Stanford's Francis Fukuyama on Political Order and Political Decay

well thanks and welcome to Stanford into FSI it's Jonah said I'm the director of something called the Center on democracy development in the rule of law so we look at political change the development of national level political institutions the question of democracy around the world is very you know central to what we do and I was just by the way like to say that I I really appreciate meeting with this group but both of my sons spend time in Community College and it was the most helpful period of their lives because both of them were

undergoing rather difficult transitions and if it weren't for that institution they really would have been I think it had a big you know at a big loss i i really do very much appreciate what you do so I thought of what I would do is just talk about this book so this this is the second of two volumes which was it's kind of absurdly ambitious project that I started about ten years ago to basically describe where political institutions came from the reason that I started thinking about this was actually out of the kind of practical

wrestling with American foreign policy so you know September 11th happened we invaded Afghanistan and then in 2003 we invaded Iraq I was very much part of those debates those foreign policy debates both about the wisdom and then how you actually what do you do once you've come to occupy a country and in both of those places you essentially had these collapsed States in the case of Iraq we were the cause of the collapse of the state and you couldn't solve the problem of terrorism you know and today you cannot solve the problem of terrorism in

Syria or Iraq you know with Isis unless you can figure out the question of how do you create a durable state institution that can exert some over you know over a piece of territory and that was the thing that we were we've been wrestling with ever since then and that I think is at the core of our foreign policy problem that the reason that you have terrorism in Syria Iraq northern Nigeria Mali Yemen you know all of these places is that there's no government in in in in any of these places that can actually provide

security to its own citizens and therefore security to other people that are affected by that kind of phenomenon and then it struck me well here I'm a political scientist and I should know about where something like the state comes from but they never taught that to me you know they they never taught that to me in graduate school where does the rule of law come from we go around the world saying you know you need a strong rule of law you know in order to defeat corruption and so forth well where did our rule of

law come from and so on and so forth and so this was kind of the origin of this book and so I started going all the way back to the beginning I also did a lot of consulting work for the World Bank back in the 2000s in places like Papua New Guinea so not too many people have been to Papua New Guinea or other parts of Melanesia but you know these are among the most primitive societies anywhere on earth I mean no European went up into the Highlands of Papua New Guinea until the 1930s and

it's still a society that's organized tribally and yet they've got you know supposedly a West Minister system of government you know they have a parliament and they vote and have been ever since independence but the institution's work in a very very weird way because everybody is still organized tribally and so when they go to vote they vote for their tribal leader the big man you know that gives them pigs and you know and distributes you know various kinds of goodies including construction contracts and other things you know from international donors and so that also reinforced

this notion that you know everybody started out in this kind of society and somehow we got to these modern institutions but I had very little idea of how this you know all this came about so that's why you got these two 500 page books now this is my effort to explain this I'm very gratified that a lot of you know in a lot of college courses have now adopted this because one of the things is in political science we tend not to write a lot of textbooks or there's not a it's not like economics where

there's these kind of big-name you know kind of well-established textbooks and I think this there's also a pedagogical purpose in this because you know it would be a way of helping to you know teach just this basic history which some you know if you take a history course at Stanford it's not going to help you with this kind of issue because there you know the professional historians want to look at really really narrow very very specialized issues and I think there's something to be said for having a more synoptic you know kind of broader view

so that's a general that's the general background to to this so if you think about the world today political order is actually a very very critical question some parts of the world have in a way too much political order if you think about Eurasia you've got Russia and China which are big centralized states that have powerful militaries and they've got agendas and they you know they're kind of in control of what they're doing that provides one set of problems but it's actually a fairly familiar one but this other part of the world which includes sub-saharan

Africa the Arab world much of the greater Middle East all the way to the borders of India you know as the world that basically is is fundamentally lacking in in basic political institutions so as I said that's one of the reasons I think you see terrorism gravitating to these weak state you know these weak state kinds of areas and I think that this is kind of general problem with the success of democracy around the world is the fact that states are weak and cannot provide citizens with the fundamental goods services protections that you know the

people that people expect and I think actually that as Americans we have not focused on the right issues in the kinds of advice we've given and in the kinds of nation-building exercises that we have been involved in because in a certain sense I think we've over emphasized democracy at the expense of actually having a basic state that can provide order so conceptually I think in a modern political order you really have to have three different sets of institutions okay so the first institution is the state itself the state was defined by Max Weber great German

sociologist as being a legitimate monopoly of force over a defined territory I think that remains a very good definition because it distinguishes the state from labor union or a transnational NGO or a lot of other kinds of social organization states are about power they are about power but they're a particular kind of power that is legitimate where people agree that the state has a right to go and arrest people that break the law and other kinds of institutions don't have that don't have that ability actually is it possible to get out some water I've had

this coughing no it's okay he'll go get something she'll get some also all right so that's institution number one all right great thank you very much okay good thank you so institution number two is the rule of law okay so the rule of law I would define in the following way there are a lot of definitions almost as many definitions as law professors but in my view it's not the rule of law if the law does not constrain the most powerful people in a society right so if the law is just commands of the emperor

saying do this and don't do that that's what we might call rule by law but rule of law is when the emperor himself or the king himself has to obey the law is is underneath the law and if you're a president who can make up the law as you go along or vade the law when it's convenient for you to do so that's not the rule of law right so if you think about the state on the one hand of the rule of law on the other they pull in opposite directions the state is about

accumulating and using power and the law is fundamentally about limiting power it's limiting power according to certain agreed-upon rules all right and then the third institution would be institutions of democratic accountability meaning that the government ought to be accountable not just to the elites that run the government they ought to be as accountable as possible to the whole population and so today we interpret that as free and fair multi-party elections but the point of these procedures is to achieve substantive accountability meaning that the government really needs to be responsive to you know as many of

its citizens as as possible and if you think about accountability in that way it's on the law side of the scale so you have the power institution which is the state and then you have two institutions that constrain the state you have the law and you have democratic accountability that limit the ability of this powerful state to do whatever it wants and I think that the big challenge and the kind of miracle of modern politics is that you can have all three of them simultaneously where you can have a state that's powerful enough to protect

