Iran’s Ahmadinejad warmly welcomed in Latin America, or not quite?: Misgovernance in one chart
By Kaufmann | January 14, 2012 | 2 Comments »
Mahmoud Ahmadinejad’s visit to Latin America has received wide coverage. Much is being written about the fact that the President of Iran, increasingly isolated around the world, can count on a warm welcome in one continent, Latin America, providing him with excellent photo-ops embracing the region’s leaders, thereby stinging the U.S.
It is however misleading to group Latin America as one.
The bottom line is that Iran’s Ahmadinejad is being welcomed in only four countries. And the four welcoming countries exhibit very poor levels of governance, very much like Iran…
Topics: Aid Effectiveness, capture, Corruption, Measurement Frontiers, Voice and Human Rights | 2 Comments
Transparency, Conflict Minerals and Natural Resources: Debating Sections 1502 and 1504 of the Dodd-Frank Act
By Kaufmann | December 20, 2011 | No Comments »
With a focus on conflict minerals and natural resource transparency, Sections 1504 and 1502 of the Dodd-Frank Wall Street Financial Reform Act are unrelated to the U.S. banking system.
Yet they have stirred up controversy. As is often the case with provisions that aim at changing the rules of the game, Sections 1502 and 1504 have pitted stakeholders that support their passage and full implementation against the interests of those that wish to water them down or greatly delay their implementation. Last Tuesday, Brookings and Global Witness hosted an event at the National Press Club to examine the debate surrounding these two provisions*…
Topics: Aid Effectiveness, capture, Corruption, financial crisis, G-20, Public-Private Linkages, Regulation & Security, Rule of Law, Transparency, Voice and Human Rights | Read and Submit Comments
Transparency in Natural Resources and Conflict Minerals: What We May Not Know About Dodd-Frank
By Kaufmann | December 9, 2011 | No Comments »
The Dodd-Frank Wall Street Reform and Consumer Protection Act is the very well known piece of legislation that intends to regulate the U.S. financial market. The debate over the act and its implementation continues and I have contributed to that discussion in previous postings.
Yet, what is not so well known is how the Dodd-Frank Act extends beyond Wall Street and even the rest of the United States. There are two provisions in it that are intended to promote transparency and governance in natural resources in countries outside the United States…
Topics: Aid Effectiveness, Corruption, Public Financial Management, Public-Private Linkages, Regulation & Security, Rule of Law, Transparency, Voice and Human Rights | Read and Submit Comments
Judge Rakoff Challenge to the S.E.C.: Can Regulatory Capture be Reversed?
By Kaufmann | December 3, 2011 | No Comments »
Last Monday, Federal Judge Jed Rakoff issued a potentially precedent-setting challenge to the Securities Exchange Commission (SEC) when he rejected the $285 million settlement between the agency and Citigroup. The bank is charged with negligence related to its misleading sale of toxic mortgage-backed securities, which ultimately cost investors nearly $700 million but earned the bank a handsome profit of almost $160 million.
Analysts have focused on the immediate and narrow concern of how the SEC and Citigroup will respond to this challenge and on second-guessing what may satisfy Judge Rakoff. Three options exist: the agency could renegotiate a deal with the bank for a higher settlement and insert vague (and non-incriminating) language hinting at the bank’s culpability; it could allow the case to go to trial; or it could appeal the Judge’s decision. Some even suggest that the ruling may result in the SEC pursuing more cases administratively in the future…
Topics: capture, Corruption, financial crisis, Measurement Frontiers, Public Financial Management, Public-Private Linkages, Regulation & Security, Rule of Law, Transparency | Read and Submit Comments
Africa’s Dawn or Doom?: From Premature Exuberance to Tempered Optimism
By Kaufmann | August 28, 2011 | 3 Comments »
Earlier this summer, President Obama welcomed one day apart Gabonese President Ali Bongo and Nigerian President Goodluck Jonathan to the White House. Both countries share in common significant oil wealth, weak public institutions, and a large proportion of the population living in poverty.
Nigeria is ahead of the laggard Gabon in terms of developing democratic institutions, and has made inroads compared with its misgoverned authoritarian regims in past decades, even though it still faces considerable governance challenges, such as corruption (including in some provinces) and violence…
Topics: Aid Effectiveness, Corruption, G-20, Measurement Frontiers, Public-Private Linkages, Regulation & Security, Rule of Law, Voice and Human Rights | 3 Comments
Unexpected Earthquake in U.S. East Coast Spurs a Stock Market Rally?
