Book Review: The Dictator's Handbook

How do leaders both democratic and autocratic come to power and stay in power? That is the central question with which The Dictator's Handbook wrestles. In a fascinating work the authors dispense with the notion that there is a great chasm between democrats and autocrats. Instead they offer the idea that every country is one a scale between autocratic and democratic. What differentiates them is the number of essential supporters the leader requires to remain in power. In a democracy this number is a significant fraction of the total population, anywhere between 15% and 40%. For autocracies on the other hand a leader usually requires less than 1,000 essential supporters and in many cases less than 50 will do the trick.

The authors study the central question in the tradition of positive economics, focusing the majority of the book on a study of political power free of value judgements. Not until this question has been answered in depth do the authors embrace a normative view as they offer their suggestions for how to improve governance. The authors dispense with the idea that autocrats are driven by evil intention offering instead an explanation driven by the incentives of political power.

One of the most dominant conclusions of this work is that freedom and wealth are inextricably linked. Without freedom of assembly, freedom of association and freedom of speech it is very hard to effectively conduct commerce. This then provides a provocative new explanation for the resource curse: many of the world's countries that are richest in natural resources are among the bottom of the ranks in general welfare and freedoms. Leaders of those countries don't require a strong local economy to fund their treasury instead needing only the royalties of resource extraction. For leaders without many natural resources they must fund their treasury purely off the taxation of the local economy; an economy that can only flourish if ideas can be shared freely and prices can be negotiated openly in the market. Coincidentally these same freedoms also allow the people to organize against the leader whether autocratic or democratic.

The authors point out that the logical conclusion of this line of thinking is that an economic crisis in, particularly in autocratic states, is the best opportunity for increasing political freedom. As the leader becomes unable to pay off his closest supporters he runs the risk of losing their backing. This leaves only two options: grow the economy which requires additional freedoms or find an outside source of funding. The lesson then is that in the interests of democracy autocrats should not be bailed out when they face economic crisis but instead be given aid only if and when they have provided their people more freedom.

The most counter-intuitive conclusion reached by the authors is that (western) democracies have accomplished very little in the cause of democracy around the world. On the contrary, democracies are more than happy to rely on autocrats to advance their agendas around the world, in fact they much prefer working with autocratic regimes as opposed to thriving democracies. Autocrats are cheaply bought as they are beholden to a small group of supporters to stay in power and have little need to develop public policy that makes the people happy. On the other hand, leaders in democracies require the support of many thousand times more supporters to stay in power and must deliver on policy that makes the masses better off. It's that second requirement of a democratic leader that prevents them from obediently adopting policy from a foreign power.

Foreign aid is a prime example of how a democracy pursues a policy that appears to be compassionate and improving lives around the world only to help autocrats strengthen their hold on power while lining their personal bank accounts. Most foreign aid comes with few requirements for improved franchisement and is delivered in a form that presents plenty of opportunity for graft. In the arena of international relations democracy tends to get in the way of pragmatic policy preferring to chase the feel-gooded-ness of foreign aid with few strings attached.

This is not a book that will leave you feeling optimistic for the future of governance but it does give hope that we need not rely on people's motives alone to improve governance. Understanding that a leader's motives are not the primary driving force of policy and action helps fix our focus on the system instead of the specific people in charge. And by fixing the system with even small tweaks, such as increasing the franchise, we can make significant strides in the quality of governance.