its citizens to deliver basic services to collect taxes to do the things that states do and yet is constrained by these other institutions so that it stays within the boundaries of what you know its own citizens its own citizens want and obviously if you've got a state without rule of law and democracy you've got a dictatorship on the other hand if you only have institutions of constraint but no state you've got something like Afghanistan where you know they have elections but the state can't protect its own people and you know it can't delivers basic services

so on and so forth there's a fourth important definition which i think is actually critical for understanding the way the current world is shaping up which is the definite of the difference between what Max Weber called a patrimonial state and a modern state so a patrimonial state is a state where the government is regarded as as a species of private property you know it's a it's literally a patrimony so when you had kings and queens the king could give a province to his daughter as a wedding present with all the inhabitants that lived in the

province because he owned the province you know it was part of his dynastic possessions so today we don't have very many rulers that claim they own their countries what we have instead is what political scientists called neo patrimony ilysm where you may have you know elected presidents and Parliament's and so forth but the whole reason that people are in politics is basically to enrich themselves you know they want to make use of the the state the government in order to enrich themselves and their families and this is the source of you know the very pervasive

political corruption that you know exists in very very many societies and by contrast a modern state at least this is the aspiration a modern state tries to be impartial or impersonal meaning your relationship to the state doesn't depend on whether you're a cousin of the Emperor or the cousin of the president or something it just depends on your status as citizen and the state tries to treat everybody in a fairly impartial way and there's a strong distinction between public and private right so the money that belongs to the public treasury is not your money you

can't spend that money and that means that you know it's only in a modern state that you can have this phenomenon we call corruption corruption is when you when the ruler appropriates for his own private uses money that really belongs to the public or should be serving the public interest and I would say that actually in today's world the bigger and more in many ways more important division is between on the one hand patrimonial or neo patrimonial States and modern states and these days less between democracies and authoritarian regimes I'll give you some examples of

this so in Ukraine the current crisis going on in Ukraine Russia you know over Crimea and so forth so I would say that the big issue there is actually not democracy so mr. Putin does not have a democratic bone in his body as far as I can see but the bigger problem with Russia I think is that it is a neo patrimonial country you know he is reputed to be one of the richest men in the world he and his cronies had managed to appropriate Russian state institutions to their own benefit which they run you

know for their private benefit he had a his personal secretary you know just had a wedding in Europe somewhere where he rented this forty million dollar yacht you know and he gets paid a salary of $50,000 a year something like this you know so this you know that and and and but on the other hand mr. Putin is a democratically elected president it may not be a completely free and fair election but all of the poles everything we know about Russian public opinion indicates that if there is an election in Russia tomorrow he would be

elected by a really large margin and so the problem I you know I think that the West has with him is not that he's not a democratically legitimated leader it's that he's a crook you know that he is a kleptocrat and that he's presiding over a kleptocratic regime whose existence the purpose of whose existence is basically to suck money out of the Russian public treasury you know and appropriated for private purposes and that frankly was the big issue that led to this uprising and my don in Ukraine and all these young Ukrainians had this choice

of either going with Russia this kleptocracy or trying to join the European Union and they had no question which one they wanted you know they wanted to be with the modern society the society where public interest mattered where corruption was not endemic and their former President Viktor Yanukovych you know basically changed his mind at the last minute it was trying to drag them back into this Russian morass and that's why there is a big popular you know uprising and so forth and so you know that's what the issue is I think it's it's it's less

the you know democracy in terms of elections and it's more the quality of the state and whether you're living in a modern state to give you another example of how poor state quality really hurts things and makes democracy itself problematic you take the example of India so India is a really good democracy and it has been except for a brief period in the 1970s it's been a very good democracy very impressive democracy since independence in the nineteen late 1940s so they have competitive elections there's a lot of competing parties there's a Free Press you know

a lot of individual freedom to criticize the government so in the late 1990s there is an activist named Jean J as we in a study of elementary education in a number of poor states in northern India and he discovered that 50% of all of the school teachers in these public schools were being paid but they weren't showing up for work 50% of teachers right so there's this right I mean I presume you all show up for your classrooms every day and you don't have an absentee rate anywhere close to this but 50% of teachers were

doing this and so nobody in India thinks this is a good idea right so there's a big human cry all the opposition parties started criticizing the government the media you know stays on top of this they do all of these reforms you know including doing things like putting TV cameras in every single classroom just show see whether the teacher was there or not and after 10 years of attempting to reform this system they do another survey and it turns out that almost the identical number of teachers aren't showing up for work they aren't able to

solve this problem and you know if you've spent any time in developing countries you'll see that this was just the tip of the iceberg with regard to the ability to kind of enforce rules you know in terms of you know traffic tickets and registering you know your company or you know doing a lot of things that we take for granted in the United States or in other developed countries many things that the public sector is supposed to do in a developing country just don't get done and this is a problem with state quality and I

think this is why people are unhappy with democracy and in fact they elected neuringer Modi as Prime Minister of India by a very impressive majority you know almost a year and a half ago because I think a lot of people in India were sick and tired of a weak government that couldn't you know they'd make decisions to do something and then nothing would happen they can't build infrastructure they can't modernize their water electricity roads you know this sort of thing and they wanted somebody that could actually get things done whether mr. Modi is actually the

one that's going to do this I mean he's actually been I think disappointed the expectations a lot of people had voted for him because he's running up against you know I think some of the same institutional constraints that you know that plagued his predecessors but it certainly makes people unhappy and you know I think it hurts the quality of democracy so a third example is closer to Europe which is Greece right so Greece got into a lot of trouble 2010 during the euro crisis it triggered the euro crisis because it borrowed a lot of money

and couldn't pay it back right why did it borrow so much money well it's not because Greece is I mean so so first of all Greece's is a also like India very successful democracy it was under a military dictatorship and until 1974 after 1974 you had two political parties pesach which was center-right and new democracy centric nonsense the other way around Pesach was a center-left party and new democracy was a center-right party they alternated in vigorously contested elections periodically they changed places and yet they got into this big problem why the reason was that these

are what are called client lists ik parties meaning that every time one of them was elected into office they filled the entire Greek public sector with their own party workers and in Greece they've got a law against firing civil servants so every time there's a changeover and parties instead of replacing all the members of the other party they would just hire a bunch of new people and you got to this point where the per capita number of civil servants in Greece was several times you know the the the per capita number in Britain or other