By Kaufmann | August 24, 2011 | No Comments »
A rare earthquake of magnitude 5.8 shook the East Coast of the US earlier today, affecting Washington, D.C., New York, their environs some environs, and Virginia. While an earthquake of this magnitude carries a minimal fraction of the force of the mega-earthquakes experienced by countries like Chile, Japan, Indonesia and Haiti in recent years, it did rattle buildings and nerves.
And it raised questions about building safety in this geographical area, which is not known to be earthquake prone. Thus it has not been subject to the more stringent building codes that apply in places like California, not to speak about the large stock of very old structures which exists in the East Coast…
Topics: capture, financial crisis, G-20, Measurement Frontiers, Public Financial Management, Public-Private Linkages | Read and Submit Comments
Congress’ Dismal Performance Need Not Be the Case: A Governance Perspective
By Kaufmann | July 29, 2011 | No Comments »
According to a Gallup nationwide poll ten years ago, 55 percent of citizens approved of the way Congress was handling its job. That was in March 2001, before the surge in solidarity that resulted in Congressional approval ratings of 70-80 percent following the 9/11 terrorist attacks. By mid-2002, the approval ratings were back to pre-9/11 levels, at 54 percent in July 2002.
By July 2009, Congressional approval ratings declined to just 32 percent. Just prior to the debt-ceiling debate three weeks ago, they stood at 18 percent. These poll figures contradict Gallup’s expectation that there would be a surge in Congress’ popularity following the 2010 midterm elections. It had been suggested that Congress’ ratings may rise since that had been observed following some prior midterm elections. But not quite…
Topics: capture, Corruption, financial crisis, Measurement Frontiers, Public Financial Management, Public-Private Linkages, Regulation & Security, Rule of Law, Voice and Human Rights | Read and Submit Comments
Open Government Partnership: First Steps and the Road Ahead
By Kaufmann | July 23, 2011 | No Comments »
“When a government hides its work from public view, hands out jobs and money to political cronies, administers unequal justice, looks away as corrupt bureaucrats and businessmen enrich themselves at the people’s expense, that government is failing its citizens,” stated U.S. Secretary of State Hillary Clinton during the opening of the multi-country Open Government Partnership (OGP) Forum last week. She described the new OGP “as a network of support for those leaders and citizens working to bring more transparency and accountability to governments worldwide. This can be a lonely, sometimes even dangerous, task. But through this partnership, we hope to change that.”..
Topics: Aid Effectiveness, Corruption, G-20, Measurement Frontiers, Public Financial Management, Transparency, Voice and Human Rights | Read and Submit Comments
Preventing Nuclear Meltdown: Assessing Regulatory Failure in Japan and the United States
By Kaufmann | March 31, 2011 | No Comments »
Many wonder whether Japan’s nuclear disaster could have been averted. The embattled operator of the Fukushima nuclear plant, Tokyo Electric Power Company (TEPCO), has borne the brunt of criticism; its numerous failures over the years are certainly well known. However, Japan’s Nuclear and Industrial Safety Agency (NISA), responsible for regulating the nuclear industry, also ought to be subject to particular scrutiny for allowing TEPCO to operate despite its past safety and disclosure violations.
We thus ask what types of regulatory failure may have contributed to Japan’s nuclear crisis and assess whether the U.S. Nuclear Regulatory Commission (NRC) is at risk of committing similar errors*…
Topics: capture, financial crisis, G-20, Public-Private Linkages, Regulation & Security | Read and Submit Comments
Amid Global Crises, Can Obama Make a Real Impact in Latin America?
By Kaufmann | March 18, 2011 | 2 Comments »
President Obama’s tour of Latin America, including visits to Brazil, Chile and El Salvador, is starting this weekend. This visit is unlikely to constitute a historical watershed. It comes at a time when Obama faces three major crises— Libya’s ongoing civil conflict, Japan’s unfolding triple disaster, and the United States’ congressional impasse over the federal budget.
Thus, throughout his visit, Obama may confront issues far removed from Latin America. Fittingly, or ironically, Latin America has not been a priority for U.S. foreign policy in recent years. From a national security standpoint, there are a few exceptions, such as two important countries Obama will not visit, namely Colombia and Mexico, where narco-violence has attracted U.S. focus. Yet, that almost sums up the extent of U.S. foreign policy priorities vis-à-vis the continent so far…
Topics: capture, Corruption, financial crisis, G-20, Measurement Frontiers, Public Financial Management, Public-Private Linkages, Regulation & Security, Rule of Law | 2 Comments
On the Triple Disaster in Japan: Governance and the Earthquake, Tsunami and Nuclear Crises
By Kaufmann | March 16, 2011 | No Comments »
In light of the unprecedented triple disaster that has struck Japan, I contributed this Opinion article at Brookings with Veronika Penciakova (here). We discuss the governance failures in Japan that have exacerbated its nuclear crisis. Of particular concern is the extent of regulatory capture and failure in the nuclear industry, and the country’s lack of both transparency and resolute leadership, which is undermining public confidence. If this is not addressed, the disaster’s fallout is likely to be multiplied. Witnessing from afar the Fukushima plant disaster unfold, Chernobyl’s specter is looming larger by the hour, even in its political dimension.
