Dimensions of Development - Francis Fukuyama

FRANCIS FUKUYAMA: So,

thank you very much. It's a real pleasure to be

invited to speak at this GEM conference. There are a lot of people around

the room that are old friends, and it's really terrific

to see all of them. So I am going to

present a framework for thinking about development. I've always thought

that development was one of the most

complex phenomena, precisely because it has so

many different dimensions that interact in very complex ways. And I'm going to present

my way of thinking about how these economic,

social, and political factors interact. And I'm not going to leave you

with a comfortable conclusion, because I think

that this is really meant to explain in a

way, the complexity of how the development process

actually unfolds. So let me begin. So, this is the

framework that I laid out in my two political order

books, in which I basically talk about six boxes on

this chart, which I think are six dimensions

of development. Now, you can subdivide

some of them, or you can collapse

some of them, but these are the ones

that I think about. So, economic growth is

what economists deal with. It's increases in per

capita output over time. Social mobilization has

to do with the development of social groups and new

kinds of social relations when a social group becomes

conscious of itself. For example, a classic

one was Karl Marx saying that the

origins of capitalism produce two social

classes, the bourgeoisie and the proletariat, that really

did not exist in feudal times. So that's an example

of social mobilization. And then, I'm a

political scientist, so I get to have three

boxes for politics because I think they're

actually quite separate. So the first box is the state. The state is about power. Max Weber's famous

definition of the state was a legitimate monopoly

of force over territory. I think that's actually

a good definition. States are about

accumulating and using power to enforce laws to

protect the community, to maintain domestic order. The rule of law, as

Ricardo indicated, pushes in the

opposite direction. You can have something

that's sometimes referred to as rule by law,

which is where the ruler simply gives commands that

people have to obey. That's not the rule of law. The rule of law exists when

the ruler himself or herself is under the law, and therefore

has to follow the same rules that other people do. And so the state

pushes in one direction towards the accumulation and use

of power, and the rule of law pushes in the

opposite direction. It's a limitation on power,

so that the ruler can't do whatever he or she wants. And the final box has to do

with democratic accountability. These are simply

procedural rules to try to ensure that

what the ruler does reflects as much of the

whole population's wishes and not simply of the

elite that happens to be running the government. And so in effect, you've got

one institution, the state, that pushes towards the

accumulation of power, and two institutions,

the rule of law and democratic accountability,

that are constraints on power. And what's difficult about

getting to a modern state, that is to say a modern

liberal democracy, is that you have

to find a balance. If you have a strong state

without constraint-- basically you've got China today, a

very powerful modern state, but no rule of law and no

democratic accountability. At the other end of

the scale, you've got Syria or Libya or some

stateless territory that doesn't have a state at all. That's an obvious problem. But that's not the case in

most developing countries. Most developing

countries may have some degree of law, some degree

of democratic accountability, but very weak states. And so the issue is

really not to have a weak state that

can't do anything, but a strong state

that is operating under those constraints. Now those arrows are various

empirical correlations between these boxes-- I'm sorry-- a couple

more definitions. So there's the legitimacy

box in the middle. This is a box that I

think a lot of economists don't think a lot

about, but I think it's actually very important. In fact, Deidre McCloskey has

written this very nice set of books arguing that the

whole of modern economic growth cannot be understood apart from

the kind of ideological changes that took place in Europe

in the 17th, 18th centuries, and I'm going to talk about that

at some length in terms of how states consolidate and how

national identity consolidates. And I think that is

a separate dimension. The thing about

these six boxes is that development can

occur in any one of them separately for reasons that

have to do simply with things going on in that box. So you can have the state

getting more powerful, you can have the rule of

law getting more powerful, you can have social

mobilization occurring. It may or may not be

connected to things going on in some of the other

boxes, but in some cases, they are connected. Now you have this thing

called modernization theory that was very popular, really,

up until about the 1960s. And I would say the bottom

line of modernization theory was the following-- it

said that development is a single as a single process,

and that all six of these boxes were mutually supporting, that

all good things go together. So if you have

economic growth, you're going to have social

modernization, you're going to have

changes in attitudes, you're going to have democracy,

and all of these things will mutually interact. Now, before you

dismiss this theory, there are countries in

which something like this actually did unfold,

and this is simply a diagram of South Korea. So, in 1954, South Korea

had a lower per capita GDP than the then Belgian Congo. People thought it had very

