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Out of Order

Author: Max Boot, Jeane J. Kirkpatrick Senior Fellow for National Security Studies
July/August 2004


State-Building: Governance and World Order in the 21st Century
by Francis Fukuyama
Cornell. 137 pp. $22.50
Reviewed by
Max Boot

Few subjects in American foreign policy today are more important or contentious than "nation-building." The idea that the U.S. should prop up failed states first came to the forefront of public debate during the Clinton administration, which inherited George H.W. Bush’s foray into Somalia, sent troops to Bosnia, Kosovo, and Haiti, and supported an Australian-led occupation of East Timor. These interventions were viewed with great suspicion by many conservative isolationists and realpolitikers, who denounced what Michael Mandelbaum called "foreign policy as social work."

George W. Bush belonged to this camp of doubters. But that was before 9/11. Having spoken disdainfully of nation-building during the 2000 campaign, he has embarked on one of the most ambitious such experiments in our history. No matter how the occupation of Iraq ultimately turns out, the problems encountered by the U.S. during the past year are likely to sour many Americans on the whole idea of nation-building. Indeed, many conservatives now seem to be coming full circle, reverting to views they held during the Clinton years after having only reluctantly endorsed President Bush’s apparent change of heart on the issue.

But anyone tempted by today’s headlines to jump to hasty conclusions about nation-building would be well advised to read Francis Fukuyama’s new book. A professor at the Johns Hopkins School of Advanced International Studies in Washington, Fukuyama has become one of the most important social scientists in America during the past decade by tackling the thorniest public-policy questions with great verve and erudition. He has now turned his penetrating intelligence to the problem of nation-building or, as he more accurately calls it, "state-building."

For the past generation, Fukuyama writes, "the dominant trend in world politics" has been "the critique of ‘big government’ and the attempt to move activities from the state sector to private markets or civil society." This loosening of state controls has been a great boon to the industrialized countries. In the developing world, however, the chief barrier to progress has been not heavy-handed government but rather "weak, incompetent, or nonexisting government." Failed states, Fukuyama observes, "are the source of many of the world’s most serious problems, from poverty to AIDS to drugs to terrorism."

It is not that these states lack for ambition. Many of them have, as Fukuyama puts it, great "scope" but little "strength": that is, they claim to provide everything from free health care to universal employment but in reality cannot perform even such basic tasks as collecting taxes and hauling away garbage. The big mistake of development experts in the 1990’s, he argues, was trying to prune back such overgrown states while ignoring the need to strengthen their core functions.

Fukuyama’s prime example is Russia, where Western advisers focused on the rapid privatization of state assets without first making sure that the rule of law had been established. The corrupt oligarchy that resulted has turned many Russians against liberal democracy. A similar failure, caused by "the absence of adequate regulatory institutions," contributed to the Asian financial meltdown in 1997-98. Severe as the repercussions of these mistakes were, they pale by comparison with the West’s indifference to state-building in Afghanistan during the 1990’s— a failure that led directly to the attacks of 9/11.

What do we know about how to build sound governments? Fukuyama’s answer, in a nutshell, is: not a lot. The institutions of successful countries like Denmark or the United States are not hard to replicate on paper. But how can they be made to work in places like Iraq or Afghanistan?

Systems of governance are difficult to transfer, Fukuyama observes, because they always include a large cultural component. One has only to imagine what would have happened if a clone of the Japanese Ministry of Trade and Industry had been transplanted to Pakistan or Brazil after World War II. Would those countries have matched Japan’s rate of growth? Of course not. They lack many of the intangible cultural assets— social cohesion, a tradition of honest civil servants— that enabled Japan’s extraordinary economic rise.

Western countries have tried to force-feed good government to developing countries by imposing conditions on their financial aid, like lower taxes and budget deficits. But this seldom works, Fukuyama contends, both because of entrenched resistance from local elites and because of the unwillingness of donors to cut off the poorest countries from all assistance when they do not meet their obligations.

A blunter approach to getting failed states to shape up is military occupation. In places ranging from East Timor to Bosnia, the international community has increasingly resorted to reform-at-gunpoint. Such interventions have been successful in alleviating immediate problems like starvation and ethnic cleansing, but not in creating liberal institutions that can survive the pullout of foreign troops.

What, then, of imperialism? Alas, writes Fukuyama, in only "a depressingly small handful" of places— mainly former British dominions like India, Singapore, and Hong Kong— has it left a positive and enduring legacy. U.S. interventions, by contrast, have done little to promote reform, in Latin America or elsewhere. The two most frequently cited success stories, Germany and Japan, do not count in Fukuyama’s view, since both were "very strong bureaucratic states long before the United States defeated them."

State-Building began as a series of lectures at Cornell University, and Fukuyama spends much of it reviewing what the scholarly community knows— and does not know— about how to create successful states. This does not make for especially provocative reading, but what the book lacks in shock value, it more than makes up for with common sense and sound research.

Those who believe that the U.S. should not be in the business of nation-building will find some support in Fukuyama’s book— but also plenty of rebuttal. For all of his doubts about our capacity to build better states in the developing world, he understands that, given the magnitude of the threats we face, we cannot abandon the effort. It is not a very galvanizing conclusion, but it is an accurate one.

Oddly enough, however, Fukuyama does not address the most burning question of the moment regarding state-building: whether the U.S. should try to install a democracy in Iraq or settle for some kind of strongman or even a three-state solution. More broadly, he does not take a position in the debate between "neoconservatives" who believe in promoting democracy abroad and "realists" who think that dictators committed to the rule of law are a better bet. While noting that "authoritarian countries . . . have long-term problems with legitimacy," he essentially throws up his hands and declares that "the empirical relationship between democracy and development remains complex and ambiguous."

By not addressing this point, Fukuyama neglects an important normative dimension of his subject. Should the goal of state-building simply be a strong state or should it be a strong liberal-democratic state? The answer one gives to this question is crucial, since it dictates how much emphasis to place on promoting individual liberties as opposed to enhancing the power and efficiency of the state. Fukuyama does not consider the obvious trade-offs.

Indeed, in this slim volume, Fukuyama is uncharacteristically reluctant to take strong positions, refusing even to say whether he supported the intervention in Iraq: "The pros and cons of that case," he writes, "were very complex." Nor does he offer much by way of practical solutions (as he did recently in a valuable article in the Atlantic). Fukuyama does offer, however, fresh ways to think about this vitally important, if awfully vexing, subject. Policy-makers would be well advised to read this book and ponder its many lessons.

Max Boot is a senior fellow in national security studies at the Council on Foreign Relations, a weekly columnist for the Los Angeles Times, and a contributing editor of the Weekly Standard.