Political Rigging

OXFAM AMERICA RESEARCH BACKGROUNDER Political Rigging A primer on political capture and influence in the 21 st century Janine R. Wedel, Nazia Hussain, and Dana Archer Dolan CONTENTS Oxfam America’s Research Backgrounders ............................................. 2 Author Information and Acknowledgments ............................................... 2 Introduction .............................................................................................. 4 Political Capture and Today’s Influence Elites ......................................... 8 Templates for Studying Political Capture ............................................... 18 Johnston’s Syndromes of Corruption ...................................................... 19 Chayes’s Types of Kleptocratic Rule ..................................................... 24 Reflecting on the Templates .................................................................. 27 A Framework for Identifying Political Rigging ......................................... 28 Informality .............................................................................................. 28 Flexibility ............................................................................................... 45 Digital-Powered Simulacra .................................................................... 65 Putting the Framework into Practice: Some Guiding Questions ............. 71 Conclusion……………………………………...............................................78 Images…………………………………...…………………………………......79 References Cited…………………………………...…………………...….….82 Research Backgrounder Series Listing……………………………………...99 1 OXFAM AMERICA’S RESEARCH BACKGROUNDERS Series editor: Kimberly Pfeifer Oxfam America’s Research Backgrounders are designed to inform and foster discussion about topics critical to poverty reduction. The series explores a range of issues on which Oxfam America works—all within the broader context of international development and humanitarian relief. The series was designed to share Oxfam America’s rich research with a wide audience in hopes of fostering thoughtful debate and discussion. All Backgrounders are available as downloadable PDFs on our website, oxfamamerica.org/research, and may be distributed and cited with proper attribution. Topics of Oxfam America’s Research Backgrounders are selected to support Oxfam’s development objectives or key aspects of our policy work. Each Backgrounder represents an initial effort by Oxfam to inform the strategic development of our work, and each is either a literature synthesis or original research, conducted or commissioned by Oxfam America. All Backgrounders have undergone peer review. Oxfam America’s Research Backgrounders are not intended as advocacy or campaign tools; nor do they constitute an expression of Oxfam America policy. The views expressed are those of the authors—not necessarily those of Oxfam. Nonetheless, we believe this research constitutes a useful body of work for all readers interested in poverty reduction. For a full list of available Backgrounders, please see the “Research Backgrounder Series Listing” section of this report. Author information and acknowledgments Janine R. Wedel, anthropologist and university professor in the Schar School of Policy and Government at George Mason University, is the author, most recently, of Unaccountable: How the Establishment Corrupted Our Finances, Freedom and Politics and Created an Outsider Class (Pegasus, updated paperback, 2016) and Shadow Elite: How the World’s New Power Brokers Undermine Democracy, Government, and the Free Market (Basic Books, 2009). Nazia Hussain (Ph.D., George Mason University, 2016) is a post-doctoral fellow at UNU-CPR (United Nations University - Center for Policy Research) in Toyko. Dana Archer Dolan is a Ph.D. candidate in the Schar School of Policy and Government at George 2 Mason University. The authors can be reached at: [email protected], [email protected] , and [email protected]. The authors would like to acknowledge Oxfam America’s Nick Galasso for his foresight, terrific guidance, and support of this project, and Kimberly Pfeifer, Oxfam America’s head of research, for her vision, innovative approach to research, and support of the project. For feedback on the manuscript or ideas therein, we are grateful to Oxfam reviewers and to participants in the January 2016 Oxfam workshop on political capture. We are much obliged to external reviewers Hülya Demirdirek, Michael Johnston, and Paul Stubbs, who provided helpful, copious comments. Linda Keenan has generously and steadfastly supplied invaluable analytical and editorial feedback, and to her we are greatly indebted. We thank Heidi Fritschel for her careful editing of the manuscript and Kelly Knight for her logistical support. Finally, we are beholden to Karelle Samuda for her crucial and abiding help. Of course, any shortcomings rest solely with the authors. For permission to publish a larger excerpt, please email your request to [email protected]. 3 INTRODUCTION Who influences decisions that crucially affect the public—from the distribution of precious water or energy resources to health care to the regulation of exotic and potentially risky financial instruments? What factors shape whose say matters and who gets what? With economic inequality growing so dramatically in recent years, there is increasing scrutiny on the question of whether elite priorities have taken an outsized role in the policies that helped create this vast disparity.1 Studying how influence-wielding elites fashion rules of the game to favor the rich few, at the expense of the underprivileged many, is at once an intuitive but challenging and imperative task. It is intuitive because varied protests around the globe have made clear that the general public grasps it instinctually—often more easily than academics and policy practitioners. It is challenging because power maps have become much more difficult to see and trace. From the tangle of “mafia,” political party syndicates, and government operatives in Karachi who determine who gets scarce water to the big New York bankers who set the informal rules for derivatives trading in secretive meetings, 2 the activities of powerbrokers are today less visible and hence harder to track than at any time in living memory. Studying how influence works is imperative because the belief that the system is rigged has taken hold in many parts of the globe, including in the United States and Europe. Anti-elitist, anti-system movements are fiercely challenging the establishment, as seen most dramatically in the election of US President Donald Trump. The wholesale collapse of trust has generated enormous and justified anger. Some of the protestors want to smash the system, but might not have a viable idea of how to fix it. Far worse, some are directing rage at easy and misguided targets, like already-vulnerable refugees or minorities. For these reasons, it is important to carefully understand the processes of rigging and resulting inequality, as it is one of several major factors that has created this widening gap. How did elite power brokers grow so powerful? A seismic change in the environment in which policies are formed and implemented over the past few decades, wrought by the combined effects of privatization, deregulation, financialization, and technological innovation, has ignited an explosion of complexity, opacity, flexibility, and ambiguity. This sea change has enabled players and organizations to leverage new opportunities to their own advantage, 1 Oxfam found that “the gap between rich and poor is reaching new extremes. Credit Suisse recently revealed that the richest 1% have now accumulated more wealth than the rest of the world put together” (Hardoon, Fuentes-Nieva, and Ayele 2016, 2). See also Fuentes-Nieva and Nicholas Galasso 2014; Kuttner 2016. 2 As the New York Times reported, the meetings aimed to prevent price transparency and keep others out of the market. The particulars of the meetings, as well as the identities of the men involved, “have been strictly confidential” (Story 2010). 4 and, at the same time, deny responsibility for doing so. Amid the sea change, is it any wonder that the gap in economic equality has grown so wide? Or that the result has been rage in many parts of the world? By Oxfam’s accounting, in 2015, just 62 people at the top had the same wealth as 3.6 billion of the poorest. 3 This widening gap saps the morale of large swaths of the population. It stokes public discontent, upon which authoritarian figures around the globe have been capitalizing. One of the root causes of economic inequality is said to be “political capture” (Galasso 2013; Fuentes-Nieva and Galasso 2014)—a concept that is more encompassing than the older notions of “regulatory capture” and “state capture.”4 Yet the concept of political capture requires a more thorough unpacking than it has been given by most scholars, not to mention politicians like Trump, who as a presidential nominee regularly invoked this enormously complex problem in insufficiently robust ways. Prevailing approaches to analyzing governance, policy, and influence are not quite up to the task: they imply the existence of stable institutions and clarity about who is who, who does what, and who is acting in whose interests. Traditional approaches often pay most attention to what is formal or visible, overlooking what is informal, flexible, and difficult to detect. But in many settings, and with respect to many issues, the most crucial drivers

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