group is now splintered, weakened,

and largely in effec tive.3

Stability, engendered by public participation and devolution, has al-

lowed for investment and stronger growth; except for India and China, In-

donesia has posted some of the highest growth rates in the world in recent

years. Yudhoyono also has presided over truly free and contested elections.

After its violent birth, the in de pen dent country of East Timor did emerge.

Another secessionist confl ict, in Aceh, was resolved following the devastat-

ing tsunami in December 2004; Yudhoyono had the wisdom to try to help

negotiate an end to the decades- long confl ict in Aceh, rather than attempt

to overwhelm insurgents by force. Attacks against Indonesian Chinese have

decreased sharply as calm has been restored. Today, far from sheltering

themselves in heavily guarded enclaves across Jakarta, behind razor wire

and security checks, many ethnic Chinese businesspeople are beginning to

participate openly in politics.

In recognition of Indonesia’s supposed turnaround, the United States,

which all but ignored the country for a de cade after Suharto’s fall in 1998,

is once again courting it. The Obama administration has launched what it

calls “comprehensive partnership” with Indonesia.4 As countries in the Mid-

dle East throw off their own dictators, the White House commissioned an

internal study to examine Indonesia’s transition, and to see whether the

archipelago now could be an example to the Arab world.5 Returning in

November 2010 to the country where he spent four years of his childhood,

President Barack Obama heaped praise on Indonesia, declaring, “Indonesia

has charted its own course through an extraordinary demo cratic transforma-

tion.”6 Secretary of State Hillary Clinton, meeting with Indonesian offi cials

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104 Graft, Graft, and More Graft

the following year, urged them to promote democracy in the Middle East

and in Burma, saying that Indonesia “provides an example for a transition

to civilian rule and building strong demo cratic institutions.”7

And yet, even as it supposedly goes from success to success, Indonesia

has developed what could be a fatal fl aw. As in many other young democra-

cies, the opening of politics also has opened the tap for corruption. In this

liberalization of corruption, the breakdown of a centralized system of graft,

common under authoritarian rule, leads to more bureaucrats, offi cials, and

average policemen with their hands out— so many more people for citizens

to pay in order to start a business, get their kids into school, drive on the

highway, mail a letter, or fulfi ll any number of other tasks taken for granted

by citizens of wealthy democracies. Corruption has become so common-

place that, when politicians accused the national anticorruption commission

of being penetrated by corruption and other crimes itself, few Indonesians

were surprised— though it turned out that the accusations were mostly an

attempt to undermine the commission.8 Still, in 2010 one former head of

the anticorruption commission was found guilty of masterminding the mur-

der of a rival.9

In theory, more open politics should reduce corruption, by throwing sun-

light onto the actions of politicians. This may be true in the long run, but

in the short run the opposite often seems to happen. During an era of tight

authoritarian rule, graft often remains relatively centralized and predict-

able, allowing citizens to understand and manage established networks of

corruption. The regime siphons off a certain percentage of money from lo-

cal businesses, but the number of actors involved in the corruption remains

relatively small. (To be sure, there are exceptions, like Mobutu Sese Seko’s

Zaire, in which the venality of this small number of actors was so great that

it became utterly unmanageable.) Yet as countries demo cratize, the old

channels of graft and monopolies over important information tend to van-

ish, and more actors have access to important government information that

could be sold, and so these new and different actors— local po liti cal bosses,

broader segments of the bureaucracy, staff of members of parliament— put

out their hands. This liberalization of corruption can add to business costs

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Graft, Graft, and More Graft 105

for everyone, from the largest local corporations to the smallest street ven-

dors, who now, in cities like Jakarta, have to pay a litany of small “fi nes” to

everyone from beat cops to traffi c police to small- time local offi cials.

