Kleptocracy
Encyclopedia
Kleptocracy, alternatively cleptocracy or kleptarchy, (from (thief) and κράτος (rule), "rule by thieves") is a form of political and government corruption where the government exists to increase the personal wealth and political power of its officials and the ruling class
at the expense of the wider population, often without pretense of honest service. This type of government corruption is often achieved by the embezzlement
of state funds.
s, oligarchies, military juntas, or some other forms of autocratic
and nepotist
government in which no outside oversight is possible, due to the ability of the kleptocrat(s) to personally control both the supply of public funds and the means of determining their disbursal. Kleptocratic rulers typically treat their country's treasury
as though it were their own personal bank account, spending the funds on luxury good
s as they see fit. Many kleptocratic rulers also secretly transfer public funds into secret personal numbered bank accounts in foreign countries in order to provide them with continued luxury if/when they are eventually removed from power and forced to flee the country.
Kleptocracy is most common in third-world countries where the economy (often as a legacy of colonialism
) is dominated by resource extraction
. Such incomes constitute a form of economic rent
and are therefore easier to siphon off without causing the income itself to decrease (for example, due to capital flight
as investors pull out to escape the high taxes levied by the kleptocrats).
An early phase of this is driven by tenderpreneur
elites who seek to capture resources for personal benefit.
, political affairs and civil rights. Kleptocracy in government often vitiates prospects of foreign investment and drastically weakens the domestic market and cross-border trade. As the kleptocracy normally embezzles money from its citizens by misusing funds derived from tax payments, or money laundering schemes, a kleptocratically structured political system tends to degrade nearly everyone's quality of life.
In addition, the money that kleptocrats steal is often taken from funds that were earmarked for public amenities, such as the building of hospitals, schools, roads, parks and the like - which has further adverse effects on the quality of life of the citizens living under a kleptocracy. The quasi-oligarchy that results from a kleptocratic elite also subverts democracy (or any other political format the state is ostensibly under).
released a list of what it believes to be the ten most self-enriching leaders in recent years.
In order of amount allegedly stolen (in USD), they were:
In addition, other sources have listed former PLO Chairman Yasser Arafat
as having stolen $1 billion to $10 billion; and Pakistani President
Asif Ali Zardari
to have received kickbacks on contracts and misappropriating public funds, siphoning over $2 billion to his Swiss accounts.
The term has its origin in a report prepared by a subcommittee of the United States Senate
Foreign Relations Committee, chaired by Massachusetts
Senator
John Kerry
. The term was used specifically to describe the regime of Manuel Noriega
in Panama
.
Ruling class
The term ruling class refers to the social class of a given society that decides upon and sets that society's political policy - assuming there is one such particular class in the given society....
at the expense of the wider population, often without pretense of honest service. This type of government corruption is often achieved by the embezzlement
Embezzlement
Embezzlement is the act of dishonestly appropriating or secreting assets by one or more individuals to whom such assets have been entrusted....
of state funds.
Characteristics
Kleptocracies are generally associated with corrupt forms of authoritarian governments, particularly dictatorshipDictatorship
A dictatorship is defined as an autocratic form of government in which the government is ruled by an individual, the dictator. It has three possible meanings:...
s, oligarchies, military juntas, or some other forms of autocratic
Autocracy
An autocracy is a form of government in which one person is the supreme power within the state. It is derived from the Greek : and , and may be translated as "one who rules by himself". It is distinct from oligarchy and democracy...
and nepotist
Nepotism
Nepotism is favoritism granted to relatives regardless of merit. The word nepotism is from the Latin word nepos, nepotis , from which modern Romanian nepot and Italian nipote, "nephew" or "grandchild" are also descended....
government in which no outside oversight is possible, due to the ability of the kleptocrat(s) to personally control both the supply of public funds and the means of determining their disbursal. Kleptocratic rulers typically treat their country's treasury
Treasury
A treasury is either*A government department related to finance and taxation.*A place where currency or precious items is/are kept....
as though it were their own personal bank account, spending the funds on luxury good
Luxury good
Luxury goods are products and services that are not considered essential and associated with affluence.The concept of luxury has been present in various forms since the beginning of civilization. Its role was just as important in ancient western and eastern empires as it is in modern societies...
s as they see fit. Many kleptocratic rulers also secretly transfer public funds into secret personal numbered bank accounts in foreign countries in order to provide them with continued luxury if/when they are eventually removed from power and forced to flee the country.