poor development prospects. It had, however,

a coherent state. That state could

oversee a period of rapid economic growth. The economic growth

led, by the 1980s, to a transition from an agrarian

to an urban industrial society. Social mobilization happened. You had all sorts of new groups

like labor unions, students, NGOs that were pushing

then for the democracy box, and in 1987, South Korea made

that transition to democracy. The democracy

strengthened rule of law. We saw that in the public

protests a couple of years ago that brought

President Park Geun-hye down for corruption charges

because civil society was mobilized to protect the

rule of law in South Korea, and all of that

reinforced the legitimacy of the system itself. And so that's kind of

modernization theory working on all six cylinders, where in

fact these boxes are mutually supportive. However, unfortunately,

several of the boxes actually contain contradictions,

mutual contradictions, and this is just a

list of four of them. Let's begin with the first

one, social mobilization, and political stability. This is the one that my

mentor Samuel Huntington wrote about way back in 1967

in his book, Political Order in Changing

Societies, where you said, if you get too much rapid

social mobilization that outruns the pace of political

participation expanding, then you're going

to get instability. I think that's

essentially what was going on in Tunisia and

Egypt prior to the 2011 uprisings known as the

Arab Spring, where you have a lot of people

going to university, a lot of new middle

class people. They don't have

jobs and they don't have political opportunity,

and that actually is not conducive to stability. That was Huntington's argument. So this is, in a

way, the diagram that he was focusing on. The dotted lines

are negative forms of causality, where social

mobilization actually weakens the state. It weakens the rule of law. It may produce democracy, but

you don't have a happy outcome because these different boxes

are not mutually supporting. Now, another

contradiction, which is kind of an obvious one,

is between a strong state and the rule of law. So obviously, states pursuing

terrorists can be too strong. They can violate

people's human rights. They can act. They can do

extrajudicial killings. That's what's going on under

Duterte in the Philippines. I would point out, however,

that states with respect to the rule of law can actually

be both underconstrained, as in the Philippines, but they

can also be overconstrained. I'll give you a little

example from my home state in California. All 40 million of us

residents of California have the right to sue

any given infrastructure project done in the state. We can sue anonymously for

any reason that we want. And as a result of this rather

broad understanding of standing who has the right to sue,

infrastructure projects don't get built because it's

just too damn difficult because of the litigation. And I would say there's

other democracies. I would say India is probably

one of the foremost ones that I would say just

has too damn much law. I mean, it's too easy to

block things using the court system, which has got to-- the Supreme Court's got a

backlog of 60,000 cases. So on and so forth. So, the relationship between

strong state and rule of law can be very problematic. Democracy and good governance. This is very depressing

in a way to me because I really like democracy. I think liberal democracy

is a great thing. There is a theory out there

that says that democracy will automatically lead

to good governance, because if you have

enough transparency and accountability, then

people are going to want to demand clean government. If they see that

officials are corrupt, they're going to vote

them out of office. It's a nice theory, but I

think empirically, it really has worked in some cases

and in many other cases has not worked. And I think there are

actually cases in which the expansion of the franchise-- more political participation,

in other words, more democracy--

is actually reduced the quality of government. The case that I would

cite is actually, again, the United States, which opened

up the franchise in the 1820s to all white males

that previously had been restricted to only

white males with property. All of a sudden you

had millions of people that had the right to vote

in the election of 1828. They elect a populist

named Andrew Jackson, and he begins a 100 year period

in American history known as the spoils system or

the patronage system, in which every politician

basically uses their ability to distribute jobs in the

government and sometimes outright bribes as a

way of motivating people to go to the polls. And I would argue that in

relatively poor low education level democracies, opening

up democracy is actually going to have this effect. And this is really the problem

