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57318e5
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But the late seventeenth century does provide an important model of how patrimonialism can be reversed that has some relevance to present-day anticorruption efforts. All of the elements that came together to produce the late Stuart reforms are still critical: an external environment that puts fiscal pressure on the government to improve its performance; a chief executive who, if not personally leading the reform effort, is at least not bloc..
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Francis Fukuyama |
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67c65b6
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The repeated demand for "justice," incorporated into the names of many Islamist parties, reflects not so much a demand for social equality as a demand for equal treatment under the law."
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Francis Fukuyama |
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c95f564
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And indeed today as it struggles with its financial crisis, the central issue in Greek politics remains resentment of the influence of Brussels, Germany, the International Monetary Fund, and other external actors, which are seen as pulling strings behind the back of a weak Greek government. Although there is considerable distrust of government in American political culture, by contrast, the basic legitimacy of democratic institutions runs v..
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Francis Fukuyama |
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01f5b18
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We are taking the time to consider the Hungarian case for a simple reason: to show that constitutional limits on a central government's power do not by themselves necessarily produce political accountability. The "freedom" sought by the Hungarian noble class was the freedom to exploit their own peasants more thoroughly, and the absence of a strong central state allowed them to do just that. Everyone understands the Chinese form of tyranny, ..
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Francis Fukuyama |
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277a2bf
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Slavery and serfdom, while not unknown in tribal societies, expand enormously under the aegis of states.
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Francis Fukuyama |
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a71f240
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How the new Chinese middle class behaves in the coming years will be the most important test of the universality of liberal democracy. If it continues to grow in absolute and relative size, and yet remains content to live under the benevolent tutelage of a single-party dictatorship, one would have to say that China is culturally different from other societies around the world in its support for authoritarian government. If, however, it gene..
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Francis Fukuyama |
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463ecc3
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In my view, Greek distrust is rooted in politics, particularly in the absence of a strong, impartial state, but over the years it has perpetuated itself as a cultural habit. Distrust has been pervasive in both traditional rural Greek society and in the bitter political struggles of the twentieth century. Greeks have been divided by family, kinship, region, class, and ideology, despite the fact that Greece is one of the world's most ethnical..
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Francis Fukuyama |
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be3eebf
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In the period immediately following ratification of the Constitution in 1789, the national public service at its upper levels has been described as a "Government by Gentlemen" and it did not look too different in certain respects from the one that existed in early-nineteenth-century Britain.8 One might also label it government by the friends of George Washington, since the republic's first president chose men like himself who he felt had go..
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Francis Fukuyama |
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a9eb002
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Given the novelty of this organization, lines of authority were confused. Although Bremer nominally worked for and reported to Defense Secretary Rumsfeld, he increasingly dealt directly with the White House staff and bypassed the Pentagon bureaucracy. Relationships with the local U.S. military command were reportedly both strained and confused. The massive U.S. military presence and its role in providing law and order were regarded as incre..
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Francis Fukuyama |
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d36b15a
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The government's perpetual failure to live up to debt obligations was an alternative to taxing these same elites directly, which the regime found much more difficult to do politically. It is a tradition carried on by contemporary governments in Latin America, such as that of Argentina, which after the economic crisis of 2001 forced not just foreign investors but also its own pensioners and savers to accept a massive write-down of its sovere..
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Francis Fukuyama |
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e9b2dcc
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Should it happen that the community where they are born be drugged with long years of peace and quiet, many of the high-born youths voluntarily seek those tribes which are at the time engaged in some war; for rest is unwelcome to the race, and they distinguish themselves more readily in the midst of uncertainties: besides, you cannot keep up a great retinue except by war and violence ... you will not so readily persuade them to plough the l..
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Francis Fukuyama |
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ea56c91
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Many believed that the Mafia, clientelism, and corruption represented traditional social practices that would gradually erode as the country modernized economically.
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Francis Fukuyama |
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b7cdcc5
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There were, however, countervailing forces. The independence of the Italian judiciary had been reinforced by the recruitment of a generation of idealistic lawyers in the wake of the global uprisings of 1968.
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Francis Fukuyama |
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7bcbdf4
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The parallels between contemporary Russia and the society that emerged in the hundred years following the death of Peter the Great are striking. Despite modern Russia's formal constitution and written laws, the country is run by shadowy elite networks that resemble the Saltykov and Naryshkin families that used to control imperial Russia. These elites have access to power in ways that are not defined either by law or regularized procedure. B..
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Francis Fukuyama |
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0900b5a
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Russia prior to the Bolshevik Revolution had developed a strongly centralized state, in which executive power was only weakly constrained by either rule of law or accountable legislatures. The nature of the absolutism that was achieved in pre-Bolshevik Russia was qualitatively different from that of either old regime France or Spain, and much closer to the premodern Chinese or Ottoman variants.
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Francis Fukuyama |
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42ae857
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Most neoclassical economists would argue that state-owned firms will inevitably be less efficient than private ones because the state lacks the proper incentives to run enterprises efficiently. The state does not have to fear bankruptcy, since it can keep businesses going out of tax dollars or, at worst, by printing money. It also has strong incentives to use the firm for political ends like job creation and patronage. These deficiencies of..