Kleptocracy is most common in third-world countries where the economy (often as a legacy of colonialism
Colonialism
Colonialism is the establishment, maintenance, acquisition and expansion of colonies in one territory by people from another territory. It is a process whereby the metropole claims sovereignty over the colony and the social structure, government, and economics of the colony are changed by...
) is dominated by resource extraction
Resource extraction
The related terms natural resource extraction both refer to the practice of locating, acquiring and selling natural resources....
. Such incomes constitute a form of economic rent
Economic rent
Economic rent is typically defined by economists as payment for goods and services beyond the amount needed to bring the required factors of production into a production process and sustain supply. A recipient of economic rent is a rentier....
and are therefore easier to siphon off without causing the income itself to decrease (for example, due to capital flight
Capital flight
Capital flight, in economics, occurs when assets and/or money rapidly flow out of a country, due to an economic event and that disturbs investors and causes them to lower their valuation of the assets in that country, or otherwise to lose confidence in its economic...
as investors pull out to escape the high taxes levied by the kleptocrats).
An early phase of this is driven by tenderpreneur
Tenderpreneur
Tenderpreneur is a South African term used to describe a government official or politician who uses their powers and influence to secure government tenders and contracts...
elites who seek to capture resources for personal benefit.
Effects
The effects of a kleptocratic regime or government on a nation are typically adverse in regards to the faring of the state's economyEconomy
An economy consists of the economic system of a country or other area; the labor, capital and land resources; and the manufacturing, trade, distribution, and consumption of goods and services of that area...
, political affairs and civil rights. Kleptocracy in government often vitiates prospects of foreign investment and drastically weakens the domestic market and cross-border trade. As the kleptocracy normally embezzles money from its citizens by misusing funds derived from tax payments, or money laundering schemes, a kleptocratically structured political system tends to degrade nearly everyone's quality of life.
In addition, the money that kleptocrats steal is often taken from funds that were earmarked for public amenities, such as the building of hospitals, schools, roads, parks and the like - which has further adverse effects on the quality of life of the citizens living under a kleptocracy. The quasi-oligarchy that results from a kleptocratic elite also subverts democracy (or any other political format the state is ostensibly under).
International ranking
In early 2004, the anti-corruption Germany-based NGO Transparency InternationalTransparency International
Transparency International is a non-governmental organization that monitors and publicizes corporate and political corruption in international development. It publishes an annual Corruption Perceptions Index, a comparative listing of corruption worldwide...
released a list of what it believes to be the ten most self-enriching leaders in recent years.
In order of amount allegedly stolen (in USD), they were:
- Former RussiaRussiaRussia or , officially known as both Russia and the Russian Federation , is a country in northern Eurasia. It is a federal semi-presidential republic, comprising 83 federal subjects...
n President Putin ($40 billion) - Former IndonesiaIndonesiaIndonesia , officially the Republic of Indonesia , is a country in Southeast Asia and Oceania. Indonesia is an archipelago comprising approximately 13,000 islands. It has 33 provinces with over 238 million people, and is the world's fourth most populous country. Indonesia is a republic, with an...
n President Suharto ($15 billion – $35 billion) - Former PhilippinePhilippinesThe Philippines , officially known as the Republic of the Philippines , is a country in Southeast Asia in the western Pacific Ocean. To its north across the Luzon Strait lies Taiwan. West across the South China Sea sits Vietnam...
President Ferdinand MarcosFerdinand MarcosFerdinand Emmanuel Edralin Marcos, Sr. was a Filipino leader and an authoritarian President of the Philippines from 1965 to 1986. He was a lawyer, member of the Philippine House of Representatives and a member of the Philippine Senate...
($5 billion – $10 billion) - Former ZairianZaireThe Republic of Zaire was the name of the present Democratic Republic of the Congo between 27 October 1971 and 17 May 1997. The name of Zaire derives from the , itself an adaptation of the Kongo word nzere or nzadi, or "the river that swallows all rivers".-Self-proclaimed Father of the Nation:In...
President Mobutu Sese SekoMobutu Sese SekoMobutu Sese Seko Nkuku Ngbendu wa Za Banga , commonly known as Mobutu or Mobutu Sese Seko , born Joseph-Désiré Mobutu, was the President of the Democratic Republic of the Congo from 1965 to 1997...