Indeed, Indonesia provides a clear illustration of how po liti cal opening

leads to the liberalization of corruption. At the beginning of the transition

from longtime dictator Suharto, whose regime collapsed in 1998, graft be-

came decentralized, following de cades of tightly controlled networks of cor-

ruption run by the military and Suharto’s extended family.10 The central

government handed over more power to local leaders, and, in addition to

empowering local politicians, the new situation also provided many more

opportunities for corruption. “Actors in the bureaucracy, judiciary, po liti cal

parties, and in the army have reemerged as central players in a corruption

free for all in demo cratic Indonesia,” wrote economist Michael Rock in a

comprehensive study of corruption in Indonesia and several other develop-

ing countries.11

A truly competitive legislature, a sharp change from Suharto’s compli-

ant parliament, also has added to an increase in corruption. Again, in the

long run a competitive legislature could bring transparency to politics, and

studies by multiple economists have found that corruption eventually de-

creases as a democracy ages. But for now, it signifi cantly increases the amount

of money in the po liti cal system. Although Indonesian legislators no longer

can count on winning offi ce just by joining Suharto’s party, Golkar, the

young democracy has developed few rules governing how politicians should

raise money to campaign. “With the emergence of a confrontational rela-

tionship between newly empowered legislatures and embattled presidents,

members of parliament, who needed ample war chests to win re- election,

used their new po liti cal powers to extort funds. . . . Local offi cials also par-

ticipated in extorting and taxing private fi rms,” Rock wrote.12 Democracy

has provided rent seekers with many more opportunities to make money

off the state, or from elections, but Indonesia has not yet developed the

checks and balances to restrain them, he concluded.

Simply the fact that Indonesia now has more elections— for local po liti-

cal positions, for party leadership, for legislative seats— provides more op-

portunity for graft in the absence of strong traditions of clean elections or

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106 Graft, Graft, and More Graft

effective monitoring. During the 2006– 7 race for the governor of Jakarta, a

position similar to that of an American mayor, the U.S. embassy reported

that some parties were trying to sell their nominations for the post to the

highest bidder.13 Two years earlier, in the run- up to the national presiden-

tial election ultimately won by Yudhoyono, a similar problem had emerged:

powerful politician Jusuf Kalla, who would serve as Yudhoyono’s fi rst vice

president, allegedly won the chairmanship of the Golkar party by “[paying]

enormous bribes to secure votes from party branches,” according to another

U.S. embassy analysis. Since there were now so many more party branches

than during the dictatorship, and each one could exercise the kind of infl u-

ence that local party offi ces never had during Suharto’s time, the amount of

money needed to pay them off was far higher than in the past.14

Even Yudhoyono, who tried to build a reputation as a clean politician,

rhetorically supporting the nation’s anticorruption watchdog even as it

went after some of his closest associates, could not escape the country’s

growing graft problem. The trea sur er of Yudhoyono’s Demo cratic Party, a

man named Muhammad Nazaruddin, fl ed the country in May 2011 after

being accused of massive corruption in the tender of buildings in Jakarta.

Once abroad, Nazaruddin claimed that many members of Yudhoyono’s

party had been involved in his state contracts scheme, an allegation widely

believed among Indonesian po liti cal, media, and business leaders.15

Not surprisingly, despite its increasingly open politics, Indonesia has

made little headway in recent years in Transparency International’s annual

rankings of perceptions of corruption. The Po liti cal Economy and Risk

Consulting, a leading Asian survey, ranked Indonesia as the most corrupt

country in Asia, behind such paragons of clean politics as Cambodia and

the Philippines.16

This decline in Transparency International rankings is echoed in other

emerging democracies, where the enlargement of the franchise and the

decentralization of po liti cal power, at least at fi rst, seems to make graft

easier. As Thailand became more demo cratic in the 2000s, in terms of a

broader franchise, freer voting, and a decentralization of power to prov-

inces from Bangkok, its Transparency International ranking fell from sixty-

fi rst in the world in 2001 to seventy- eighth in 2010. The Philippines’s ranking

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Graft, Graft, and More Graft 107

in Transparency International’s survey of corruption perceptions declined

from fi fty- fi fth in the world in 1998 to one hundred thirty- fourth in 2010.

In fact, in analyzing over thirty developing countries that emerged from

authoritarian rule and shifted to democracy in the late 1990s and early 2000s,

Council on Foreign Relations researchers have found that the Transparency

International score for corruption perceptions actually declined in most of

the countries in the fi rst fi ve years of demo cratic rule.