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Francis Fukuyama |
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9c6ab07
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The low-trust, family-oriented societies with weak intermediate organizations we have observed have all been characterized by a similar saddle-shaped distribution of enterprises. Taiwan, Hong Kong, Italy, and France have a host of smaller private firms that constitute the entrepreneurial core of their economies and a small number of very large, state-owned firms at the other end of the scale. In such societies, the state plays an important ..
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Francis Fukuyama |
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574eb6f
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At the root of the problems of Greece and Italy is the fact that both countries have used public employment as a source of political patronage, leading to bloated and inefficient public services and ballooning budget deficits. Germany, as we saw in chapter 4, inherited an autonomous, merit-based, modern bureaucracy from absolutist times. Modernization of the state occurred prior to the arrival of full democratic participation. Political par..
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Francis Fukuyama |
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d9e122e
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while Koreans also are relatively group-oriented, they also have a strong individualistic streak like most Westerners. Koreans frequently joke that an individual Korean can beat an individual Japanese, but that a group of Koreans are certain to be beaten by a group of Japanese."36 The rate of employee turnover, raiding of other companies' skilled labor, and the like are all higher in Korea than in Japan.37 Anecdotally, there would seem to b..
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Francis Fukuyama |
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01413d0
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In opting for large scale, Korean state planners got much of what they bargained for. Korean companies today compete globally with the Americans and Japanese in highly capital-intensive sectors like semiconductors, aerospace, consumer electronics, and automobiles, where they are far ahead of most Taiwanese or Hong Kong companies. Unlike Southeast Asia, the Koreans have moved into these sectors not primarily through joint ventures where the ..
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Francis Fukuyama |
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8e07b30
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There are other problems more closely related to the question of culture. The poor fit between large scale and Korea's familistic tendencies has probably been a net drag on efficiency. The culture has slowed the introduction of professional managers in situations where, in contrast to small-scale Chinese businesses, they are desperately needed. Further, the relatively low-trust character of Korean culture does not allow Korean chaebol to ex..
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Francis Fukuyama |
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68b2eb5
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Between economic growth and social development, or the development of civil society A lot of classic social theory links the emergence of modern civil society to economic development.28 Adam Smith in The Wealth of Nations noted that the growth of markets was related to the division of labor in society: as markets expand and firms take advantage of economies of scale, social specialization increases and new social groups (for example, the in..
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Francis Fukuyama |
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9672bdd
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Imagination is a very scarce resource, and also a highly imperfect one, because thinking about things that have not happened is inherently more difficult than thinking about things that have.
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Francis Fukuyama |
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4ef17fa
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The great concentration of wealth in the hands of the owners of chaebol has also had the consequence feared by the KMT in Taiwan: the entry into politics of a wealthy industrialist. This happened for the first time with the candidacy of Chung Ju Yung, founder of Hyundai, for president in the 1993 election. There is, of course, nothing wrong with a Ross Perot-style billionaire's entering politics in a democracy, but the degree of concentrate..
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Francis Fukuyama |
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8f355b4
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Family life, which constitutes the smallest and most basic form of association, has deteriorated markedly since the 1960s with a sharp increase in rates of divorce and single-parent families. Beyond the family, too, there has been a steady breakdown of older communities like neighborhoods, churches, and workplaces. At the same time, there has been a vast increase in the general level of distrust, as measured by the wariness that Americans h..
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Francis Fukuyama |
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8b685c5
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The increases in productivity brought about by Ford's innovation were startling and revolutionized not just the automobile industry but virtually every industry serving a mass market. Introduction of "Fordist" mass production techniques became something of a fad outside America: German industry went through a period of "rationalization" in the mid-1920s as manufacturers sought to import the most "advanced" American organizational techniques..
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Francis Fukuyama |
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a9bd0ea
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When we step back from contemporary American debates over family values, we find that the family paradoxically does not always play a positive role in promoting economic growth. The earlier social theorists who saw the strong family as an obstacle to economic development were not entirely wrong. In some cultures, such as in those of China and certain regions of Italy, the family looms much larger than other forms of association. This fact h..
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Francis Fukuyama |
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34eb0c8
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Friction-Free Economies Why is it necessary to turn to a cultural characteristic like spontaneous sociability to explain the existence of large-scale corporations in an economy, or prosperity more generally? Wasn't the modern system of contract and commercial law invented precisely to get around the need for business associates to trust one another as family members do? Advanced industrialized societies have created comprehensive legal fram..
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Francis Fukuyama |
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75f360d
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Between social mobilization and liberal democracy From Alexis de Tocqueville onward there has been a large body of democratic theory arguing that modern liberal democracy cannot exist without a vigorous civil society.29 The mobilization of social groups allows weak individuals to pool their interests and enter the political system; even when social groups do not seek political objectives, voluntary associations have spillover effects in fos..
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Francis Fukuyama |
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087aa73
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The main problem facing immigrant communities was to change the sort of sociability they practiced from an ascriptive to a voluntary form. That is, the traditional social structures they brought with them were based on family, ethnicity, geographic origin, or some other characteristic with which they were born. For the first generation that landed in the United States, they created the trust necessary for revolving credit associations, fami..
