Why Nations Fail

by Daron Acemoglu

  A CHILDREN’S CRUSADE?

  On March 23, 1991, a group of armed men under the leadership of Foday Sankoh crossed the border from Liberia into Sierra Leone and attacked the southern frontier town of Kailahun. Sankoh, formerly a corporal in the Sierra Leonean army, had been imprisoned after taking part in an abortive coup against Siaka Stevens’s government in 1971. After being released, he eventually ended up in Libya, where he entered a training camp that the Libyan dictator Colonel Qaddafi ran for African revolutionaries. There he met Charles Taylor, who was plotting to overthrow the government in Liberia. When Taylor invaded Liberia on Christmas Eve 1989, Sankoh was with him, and it was with a group of Taylor’s men, mostly Liberians and Burkinabes (citizens of Burkina Faso), that Sankoh invaded Sierra Leone. They called themselves the RUF, the Revolutionary United Front, and they announced that they were there to overthrow the corrupt and tyrannical government of the APC.

  As we saw in the previous chapter, Siaka Stevens and his All People’s Congress, the APC, took over and intensified the extractive institutions of colonial rule in Sierra Leone, just as Mugabe and ZANU-PF did in Zimbabwe. By 1985, when Stevens, ill with cancer, brought in Joseph Momoh to replace him, the economy was collapsing. Stevens, apparently without irony, used to enjoy quoting the aphorism “The cow eats where it is tethered.” And where Stevens had once eaten, Momoh now gorged. The roads fell to pieces, and schools disintegrated. National television broadcasts stopped in 1987, when the transmitter was sold by the minister of information, and in 1989 a radio tower that relayed radio signals outside Freetown fell down, ending transmissions outside the capital. An analysis published in a newspaper in the capital city of Freetown in 1995 rings very true:

  by the end of Momoh’s rule he had stopped paying civil servants, teachers and even Paramount Chiefs. Central government had collapsed, and then of course we had border incursions, “rebels” and all the automatic weapons pouring over the border from Liberia. The NPRC, the “rebels” and the “sobels” [soldiers turned rebels] all amount to the chaos one expects when government disappears. None of them are the causes of our problems, but they are symptoms.

  The collapse of the state under Momoh, once again a consequence of the vicious circle unleashed by the extreme extractive institutions under Stevens, meant that there was nothing to stop the RUF from coming across the border in 1991. The state had no capacity to oppose it. Stevens had already emasculated the military, because he worried they might overthrow him. It was then easy for a relatively small number of armed men to create chaos in most of the country. They even had a manifesto called “Footpaths to Democracy,” which started with a quote from the black intellectual Frantz Fanon: “Each generation must, out of relative obscurity, discover its mission, fulfill it or betray it.” The section “What Are We Fighting For?” begins:

  We continue to fight because we are tired of being perpetual victims of state sponsored poverty and human degradation visited on us by years of autocratic rule and militarism. But, we shall exercise restraint and continue to wait patiently at the rendezvous of peace—where we shall all be winners. We are committed to peace, by any means necessary, but what we are not committed to is becoming victims of peace. We know our cause to be just and God/Allah will never abandon us in our struggle to reconstruct a new Sierra Leone.

  Though Sankoh and other RUF leaders may have started with political grievances, and the grievances of the people suffering under the APC’s extractive institutions may have encouraged them to join the movement early on, the situation quickly changed and spun out of control. The “mission” of the RUF plunged the country into agony, as in the testimony of a teenager from Geoma, in the south of Sierra Leone:

  They gathered some of us … They chose some of our friends and killed them, two of them. These were people whose fathers were the chiefs, and they had soldiers’ boots and property in their houses. They were shot, for no other reason than that they were accused of harbouring soldiers. The chiefs were also killed—as part of the government. They chose someone to be the new chief. They were still saying they had come to free us from the APC. After a point, they were not choosing people to kill, just shooting people.

  In the first year of the invasion, any intellectual roots that the RUF may have had were completely extinguished. Sankoh executed those who criticized the mounting stream of atrocities. Soon, few voluntarily joined the RUF. Instead they turned to forcible recruitment, particularly of children. Indeed, all sides did this, including the army. If the Sierra Leonean civil war was a crusade to build a better society, in the end it was a children’s crusade. The conflict intensified with massacres and massive human rights abuses, including mass rapes and the amputation of hands and ears. When the RUF took over areas, they also engaged in economic exploitation. It was most obvious in the diamond mining areas, where they press-ganged people into diamond mining, but was widespread elsewhere as well.

  The RUF wasn’t alone in committing atrocities, massacres, and organized forced labor. The government did so as well. Such was the collapse of law and order that it became difficult for people to tell who was a soldier and who was a rebel. Military discipline completely vanished. By the time the war ended in 2001, probably eighty thousand people had died and the whole country had been devastated. Roads, houses, and buildings were entirely destroyed. Today, if you go to Koidu, a major diamond-producing area in the east, you’ll still see rows of burned-out houses scarred with bullet holes.

