Peace Through Entrepreneurship: Investing in a Startup Culture for Security and Development

by Steven R. Koltai, Matthew Muspratt (Primary Contributor)

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Joblessness is the root cause of the global unrest threatening American security. Fostering entrepreneurship is the remedy.

The combined weight of American diplomacy and military power cannot end unrest and extremism in the Middle East and other troubled regions of the world, Steven Koltai argues. Koltai says an alternative approach would investing in entrepreneurship and reaping the benefits of the jobs created through entrepreneurial startups.

From 9/11 and the Arab Spring to the self-proclaimed Islamic caliphate, instability and terror breed where young people cannot find jobs. Koltai marshals evidence to show that joblessness—not religious or cultural conflict—is the root cause of the unrest that vexes American foreign policy and threatens international security.

Drawing on Koltai’s stint as senior adviser for Entrepreneurship in Secretary Hillary Clinton’s State Department, and his thirty-year career as a successful entrepreneur and business executive, Peace through Entrepreneurship argues for the significant elevation of entrepreneurship in the service of foreign policy; not rural microfinance or mercantile trading but the scalable stuff of Silicon Valley and Sam Walton, generating the vast majority of new jobs in economies large and small.

Peace through Entrepreneurship offers a nonmilitary, long-term solution at a time of disillusionment with Washington’s “big development” approach to unstable and underdeveloped parts of the world—and when the new normal is fear of terrorist attacks against Western targets, beheadings in Syria, and jihad. Extremism will not be resolved by a war on terror. The answer, Koltai shows, is stimulating entrepreneurial economic opportunities for the virtually limitless supply of desperate, unemployed young men and women leading lives of endless economic frustration.
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240 pages, Hardcover

Published August 30, 2016

Reviews

[Karel Baloun · Rating 4 out of 5]

Entrepreneurship is essential to healthy global development, and an essential national security tool to prevent terrorism, since terrorists are primarily young desperate youth with no economic prospects. Koltai proves this point very effectively, and introduces his 6x6 model for internationally promoting entrepreneurship.

Youth jobs needed by region, given youthful demographics:
Africa 130m by 2025
India 150m by 2025
MENA 80m by 2020

He presents reality cogently, both as a state department insider “on the ground” and as an objective successful entrepreneur. He adds history of government development programs, and remains open to competing approaches, and remains staunchly pragmatic.

I do wonder who the audience is.. because this book is rarely for entrepreneurs. State department officials and congressmen would be a small audience, and not receptive to business pragmatism uninterested in their own career prospects. Since he writes “truth” without an audience, I wonder whether that could be a personality characteristic that led to the almost complete failure of his own specific program at State. While half of the book is “the solution”, Koltai is much more capable of describing the problem, despite his active consulting company working towards this solution.

My main worry is: what can these regions produce that anyone would want to buy? 😔

Everyone has value, by my faith in humanism, and I’m not able to see how even an optimally supported market can draw that out as economic value. But if this can’t, Koltai and I can’t think of anything that could.

Liberals just want to have faith that government programs work... that if we invest in institutions, a well run government will make a positive impact. Perhaps this includes faith that shifting money away from defense to non military institutions is more effective, and that diplomatic arms like the State Department are best at ideas. Well, Koltai has been there, and would like to burst our bubble. These hundred of cross-competing, territorial, legacy staffed, uncommunicative agencies are a bureaucratic nightmare of inefficiency. I'd like to not believe that and just shoot the messenger. And his personally warm and capable tone makes it hard to pull the trigger.

[Alejandro · Rating 3 out of 5]

Ok, so entrepreneurship is "Americas" greatest tool for foreign policy. All you need to change is the military industrial complex that matches foreign aid with arms sales to poor countries.

Six point model to foster entrepreneurship. Unemployed young people are fodder for extremist and violent groups. Through entrepreneurship, we can create jobs and young men and women will have hope for a better future.

Model includes universities, seed capital, business plan competitions, etc.

Challenge is that the book is outdated since the USA has become the leading isolationist country in the world, the world bully and protectionist champion. We'll have to wait for these ideas to prosper for a few years.

