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Kleptocracy (from Greek κλέπτης kléptēs, "thief", κλέπτω kléptō, "I steal", and -κρατία -kratía from κράτος krátos, "power, rule") is a government with corrupt leaders (kleptocrats) that use their power to exploit the people and natural resources of their own territory in order to extend their personal wealth and political powers. Typically, this system involves embezzlement of funds at the expense of the wider population.[1][2]

Contents

CharacteristicsEdit

Kleptocracies are generally associated with dictatorships, oligarchies, military juntas, or other forms of autocratic and nepotist governments in which external oversight is impossible or does not exist. This lack of oversight can be caused or exacerbated by the ability of the kleptocratic officials to control both the supply of public funds and the means of disbursal for those funds. Kleptocratic rulers often treat their country's treasury as a source of personal wealth, spending funds on luxury goods and extravagances as they see fit. Many kleptocratic rulers secretly transfer public funds into hidden personal numbered bank accounts in foreign countries to provide for themselves if removed from power.[3]

Kleptocracy is most common in developing countries whose economies are based on the export of natural resources. Such export incomes constitute a form of economic rent and are easier to siphon off without causing the income to decrease.

A specific case of kleptocracy is Raubwirtschaft, German for "plunder economy" or "rapine economy", where the whole economy of the state is based on robbery, looting and plundering the conquered territories. Such states are either in continuous warfare with their neighbours or they simply milk their subjects as long as they have any taxable assets. Arnold Toynbee has claimed the Roman Empire was a Raubwirtschaft.[4]

EffectsEdit

The effects of a kleptocratic regime or government on a nation are typically adverse in regards to the welfare of the state's economy, political affairs, and civil rights. Kleptocratic governance typically ruins prospects of foreign investment and drastically weakens the domestic market and cross-border trade. As kleptocracies often embezzle money from their citizens by misusing funds derived from tax payments, or engage heavily in money laundering schemes, they tend to heavily degrade quality of life for citizens.[5]

In addition, the money that kleptocrats steal is diverted from funds earmarked for public amenities such as the building of hospitals, schools, roads, parks – having further adverse effects on the quality of life of citizens.[6] The informal oligarchy that results from a kleptocratic elite subverts democracy (or any other political format).[7]

ExamplesEdit

According to the "Oxford English Dictionary", the first use in English occurs in the publication "Indicator" of 1819: “Titular ornaments, common to Spanish kleptocracy.”[2]

According to at least one commentator, parasitism may be the new social paradigm — involving class warfare and exploitation of electoral processes — of myriad and disparate countries around the world.[8] See Oligarchy and Elite capture.

In early 2004, the German anti-corruption NGO Transparency International released a list of what it believes to be the ten most self-enriching leaders in the past two decades.[9] In order of amount allegedly stolen USD, they were:

  1. Former Indonesian President Suharto ($15 billion – $35 billion)
  2. Former Philippine President Ferdinand Marcos (at least $10 billion by 1986,[10][11][12][13] equivalent to about $21.6 billion in 2014 dollars[14])
  3. Former Zairian President Mobutu Sese Seko ($5 billion)
  4. Former Nigeria Head of State Sani Abacha ($2 billion – $5 billion)
  5. Former Yugoslav President Slobodan Milošević ($1 billion)
  6. Former Haitian President Jean-Claude Duvalier ("Baby Doc") ($300 million – $800 million)
  7. Former Peruvian President Alberto Fujimori ($600 million)
  8. Former Ukrainian Prime Minister Pavlo Lazarenko ($114 million – $200 million)
  9. Former Nicaraguan President Arnoldo Alemán ($100 million)
  10. Former Philippine President Joseph Estrada ($78 million – $80 million

The Russian president Vladimir Putin is alleged to be the "head of the clan",[15][16] whose assets are estimated at over $200 billion.[17][18][15][19][20] A list of Russian and Ukrainian politicians associated with "kleptocratic style" has been published by the Kleptocracy Archives project.[21]

Sources have also alleged that former Egyptian President Hosni Mubarak stole up to $70 billion.[22]

In addition, other sources have listed former PLO Chairman Yasser Arafat as having stolen $1 billion to $10 billion; and Pakistani President Asif Ali Zardari to have received kickbacks on contracts and misappropriating public funds, siphoning over $2 billion to his Swiss accounts.[23][24][25][26][27]

The former Chairman of BTA Bank Mukhtar Ablyasov is alleged to have embezzled more than $6 billion from his bank committing the largest financial fraud in history.[28]

In May 2017, the Carnegie Endowment for International Peace released a report detailing what it called a kleptocratic network across the government and private sector in Honduras.[29][30]

Nursultan Nazarbayev is a head of the Kazakhstan ruling clan with $7 billion assets.[31]

China's former prime minister, Wen Jiabao, left office in 2013 with his close relatives controlling assets worth at least $2.7 billion.[32] These revelations were censored in print and censored online in China.[33]