In a number of cities and provinces across Indonesia, newly empowered

local offi cials— or party leaders like Nazaruddin— have built megaprojects,

like a $600- million, 50,000- seat outdoor stadium in East Kalimintan on the

island of Borneo, that allegedly have provided innumerable opportunities

for contractors, in collusion with local offi cials, to skim money from proj-

ects. Today nearly a quarter of the Indonesian leaders charged with cor-

ruption come from district and provincial- level jobs, compared with almost

none a de cade ago, when graft was controlled by Jakarta.17

This corruption is hard to miss, even for outsiders. Even as Obama

pushes for the “comprehensive partnership” with Indonesia, American in-

vestors, who have looked closely at the country, understand how graft is

spiraling out of control. Despite Indonesia’s size, it remains only the twenty-

eighth- largest trading partner of America, behind such global minnows as

Belgium. When quizzed about their interest in investing in Indonesia, most

American companies— other than large natural resources fi rms that already

have huge investments in the country— reply that they are still deferring

any investments, largely because of the country’s problem with graft.18 When,

in 2011, Google decided to launch new investments in Southeast Asia, it

initially passed over Indonesia, by far the largest country in the region, and

then essentially asked the Indonesian government for waivers that would

allow it to avoid all the red tape (and potential graft) clogging Indonesian

business today.19

Indonesia’s story is repeated in many young democracies. In Rus sia and

other post- Soviet states, people watched, after 1989, as the old nomenkla-

tura, the former communist offi cials, benefi ted from an orgy of self- dealing

of state assets. Yet, at the same time, the chaotic freeing of the economy of-

ten allowed these former bureaucrats, who now “owned” many former state

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108 Graft, Graft, and More Graft

assets, to extort bribes from the general public to get access to certain for-

eign goods, licenses to launch a business, or entrée into companies created

from old state fi rms. In a study of several post- Communist states by the New

Democracies Barometer at the University of Strathclyde in Scotland, over 70

percent of respondents said that corruption had increased in comparison

with that under their former communist regimes, and that this had signifi -

cantly impacted their views of the quality of democracy.20

Indeed, several multicountry studies of corruption suggest that graft

increases in the early years of demo cratization. In one analysis of democ-

racy and rent seeking, economists Hamid Mohtadi and Terry Roe of the

University of Minnesota found that in nearly every one of the sixty- one

countries they studied, rent seeking and corruption rose in the early stages

of demo cratization.21 Other studies, focusing on specifi c regions or coun-

tries, have found similar results. Po liti cal scientists Chris Baker and Pasuk

Phonpaichit concluded that corruption rose as Thailand demo cratized; other

economists discovered that corruption has increased in most demo cratizing

Latin American nations as centralized networks give way to more decen-

tralized politics.22

Even when graft might not actually be getting worse, the openness of new

democracies often leads to the perception among the general public that it is.

In large part, this is simply because a freer media, and more in de pen dent

anticorruption agencies, investigate the government and publish reports on

graft. In the long run, again, this is a positive development: Exposés of graft

eventually could encourage politicians and civil servants to think twice about

their actions. But in the short run, the freer media and anticorruption agen-

cies’ reports tend to increase public perceptions of government corruption.

Under authoritarian governments, rumors of graft within po liti cal circles

may spread, but they are easier to keep out of the local press. In China, for

example, Prime Minster Wen Jiabao has successfully maintained an image

of a caring, earthy, and incorruptible grandfather type. Because of this im-

age, Wen is always the fi rst top Chinese offi cial on the scene at any major

tragedy, like the deadly 2008 earthquake in Sichuan province, where he

comforted the grieving and vowed an honest government investigation of

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Graft, Graft, and More Graft 109

any malfeasance that might have made the disaster worse. Wen has main-

tained this image despite the fact that po liti cal insiders— and foreign

journalists— know that his wife, Zhang Peili, wears staggeringly expensive

jewelry, which makes one wonder how she can afford such items given his

modest offi cial salary.23 But because the tightly controlled Chinese press

never reports on the business interests of Wen’s wife, and China’s state an-

ticorruption agencies do not touch such se nior offi cials, most average Chi-

nese have no idea about her wealth. When, in 2007, the Taiwanese media

reported that Zhang owned jade jewelry worth hundreds of thousands

of dollars, Chinese censors quickly blocked the stories from the Chinese

Internet. “The Propaganda Ministry issued blanket orders to the news me-

dia not to cover Zhang’s jewelry activities, according to a se nior Chinese

editor who asked not to be identifi ed. Filtering software was updated to

block all queries about “Wen’s wife” and “jewelry,” reported the Los Ange-

les Times.24

Similarly, during the time of the dictator Suharto, whose family stole

as much as $35 billion in government wealth, according to several estimates,

to publish an exposé of the Suharto empire would have meant guaranteed

arrest for any local reporter who attempted to do so. By contrast, the free,

and scandal- driven, press in Indonesia now produces endless exposés of cor-

ruption in high po liti cal circles. In addition, demo cratic Indonesia has devel-