with patronage and weak state capacity in many

places-- in Mexico, in Brazil in India,

Indonesia, and so forth. And again, this

is not an argument for authoritarian

government, but I'm just pointing out that there

is a tension there, right. There is a tension between

democrat-- in fact, just in South Africa,

and it seems to me that's exactly what's been

going on in South Africa. You actually had a very high

quality modern government that only applied

to white people, and then you open it up to

the whole of the society and the quality of

government goes down, for I think very

understandable reasons. The last issue that

I want to focus on, however, is this

question of democracy and national identity, because

I think that, again, this is an intangible form

of state building that I think is really critical,

and unfortunately, in our world today, it's becoming the

central issue that's determining a lot of global politics. All right. And this is the

ideas or legitimacy box which I think is really

critical to state formation, it's critical to

social mobilization, it's critical to the rule

of law and it's obviously critical to democracy. If you don't have the right

ideas supporting what goes on in these boxes,

they're not going to evolve into

strong institutions, but I'm going to focus on

the one that leads from ideas and legitimacy to the state. All right. So the question here-- what's wrong with this country. This is Syria. Syria has had a

devastating civil war that is still not resolved. It's led to the deaths of

close to half a million people. Half the population has

been turned into IDPs. A million of them showed up on

Europe's doorstep back in 2015. Now there's a lot

of proximate causes to why this civil war has been

so violent and so neuralgic and so difficult to solve. But I think one of

the underlying factors is the fact that the country

Syria had no national identity. There wasn't an

idea of something called Syria to which the

different stakeholders in that country felt

greater loyalty than they did to their particular sect

or ethnic group or region or in some cases tribe. In particular, the Alawites

felt like a beleaguered minority that was sitting on top of

a kind of social volcano, and if they didn't use the

utmost level of violence to protect their position,

they all themselves would get killed. And then this leads to

everybody feeling the same way, since they perpetrated a

great deal of violence, and the result is

the one that you see. There are many countries

in the Middle East that are now suffering

from exactly this absence of any sense of state identity. And you've had several of them-- Libya, Syria, Iraq,

Afghanistan, Somalia-- all of these countries,

I think, have the same basic underlying

problem that some of them were colonial

creations, some of them were patched together out

of different ethnic groups or sects, but there

is not an overriding sense of national identity

that allows people to sacrifice the short term interests of

their narrow identity group in favor of something

like national interest. If I had to point to one

factor that differentiates East Asia from this

part of the world, it's the fact that in

most East Asian countries, or at least in

China, Korea, Japan, these issues were solved way

before they tried to modernize. That is to say, they

were all coherent nation states, ethnically

coherent nation states, before the European

colonialists ever got there, and they had

centralized governments. It was a Chinese tradition

of centralized bureaucracy. So having a strong state was

always in the cards for them. And that's why once the

economic conditions changed in the 20th century, such

that they had the ability to take advantage of technology

and markets and all the things that Ricardo was

talking about, they just went to town

because they did not have to solve this

national, this underlying national identity

problem, in the way that so many other countries in

other parts of the developing world have. And this is a problem that

continues in the developed world. And so these national

identity problems have really not been settled. This is a particularly

difficult one that's actually dragging Spain backwards. The economic threat,

I think, will appear, the political threat is

really there right now. And one of the things that I

find particularly difficult about this question is that

democratic theory doesn't actually give us a

normative way of assessing the claim of a place

like Catalonia, as to what makes it a

legitimate claim, when one democratic entity

is trying to break off from another democratic entity. Who's right and who's wrong