Topics: capture, Regulation & Security, Transparency | Read and Submit Comments
Qaddafi’s Corrupt Influence in the West: a case of International State Capture?
By Kaufmann | March 7, 2011 | 2 Comments »
We know about the story in many countries of low level bureaucrats demanding a bribe to expedite the processing of a business license, or a driver’s permit, or to pay reduced taxes. For a long time, such administrative corruption has been the focus of research and measurement in the field of corruption. Administrative corruption is not very difficult to quantify. It is easy to talk about it in high levels of government and in international organization, and it is not very demanding to analyze it.
Unfortunately, bureaucratic or administrative corruption is far from being the most damaging type of corruption for a country, or internationally. High level political corruption, and within it, the particular form we have called ‘State Capture’, can be far more damaging where it is prevalent. We have been emphasizing the problem of state capture (the undue influence of the corporate elite in shaping the rules of the game) for well over a dozen years, including in countries like Russia and Ukraine (here), and also in the financial sector of the US (here), leading up to the recent Wall Street-induced global financial crisis…
Topics: capture, Corruption, G-20, Measurement Frontiers, Regulation & Security, Rule of Law, Voice and Human Rights | 2 Comments
Libya’s Startling Failure: Unforeseen or Ignored?
By Kaufmann | February 25, 2011 | 2 Comments »
A month ago, emboldened by the successful ousting of Tunisia’s Ben Ali, Egypt’s anti-government protesters took to the streets in Cairo demanding the resignation of Mubarak. And at that time, as pointed out in a previous post, many pundits wrote that the uprising in Tunisia was of a unique nature, that the reality in Egypt and other countries was rather different, and that a “domino effect” would not sweep the region. Many analysts and national governments were proved wrong in the case of Egypt; and now, with few exceptions, neither governments nor policy wonks anticipated the turn of events in Libya, which until a few short weeks ago was widely seen as a stable country…
Topics: Aid Effectiveness, Corruption, Measurement Frontiers, Regulation & Security, Rule of Law, Voice and Human Rights | 2 Comments
Financial Regulatory Capture Symposium at Fordham Law School
By Kaufmann | February 6, 2011 | No Comments »
The global financial crisis that started in Wall Street a few years ago brought to the forefront the notion of ‘capture’ in the financial sector. Policy-makers, experts and academics still disagree whether regulatory capture was a major determinant of the crisis. Nonetheless, the problem of capture has at least become an important part of the policy debate in the US. This is in sharp contrast with the past, when the problem of capture tended to be ignored in the US, and associated with countries like Russia instead.
Even among those who write about capture in the US there is a lively debate regarding what constitutes capture, and which manifestations of capture matter in particular in the US. The terminology has been steadily expanding, and include terms such as state capture (which we used and analyzed well over a decade ago first in transition countries), regulatory capture, cognitive capture, social and cultural capture, soft and hard capture, among others…
Topics: capture, Corruption, financial crisis, Measurement Frontiers, Public-Private Linkages, Regulation & Security | Read and Submit Comments
Tunisia, Egypt and Beyond: Fewer Predictions, More Data and Aid Reform Needed
By Kaufmann | February 2, 2011 | 5 Comments »
Nobody predicted that the desperate act of a young Tunisian who set himself on fire in protest of government policies that had left him jobless and disenfranchised would ignite protests for democratic and economic reforms across the Middle East.
Since this incident, Tunisia’s government has fallen and demonstrations have spread to Yemen, Jordan, Algeria, Sudan and Egypt, where only yesterday well over a million people took to the streets to demand the ousting of President Mubarak, whose days appear numbered.
And Yemen’s president has also announced that he will not seek re-election or hand power to his son, while the prime minister and government of Jordan was dismissed by the King after demonstrations. The world has been watching and Middle East experts, politicians and pundits have weighed in on the unfolding events. Many wonder whether we could have foreseen this wave of unrest…
Topics: Aid Effectiveness, Corruption, Measurement Frontiers, Regulation & Security, Transparency, Voice and Human Rights | 5 Comments
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