European Union countries and so that's why they had a budget deficit you know they couldn't afford to pay for all of these public officials that were basically not doing very much doing very much useful so again the problem in Greece is not democracy it has a vigorous democracy the problem is really it doesn't have a modern state the state is used as a source of patronage for the political elites and I would say that Europe is not out of this crisis yet because they fundamentally haven't you know they haven't solved this problem they've they've considered

selling the Parthenon but they've not considered ending this practice of packing you know the public sector with with political appointees so so this I think indicates that you know the fracture line in in the world and the really difficult challenge is in in a certain sense less getting to a democracy than getting to a modern democracy getting to an effective modern state that's a harder transition it's a it's a transition that I called the problem getting to Denmark and so Denmark I don't mean the actual country Denmark necessarily Denmark's kind of a symbol for a

country that's rich democratic stable and has vanishingly low levels of corruption you know there's all these international indicators that that try to measure levels of corruption Denmark you know Singapore Norway they all always almost always end up at the top of the league tables in in regard to this and you know the United States and its foreign policy has wanted to try to create little Denmark's all over the place in Haiti Somalia Afghanistan the Congo and we don't get anywhere close to this you know it would actually be nice to turn them into Indonesia or

something but we can't even really get to that point and so the you know the so it's a very tough problem and the question is how did any country make that transition from a patrimonial or a neo patrimonial system to a modern system so that's the that's the point I'm going to try to now illustrate by reference to American history because this happened in the United States in the nineteenth century and I think that Americans don't understand you know the way their own institutions develop because when they look at a Mexico or India Brazil you

know any one of these developing countries that has a lot of corruption a lot of political patronage clientelism and so forth they say oh these people don't know what they're doing they don't understand what a modern government is supposed to look like and you know how could they be that ignorant and I think the issue is that it's not a matter of ignorance it's I think a kind of natural evolution in early democracies and I think the single proof of this is the history of the United States itself so I'm sure a lot of you

teach American history but if I can give my own canned history of the development of bureaucracy in the United States it would go something like this so if you asked the question who ran the US government in the early days after the Revolution you could say it was kind of the Friends of George Washington meaning first of all the federal government was very very small at that time they had some customs inspectors they had a post office at a national level they had not even a standing army they just had state militias there was a

Navy that was about it so the revenue needs were very very small and most of the government was staffed by elites at that time that's what I mean by the Friends of George Washington meaning a lot of them were graduates of Harvard Yale Princeton they all came from either the planter class in Virginia or the merchant Gentry class in New England and that is a situation that persisted really up until the 1820s in the 1820s America started to really democratize so as you're aware there are all of these qualifications property qualifications on the franchise in

the early days in the United States and by the late 1820s basically most of the states that dropped them so that all white males could vote so he still didn't have women's suffrage or certainly African Americans were still slaves but all of a sudden all white men could vote and the first you know major election that was affected by this opening of the franchise was the election of 1828 which brought Andrew Jackson to power so Andrew Jackson ran against John Quincy Adams and in a way this is a classic pairing in American politics which exists

up until the 2016 election John Quincy Adams was a Boston Brahmin he was the son of John Adams the second President of the United States he had been educated at Harvard he traveled in Europe as a young man he could speak foreign languages very well-educated cosmopolitan guy Andrew Jackson was a frontiersman from rural Tennessee he probably didn't even have a high school education he was a brawler a drinker scotch-irish you know backwoodsman but he was also a very successful military leader he in a couple of very brutal campaigns you know against the Cherokees and the

Seminoles you know essentially drove them out of their territories and then he ended up as the victor in the Battle of New Orleans against the British during the War of 1812 which is what propelled him onto a national stage so he wins the so so just if you keep in your mind these two gentlemen running against each other you know John Quincy Adams is like the John Kerry you know of his day i John Kerry went to Yale and he can speak French and you know comes from a rather privileged background and you know essentially

Jackson is not I mean he's more like Sarah Palin than Donald Trump in that Donald Trump himself you know came from a very privileged background so but you know Jackson was a populist I mean he was the first American populist and he mobilized a lot of popular anger against northeastern elites all these Harvard and Yale educated people like John Quincy Adams that had been running the American government up to that plane and because the franchise had expanded you know there are a lot of new voters that had never voted in their lives most of them

didn't have you know much more than about a fourth grade education and these were the people that that supported him you know he just like Ron Paul he didn't like you know the idea of a national bank which had been Alexander Hamilton's pet project you know to have a Bank of the United States so he basically undermine that so it's kind of like distrusting the Federal Reserve today and when he was elected in 1828 he said two things he said first of all I won the election so I should choose who runs the American government

and secondly in I'm paraphrasing now he said it doesn't take a genius to run the American government any ordinary American can do it and so this inaugurates this period in American history known as the patronage or the spoils system in which virtually every office in the American government from the federal government all the way down to your local fourth class postmaster is put there as a result of a payoff from a politician to a political supporter right and so essentially once the system gets going every time the Republicans replace the Democrats or vice versa in

you know your local state legislature every postmaster is fired and replaced by a postmaster with allegiance to the other party that just won the election and then in you know eastern and southern American cities you have these big-city machines in Boston Chicago New York you know Tammany Hall all of which operate according to this patron principle that basically I trade you know I give you an individual benefit like a Christmas turkey or a job on the police force in return for you're voting for me you know on Election Day it is no different from what

goes on in India Brazil Mexico you know any number of developing countries today and this is what makes me think that if you call this corruption and and it did lead to a substantial amount of corruption but if you call this corruption I would say that in that case corruption I think is a kind of natural stage in the developed in the early development of democracies you know because why did this happen in the United States well founding fathers as you I'm sure well aware did not imagine the need for political parties but the moment

you opened up the franchise and you had to get thousands of people out to the polling place you needed an organization that could mobilize voters so that's the origin of a political party and then how do you get poorly educated and not very wealthy voters to go out and vote on Election Day well you don't do it by saying oh you know we need to change our policy towards the british french alliance you know or something like that you do it by saying i'll give you a job you know i'll or i'll give you a

bottle of brandy or something you know if you if you vote for me and i think this is the process that goes on in you know poor democracies today that you need to mobilize a lot of voters and the easiest way to do it is essentially by bribing them individually alright so by the time you get to the Civil War Abraham Lincoln if you read his letters especially when he's re-elected in 1864 he's just inundated with office seekers and it's just you know it's just a plague he has to spend the first six months of

his term meeting with individuals who supported him during the election campaign and they think they deserve you know a government position so the United States is very similar to many contemporary demap you know young democracies in the developing world how did and or how did we get out of this this all began to change in the 1880s so in the 1880s the United States is going through this very large socio-economic transition at that point the leading technology the Internet of that day is the railroads railroads are tying the United States together in a big national

market so all of these isolated farm communities in Iowa and Kansas can all of a sudden ship all their grain to Chicago and then put it on a boat and send it to Europe right so the scale of the economy expands tremendously and the country begins to urbanize and industrialize a lot of people begin to feel that this old kind of incompetent patronage based governmental system isn't serving them terribly well but they cannot bring about political change why so what are the incentives of members of Congress at this point so there was something called the

