When is a failed state not?

I have to believe that one of the least favorite jobs in Washington is being an author or contributor to one of the annual reports that make you a target of unhappy embassies. Whether it’s from the roll call of State Department publications, which includes Human Rights Reports, International Religious Freedom Reports, Trafficking-in-Person Reports, Advancing Freedom and Democracy Reports, or those from NGOs such as Reporters without Borders, Amnesty International, The Heritage Foundation, or any of the dozens of other national and international reports used by the Millennium Challenge Corporation in its selection criteria, being the messenger is no easy task.

Over the past decade, there is a special place of skepticism reserved for the annual Failed States Index (FSI) published by the Fund for Peace, now in its ninth year and increasingly detailed and sophisticated. The title is a bit misleading as the report is not a predictive tool of state failure but rather an assessment of more than 100 internal factors that affect a country’s stability. Of course, since the data is based on the calendar year, the first yellow flag is what has occurred following the six months it takes to prepare the report that could affect a country’s ranking. The natural inclination is to look at a country’s rating and then compare it to others, breathing a sigh of either relief or exasperation. But that’s not where the substance is, and those who take the time to read the key indicators grouped into 12 categories can benefit from the extraordinary analytical efforts the FSI involves.

What makes the FSI useful

Why am I a fan?  Because I believe that the real benefit of FSI is as a tool to facilitate discussion among a country’s stakeholders about its ambitions, core values, and means of delivering credible governance and equitable opportunities. It is less important to be chagrined that the 2012 rankings have France and Portugal in better shape than the US, and more important to drill down into the social and economic indicators (demographic pressures, group grievance, refugees and Internally Displaced Persons, human flight and brain drain, uneven economic development, poverty and economic decline) and political and military indicators (state legitimacy, public services, human rights and law, security apparatus, factionalized elites, and external intervention) to understand why.

In terms of methodology, the FSI relies on crunching tens of millions of pieces of information from around the world, which is then sorted into the 12 key indicators. “The content analysis is further triangulated with two other key aspects of the overall assessment process: quantitative analysis and qualitative inputs based on major events in the countries examined.” Final quality control is a review of the results and comparison with a “comprehensive set of vital statistics …as well as human analysis to ensure that the software has not misinterpreted the raw data.”

Lessons about state building

So what do we learn about state building from this year’s index? In the first instance, countries that work harder on capacity building over the long term are better able to withstand natural and man-made shocks that would drive weaker countries into crisis. It is a country’s ability to deliver a broad range of social services to greater numbers of its citizens while driving more equitable political participation that parallels the recommendations in the CFR report I mentioned last week.

Secondly, there are no magic bullets—not elections, not foreign assistance or intervention, nor increasing social benefits—that will reduce instability rooted in economic inequality, political marginalization, and degraded rule of law. Countries with large disparities in wealth, political access and influence, and public safety tend to be less stable than those that have fewer gaps (yes, Egypt was worse than Mali, but barely). In the section on the Arab Spring, it notes that the 2010 data “tells the story of a storm birthed in North Africa…indicators for Group Grievance and Human Rights were gradually and inexorably getting worse. In November 2010, there was a dramatic regional increase (not a good thing, the higher the score, the worse the ranking) in the State Legitimacy score…that has yet to come back down.”

Well, there may be a claim that this is all hindsight, and in fact the human analysis that is part of the process makes it inherently biased. Or one could take lessons from where the data and negative events have a high correlation, as in the example above, and draw analytical and policy lessons that increase our understanding of managing conflict before it become chaos or worse.

The FSI draws back the curtain on the complexities of state-building by enumerating the challenges, represented by the 100+ indicators that make up the profile of a country’s internal heartbeat. Rather than wait until the patient is in triage or functional failure, international donors and organizations can use this data and other sources to support dialogues with countries at risk to enable them to develop more robust strategies for reducing instability. Even isolated countries such as North Korea or far-away places like Somalia impact our lives. The FSI is a tool that helps us understand the caution flags that increasingly populate our mental maps of countries. It is this kind of solid data tied to the concurrence of values and interests that will enable policy makers and stakeholders to make the right choices.