($5 billion) - Former NigeriaNigeriaNigeria , officially the Federal Republic of Nigeria, is a federal constitutional republic comprising 36 states and its Federal Capital Territory, Abuja. The country is located in West Africa and shares land borders with the Republic of Benin in the west, Chad and Cameroon in the east, and Niger in...
n Head of State Sani AbachaSani AbachaGeneral Sani Abacha was a Nigerian military leader and politician. A Kanuri from Borno by tribe, he was born and brought up in Kano, Nigeria. He was the de facto President of Nigeria from 1993 to 1998....
($2 billion – $5 billion) - Former Yugoslav and SerbiaSerbiaSerbia , officially the Republic of Serbia , is a landlocked country located at the crossroads of Central and Southeast Europe, covering the southern part of the Carpathian basin and the central part of the Balkans...
n President Slobodan MiloševićSlobodan MiloševićSlobodan Milošević was President of Serbia and Yugoslavia. He served as the President of Socialist Republic of Serbia and Republic of Serbia from 1989 until 1997 in three terms and as President of the Federal Republic of Yugoslavia from 1997 to 2000...
($1 billion) - Former HaitiHaitiHaiti , officially the Republic of Haiti , is a Caribbean country. It occupies the western, smaller portion of the island of Hispaniola, in the Greater Antillean archipelago, which it shares with the Dominican Republic. Ayiti was the indigenous Taíno or Amerindian name for the island...
an President Jean-Claude DuvalierJean-Claude DuvalierJean-Claude Duvalier, nicknamed "Bébé Doc" or "Baby Doc" was the President of Haiti from 1971 until his overthrow by a popular uprising in 1986. He succeeded his father, François "Papa Doc" Duvalier, as the ruler of Haiti upon his father's death in 1971...
($300 million – $800 million) - Former PeruPeruPeru , officially the Republic of Peru , is a country in western South America. It is bordered on the north by Ecuador and Colombia, on the east by Brazil, on the southeast by Bolivia, on the south by Chile, and on the west by the Pacific Ocean....
vian President Alberto FujimoriAlberto FujimoriAlberto Fujimori Fujimori served as President of Peru from 28 July 1990 to 17 November 2000. A controversial figure, Fujimori has been credited with the creation of Fujimorism, uprooting terrorism in Peru and restoring its macroeconomic stability, though his methods have drawn charges of...
($600 million) - Former UkrainianUkraineUkraine is a country in Eastern Europe. It has an area of 603,628 km², making it the second largest contiguous country on the European continent, after Russia...
Prime Minister Pavlo LazarenkoPavlo LazarenkoPavlo Ivanovych Lazarenko is a former Ukrainian politician and former Prime Minister who, in August 2006, was convicted and sentenced to prison in the United States for money laundering, wire fraud and extortion...
($114 million – $200 million) - Former NicaraguaNicaraguaNicaragua is the largest country in the Central American American isthmus, bordered by Honduras to the north and Costa Rica to the south. The country is situated between 11 and 14 degrees north of the Equator in the Northern Hemisphere, which places it entirely within the tropics. The Pacific Ocean...
n President Arnoldo AlemánArnoldo AlemánJosé Arnoldo Alemán Lacayo was the 81st President of Nicaragua from 10 January 1997 to 10 January 2002.-Biography:Alemán was born in Managua and received his early education at the La Salle institute in Managua...
($100 million) - Former PhilippinePhilippinesThe Philippines , officially known as the Republic of the Philippines , is a country in Southeast Asia in the western Pacific Ocean. To its north across the Luzon Strait lies Taiwan. West across the South China Sea sits Vietnam...
President Joseph EstradaJoseph EstradaJoseph "Erap" Ejercito Estrada was the 13th President of the Philippines, serving from 1998 until 2001. Estrada was the first person in the Post-EDSA era to be elected both to the presidency and vice-presidency.Estrada gained popularity as a film actor, playing the lead role in over 100 films in...
($78 million – $80 million)
In addition, other sources have listed former PLO Chairman Yasser Arafat
Yasser Arafat
Mohammed Yasser Abdel Rahman Abdel Raouf Arafat al-Qudwa al-Husseini , popularly known as Yasser Arafat or by his kunya Abu Ammar , was a Palestinian leader and a Laureate of the Nobel Prize. He was Chairman of the Palestine Liberation Organization , President of the Palestinian National Authority...
as having stolen $1 billion to $10 billion; and Pakistani President
President of Pakistan
The President of Pakistan is the head of state, as well as figurehead, of the Islamic Republic of Pakistan. Recently passed an XVIII Amendment , Pakistan has a parliamentary democratic system of government. According to the Constitution, the President is chosen by the Electoral College to serve a...