Pendleton act that was proposed by congressman named George Pendleton to create a modern civil service that was not patronage based why would what if you're a member of congress in the year 1882 or three what are your incentives would you support the something like the Pendleton act we'll think about it how did all these guys get elected in the first place by patrons right so they have zero they have zero incentive to vote for a system that they got them into office and they manipulated so this is another truth about political reform is that political

reform fails not because people don't understand that there's a better system out there it fails because all of the incumbent power holders don't want it to succeed you know because they profit from the current system right so Pendleton acts proposed and it doesn't go anywhere so the only reason that something happens is in 1883 1882 James Garfield is elected president he is shot by a would-be office seeker this guy named Charles Guiteau the thought he should be appointed the consul US Consul to France he doesn't get the job he gets pissed off shoots the President

Garfield takes about six weeks to die this very painful death and then all of a sudden there's this big uproar about patronage because here the president had been assassinated by a patronage seeker and so even the outgoing Congress is embarrassed into actually voting for the Pendleton act and then a new Congress is elected in 1884 that shifts the balance into people that actually you know now want reform and so what is a Pendleton act do it establishes a principle that you should get a job in the federal government if you pass a civil service examination

and you should be promoted on the basis of technical knowledge and merit and not because of your political connections but the rearguard action of the two political parties is such that they only permit an extension of classified employment when their party loses and they want to protect all of their political appointees you know that are already in the government so they say all right well they can be their positions can be classified and after they die you can appoint them to someone qualified but and so it takes another 40 years until you know majority of

positions in the US government are classified positions as opposed to patronage positions and by the way even today compared to a European government where if you have a changeover in administration's and a typical parliamentary democracy in Europe the minister and maybe the Vice Minister in each cabinet department will change so a total of maybe a couple dozen people will turn over when a administration changes in the United States we still change about four or five thousand positions every time the Republicans replace the Democrats or vice versa in you know in the White House so you

still have a pretty high level of old-fashioned political patronage so so I think I would draw the following lessons from that story which is that first of all you know you know a certain way living in a patronage filled corrupt political system is not unusual it's not a pathological condition I think it's actually a normal condition and it's particularly a normal condition for young democracies and you actually have to take very special measures to get out of this situation and the way that you get out of it is essentially political so in a way democracy

was created with what created the problem you know how do you get voters motivated to vote for you but democracy it turned out was also the solution because by the 1880s enough Americans had joined the middle class you know they were more educated they had more wealth they were more interested in having a high quality government they were really quite sick of having these political hacks you know running all of their local political institutions and so there's the kind of groundswell during the Progressive Era for this kind of change and there's also very good leadership

you know from people like Theodore Roosevelt or Woodrow Wilson who you know in fact Roosevelt was one of the first chairman of the u.s. Civil Service Commission you know was very interested in having a high quality government Woodrow Wilson was actually a professor of public administration at Johns Hopkins before he became president or went on to be President of Princeton and then President of the United States so there's a lot of you know things came together to bring about this kind of reform so I'm gonna close just by talking about the United States today because

I actually think that we're in a kind of bad situation because I think that the system has now reverted my term is this very long word re patrimonial ization but I think that you know this the American system is undergone decay so the word political decay is in the title of my book and I'm afraid that that's in my view what's happened so my deaf I've got a very specific definition of decay so decay is is the product of two things it's when the institutions are rigid and and they don't change they don't adapt you

know sufficiently to meet you know new circumstances and they also decay because there's a universal tendency of elites to try to capture the political system and use it for their own ends this is not just a feature of democracy if you read the first volume of my book where I talk about you know dynastic China and the Ottoman Empire and you know old regime France I mean you saw versions of decay in all of these in all of these political systems but we tend to favor friends and family and people that have a lot of

power and wealth you know tend to use their power and wealth to basically protect themselves and protect their children to protect their friends and I think we've got a version of that in the United States and and the basic problem I think is kind of the it's the collision of two different broad things so one is in American society several things have changed over the last thirty years one of them is polarization you know this is something political scientists can actually measure pretty well I mean for most of American well not for I shouldn't say

we have been this polarized in the late nineteenth century and before the Civil War but for most of the 20th century you know the two American political parties had a very substantial degree of overlap all of the major legislation you know the New Deal Great Society the Reagan tax cuts they are all passed by Congress's in which presidents could form coalition's that they may have relied more on one party than the other but basically it had to be bipartisan order to get the thing through Congress today they're completely split apart so the most liberal Republican

is considerably more conservative and the most conservative Democrat all right that's one thing that's happened the other thing is the rise of very well organized and very well resourced interest groups you know so many many of these groups represent corporate interests you know the banking lobby is you know one of the most powerful lobbies out there but not all of them so you've got public sector unions you've got like every disease in the United States has a lobby you know kidney disease has a bunch of lobbyists in Washington that want more spending more federal spending

on you know research into kidney disease so all of that is not in itself bad in fact the democracy has to have interest groups people have to be able to organize you know to express their views on all sorts of political issues the question is whether our political system adequately represents the whole of the society as opposed to these very concentrated you know kinds of interests and here I would say that the other fact of American politics is its institutional structure which in my view over represents the power of these concentrated interests and this goes