oped a Supreme Audit Agency and other anticorruption watchdogs, which

generally produce in de pen dent, fair investigations of graft allegations. Yud-

hoyono, though certainly far less corrupt than Suharto by any standard, has

been battered by a long string of media reports about corruption linked to

his administration, including the Nazaruddin allegations and allegations

that the president ordered the bailout of a leading bank, Bank Century,

that made major campaign contributions to his vice president. These alle-

gations were given more fuel by a report, released in late 2009, by the

Supreme Audit Agency, which suggested that the vice president, who had

formerly governed Indonesia’s central bank, had used his powers as central

banker to help rescue Bank Century. The allegations became so numerous

that Yudhoyono was forced to go on national tele vi sion to address his role in

them, and to promise a tougher fi ght against graft. During Suharto’s time,

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110 Graft, Graft, and More Graft

such allegations simply would have been completely quashed, and the pres-

ident would not even have had to respond to them in public.25

These perceptions of corruption heighten economic uncertainty, since

average people simply hear more about graft than they used to under an au-

thoritarian regime, and they also add to civic disengagement from a po liti-

cal elite perceived as cynical and uninterested in the public welfare. As

economist Rock notes, under Suharto the private sector was, in a way,

protected from excessive graft— Suharto granted a “franchise” to a certain

number of se nior regime cronies to extort money from companies, but he

prevented any other offi cials who did not have this “franchise” from doing

so. Now, “demo cratization witnessed the collapse of the franchise system,”

making private companies in Indonesia even more uncertain about whether

their investments would be protected, or whether they would have to pay a

continual, unending string of bribes.26

In earlier global demo cratic waves, freedom of the press may have had

a similar impact, exposing corruption to the public. But the reach and scope

of media outlets were much smaller in the second and third waves of de-

mocracy, and so even if the press did print more stories on corruption, its

ability to quickly infl uence large sections of the public was limited. With

the Internet and social media, the media’s reach is far greater and faster.

Even in a developing nation like Indonesia, widespread Internet penetra-

tion and use of social media provide even the poorest men and women with

access to the latest news coverage— including numerous stories about cor-

ruption. Indonesia, in fact, now has the largest number of Facebook users

of any country other than the United States.27

Rising corruption, or even perceptions of rising corruption, can add to

pop u lar alienation with democracy. A meta- analysis of over thirty emerging

democracies around the world conducted by several of my research associ-

ates at the Council on Foreign Relations and myself used survey data be-

tween 2002 and 2007, the most recent years with comprehensive survey

information, to examine the correlation between support for democracy and

corruption. We conducted our analysis by using Barometer surveys from

various regions to examine support for democracy, and also utilized data

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Graft, Graft, and More Graft 111

from the Pew Global Attitudes Survey, in which people in several regions

were questioned to assess whether they considered corruption a “very big

problem” in their country. We found that, in roughly one- quarter of the

countries, support for democracy decreased when perceptions of corruption

increased. Conversely, in several of the case studies, such as Bangladesh,

Argentina, and India, signifi cant decreases in perceptions of corruption

were correlated with increases in pop u lar support for democracy. These

results suggest that, if governments in emerging democracies can quickly

get graft under control, they can more easily consolidate demo cratic transi-

tions.28

In countries in this meta- analysis that showed a clear link, the relation-

ship between corruption and diminishing support for democracy was sub-

stantial— a fi nding supported by the work of other researchers such as

Yun- han Chu of National Taiwan University, who has found that corrup-

tion perceptions have eroded trust in government in many young Asian

democracies.29 In Pakistan, where even many middle class liberals privately

admit that graft has increased in recent years of civilian governments as

compared with past military regimes, the survey data shows that perceptions

of corruption have been bad for democracy. Between 2002 and 2007, the

number of Pakistanis who perceived that the country had a serious cor-

ruption problem grew by 6 percent; over the same period, support for de-

mocracy among the Pakistani population fell by nearly 9 percent. Similarly,

in Ukraine, where many middle class men and women grew frustrated

in the late 2000s with the government of Orange Revolution leader Viktor

Yushchenko because they saw graft rising despite the country’s greater po-

liti cal openness, the survey data also shows that this frustration has led to

disillusionment with democracy. Between 2002 and 2007, the percentage of

Ukrainians who believed that the country had a serious problem with cor-

ruption grew by 9 percent; over that same period, support among the popu-

lation for democracy fell by a sizable 11 percent.30

Other studies show similar results. Examining perceptions of corruption

in Africa between 2002 and 2005, several researchers found that “corruption

is a major, perhaps the major, obstacle to building pop u lar trust in state insti-

