The Dictator's Handbook: Why Bad Behavior is Almost Always Good Politics

Good governance for the everyday people rarely motivates leaders. In fact, doing what is best for the people is generally bad for staying in power. Bueno de Mesquita and Smith’s logic of political power teaches readers that leaders of all organizations and governments want to get and keep power.

This theme is particularly evident with the phenomenon known as resource curse, where nations that are resource rich are generally less well-off than nations that are resource poor. Resource-rich nations are more prone to being autocracies, have worse economic growth, and are more prone to internal conflict. Nigeria, which has the world’s 10th-largest oil reserve, is one example. Nigeria accumulated over $350 billion in oil revenue between 1970 and 2000, yet none of this money went to the everyday people. Average annual income actually dropped during this time frame. The leaders of Nigeria used this wealth to pay off their supporters and amass their own fortunes.

The authors also highlight this theme when they discuss corruption. Corruption is a private good. People who benefit from corrupt practices become indebted to leaders for two reasons. The first is that they are grateful to the leader for allowing them to accumulate wealth, especially when this ability is not available for everyday people. The second is that they understand that being disloyal to the leader will result in loss of this privilege and wealth. Leaders could use wealth to fix corruption and help the everyday people. Instead, such corrupt practices help them build a loyal coalition and stay in power at the expense of quality of life for the everyday people. A non-politics example is the International Olympic Committee. Instead of choosing cities based on quality of leadership, games, and facilities, committee members accept bribes of between $100,000 and $200,000 for their vote. Leaders are willing to pay these bribes to committee members for the so-called honor and prestige that go along with hosting the Olympics in their country. By accepting bribes, committee members only care about their own power. They set aside good governance by not caring about whether the city makes logistical sense or whether it will be safe for the athletes.

This theme also comes out through the discussion of foreign aid. Many people in democracies believe aid goes towards alleviating poverty in foreign countries. Bueno de Mesquita and Smith show how this is not what actually happens. Instead, dictators use foreign aid to cling to power while often making the lives of the everyday people worse. For example, President Asif Ali Zardari of Pakistan used aid money intended to help the country with irrigation and flood control to enrich himself and help only his supporters. He reinforced dikes where his supporters lived but allowed flooding to continue in areas with high numbers of minorities and opposition supporters. If the objective of politics was good governance, then President Zardari’s behavior makes no sense. Since power drives politics, however, his behavior represents an “ingenious move.” Zardari reminded supporters “of the consequences of being outside the coalition of essential backers” (188).

The authors believe that to actually improve the lives of everyday people, we need to change the incentive structures of politics. In particular, Bueno de Mesquita and Smith argue that making leaders accountable to larger coalitions will improve quality of life. They look at death rates from earthquakes in Chile and Iran as one example to support this idea. Iran has consistently been a small coalition regime, whereas Chile has gone back and forth between small- and large-coalition regimes. During a period of democratic rule, Chile strengthened its policies for protecting the people from earthquakes (e.g., updating building codes, etc.). Policies that protect people help democratic leaders stay in office. Iran has never had this type of investment since there are not the same incentives to spend money on the public. Iran has substantially higher death rates from earthquakes than Chile, supporting the idea that big coalitions appear to save lives over small coalitions. While democratic leaders still care more about staying in power than they do governing, the fact that this power relies on public support strongly incentivizes these leaders to protect and ensure a high quality of life for their people.

Another example of changing incentives is to convince autocratic leaders to rely on tax revenue rather than revenue from natural resources. Autocratic countries that rely on the latter have some of the worst living conditions in the world. The reason is that they can have total control over their populace. Bueno de Mesquita and Smith note, “The easiest way to incentivize the leader to liberalize policy is to force him to rely on tax revenue to generate funds. Once this happens, the incumbent can no longer suppress the population because the people won’t work if he does” (91). Thus, encouraging leaders to use tax revenue over resources revenue will help improve the living conditions of people.