back to the basic design of our constitutional system right so the American founding fathers were very worried about tyranny you know they had revolted against the British monarchy and Parliament they wanted individual liberty they did not want it encroached on by a king and they worried about an excessively powerful executive in in this new democracy and as a result they created this institutional system of checks and balances that spreads power out horizontally among a lot of different institutions so you have a very powerful upper house of Congress you have a separately elected presidency that can

be held by a different party and you have a judiciary that can overturn legislation and then delegation to state and local you know levels of government so compared to let's say a British parliamentary system you spread you know power out in in in a lot of different ways when you combine this check and balance system with polarization and with powerful interest groups you get what I label in this book Fatah cracy meaning rule by veto which is to say in our system we privilege minorities you know it comes from this reasonable desire to avoid tyranny

of the majority we allow minorities to block action by the whole in ways that actually make collective action extremely difficult and it basically gives vetoes to all of these very powerfully organized groups and that among other reasons is why Congress has not passed a budget you know under regular order for I know a decade or so now the only reason Congress could actually pass a budget this year is that Speaker Boehner fell on his sword you know he knew that any kind of reasonable budget wouldn't be able to get through this Congress and therefore he

had to you know plan to resign ahead of time in order to sneak the budget sneak the budget through but it has a lot of other you know I think very negative consequences for the way we're governed so for example I actually agree with the Republicans that the corporate tax rate is too high it's thirty five percent which is much higher than the average for other OECD countries and that's why all these companies are doing these inversions and trying to incorporate themselves in Ireland and you know they're low tax places so most tax experts that

I know of both Republican and Democrat have supported the basic idea that you should lower the nominal corporate tax rate to maybe 25 20 25 percent and then get rid of a whole bunch of special exemptions subsidies tax expenditures that are in our you know whatever ten thousand page tax code so it would be revenue neutral it would be much simpler fairer and it would solve you know this basic problem of why companies aren't willing to repatriate money back into the United States we can't do it despite the fact that all the experts think so

and all the leaders in Congress think so the problem is that there are too many individual special interests that would lose out if you did this kind of a reform so you know it can't get rid of the mortgage interest deduction because the Realtors don't like it you can't get rid of you know the oil and gas investment subsidy because the energy companies don't like it so on and so forth and so this is what Fatah cracy means that everybody can veto but nobody has the authority to actually force a decision you know that is

collectively in the interest of the whole political community and I kind of think that this is where we've been and why are the quality you know the legislation we do pass is is just very poor quality so you know if you think about the two big achievements of the Obama administration which are the Affordable Care Act and the dodd-frank bill on regulating the banking industry you know I support both of them I think we needed both of these things but they're terrible pieces of legislation you know I mean they're both hundreds and hundreds of pages

long why are they that long because our legislative process you know forces you to basically buy off all of these small concentrated interests in order to get anything through Congress and this is not the way it works in a parliamentary democracy it's not the way it works in Germany or you know Australia or Canada or you know Great Britain where you know this kind of legislation is not crafted as a result of this aggregation or small interest but you know it's it's a much much more rational process and so I think that we are kind

of in a you know you know it's not a crisis of the sort where the the Republic's gonna collapse tomorrow as a result of this but you know it may we may elect Donald Trump you know I mean we may you know I mean I guess actually what I find kind of funny about watching this process the electoral process is that Americans themselves do not understand their own political system and so they actually imagine that the president is the kind of democratic dictator and that you know President Trump on the second day after he's elected

he's gonna sign a piece of paper says build that wall you know and the walls just gonna go up magically and you know what they don't realize is they live in a veto cracy meaning that even if mr. Trump manages to get elected he's still going to have all these constraints on his power that are not gonna and you know he may actually do better than Ted Cruz because he can actually negotiate but you know every every American president who's ever been successful has only been successful because they can build coalitions you know and they

can actually work with people that don't agree with them and kind of cobble together something out of this extremely heterogeneous mass of you know that's called that's called Congress but it is worrisome you know for the future because I think that you know the kind of political system that the founding fathers created was you know it was quite adequate for the kind of agrarian society with a very small government that didn't really do much but unfortunately we're not living in that kind of world anymore you know you have to have institutions like the Federal Reserve

for better or worse we've got this whole set of international commitments and a big national security structure and all of these things you know need to be managed you know a lot better and I think we're not doing that good a job at it and by the way I mean so just to connect this to the stuff that I said at the beginning I do think that this affects America's place in the world and the the prestige of democracy because right after the Cold War it's when I wrote my first book the end of history

the United States was far and above you know the most powerful country it looked very successful economically politically you know everything else and many countries around the world you know wanted to be like the United States and I've noticed this just in my own students you know who are non-american that that degree of respect isn't there anymore you know a lot of foreigners including very friendly ones that would like to think well of the United States you know they kind of look at Washington visa knows the hell's going on here you know that's I mean

there's some there seems to be something wrong with your democracy and so I think that fixing this problem is something that's quite important because I do think that it then affects you know the appeal of democracy outside of the United States so so why don't I just stop talking and you know maybe we could open it up yeah yeah so the fixing well no the the fix is complicated because our Constitution is extremely hard to amend you know if you could start all over again I think I would actually shift from a presidential to a

parliamentary system because I just think they work better but it's not going to happen in the United States in a million years and I think even modest constitutional changes like reversing Citizens United that basically has liberated all of this money you know for for campaigns is not going to happen I mean maybe now that Justice Scalia has passed away you might have a little bit of opening to shift things on the court but that's how you got to do it I mean until the Supreme Court decides differently there isn't that much you can do in

the realm of controlling campaign finance so we actually we have a project here in my Center on American politics and comparative perspective usually Americans don't like to think about other democracies because we think our democracy is perfect and we're not gonna learn anything from you know Canada or you know Germany or anything but in fact you know I think in a lot of domains other countries do do things better so one example of that is election administration and redistricting I mean we do we have this ridiculous system where we allow the political parties to control

both of those processes and in I think better designed democracies they turn this over to you know impartial you know Commission's that that that do these functions I think in terms of well the really big problems like budgeting you know one possible solution if if the perception of the problem gets sufficiently serious you could go to something like the Base Realignment Commission or you know fast-track authority in the trade realm where these are both areas where there is a realization that these powerful local interests were so powerful that you couldn't get any progress at all