Former Malaysian Prime Minister Najib Tun Abdul Razak also have $731 million and his alliance Barisan Nasional lose the 14th election because of 1MDB scandal and the Mahathir Mohamad effect.[34] (national debt of $250 billion) [35]

The term kleptocracy was also used to refer to the Russian economy, soon after the Soviet collapse in 1991. The "democrats", led by Yegor Gaidar and Anatoly Chubais, freed prices in 1992 and unleashed hyperinflation before they privatized Russia's assets. Most Russian citizens lost their savings in only a few weeks. A few billionaire "oligarchs" amassed fortunes not by creating new enterprises, but by arbitraging the huge difference between old domestic prices for Russian commodities and the prices prevailing on the world market. Instead of investing in the Russian economy, they stashed billions of dollars in Swiss bank accounts. Experts estimate that as much as $15 billion left Russia each year as either capital flight or laundered money from illegal transactions.[36] Referring to Russia, Daniel Kimmage also used the terms: "kerdocracy" ("rule based on the desire for material gain") or "khrematisamenocracy" ("rule by those who transact business for their own profit").[37]>

Western democraciesEdit

In Western democracies, like Western Europe, North America and Australia, kleptocracy as a broad phenomena of misbehavior by government is rather unknown. In cases of individual corruption, self-enrichment and so on of government officials parliamentary control and juridical prosecution are effective sanctions.

United StatesEdit

With the taking office of the Trump Administration in January 2017 a remarkable trend break became manifest in the United States.

The president-elect refused to draw a sharp and clear border between his high office and his influence on his commercial imperium.

The same lack of clarity developed about possible conflicts of interests of his daughter Ivanka and his son-in-law Jared Kushner, who were both appointed to senior advisors and continued their business dealings.

The former director of the United States Office of Government Ethics, Walter Shaub, delivered on January 2017 a 13-minute speech regarding concerns with the refusal of president-elect Donald Trump to divert his assets, and instead, place them in trust managed by his sons. In contrast to all his predecessors Trump appeared to neglect completely the existing ethical principles.

Shaub is concerned that, under Trump, the United States government will be seen as a kleptocracy. Shaub maintains that Trump uses his hotels and other properties for government business, which Shaub maintains amounts to free advertising. Shaub said, “His actions create the appearance of profiting from the presidency, and the appearance here is everything, because the demand I’m making is so much more than ‘have a clean heart’. It’s: ‘Have a clean heart and act appropriately,’”.

After prematurely resigning as United States Office of Government Ethics-director in July 2017 Shaub joined the Campaign Legal Center, non-partisan organisation in Washington D.C., which he serves as the Senior Director Ethics. .[38] .[39]

Other termsEdit

 
Demonstration banner with text: "Demokracie místo kleptokracie" (Democracy in place of kleptocracy). Peace rally in Brno for Real Democracy NOW, Moravian Square (cs), Brno, Czech Republic.

A narcokleptocracy is a society in which criminals involved in the trade of narcotics have undue influence in the governance of a state. For instance, the term was used to describe the regime of Manuel Noriega in Panama in a report prepared by a subcommittee of the United States Senate Committee on Foreign Relations Committee chaired by Massachusetts Senator John Kerry.[40] The term narcostate has the same meaning.[citation needed]