[George Wood · Rating 1 out of 5]

Koltai seems dumbfounded at why Singapore and Jamaica developed differently, saying that entrepreneurship must be the natural explanation. This man is a moron. Has he heard of colonialism?

This makes me question the quality standards of Brookings. Perhaps they gave this to him out of pity for a corporate factotum's declining self-esteem. If this were anaylzed by any competent historian or political scientist, this would be laughed out the window.

[Kat White · Rating 3 out of 5]

A well-researched book with an admirable premise and lots of interesting information about global ecosystems. The book is let down by it's excessive focus on the US government (why can't other developed nations also help promote peace?) and constant repetitions of the same examples and phrases.

[Ema · Rating 4 out of 5]

I really liked this book. I thought it tackled some very interesting subjects and I thought the framework provided by Koltai was a helpful and insightful one.

[Charles · Rating 5 out of 5]

The United States has been militarily engaged in several Middle Eastern countries for over a decade now and all of the objective data indicates that little progress has been made towards subduing the forces of violent extremism. Bombs fall and kill, fighters launch suicide attacks, politicians and their media allies talk tough in public, yet the wars continue with no real end in sight.
In this book Koltai identifies what the real problem is and puts forward potential solutions that are cheaper and actually have a chance to work. He points out that the countries with the greatest turmoil in the Middle East have very high percentages of young people that have a very high percentage of unemployment. The lack of any significant economic opportunities leads to despair, hopelessness and a desire to fight back.
Although it has now become a proxy war between Sunni and Shia Muslims, the unrest in Syria that led to the civil war was based on economic conditions. Prolonged drought and lack of government response led people to the point of desperation. The events that came to be called the “Arab Spring” were largely responses to a lack of economic opportunities for young people as well as a spike in the price of food.
Koltai’s solution is to export the one American feature that everyone in the world admires, the entrepreneurial culture. For only the tiniest fraction of the cost of the military actions, the United States can provide economic opportunities having a local flavor that will “take people off the streets” and into businesses that will lead to opportunities.
Koltai once worked for the U. S. government in the projects to promote entrepreneurship in other countries and paints a very bleak picture of the effectiveness of the programs. He also expresses a low opinion of USAID programs and how only a small number of companies get the majority of the contracts. Largely due to their skills at navigating the process rather than any talent at actual economic development.
Despite the bleakness, Koltai does put forward believable arguments for the development of a global entrepreneurship program fueled by the U. S. government. Not only is it a program that has a chance of success, the cost is insignificant compared to the use of military hardware. Unfortunately, the transfer of a military helicopter directly creates American jobs while an entrepreneurship program in Tunisia does not. This book contains long-term thinking at its best, something the American political process does not do very well.

This book was made available for free for review purposes.

[Frank Kiefer · Rating 1 out of 5]

An ambitious, but ultimately a cheap attempt at foreign policy. With the academic rigour of a Malcolm Gladwell supermarket book, the literary sophistication of a young adult fiction novel, and the cultural awareness of a public school history textbook.

[Whitney Collins · Rating 1 out of 5]

Grossly simplistic and flippant. Zero interest in being culturally literate or sensitive. There are a few good premises, but the methods for solving the issues outlined are strange at best and disturbing at worst.

A pathetic attempt at approximating a neoliberal framework while Koltai embarrassingly lacks self-awareness of how much of a simpleton he comes off as in his work.

Steven Koltai epitomizes American exceptionalism and arrogance. Even worse, it seems that Koltai is woefully unaware of this.

[Abhi Yerra · Rating 4 out of 5]

The world is sort of stuck in a post-WW2 mentality where working for big companies and firms seem to be the way of the road expect for a few pockets of entrepreneurship such as Silicon Valley. This sentiment is conveyed as well by Koltai who shows that if the US government spent more on entrepreneurship we can create jobs and peace all over the world. According to his data the State Department spends less than 1% of its money on entrepreneurship, less then the cost of a F16. Procurement for the government goes to giant nonspecialist contractors who know how to play the game of procurement instead of actually knowing how to do the job. Basically the US government is just not setup to deal with startups and how to help new companies thrive.

I liked the proposed policy changes that Koltai said may be beneficial for promoting entrepreneurship, but the one of the chapters seems to be a summary of Startup Communities by Brad Feld.