if you left it simply up to them and therefore they designated you know a larger group that would make the decisions and then give it to Congress in a single up or down vote so the Base Realignment Commission did that they came up with a rational plan for how to allocate the pain of base closings across the whole of the United States without regard to political you know the fact that this space was in this home district of the Speaker of the House and you know this sort of thing and then the whole Congress could

vote it up or down as a whole and similarly with fast fast-track Authority or I guess they now call it trade promotion with regard to you know the TPP and other measures so you could try to do something like that with the budget as a whole you know you could try to delegate it to you know a smaller more expert group and then present it to the whole Congress and they can either vote it up or down but they can't amend it and you know that's the way a parliamentary system kind of works actually with

regard to campaign finance short of changing the Supreme Court a one idea that came out of our project is you basically would have to repair we repeal mccain feingold which had this unfortunate effect it it caps individual donations at a fairly low level but imposes no caps whatever to these political action committees under this fiction that they're not related to the campaign that they're actually helping right and so the result is that it limits actually legitimate money and it opens the floodgates to all of this outside money that actually you know in the republican party

has been going to tea party challengers in primaries and that has the effect of weakening the power of you know the party establishments so the republican party establishment does not want Donald Trump or Ted Cruz or any of these characters that have been running it's all kind of a grassroots movement and a lot of it fueled you know by outside money from very wealthy donors so one idea is if you actually force the money and channeled it through the parties that you would have less of this you know dispersion of the trouble is that it

wasn't money that elected Donald Trump and Ted Cruz I mean you know there really is a genuine Democratic upsurge within at least that narrow segment of the electorate so even that reform might not help another possibility that my colleague Larry diamond has been very supportive of is to change the electoral system into something his his preference would be something like the Australian system of limited preferences so in Australia this is what goes on in Oakland now and I think in Portland or a couple of cities around they're all liberal cities you know on the west

coast of the United States but it's basically where instead of you have a first-past-the-post system where you just elect one candidate but you have to rank order your preferences and so this avoids the vote Bush v Gore problem with wood Mader in the 2000 election where most of Nader's voters would have vastly preferred Gore over Bush but they actually handed the election - you know Bush because they they took votes away from Gore if you have these Australian rules then all of the Nader voters would have put Gore down as their second choice he would

have been elect eliminated from the ballot in the second and Counting and all of his votes would have been reallocated to to Al Gore and Gore would have won the election and in Florida and then would have won the presidency and what this does basically is it makes third party challenges much more viable now the problem with this is that it kind of assumes that there's this big pool of centrist reasonable voters out there in America who actually are just waiting for a Michael Bloomberg or somebody you know that has their kind of moderate sensibilities

to emerge but somehow the two-party system is preventing that from happening maybe that's true you know maybe that's true but I think the way these primaries have been going it kind of indicates that there isn't that much of a kind of moderate center out there and that voter preferences are actually polarizing you know towards more extreme candidates so even the introduction of this thing wouldn't you know wouldn't help much so there are these small things I think that you can consider doing but I'm afraid that you know collectively are they going to solve our problem

probably not the other thing you can wait for is for one party to simply win a huge victory this happened at several points in the 1896 election in the 1932 election you know where one party controls the presidency both houses of Congress and then they got a very big agenda and they somehow managed to get it through but I'm not sure that demographically that's going to happen anytime soon and because of gerrymandering I think you know it it may not happen for decades did you I'm sorry yeah well I mean I think that so here

on on the Stanford campus you know Sanders is the runaway favorite of you know most of the students and I think that you know they're responding to a number of things so one of them is just a frustration with centrist Democrats you know ever since I mean I actually think that Bill Clinton accomplished a fair amount and Obama actually accomplished a fair amount but you know there's this there's this you know this feeling that they have had to make too many compromises in order to you know just stay in office and they don't want anyone

that compromises like that there's still a lot of anger at the banks and other big institutions you know left over from the 2008 crisis which i think is quite reasonable I'm angry too and that not enough has been done about that and then I think you know a lot of it reflects Hillary's weaknesses as a candidate because I just think a lot of people regarder is not terribly authentic and so it's this combination of personality plus you know kind of pent-up anger so I think that the populism on both the right and the left is

really driven by something very similar which is and and this is there's been more and more attention paid to this over the last few months which is the position of the especially the white working-class in the United States both charles murray on the right and Bob Putnam on the left both written books on this in the last few years the statistics are just are they're really shocking and basically what they show is that if you have a high school education or less your life chances and all these outcomes have just gone like this on the

other hand if you're a college educated or have some kind of professional degree you've gone like this right so you know there's a paper that got a lot of notice by this Angus Deaton we rock won this year's Nobel Prize in Economics that life expectancies for white males working-class males has declined you know quite substantially in the last you know 20 years the only ethnic group for which this is true seventy percent of working-class children or children of working-class families are now growing up in a single-parent family you've got this you know opiate you know

epidemic going on I mean I think this came as a revelation to all of the candidates then in New Hampshire what was the number one issue that voters cared about it was heroin addiction you know because that was like the number one social problem there and I think that's true in rural you know for rural white America that's true in many many places you know I suspect you're seeing that among your students and meanwhile you know the people with higher education czar just gone gone to town you know they're walking away with an increasing share

of national income and their families are more stable than they were before you know instead of single-parent families you've got helicopter parents that you know can't leave their children alone and send them you know to start an NGO in Africa when there are thirteen years old and this sort of thing so you know so there's a real and so for the you know for the working class it's not surprising that they want to make America great again because America is really not great for them anymore you know it really is not great their incomes their

real incomes are lower than they their parents generation and so forth so why shouldn't they be angry right so I do think that Sanders and Trump are both you know they're kind of responding to to that and nobody frankly nobody in either party has done a damn thing for this group of people and it's kind of it's it's sort of a paradox because the Democrats should normally be the party that would kind of be the party of the working class but you know they're very much into identity politics and white working-class voters just don't you

know culturally they just that's not their kind of that's not their cup of tea and then the Republicans up till now you know I've actually been supporting economic policies that make their position worse off and so I think now that's why you're getting this big split in the Republican Party so thank you for taking the opportunity to to speak with us I was wondering if I can get your thoughts about current events here shifting the topic to political economy speak about American hegemony of the future of American hegemony in in what and look what's happening