Defining a nation-state in the 21st century – part 1

With the growing onslaught of ethnic and minority conflicts in much of the emerging world, it often appears that we are on the edge of shaking out the structure of the Westphalian state system without a clear notion of what is to come. More than a dozen countries in the Middle East and North Africa, South Asia, and Latin America are going through significant crises in terms of governance and the emergence of new players in the political space. While the likelihood of more Sudan/South Sudan or Yugoslavia splits is not clear, the options for a greater number of federations and autonomous units cannot be ignored.

A recent publication helps frame a strategic discussion about avoiding the next Egypt or Mali by recognizing what promotes national stability and integrity. “Pathways to Freedom: Political and Economic Lessons from Democratic Transitions” is a volume of essays published by the Council on Foreign Relations, edited by Isobel Coleman and Terra Lawson-Remer. It is useful both for what is says and what it cannot. Based on the case studies in the collection, the generalizations offered in the first chapter “Statistical Evidence” put several assumptions about trends in national development under the microscope. Its conclusion: “Quantitative evidence has been relatively successful in explaining long-run democratic trajectories, but it cannot predict revolutions or coups in the short term, and it is impossible to know when or how particular reforms might happen. Three priorities emerge from quantitative analysis…increasing the capacity for nonviolent protests against autocratic regimes…support for multiparty elections…maximizing access to mass media…to safeguard democratic progress already achieved…in the short run, promoting democracy and prosperity may be incompatible.” The final point is unfortunately underscored by the continuing unrest in Arab countries where greater employment opportunities have yet to be achieved.


Apropos this observation is the first recommendation in the final chapter: “New democratic governments should move quickly to adopt policies aimed at materially improving the lives of the poor and dealing with unemployment,” with the caveat “without creating dependency on unsustainable and distortionary economic policies in the longer term.” In Egypt, Libya, or elsewhere, the mantra of jobs, jobs, jobs has yet to dominate the debate within governments, although it is certainly the priority on the Arab street. Employment and more equitable distribution of subsidies will not disappear from the agenda despite the difficulties of implementation.

The second recommendation focuses on judicial reform. “Rule of law reforms that establish a fair and level playing field and that prevents elites from bending the rules to serve their interests are critical.” Again a telling caveat: don’t use outside models; rather work “with local partners to bolster domestic pressures for reforms…take a bottom-up, capacity-building approach that supports the ability of average citizens to exercise their rights and the legal system’s ability to implement laws consistently and fairly.” Without an integrative model that is respectful of local jurisprudence and without ensuring that citizens can employ the law as it is intended, judicial reform may become a hollow exercise.

I particularly find the third recommendation instructive and reasonable for start-up governments. “Transitional countries should decentralize in ways that help deepen and sustain democratization efforts.” It is important that governments are present in a positive way in people’s lives. Investing in a higher degree of social services has two immediate benefits: it creates jobs for the new service providers, who should be recruited from and trained in local communities; and it shrinks the space for opportunities for services provided by forces that may not support the inclusive goals of the new regime.
The fourth recommendation takes a glass-half-full perspective on elections. “Conducting even flawed elections under authoritarian governments is worthwhile” primarily because they give the outside world an opportunity to critique the process and give local groups experience in organizing. One can see this clearly in the ability of the Islamic parties, particularly those like Morocco’s PJD, which spent time as an opposition party, quickly seizing center stage as broad political reforms are implemented.

The report also addresses positive actions by the international community, including “support[ing] civil society and independent media under authoritarian regimes through civic exchanges, capacity building, and bottom-up technology transfers.” There is a strong economic support role for technology transfer, technical assistance, sharing best practices, and supporting civil society empowerment. The report notes that “foreign governments and international and regional organizations must strive to compensate for bad [neighbors] by mobilizing to give domestic democratic reformers support in economic restructuring and investing for inclusive growth … access to preferential trade, investment, and security agreements should be conditioned on the implementation of homegrown governance reforms that improve accountability in the long term.” A particularly important caveat addresses the need to support the growth of a middle class “rather than promote economic ties that increase the overall growth and wealth but concentrate these gains in the hands of elites.”

The details in the report are more robust than what is summarized here, and the whole thing is worth reading for its analytics and as a measure of policy options being pursued by the US in the Middle East and elsewhere. The report closes with the following: “Even with the best circumstances and wisest decisions by policymakers and publics, the road to democratic consolidation is long and difficult. But there are no failed aspirations for human freedom: dreams of liberty and opportunity are sometimes long deferred, but they cannot be forever denied.”

Amen to that. Next week, I take a look at the 2013 Failed States Index for more lessons on state-building.