phelics’s Reviews > Why Nations Fail: The Origins of Power, Prosperity, and Poverty > Status Update

15.4 there is few things that can really help changing systems. One being a broad society and and non party institutions like worker unions. These helped Brazil reform and become successful. Another is the free media, which helps inform people and organize.

15.3 Nations fail, because of their extractive institutions. Foreign aid, simply pouring money on them, is not the solution, as it will be abused by the existing ruling elites to enrich themselves. Making it conditional does not help either, as we have seen, it has the same impact. It would mean, that leaders would have to undermine themselves.
What would help would be supporting ‘new’ groups, to challenge elite

14. Whether it Botswana, China or the U.S south, it is possible to break the mold. It needs a broad coalition, like the male adults with wealth in Botswana and often a critical juncture, like the death of Mao. Ultimately it is to note, that luck is key too, like the chiefs in Botswana got lucky, that their appeal for royal safety before Rhodes and the low interest of the UK in their country helped them stay on track.

14.3 China was in a bad economic situation under Map, having between 20 - 40 million people starve in a certain period. Maos policies were very extractive. Then came change, when Mao died Deng was able to open up markets. One of the first things implemented were incentives, so productivity rose. Then they opened cities for international investments. This accounted for a huge economic rise.

14.1 Botswana was, like many African nations before colonialism split into smaller parts, ruled by chiefs. These chiefs would inherit their positions, unless there was a more talented male adult there. So these chiefs could be challenged. They also held meetings with all male adults to discuss important matters and could be outvoted. These inclusive institutions led to a democracy and wealth after independence.

13. There is a lot of different examples of modern failing nations. The general reason are extractive economic institutions. Whether it be like in Zimbabwe or Colombia, with a lack of state centralization, North Korea with communism or Uzbekistan and Egypt with extractive elite controlled capitalisms or Argentina.
Generally leaders often make use of persisting extractive institutions, enriching themselves.

13.5
In Uzbekistan president Karimov has split up the cotton farms between the elites. Every school kid has to pick cotton in autumn and gets paid around 0.03 $ per day. The tea industry is also owned by the first and so far only president of Uzbekistan. This country is very poor and its situation derives from the extractive nature of its economy and subsequently politics.

13.4 a lot of nations today fail, because they implement communist theory. They abolish the possibility to own something and therefore cut out all possible innovation. On top such economies virtually always have a small elite. The systems are designed to extract any wealth created by the economy, to live a good life. North Koreas leader had an annual cognac-budget of around $ 800.000.

13.3 Columbia, a state that basically works and does not fail to provide certain services (health, education, security) to their citizens in urban areas, massively lacks state centralization, resulting in paramilitary rules in rural areas. Columbia fails today, because it is not able to provide the same level of services in all its regions.

13.1 In Zimbabwe, like in many sub Saharan post independence countries, former extractive institutions were after gaining independence not instantly challenged and even became more extractive after some years (vicious circle). The mechanisms for extraction created by the (mostly) the west were just used by former liberal movements and their new absolutist, corrupt emperors.