Kleptocracy

Kleptocracy (or sometimes Cleptocracy) (root: Klepto+cracy) literally means rule by thieves. It is a pejorative, informal term for a corrupt form of government and represents an extreme form of the use of government for rent seeking. In a kleptocracy the rulers and their cronies use the mechanisms of government to tax the public at large in order to amass personal fortunes. "Kleptocrats" may use various overt methods (money laundering, anonymous banking) as a way of protecting and concealing their ill-gotten gains. "Kleptocracies" tend to be stably kleptocratic. That is, frequently politics consists of one set of thieves displacing their predecessors. Haiti for much of its history is just such a case. Because corruption imposes a massive tax on enterprise, kleptocracies tend to have poorly performing economies. The kleptocrats realize that they have more to gain from taking a large share of a stable or shrinking pie than from a shrinking share of an increasing pie. Economies based on natural resource extraction are particularly prone to kleptocracy as the kleptocrats simply tax the Riccardian rents. Also, corrupt politicians routinely ignore underlying economic and social problems in the quest for wealth and power. Because they do not try to build functioning states, and even cannot build large repressive forces because of the danger of coups, the governments are often incompetent in the face of social crises. Thus, some kleptocracies have collapsed into civil war and anarchy. Among the more infamous examples of "kleptocratic" government were Zaire under Mobutu Sese Seko's rule, Indonesia under Suharto's rule, Iraq under Saddam Hussein and Federal Republic of Yugoslavia under Slobodan Milosevic.\nOlder examples include the Barbary states of North Africa in the 17th through early 19th centuries. Less extreme examples are Nationalist China under Chiang Kai-shek, the Philippines under Marcos' administration, again with Estrada's administration, and Nazarbayev's Kazakhstan and Puerto Rico under the administration of Pedro Rosselló. Some observers have taken to using the term to tar democratic political processes that permit corporations to influence policy. The use of kleptocracy in this context priviliges one form of rent seeking over all the others that are a normal concomittant of democracy. See also: Raubwirtschaft