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State-Building: Governance and World Order in the 21St Century

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Francis Fukuyama provides in this slender volume a solid diagnosis of one of the most daunting obstacles impeding global security today. Specifically, Fukuyama's central argument is that the creation of new government institutions and the strenghtening of existing ones are the most important tasks we face at this point in history. Policy-makers have an impressive record when it comes to the dismantling, largely through the privatization of functions, of modern states; the ability to build sustainable political institutions is another matter. Developing countries -- at least the "majority" of them according to Mr. Fukuyama -- simply don't demand institutional reform. When reform has been imposed upon them, usually as a condition for the receipt of multi-lateral loans, the donor countries lack the patience to foster the requisite indigenous skills. The bulk of Mr. Fukuyama's text is an analysis of the distinc nature of, and unique problems posed by political insitutions in general -- that is, the ambiguity of goals, insufficient performance measures and, most significantly, the problem of delegating discretion.
The upshot of this analysis is that there is no "one-size-fits-all" organizational template that, as a drug to a disease, can be confidently applied across the board to bolster weak states. Globalization compounds the problem to the extent that its tendency is to erode the autonomy of the sovereign state. Similarly, the modern premise that governing legitimacy is exclusively derived from the consent of the governed through democratic processes (where is old-fashioned colonialism when you need it), runs the risk of raising expectations in developing countries that may very well be unrealistic, at least in the short-term. As Mr. Fukuyama notes, this is an area that will require significant research in the future. Nation-state building is not a new challenge, but is has never presented itself with the level of urgency we witness today. And, finally, that "end of history" notion. Read this book and you'll discover that not everybody is having the "end of history" experience.

For many Americans, including almost all libertarians, state power is something to be diminished. While there is usually some acknowledgement that the state is necessary for the national defense and for administering the rule of law, many Americans do not willingly concede that the regulation of certain aspects of the economy -- to give one example -- is a legitimate use of state power. In the early 1990s, this American ideology naturally became a part of the ideology of the international institutions in which the U.S. played a major role. Developing countries which came to these international institutions for help were usually told, and sometimes even required, to reduce the scope and power of their states.

In this short volume, Fukuyama shows how inappropriate - and even disastrous -- this American ideology is when applied indiscriminately in developing countries around the world. Claiming it is no longer supported by most academic empirical research, he provides a rough and tentative alternative to the idea of the shrinking state by demonstrating where states must be strong and where it is okay for them to scale down. Finally, he shows how such various global problems such as fighting terrorism and AIDS, the nonproliferation of WMD, and encouraging the spread of democracy, depend upon strong, not weak states, and that the U.S. and Europe must both come to terms (in their own ways) with this new international approach.

Fukuyama claims that what is needed is a paradigm shift. For much of the last half-century, the trend has been to weaken the state. Now, the evidence suggests that a new approach is needed, one that goes beyond simply shrinking or enlarging the state, and begins to deal with making the state more effective based on local conditions. While some basic outcomes (a democratic, capitalist state, for example) are to be expected, the way each nation gets there will be different.