  By 1991 the state in Sierra Leone had totally failed. Think of what King Shyaam started with the Bushong (this page–this page): he set up extractive institutions to cement his power and extract the output the rest of society would produce. But even extractive institutions with central authority concentrated in his hands were an improvement over the situation without any law and order, central authority, or property rights that characterized the Lele society on the other side of the river Kasai. Such lack of order and central authority has been the fate of many African nations in recent decades, partly because the process of political centralization was historically delayed in much of sub-Saharan Africa, but also because the vicious circle of extractive institutions reversed any state centralization that existed, paving the way for state failure.

  Sierra Leone during her bloody civil war of ten years, from 1991 to 2001, was a typical case of a failed state. It started out as just another country marred by extractive institutions, albeit of a particularly vicious and inefficient type. Countries become failed states not because of their geography or their culture, but because of the legacy of extractive institutions, which concentrate power and wealth in the hands of those controlling the state, opening the way for unrest, strife, and civil war. Extractive institutions also directly contribute to the gradual failing of the state by neglecting investment in the most basic public services, exactly what happened in Sierra Leone.

  Extractive institutions that expropriate and impoverish the people and block economic development are quite common in Africa, Asia, and South America. Charles Taylor helped to start the civil war in Sierra Leone while at the same time initiating a savage conflict in Liberia, which led to state failure there, too. The pattern of extractive institutions collapsing into civil war and state failure has happened elsewhere in Africa; for example, in Angola, Côte d’Ivoire, the Democratic Republic of Congo, Mozambique, Republic of Congo, Somalia, Sudan, and Uganda. Extraction paves the way for conflict, not unlike the conflict that the highly extractive institutions of the Maya city-states generated almost a thousand years ago. Conflict precipitates state failure. So another reason why nations fail today is that their states fail. This, in turn, is a consequence of decades of rule under extractive economic and political institutions.

  WHO IS THE STATE?

  The cases of Zimbabwe, Somalia, and Sierra Leone, even if typical of poor countries in Africa, and perhaps even some in Asia, seem rather extreme. Surely Latin American countries do not have failed states? Surely their presidents are not brazen enough to
win the lottery?

  In Colombia, the Andean Mountains gradually merge to the north with a large coastal plain that borders the Caribbean Ocean. Colombians call this the tierra caliente, the “hot country,” as distinct from the Andean world of the tierra fria, the “cold country.” For the last fifty years, Colombia has been regarded by most political scientists and governments as a democracy. The United States feels happy to negotiate a potential free trade agreement with the country and pours all kinds of aid into it, particularly military aid. After a short-lived military government, which ended in 1958, elections have been regularly held, even though until 1974 a pact rotated political power and the presidency between the two traditional political parties, the Conservatives and the Liberals. Still, this pact, the National Front, was itself ratified by the Colombian people via a plebiscite, and this all seems democratic enough.

  Yet while Colombia has a long history of democratic elections, it does not have inclusive institutions. Instead, its history has been marred by violations of civil liberties, extrajudicial executions, violence against civilians, and civil war. Not the sort of outcomes we expect from a democracy. The civil war in Colombia is different from that in Sierra Leone, where the state and society collapsed and chaos reigned. But it is a civil war nonetheless and one that has caused far more casualties. The military rule of the 1950s was itself partially in response to a civil war known in Spanish simply as La Violencia, or “The Violence.” Since that time quite a range of insurgent groups, mostly communist revolutionaries, have plagued the countryside, kidnapping and murdering. To avoid either of these unpleasant options in rural Colombia, you have to pay the vacuna, literally “the vaccination,” meaning that you have to vaccinate yourself against being murdered or kidnapped by paying off some group of armed thugs each month.

  Not all armed groups in Colombia are communists. In 1981 members of the main communist guerrilla group in Colombia, the Fuerzas Armadas Revolucionarias de Colombia (the FARC—the Revolutionary Armed Forces of Colombia) kidnapped a dairy farmer, Jesus Castaño, who lived in a small town called Amalfi in the hot country in the northeastern part of the department of Antioquia. The FARC demanded a ransom amounting to $7,500, a small fortune in rural Colombia. The family raised it by mortgaging the farm, but their father’s corpse was found anyway, chained to a tree. Enough was enough for three of Castaño’s sons, Carlos, Fidel, and Vicente. They founded a paramilitary group, Los Tangueros, to hunt down members of the FARC and avenge this act. The brothers were good at organizing, and soon their group grew and began to find a common interest with other similar paramilitary groups that had developed from similar causes. Colombians in many areas were suffering at the hands of left-wing guerrillas, and right-wing paramilitaries formed in opposition. Paramilitaries were being used by landowners to defend themselves against the guerrillas, but they were also involved in drug trafficking, extortion, and the kidnapping and murder of citizens.