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Francis Fukuyama |
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859cf1e
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Liberal democracy and capitalism remain the essential, indeed the only, framework for the political and economic organization of modern societies. Rapid economic modernization is closing the gap between many former Third World countries and the industrialized North. With European integration and North American free trade, the web of economic ties within each region will thicken, and sharp cultural boundaries will become increasingly fuzzy. ..
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Francis Fukuyama |
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905e5d5
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Between state building and economic growth Having a state is a basic precondition for intensive economic growth. The economist Paul Collier has demonstrated the converse of this proposition, namely, that state breakdown, civil war, and interstate conflict have very negative consequences for growth.20 A great deal of Africa's poverty in the late twentieth century was related to the fact that states there were very weak and subject to constan..
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Francis Fukuyama |
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e755352
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There were other important reasons for the growth of American individualism at the expense of community in the second half of the twentieth century besides the nature of capitalism. The first arose as an unintended consequence of a number of liberal reforms of the 1960s and 1970s. Slum clearance uprooted and destroyed many of the social networks that existed in poor neighborhoods, replacing them with an anonymous and increasingly dangerous ..
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Francis Fukuyama |
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81ee46c
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On the other hand, there are a number of cases where economic growth did not produce better governance, but where, to the contrary, it was good governance that was responsible for growth. Consider South Korea and Nigeria. In 1954, following the Korean War, South Korea's per capita GDP was lower than that of Nigeria, which was to win its independence from Britain in 1960. Over the following fifty years, Nigeria took in more than $300 billion..
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Francis Fukuyama |
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7701a8c
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Between economic growth and stable democracy The correlation between development and democracy was first noted by the sociologist Seymour Martin Lipset in the late 1950s, and ever since then there have been many studies linking development to democracy.25 The relationship between growth and democracy may not be linear--that is, more growth does not necessarily always produce more democracy. The economist Robert Barro has shown that the corr..
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Francis Fukuyama |
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968e7c3
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Between rule of law and growth In the academic literature, the rule of law is sometimes considered a component of governance and sometimes considered a separate dimension of development (as I am doing here). As noted in chapter 17, the key aspects of rule of law that are linked to growth are property rights and contract enforcement. There is a large literature demonstrating that this correlation exists. Most economists take this relationshi..
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Francis Fukuyama |
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780f778
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Francis Fukuyama |
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ca48035
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Between democracy and rule of law There has always been a close historical association between the rise of democracy and the rise of liberal rule of law.32 As we saw in chapter 27, the rise of accountable government in England was inseparable from the defense of the Common Law. Extension of the rule of law to apply to wider circles of citizens has always been seen as a key component of democracy itself. This association has continued throug..
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Francis Fukuyama |
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699cf8f
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Among ideas, legitimacy, and all of the other dimensions of development Ideas concerning legitimacy develop according to their own logic, but they are also shaped by economic, political, and social development. The history of the twentieth century would have looked quite different without the writings of an obscure scribbler in the British Library, Karl Marx, who systematized a critique of early capitalism. Similarly, communism collapsed in..
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Francis Fukuyama |
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46d790d
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As with Japanese keiretsu, the member firms in a Korean chaebol own shares in each other and tend to collaborate with each other on what is often a nonprice basis. The Korean chaebol differs from the Japanese prewar zaibatsu or postwar keiretsu, however, in a number of significant ways. First and perhaps most important, Korean network organizations were not centered around a private bank or other financial institution in the way the Japanes..
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Francis Fukuyama |
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d44a13b
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Indeed, the consensual nature of the EU itself has meant that EU-level institutions are far weaker than certain federal institutions in the United States. These weaknesses were made painfully evident in the European debt crisis of 2010-2013. The United States Federal Reserve, Treasury, and Congress responded quite forcefully to its financial crisis, with a massive expansion of the Federal Reserve's balance sheet, the $700 billion TARP, a se..
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Francis Fukuyama |
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010f8a7
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The United States is trapped in a bad equilibrium. Because Americans historically distrust the government, they typically aren't willing to delegate to the government authority to make decisions in the manner of other democratic societies. Instead, Congress mandates complex rules that reduce the government's autonomy and make decisions slow and expensive. The government then doesn't perform well, which confirms people's original distrust. U..
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Francis Fukuyama |
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1a24581
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Many of these problems could be solved if the United States moved to a more unified parliamentary system of government, but so radical a change in the country's institutional structure is inconceivable. Americans regard their Constitution as a quasi-religious document, so getting them to rethink its most basic tenets would be an uphill struggle. I think that any realistic reform program would try to trim veto points or insert parliamentary-..
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Francis Fukuyama |
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90603bc
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Because culture is a matter of ethical habit, it changes very slowly--much more slowly than ideas. When the Berlin Wall was dismantled and communism crumbled in 1989-1990, the governing ideology in Eastern Europe and the Soviet Union changed overnight from Marxism-Leninism to markets and democracy. Similarly, in some Latin American countries, statist or nationalist economic ideologies like import substitution were wiped away in less than a ..
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Francis Fukuyama |