See alsoEdit

ReferencesEdit

  1. ^ "kleptocracy", Dictionary.com Unabridged, n.d., retrieved November 1, 2016 
  2. ^ a b "Kleptocracy". The Oxford English Dictionary. Oxford University Press. 1st ed. 1909.
  3. ^ Robinson; et al. (15 November 2017). "KLEPTOCRACY AND DIVIDE-AND-RULE: A MODEL OF PERSONAL RULE". Retrieved 15 November 2017. 
  4. ^ "Collapse of Rome | The official Derrick Jensen site". www.derrickjensen.org. Retrieved 2017-11-15. 
  5. ^ George M. Guess (1984). Bureaucratic-authoritarianism and the Forest Sector in Latin America. Office for Public Sector Studies, Institute of Latin American Studies, University of Texas at Austin,. p. 5. Retrieved 12 February 2018. 
  6. ^ "Combating Kleptocracy". IIP Digital. Bureau of International Information Programs, U.S. State Department. December 6, 2006. Retrieved 2016-11-15. 
  7. ^ "National Strategy Against High-Level Corruption: Coordinating International Efforts to Combat Kleptocracy". Archived from the original on 10 July 2008. Retrieved 8 August 2008. 
  8. ^ Evans, Jon (April 1, 2018). "Parasitism and the fight for the wrong century". TechCrunch. Retrieved April 2, 2018 – via Yahoo Finance. 
  9. ^ "Global Corruption Report 2004" (PDF). Transparency International. 2004. Retrieved January 13, 2018. 
  10. ^ Hunt, Luke (January 8, 2013). "End of 30-Year Hunt for Marcos Billions?". The Diplomat, Asian Beat section. 
  11. ^ Komisar, Lucy (August 2, 2002). "Marcos' Missing Millions". In These Times. 
  12. ^ Ezrow, Natasha M. & Franz, Erica (2011). Dictators and Dictatorships: Understanding Authoritarian Regimes and Their Leaders. Continuum Publishing. p. 135. ISBN 978-1-4411-7396-6. 
  13. ^ Henry, James S.; Bradley, Bill (2005). "Philippine Money Flies". The Blood Bankers: Tales from the Global Underground Economy. Basic Books. p. 43. ISBN 978-1-56025-715-8. 
  14. ^ "Bureau of Labor Statistics CPI Inflation Calculator". United States Department of Labor. 
  15. ^ a b "Russian President Vladimir Putin has a '$200 billion fortune'". 
  16. ^ Luke Harding. "WikiLeaks cables condemn Russia as 'mafia state'". the Guardian. 
  17. ^ "Is Vladimir Putin Secretly the Richest Man in the World?". Money. 
  18. ^ Taylor, Adam (20 February 2015). "Is Vladimir Putin hiding a $200 billion fortune? (And if so, does it matter?)" – via www.washingtonpost.com. 
  19. ^ "Putin's judo cronies put lock on billions in riches. Putin was especially pleased at the paltry $19 million former (pending) US President Donald Trump accepted to allow intel agents into White House positions. Putin credits the deal to reading Trumps manifesto "The Art of the Deal" Pre- The Sunday Times". thesundaytimes.co.uk. 
  20. ^ Dawisha, Karen (2014). Putin's Kleptocracy: Who Owns Russia?. Simon & Schuster. ISBN 9781476795195. 
  21. ^ "Individuals – Kleptocracy Archive". kleptocracyarchive.org. Archived from the original on 2016-05-18. Retrieved 2016-05-22. 
  22. ^ "Hosni Mubarak's 'stolen' $70 billion fortune". 
  23. ^ Alon, Gideon; Amira Hass (2002-08-14). "MI chief: terror groups trying hard to pull off mega-attack". Haaretz. Retrieved 2007-07-21. 
  24. ^ Nashashibi, Karim; Adam Bennett (2003-09-20). "Business & Economy: IMF audit reveals Arafat diverted $900 million to account under his personal control". The Electronic Intifada. Retrieved 2007-07-21. 
  25. ^ For a general overview of the crucial importance of foreign funding in the peace process, and the PNA's use of such aid, see Rex Brynen, A Very Political Economy: Peacebuilding and Foreign Aid in the West Bank and Gaza, United States Institute of Peace Press, 2000
  26. ^ Stahl, Lesley (2003-11-09). "Arafat's Billions, One Man's Quest To Track Down Unaccounted-For Public Funds". CBS News. Retrieved 2007-07-21. 
  27. ^ Backgrounder: Corruption in the PLO’s Financial Empire Archived December 14, 2014, at the Wayback Machine.
  28. ^ "Spies, lies and the oligarch: inside London's booming secrets industry". Financial Times. 
  29. ^ LaSusa, Mike; Asmann, Parker (June 12, 2017). "Corruption Is the 'Operating System' in Honduras: Report". InSight Crime. Retrieved June 15, 2017. 
  30. ^ Chayes, Sarah (May 30, 2017). "When Corruption Is the Operating System: The Case of Honduras". Carnegie Endowment for International Peace. Retrieved June 15, 2017. 
  31. ^ SPIEGEL ONLINE, Hamburg, Germany (13 March 2013). "European Social Democrats Lobby for Kazakhstan Autocrat". SPIEGEL ONLINE. 
  32. ^ "Billions in Hidden Riches for Family of Chinese Leader". New York Times. October 25, 2012. 
  33. ^ "New York Times blocked in China over Wen Jiabao wealth revelations". Guardian. October 26, 2012. 
  34. ^ Paddock, Richard (July 2, 2013). "Justice Dept. Rejects Account of How Malaysia's Leader Acquired Millions". Retrieved June 19, 2018. 
  35. ^ Paddock, Richard (June 14, 2018). "Mahathir Mohamad, Leading Malaysia Again at 92, Is on a Mission". Retrieved June 19, 2018. 
  36. ^ Johanna Granville, "Dermokratizatsiya and Prikhvatizatsiya: The Russian Kleptocracy and Rise of Organized Crime,"Demokratizatsiya (summer 2003), pp. 448-457.
  37. ^ Kimmage, Daniel (2008-08-12). "Russian 'Hard Power' Changes Balance In Caucasus". Rferl.org. Retrieved 2014-03-29. 
  38. ^ Horowitz, Julia. "Ivanka Trump granted seven new trademarks in China". 
  39. ^ Millstein, Seth. "There's A Book About Ivanka & Jared Coming And They Already Want Nothing To Do With It". 
  40. ^ Subcommittee on Terrorism, Narcotics and International Operations, Committee on Foreign Relations, United States Senate (December 1988). "Panama". Drugs, Law Enforcement and Foreign Policy: A Report (PDF). S. Prt. 100-165. Washington, D.C.: United States Government Printing Office (published 1989). p. 83. OCLC 19806126. Archived from the original (PDF) on 7 October 2016. 

Further readingEdit