tutions and electoral pro cesses in Africa.” Corruption was the strongest factor

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112 Graft, Graft, and More Graft

hurting Africans’ trust in demo cratic institutions— institutions whose func-

tioning was critical to these young democracies.31

In other cases, corruption fosters public dissatisfaction with elected of-

fi cials. This dissatisfaction can then lead to citizens looking to other, un-

elected actors to resolve po liti cal problems. This might not be such a problem:

one comprehensive survey, taken in the mid- 2000s, and covering all of South

Asia, found that less than 50 percent of Indians trusted po liti cal parties,

but that Indians had instead placed high degrees of trust in their country’s

judiciary and nonpartisan Election Commission, two important institu-

tions in a democracy. Even so, the rallies against corruption by Indian

hunger strikers in the summer of 2011, who openly disdained the po liti cal

system and elected politicians, drew large middle class crowds, suggesting

that even those low levels of trust in Indian politicians had fallen precipi-

tously.32

But at least in India, the public has placed trust in some demo cratic in-

stitutions. In places like Pakistan, Thailand, or Egypt, where the public today

has low levels of trust in po liti cal parties, middle class citizens instead often

have put their trust in the army, which, though it has played a central role in

those nations’ histories, can hardly be called guarantors of democracy.

As we have seen in the case of the Jakarta polls, this growth in corruption

also extends to election campaigns in young democracies, which, at fi rst,

become more corrupt and, potentially, divisive. As economist Paul Collier

shows in his analysis of demo cratic systems in Africa, initial demo cratic

elections in developing countries often create what he calls a “Darwinian

struggle for po liti cal survival in which the winner is the one who adopts the

most cost- effective means of attracting votes.”33 Lacking the strong institu-

tions capable of rewarding good governance and punishing cheating— such

as anticorruption watchdogs, a strong election monitoring commission,

and impartial courts— the most cost- effective means of winning votes in a

young and poor democracy, Collier found, is not delivering good gover-

nance but bribery, voter intimidation, and ballot fraud. And without an

established tradition of tolerance for opposition parties, these fi rst free elec-

tions turn into zero- sum battles, in which no party can afford to lose, and

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Graft, Graft, and More Graft 113

so all parties are willing to use the most dramatic— and even violent—

tactics to triumph. And in each subsequent demo cratic election, as the stakes

of winning or losing become clearer— each party understands that, unless

it wins, it will be cut out of all patronage— the amount of vote buying and

intimidation tends to increase. In Nigeria, for instance, vote buying appar-

ently has increased in each demo cratic presidential election, with the me-

dian price paid for a vote rising with each election as well.

So, during the fi rst truly competitive elections in Kenya, for example,

in the early 2000s, it made sense, from a perspective of survival, for all the

parties contesting the poll to use bribery, voter and candidate intimidation,

and even outright killings to try to dominate polling districts during the

election campaign. All of the parties knew, after all, that if they lost an elec-

tion, their party, and all their po liti cal, business, and ethnic allies, would be

frozen out of power.34

Even in wealthier emerging democracies such as those in East Asia,

where one might think there would be more room for politicians to share

spoils— and thus less incentive to view elections simply as survival of the

fi ttest— democracy has actually led to spikes in election violence and vote

buying. A 2011 analysis of several emerging democracies in Asia, produced

by the United Nations Development Program (UNDP), found that while

elections can allow for public participation, in many emerging democracies

they are exacerbating violence and graft. Elections “can trigger violence. . . .

Elections are not in themselves suffi cient mechanisms for managing po liti-

cal change when the players have not bought into the rules of the game”— in

other words, contesting polls cleanly and peacefully, it noted. Electoral

democracy, it concluded, “has come at a high price [in emerging Asian de-

mocracies.] Each year hundreds of people lose their lives in connection with

competitive election.”35 In Thailand, Nepal, Bangladesh, the Philippines,

and Pakistan, among other emerging Asian democracies, elections have, as

in Africa, turned into winner- take- all contests in which any losing party

gets completely shut out, UNDP concluded. As a result, just as in Kenya or

Nigeria, Asian po liti cal parties are willing to go to any extent to win elec-

tions, since they know a loss means their power will be eviscerated. For ex-

ample, one estimate suggests that vote buying in Thailand has become so

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114 Graft, Graft, and More Graft

entrenched, despite laws that punish it with prison terms, that this activity

puts some $1 billion into the economy during election time.36

In Indonesia, money politics now has become the norm during cam-

paign seasons— in Jakarta and nearly everywhere else in the archipelago.

