Paul Krugman Mostly Right on War and Authoritarian Adventurism

First, please don’t hate me.

Even a blind pig can find… and all that. New York
Times columnist and economics Nobelist Paul Krugman’s column
today, “Why
We Fight,” explains why war keeps breaking out in the modern
age. Recall that Secretary of State John Kerry
admonished Vladimir Putin on ABC News last March for
invading Crimea:

“Russia is engaged in a military act of aggression against
another country, and it has huge risks, George. It’s a 19th century
act in the 21st century.”

The problem, Mr. Secretary, is that not all countries are
actually in the 21st century. (I am looking at you Middle
East, North Africa, China, etc.) As Krugman nicely summarizes the
history of war:

Once upon a time wars were fought for fun and profit; when Rome
overran Asia Minor or Spain conquered Peru, it was all about the
gold and silver. And that kind of thing still happens. In
influential research sponsored by the World Bank, the Oxford
economist Paul Collier has shown that the best
predictor of civil war, which is all too common in poor
countries, is the availability of lootable resources like diamonds.
Whatever other reasons rebels cite for their actions seem to be
mainly after-the-fact rationalizations. War in the preindustrial
world was and still is more like a contest among crime families
over who gets to control the rackets than a fight over
principles.

According to economics Nobelist Douglass North and his
colleagues John Joseph Wallis, and Barry Weingast in their
brilliant book
Violence and Social Orders: A Conceptual Framework for Interpreting
Recorded Human History, the first “natural states” evolved
in which militarily potent elites running patronage networks
offered peace in exchange for monopoly rents. In other words, as
Krugman observes, natural states are not so different from criminal
protection rackets. North and his colleagues persuasively show that
natural states were the only type of state-level social order that
existed until the early 19th century when Britain became the first
“open-access order” state. In fact, such open access orders reduce
social violence even more. Unfortunately, while the number of
societies that are open access orders has increased (see
Freedom House data), natural states run by rent-seeking elites
are still the norm, e.g., Russia, China, Iran, Venezuela, Nigeria,
etc.

The authoritarians (gang leaders) who currently run existing
“natural states” or want to create one (the so-called Islamic State
and its would-be Caliph) need to keep their subjects distracted and
appealing to tribalism is a sadly tried and true way to do that –
thus war. With regard to the Ukraine/Russia imbroglio Krugman
notes…

…that governments all too often gain politically from war,
even if the war in question makes no sense in terms of national
interests.

Recently Justin Fox of the Harvard Business Review

suggested that the roots of the Ukraine crisis may lie in the
faltering performance of the Russian economy. As he noted, Mr.
Putin’s hold on power partly reflects a long run of rapid economic
growth. But Russian growth has been sputtering — and you could
argue that the Putin regime needed a distraction.

Krugman concludes…

…if authoritarian regimes without deep legitimacy are tempted
to rattle sabers when they can no longer deliver good performance,
think about the incentives China’s rulers will face if and when
that nation’s economic miracle comes to an end — something many
economists believe will happen soon.

Yes.

For more background on Russia and Violence and Social
Orders see my 2011 article, “Russia’s
Natural State of Corruption.”