of course in in China slowing down in China where do you see the United States in the next may perhaps 20-30 years well we're gonna be an economic powerhouse in twenty thirty years there's no question about that I think that what was really unusual was this period from the end from the fall of the Berlin Wall up until the financial crisis when the United States was far above the most powerful country in the world and that all changed in a drama in a dramatic way after the fine of crisis because both America and Europe had

this big slowdown and China kept going and so now I think we're just reverting to the mean I mean in most periods in international history you had many great powers and you know China historically was always a great power and now they're back so you know there's not it's not surprising that relative to China we've lost a lot of ground I happen to think that the Chinese story is not going to be simply a continuation of this double-digit growth perpetually into the future I think they're headed for very rocky times because they're already slowing down

very very substantially and unlike the United States I think that their system doesn't have a fundamental inbuilt legitimacy that will allow them to survive a really bad economic setback or the way that they'll survive it is by appealing to Chinese nationalism which is dangerous because in Asia as a whole there's just there's way too much nationalism right now and I actually think that everyone's very focused on the Middle East but I would think that in the next generation Asia is going to be you know it's got a lot of potential for for real conflict so

that's kind of my view of things I think we we Americans have to both adjust to it and you know I mean I think it was kind of stupid for us to stay out of this Asian infrastructure investment bank that the Chinese I mean they set it up because the Senate wasn't willing to ratify this change in the IMF that would have given China a greater role and so the Chinese kind of said well screw you if you're not going to do this we're just going to set up our own Bank and we've got the

money to do it and so that's what happened and now we don't want to join that one so so I think we could have been a little bit more you know less short-sighted in the way that we you know we accommodated this rise yes you're but I take it to be a comparative analysis of democracies among nation states suggest anything about the solution set on an issue like global warming and equitable resource allocation across this well not really because unfortunately I'm not sure that democracy actually necessarily buys you a better climate policy or I mean

I I sort of think that in the end a lot of countries basically just follow their self-interest and so country's heavily dependent on either the use of fossil fuels or the export of fossil fuels you know tan in Australia United States have been very you have been climate skeptics and dragging their heels and so forth it kind of reflects their you know their self-interest so I don't think that you know and and climate change is the hardest international cooperation problem to solve because it requires fairly steep upfront investments and the payoff not only doesn't come

for another couple of generations but it also accrues to people that are not citizens of your you know your country and so it's very hard to get politicians to actually pay that upfront price so actually I think you know the cop21 stuff you know it was actually pretty impressive that they managed to get as far as that with just these voluntary declaration of good intentions and I sort of think that they gotta wait for technology to come rescue them you know where you'd have some alternative path that's not going to be that expensive but you

know I think we're not going to solve this problem anytime soon as far as I can see yeah okay and I'm going to come back to the question that the question is you mention about how to fix problems with this much ammonia of State to sell things every much about one solution that one party will just mean overwhelming kind of majority will take a de something will happen in Poland and so you can find legislation in Poland I would like to ask about your opinion because yeah the green party day or only what the Parliament

elections and they go there president and suddenly they're starting changing so quickly the law and go to this extent even at the Supreme Court so kind of taking away so it's going be much more yeah hungry hungry did something like this before Poland yeah so I wasn't saying that a big victory by one party is going to lead to good policy I'm just saying that this will break the current gridlock Americans have actually tended to prefer gridlock over this kind of decisive policy change that's why you can't get rid of the Senate filibuster because you

know the filibuster basically forces the Senate to have a super majority to pass ordinary legislation and neither party really wants to get rid of it because they always worry well if I'm in the minority I'm gonna want to block stuff that the other party is gonna want to do so yeah you're right you know it's it's strong government can be used for good or it can be used for evil that's just a fact of life and what you need is sufficient strength and the government but good policies you know at the same time so I'm

actually not necessarily hoping for a you know especially by one of the parties involved you know a big smashing victory how about down at the you know the governor of Texas is calling for a constitutional convention of states how realistic you think something like that it's completely unrealistic I mean a you're not going to get agreement on doing that and even if you somehow did you know the problem with that is that the Constitutional Convention itself will be then prey to the same kinds of interest group pressures and that the flicked are current institutions that

you know it will be polarized and it will be manipulated by powerful interest groups and you know so on and so forth you generally can only get to a constitutional convention after a big war revolution you know financial collapse I mean something really really calamitous that just completely discredit the old system so short of that I just don't think it's realistic yes we're seeing that today if the force is driving this move to a modern democracy in the 19th century were the rise of the middle class desire for more stable government do you see the

flip happening today that this shrinking middle class is not not necessarily I just think that you know modern institutions are kind of unstable because they're not natural it's natural for us to favor our friends and family and modern institutions force us to say no no you're gonna hire the most qualified person or you're going to forget about the identity of this job candidate and just you know choose on an impartial basis despite the fact that you know that's your cousin you know what so I just think that you know over time and actually in especially

in times of relative peace and prosperity there's just a natural human tendency for elites to kind of pad their own nests and it just goes on and then it has to be consciously reversed so you had this big buildup of inequality in the 1920s and then it brought about the you know the stock market crash and the you know bank collapse and the Great Depression and then that creates the basis for a populist coalition that you know then unites under the new deal and and redistributes income and creates a social security system and all this

stuff so there has to be a kind of constant resetting of the system if it's going to stay you know if it's going to stay modern in the first volume of the book I tell the story about a lot of other prior we patrimonial ization 's you know the one that's the most extreme because the solution was the most extreme was the one that was done by the Ottomans so you know the Ottomans were living in a very tribal part of the world where family ties were very powerful and in order to create a modern

administrative system essentially what they did was they went into the Balkans they captured all these young boys Christian boys brought them back to Turkey and then train them to be soldiers and administrators and put their entire government in their control and they forbade them to have children precisely because these were the only people they could trust to administer the system without favoring their own families and this begins to break down because they want children you know so they started having children and then they say well I want my child to have my position as a

as a Janissary so they say okay your your son is in and gradually the whole kind of impersonal system then gets transformed into you know it gets Repat rimoni alized in this system and another great example was the French monarchy before the French Revolution so French monarchy goes broke you know louis xiv they have had a really nice chateau at versailles but he was completely broke he's spent you know building that chateau and fighting all of his wars not only exhausted the French Treasury but it put the French state in incredible debt and in order