Asif Ali Zardari
Asif Ali Zardari
Asif Ali Zardari is the 11th and current President of Pakistan and the Co-Chairman of the ruling Pakistan Peoples Party . He is also the widower of Benazir Bhutto, who served two nonconsecutive terms as Prime Minister....
to have received kickbacks on contracts and misappropriating public funds, siphoning over $2 billion to his Swiss accounts.
Narcokleptocracy
A narcokleptocracy is a society ruled by "thieves" involved in the trade of narcotics.The term has its origin in a report prepared by a subcommittee of the United States Senate
United States Senate
The United States Senate is the upper house of the bicameral legislature of the United States, and together with the United States House of Representatives comprises the United States Congress. The composition and powers of the Senate are established in Article One of the U.S. Constitution. Each...
Foreign Relations Committee, chaired by Massachusetts
Massachusetts
The Commonwealth of Massachusetts is a state in the New England region of the northeastern United States of America. It is bordered by Rhode Island and Connecticut to the south, New York to the west, and Vermont and New Hampshire to the north; at its east lies the Atlantic Ocean. As of the 2010...
Senator
United States Senate
The United States Senate is the upper house of the bicameral legislature of the United States, and together with the United States House of Representatives comprises the United States Congress. The composition and powers of the Senate are established in Article One of the U.S. Constitution. Each...
John Kerry
John Kerry
John Forbes Kerry is the senior United States Senator from Massachusetts, the 10th most senior U.S. Senator and chairman of the Senate Foreign Relations Committee. He was the presidential nominee of the Democratic Party in the 2004 presidential election, but lost to former President George W...
. The term was used specifically to describe the regime of Manuel Noriega
Manuel Noriega
Manuel Antonio Noriega Moreno is a Panamanian politician and soldier. He was military dictator of Panama from 1983 to 1989.The 1989 invasion of Panama by the United States removed him from power; he was captured, detained as a prisoner of war, and flown to the United States. Noriega was tried on...
in Panama
Panama
Panama , officially the Republic of Panama , is the southernmost country of Central America. Situated on the isthmus connecting North and South America, it is bordered by Costa Rica to the northwest, Colombia to the southeast, the Caribbean Sea to the north and the Pacific Ocean to the south. The...
.
See also
- DictatorshipDictatorshipA dictatorship is defined as an autocratic form of government in which the government is ruled by an individual, the dictator. It has three possible meanings:...
- Failed stateFailed stateThe term failed state is often used by political commentators and journalists to describe a state perceived as having failed at some of the basic conditions and responsibilities of a sovereign government...
- LumpenbourgeoisieLumpenbourgeoisieLumpenbourgeoisie is a term used primarily in the context of colonial and neocolonial elites in Latin America, which became heavily dependent and supportive of the neocolonial powers...
- NetocracyNetocracyNetocracy was a term invented by the editorial board of the American technology magazine Wired in the early 1990s. A portmanteau of internet and aristocracy, netocracy refers to a perceived global upper-class that bases its power on a technological advantage and networking skills, in comparison to...
- OligarchyOligarchyOligarchy is a form of power structure in which power effectively rests with an elite class distinguished by royalty, wealth, family ties, commercial, and/or military legitimacy...
- Organized crimeOrganized crimeOrganized crime or criminal organizations are transnational, national, or local groupings of highly centralized enterprises run by criminals for the purpose of engaging in illegal activity, most commonly for monetary profit. Some criminal organizations, such as terrorist organizations, are...
- Political corruptionPolitical corruptionPolitical corruption is the use of legislated powers by government officials for illegitimate private gain. Misuse of government power for other purposes, such as repression of political opponents and general police brutality, is not considered political corruption. Neither are illegal acts by...
- RaubwirtschaftRaubwirtschaftRaubwirtschaft is a form of economy where the goal is to plunder the wealth and resources of a country or geographical area. Raubwirtschaft is synonymous of colonialism, where there is no intention of developing the colony economically more than strictly needed for exploitation purposes...
- Rentier stateRentier stateA rentier state is a term in political science and international relations theory used to classify those states which derive all or a substantial portion of their national revenues from the rent of indigenous resources to external clients.- Usage :...