  By 1997 the paramilitaries, under the leadership of the Castaño brothers, had managed to form a national organization for paramilitaries called the Autodefensas Unidas de Colombia (the AUC—United Self-Defense Forces of Colombia). The AUC expanded into large parts of the country, particularly into the hot country, in the departments of Córdoba, Sucre, Magdalena, and César. By 2001 the AUC may have had as many as thirty thousand armed men at its disposal and was organized into different blocks. In Córdoba, the paramilitary Bloque Catatumbo was led by Salvatore Mancuso. As its power continued to grow, the AUC made a strategic decision to get involved in politics. Paramilitaries and politicians courted each other. Several of the leaders of the AUC organized a meeting with prominent politicians in the town of Santa Fé de Ralito in Córdoba. A joint document, a pact, calling for the “refounding of the country” was issued and signed by leading members of the AUC, such as “Jorge 40” (the nickname for Rodrigo Tovar Pupo), Adolfo Paz (a nom de guerre for Diego Fernando “Don Berna” Murillo), and Diego Vecino (real name: Edwar Cobo Téllez), along with politicians, including national senators William Montes and Miguel de la Espriella. By this point the AUC was running large tracts of Colombia, and it was easy for them to fix who got elected in the 2002 elections for the Congress and Senate. For example, in the municipality of San Onofre, in Sucre, the election was arranged by the paramilitary leader Cadena (“chain”). One eyewitness described what happened as follows:

  The trucks sent by Cadena went around the neighborhoods, corregimientos and rural areas of San Onofre picking people up. According to some inhabitants … for the 2002 elections hundreds of peasants were taken to the corregimiento Plan Parejo so they could see the faces of the candidates they had to vote for in the parliamentarian elections: Jairo Merlano for Senate and Muriel Benito Rebollo for Congress.

  Cadena put in a bag the names of the members of the municipal council, took out two and said that he would kill them and other people chosen randomly if Muriel did not win.

  The threat seems to have worked: each candidate obtained forty thousand votes in the whole of Sucre. It is no surprise that the mayor of San Onofre signed the pact of Santa Fé de Ralito. Probably one-third of the congressmen and senators owed their election in 2002 to paramilitary support, and Map 20, which depicts the areas of Colombia under paramilitary control, shows how widespread their hold was. Salvatore Mancuso himself put it in an interview in the following way:

  35 percent of the Congress was elected in areas where there were states of the Self-Defense groups, in those states we were the ones collecting taxes, we delivered justice, and we had the military and territorial control of the region and all the people who wanted to go into politics had to come and deal with the political representatives we had there.

  It is not difficult to imagine the effect of this extent of paramilitary control of politics and society on economic institutions and public policy. The expansion of the AUC was not a peaceful affair. The group not only fought against the FARC, but also murdered innocent civilians and terrorized and displaced hundreds of thousands of people from their homes. According to the Internal Displacement Monitoring Centre (IDMC) of the Norwegian Refugee Council, in early 2010 around 10 percent of Colombia’s population, nearly 4.5 million people, was internally displaced. The paramilitaries also, as Mancuso suggested, took over the government and all its functions, except that the taxes they collected were just expropriation for their own pockets. An extraordinary pact between the paramilitary leader Martín Llanos (real name: Héctor Germán Buitrago) and the mayors of the municipalities of Tauramena, Aguazul, Maní, Villanueva, Monterrey, and Sabanalarga, in the department of Casanare in eastern Colombia, lists the following rules to which the mayors had to adhere by order of the “Paramilitary Peasants of Casanare”:

  9) Give 50 percent of the municipality budget to be managed by the Paramilitary Peasants of Casanare.

  10) 10 percent of each and every contract of the municipality [to be given to the Paramilitary Peasants of Casanare].

  11) Mandatory assistance to all the meetings called by the Paramilitary Peasants of Casanare.

  12) Inclusion of the Paramilitary Peasants of Casanare in every infrastructure project.

  13) Affiliation to the new political party formed by the Paramilitary Peasants of Casanare.

  14) Accomplishment of his/hers governance program.

  Casanare is not a poor department. On the contrary, it has the highest level of per capita income of any Colombian department, because it has significant oil deposits, just the kind of resources that attract paramilitaries. In fact, once they gained power, the paramilitaries intensified their systematic expropriation of property. Mancuso himself reputedly accumulated $25 million worth of urban and rural property. Estimates of land expropriated in Colombia by paramilitaries are as high as 10 percent of all rural land.

  Colombia is not a case of a failed state about to collapse. But it is a state without sufficient centralization and with far-from-complete authority over all its territory. Though the state is able to provide security
and public services in large urban areas such as Bogotá and Barranquilla, there are significant parts of the country where it provides few public services and almost no law and order. Instead, alternative groups and people, such as Mancuso, control politics and resources. In parts of the country, economic institutions function quite well, and there are high levels of human capital and entrepreneurial skill; in other parts the institutions are highly extractive, even failing to provide a minimal degree of state authority.

  It might be hard to understand how a situation like this can sustain itself for decades, even centuries. But in fact, the situation has a logic of its own, as a type of vicious circle. Violence and the absence of centralized state institutions of this type enter into a symbiotic relationship with politicians running the functional parts of the society. The symbiotic relationship arises because national politicians exploit the lawlessness in peripheral parts of the country, while paramilitary groups are left to their own devices by the national government.