During Suharto’s time, there were really no parties other than Golkar, the

dictator’s po liti cal vehicle. Golkar representatives might hand out small

amounts of Indonesian rupiah during the elections, which were held every

fi ve years and which resulted in Suharto and his party getting Saddam

Hussein– like vote tallies. But those disbursements of money were necessar-

ily limited by the fact that Suharto had no real opposition, and the dictator’s

party, together with the army, always could use the threat of force to get

people to vote for them as well.

Today, Indonesian po liti cal parties are far more competitive: in parlia-

mentary elections, at least fi ve sizable national parties now contest each elec-

tion. None really can rely on force to intimidate voters into supporting them,

so handing out money during campaigns, or on Election Day, has become

far more important. One prominent Indonesian academic, Effenda Ghazali,

looked at voter attitudes in several parts of the country, and found that the

amount people were paid for their votes had more than doubled between

the early 2000s and the late 2000s.37

Even a quick tour of campaign stops by Indonesian po liti cal parties

reveals hyperinfl ation in the price of votes. At rallies in one Jakarta suburb,

where migrants from around the country have built small, two- room houses

of concrete and wood, candidates from one leading Indonesian party can-

vass for support. While a candidate speaks on the suburb’s makeshift stage,

his aides hand out small baskets of rice, cooking oil, and peanuts to people

in the audience, and then the candidate leads the crowd in chants and fl ag-

waving in the party’s colors. Few in the crowd seem to even bother listening

to the speech; many are waiting for an appearance onstage of a pop u lar

local pop singer known for dancing while shaking her rump toward the

crowd.

But the men and women in the audience, mostly working class people

who came to the capital to work in construction or other manual labor, start

to pay more attention as the candidate’s aides wander through the audience

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Graft, Graft, and More Graft 115

with other presents. Inside new baskets being handed out are small hand-

fuls of rupiah, along with cards instructing people how to fi nd the party’s

symbol and colors on ballots. Men and women who a minute ago had been

relaxing on the ground, chewing sticks of spicy chicken, jump to their feet

and press forward— many grab one, two, three baskets with the cash inside

in a scene that is reminiscent of an American radio station promotion. But

several of the people who grabbed baskets turn to the party’s aides in disap-

pointment after looking inside. “This is half what we got from the other

parties,” says one.38

The ongoing vote buying, the perceptions of growing corruption among

elected politicians, the little bribes demanded over and over, have begun

to wear down many Indonesians. When asked, many Indonesian business-

people refl exively express pride in their young democracy, and in how their

country has grown since the chaos and economic crises of the late 1990s.

But when pushed a bit harder, they allow their frustration to surface quickly—

street vendors, taxi drivers, and even wealthy tycoons will promptly complain

about all the bribes they must pay to keep their businesses running. So per-

haps it should not have been surprising when the former dictator’s son,

known as “Tommy” Suharto, decided in mid- 2011 that he would enter

politics— even though his father had overseen numerous brutal campaigns

of repression and he himself had served a long jail sentence for allegedly mas-

terminding the murder of a Supreme Court judge. Tommy launched a new

po liti cal party and became chairman of its board, and laid plans for Indone-

sia’s national elections in 2014. “The people don’t believe in the [Yudhoyono]

government,” one of Tommy’s top po liti cal aides told reporters. “Thirteen

years of ‘reform’ hasn’t made people’s lives better.”39

Tommy seemed to have understood the zeitgeist. In a study by the In-

donesian research or ga ni za tion Survey Circle, released in late 2011, only 12

percent of respondents believed that the current group of politicians in

the demo cratic era were doing a better job than leaders during the era of

Suharto.40 An overwhelming number of respondents cited graft as one of the

biggest complaints about the demo cratic era; commentaries on the survey

noted that a sizable percentage of Indonesia’s elected members of parlia-

ment were targeted by corruption investigations within a year after taking

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116 Graft, Graft, and More Graft

their seats. “This underscores the fact that for a majority of Indonesians,

democracy has not delivered a better life,” noted the Jakarta Globe, com-

menting on the results of the survey.41 In another poll released in May 2011,

residents of Indonesia, the supposed demo cratic success story of the 2000s,

said, by a margin of two to one, that conditions in the country were better

during Suharto’s time than under the government of demo cratically elected

Yudhoyono.42

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