in this kind of a situation? But obviously there are

many other places in Europe that potentially

are going to suffer from these kinds of claims. Now, the question then is,

where does national identity come from? National identity, as I said,

is something intangible. It's basically the stories

that people in a society tell about themselves. It's the stories that they

transmit to their children about where did

we come from, what do we have in common,

what makes us members of the same community, what

allows us to trust one another. And this is a story that

is told both, I think, from the bottom up

and from the top down. So the bottom up part

of it is cultural. It's basically-- it's poets

and filmmakers and novelists and other people musicians

that actually create a common sense of belonging. I mean, that's why music

is so powerful, actually, in many national traditions,

because it attaches itself to a kind of deep

level of emotion. There's a famous account

of the Philippine-- Filipino novelist Rizal,

who in the 19th century wrote the Philippine's

first novel. Philippines is 11,000 islands

scattered all over the Pacific. Everybody living on

one of those islands had no idea that

they had anything in common with any of the

other residents of any of the other 11,000

islands until Rizal wrote a book about what

it means to grow up on one particular island of Luzon. And then, all of a sudden

people could say, oh yeah, that's an experience

that's familiar to me, and that creates a

common sense of identity. So that's the bottom

up part of it, but there's also

a top down part. So this-- again, I've

got a couple of chapters on this in my

political order book. So this is-- there are

two [? parralellized ?] comparisons-- Kenya and Tanzania on the one

hand, and Nigeria and Indonesia on the other. Now in many respects, the

two comparison countries are very similar. Kenya and Tanzania, obviously-- it's less obvious in the case

of Nigeria and Indonesia, but they're both oil

producing countries. They're both highly diverse

religiously and ethnically, all right. And their early rulers

faced this question of national identity. And what I argue is that in the

case of Tanzania and Indonesia, those early rulers invested

in nation building, strictly speaking,

not state building, but building this kind of

national consciousness in a way that the rulers of Kenya

and Nigeria never did, and that has led to consequences

that persist up to the present. The projects by

[? Nayerian ?] in Tanzania really revolved around

language, to make Swahili the national language

of a linguistically very diverse country. In Indonesia, it

was the promotion again of a single language,

Bahasa, Indonesia, that replaced Javanese

and Sulawesi and all of the other languages spoken

on the different islands. And then, the production

of a kind of-- if you read it as

an outsider, it doesn't seem like

it's very serious-- but Pancasila ideology

that then gets taught to schoolchildren

all across the Indonesian archipelago. And I would argue that the

Tanzanian government made lots of mistakes in economic

policy, and politically. But in this respect, that

early investment really paid off, because

they have not suffered from the kind of ethnic

looting and predation that exists in

contemporary Kenya. In Kenya right

now, elections are all about the

major ethnic groups trying to jockey for power. One of them gets control

of the presidency, and their ethnic group

basically loots the government for the period

that it's in power, and then it's replaced by

another ethnic group that does the same thing. Again, there's no larger

sense of being Kenyan, and I think that for

all their problems, Tanzania does not have

this same problem. So this is an issue,

unfortunately, that is dominating

world politics now, because this identity issue is

one that is coming to the fore, not just in poor

countries like the ones here, but in rich ones as well,

including the United States, I'm sorry to say,

where we are living in de facto highly diverse

countries in which you have to come up with a national story

that is not rooted in religion or ethnicity or race. That's the only way we

can live with one another. And there are a lot of

political entrepreneurs that are working in the

opposite direction, that want to emphasize different,

smaller identities that are pretty good for

mobilizing people, because people can get

very angry over some of these identity

issues, but are trying to drag a lot

of countries back into, I think an earlier period,

when Identity was not credal, and it was not based on ideas. Something like that is

going on in India today, where you actually had

a national identity since independence

that was built around certain liberal

principles in a highly, highly ethnically and religiously

diverse society. And now, it's being put on a

Hindu nationalist basis, which is fine if you're a Hindu

nationalist, but not so great if you're a

Muslim or somebody that's not part of that community. So, like I said,

I have no formulas for how to solve any

of these problems. I just think that

what I trying to do is indicate that these six

dimensions of development interact with each other in

these highly complex ways, and you really need to think

about the specific linkages between the different

boxes if you're going to make progress

in any of them, particularly in the

political order box. So, thank you. Thank you very much

for your attention.