to just keep this machine going he started selling well actually it wasn't louie xiv it was Henry the fourth so it happened actually a whole century before but his French Kings would start selling off parts of the French state including offices and so the word venality comes from this practice of venal office holding where the king would sell the position of treasurer of france to a rich individual and once he bought that position he could collect taxes in the name of the French state but he could keep all the proceeds and then there was this

this reform that was done in the early 17th century where these offices could not only be bought but they were turned into heritable property and then you could pass it on to your children so that same office would then become your son's property on your death so talk about repatched I mean that's literally patrimonial ization I mean that's literally selling the state off to wealthy individuals so this happens you know this thing this happens yes yes bloated bureaucracy but also the taxation and grace tax evasion excuse me apparently become a national yeah ever so there's

the other side of it so what I mean in the context of a broader issue of the eurozone how do you see what's happening there well you know tax evasion in Greece has a long history and it's not a cultural thing necessarily so Greece was in the early 19th century part of the Ottoman Empire and it was very common for Greeks to try to evade taxes because I didn't want to pay the Turks you know they didn't want to give tribute to the Turks essentially and then Greece is ruled by a whole bunch of foreign

powers or these foreign powers operate beneath behind the scenes and the indigenous Greek government is never seen as terribly legitimate and in those cases you know why not keep the state out of taxes because they're just going to waste it or use it for bad purposes and so they have been trapped in this low tax bad government equilibrium for quite a long time and unfortunately I think that we're kind of in that same equilibrium so there are some countries where you have a high tax rate so I'm thinking of Denmark I actually spent time there

as a visiting professor their marginal top marginal income tax rate used to be 63 and a half percent really high taxes like three hundred percent tax on automobiles and nobody in Denmark that I talked to it any rate really complain fundamentally about this because they said well we get such good services in return you know we don't have to save for a retirement we don't have to pay health insurance we don't have to pay for our children's education all the way through graduate school so yeah we pay high taxes but we get a lot back

and so they're in this kind of high level equilibrium where they've got a competent state they pay high taxes but they get good services back we and the Greeks and a lot of people in Latin America and Italy and other places are in this low Oh tax equilibrium where we don't like to pay taxes we you know therefore don't fund the government adequately we don't give it enough authority and then it doesn't perform well and then we turn around and say look the government is incompetent can't do anything so why should I pay my taxes

now to be fair we are better than the Greeks and actually the IRS is pretty good at collecting taxes and you know the level of tax compliance voluntary tax compliance in the United States is much much higher than it is in Greece and the level of our public services is much higher so I was putting us in the same category as the Greeks is a little bit facetious but there is a little bit of that same pathology that you can get into this downward spiral where you don't want to pay taxes because you don't like

the government and then the government doesn't perform well and that just reinforces your unwillingness to pay taxes and that's not a good position to be in either yes you spoke of a pedagogical purpose and reading your book can you accept that teaching is about storytelling well not a single narrative but I well first of all I do not think we teach enough history in general it's hard to know how to do that because there's so much history out there that you could teach and it's very hard to know how to how to encapsulate that in

a way that students can absorb you know on a broad basis I've found among my Stanford students including the ones that are political science or international relations majors that they've got a very very spotty knowledge of basic contemporary history and in fact for most of them the place where they learn most of it is in high school in their ap either in history or world history classes Stanford does not teach that kind of class anymore it doesn't I mean there's a big fight over Western Civ and you know whether there should be a core curriculum

and now I mean this is the season for evaluating applications for all sorts of things and so I've been reading a lot of them and you know I read these transcripts of Stanford students that are very bright and they've done very well in school but they're completely incoherent you know they you know so they've got a history or humanities social science requirements so they take you know kind of a random course and you know kind of Aboriginal dance you know in the 19th century and you know another one and I mean whatever you know and

it doesn't amount to actually a kind of broad knowledge I think of sort of the basic facts that you need to be an educated person now a little bit more specifically about the narratives this book it is a world history in a certain sense I concentrate on certain things that are typically not concentrated on like the growth of bureaucracy and you know states I was trying to actually avoid this thing called Whig history which used to be very common in American history textbooks where basically you start from Greek democracy and go through you know the

Roman Republic to the Magna Carta to the Glorious Revolution to the American Revolution and the Declaration of Independence all this one narrative about you know how America got to be America and it does seem to me that in the world we live in now you actually have to know about other parts of the world so this the first volume of my book actually spends most of the early chapters once you get past tribal societies on China because in my view China actually was the first world civilization to create a modern state in the sense that

I defined it in this presentation meaning centralized bureaucratic relatively impersonal and I don't talk about Greece and Rome and I've gotten a lot of people who have asked me why not and just said you know it's not that it's not important but I just think that the serious story of these other civilizations need to be told and the other problem I think with a lot of global histories is there is a problem of political correctness that the way that they're written you do not want to say anything negative about non-western civilizations and in fact there's

kind of a bias to play up the achievements of non-western civilizations and to emphasize you know colonialism and slavery and a lot of other not so nice things and in the history of the West and I also think that that's a mistake I mean you obviously have to confront all of these things I think I do that in you know these two volumes but I think you need to be able to talk about India and China and Africa and all these other places in a true comparative sense meaning not with an agenda of either puffing

them up or you know cutting them down to size you just need to tell the story you know as as objectively as you can so that's my that's been my approach was unbelievable upsurge as you said before Oh specifically our elected officials I think under you mostly simply a Meccano saying that uh President Obama could choose all he wanted but that the Senate was not going to offend or just simply standing up and telling a lie no so so I mean you seems to mean that in my lifetime that has well I don't think that

telling lies on the part of politicians is a new thing if you go back in American history well so I think what the brazenness reflects is the polarization you know that the stakes have risen because people are angry at each other and they're very divided on almost every issue and therefore they think of politics as a kind of zero-sum game take-no-prisoners you know and therefore they're willing to do things like lie brazenly in order to get their way and in you know earlier periods in the 20th century there's more consensus you know and in fact

American Political Science Association in the 1950s wrote this big study saying that the problem of the true American political parties that are too similar you know and you don't get any real policy divergence between them so I think that that's kind of a reflection of the you know our current polarization you're going to have to excuse me because I need to get on a conference call at 3 o'clock so I'm going to have to yeah sure thank you