Abstract*

Amid growing global authoritarianism and democratic backsliding, the Biden Administration has prioritized American leadership abroad to promote democracy. However, the democratic model currently advanced by the U.S. overseas is deeply flawed. Instead of promoting the freedom and empowerment of citizens, international assistance more often opts for the status quo of overly centralized government that maintains political and economic hierarchies that are unaccountable and unresponsive to their constituents. This shallow form of democracy is not the same democracy practiced at home (where it also is increasingly at risk). As a result, democracy has not proven to be efficient at delivering tangible benefits for their citizens, leaving countries susceptible to the appeal of populist authoritarian regimes. To counter this appeal, democracy allies need to re-cast democracy promotion strategies in terms of its dividends, championing principles of freedom, agency, and self-determination to focus on two primary citizen-centric elements: responsive governance and economic empowerment.

1. Responsive governance. Democracy and democracy promotion is often largely erroneously simplified as elections, especially national elections. But elections are the just the start, or rather, more organically, the result of a democratic process that originates with participation at the local level and the creation of a governments with accountable and responsive institutions. Nation states emerge from a political settlement of communities that agree to be mutually governed by a central authority. However, since WWII, but originating much earlier, countries have largely been formed through a reverse process. Central governments were formed first, often by colonial powers, creating a centralized non-democratic political and economic structure beholden to central elites and lacking the organic legitimacy of democratic states. Most countries still exist in this state, despite efforts to democratize national authority through elections. Many countries, have attempted to decentralize or devolve power to the subnational level to address this legitimacy deficit and promote participation, accountability and responsiveness, especially of public services, but these efforts have been largely half-baked, as fiscal authority (taxes and other forms of revenue generation) remain centralized. Instead, decentralized governments are given increased responsibility for services, but without the power of the purse. Local governments are entirely dependent on central disbursements from the national budget, most often determined through confusing formulas that resulting in most funds remaining at the central, setting-up local governments to fail their mandate. This lack of fiscal devolution also negates the democratic dividend of local participation in public revenue generation and provision of services, leaving most communities ever dependent on far-away national governments. Public services are inefficient and unresponsive and citizens see little progress and feel powerless to improve governance performance due to a lack of democratic discourse.

2. Economic empowerment. The centralized control of politics also extends to economies and economic assets. Democratic, market-based economies should empower citizens as both political and economic actors. However, in most of the “democratic” countries the U.S. supports, economic resources remain centralized through legal frameworks that bestow ownership of land and natural resources (e.g., soil, trees, minerals, petroleum) on the central state. Deriving from colonial origins of natural resource extraction, most national governments continue to own and/or control all land and natural resources and as a result have economies largely dependent on resource-based economic activities. The national government of Peru, for example, has granted concessions for oil, minerals, and forest covering over 50% of its territory, including 75% of the Peruvian Amazon, of which 96% is on communal land (see maps). Revenue from state-owned natural resource extraction is vast and opaque, creating ample opportunities for corruption and fostering a lack of democratic decision-making over its use. But it also hamstrings the creation of a citizen-driven, democratic economic model. In contrast, most “mature” democracies feature strong protection of land and property rights and policies that promote economic activity based on a diffusion of these resources to citizens. This diffusion and protection of property rights is the foundation for the American-style dynamic, market-based economy that promises individual and economic opportunity. As property, land and natural resource ownership is centralized it creates unaccountable governments and static, centralized economies prone to rent-seeking and elite capture.

As the U.S. and its allies convene the 2nd Summit for Democracy, democracies need to ban together to demonstrate a commitment to deepening democracy beyond the ballot box to reflect the values and dividends citizens expect. Western donors promoting democracy’s benefits need to eschew support to powerful executive branches at the expense of decentralized governance, and support the promotion of economic rights and the devolution of resource ownership (lessons even mature democracies should heed). International aid donors should strive to form a modern democracy pact that reinvigorates democracy promotion by explicitly emphasizing achievement of the democracy dividend based on a four-prong strategy: 1) Support sub-national governance and decentralization of government functions, including recognition of the right of self-determination for indigenous and customary community governance structures; 2) Strengthen land and natural resource rights, especially for women and marginalized populations, and including collective rights for indigenous/traditional communities; 3) Devolve fiscal authority and domestic revenue generation through control over property tax and other direct revenue sources; and 4) Devolve ownership of natural resource tied to land (e.g., forests, soil, minerals).

This strategy won’t be easy, but a focus on the inter-connected themes of economic rights and democratic governance is ultimately reinforcing and self-perpetuating. It also establishes the fundamental principles on which stronger, more accountable institutions are based, which in turn can advance progress on an array of development challenges that depend on strong institutions – from conservation to public health to economic growth.

*This is an abstract for a pending manuscript.