Hidden Costs of Dictatorship

Why are developed economies so uneffective in actually acting instead of simply discussing what to do? What lessons can we get from non-democratic authoritarian regimes? How is it different in digital age vs paper age? These and other questions were answered by Prof. Mark Harrison.

An interesting topic of public debate at the moment is the difficulties of Western democracies. We look at the United States, we look at the European Union, we see democratic societies that are having enormous difficulty in resolving important questions. They really can’t be put off, so the obvious thing is the fiscal problems, the problems of public debt. These are countries or groups of countries that share problems of rising debts, of insuperable disagreements about who should bear the cost of adjustment. And as result, nothing is done.

But it’s not only fiscal gridlock; there are also problems of migration and immigration, problems of the environment. These are all issues where it’s extremely difficult as it seems for democratic societies to come together and make effective decisions that will resolve problems that really can’t be put off indefinitely. And because of this, a lot of people start to think more kindly about authoritarian models of government, such as in China.

A well-known British journalist said: Let’s hear for the Chinese Communist Party, at least they can build railway lines. This is a very important and necessary public debate, but I often think that it’s carried out on a basis of asymmetric evidence. The evidence that we have is asymmetric because the problems of democracies are all out in the open. The nature of democracies is that all their processes are transparent: what happens in parliaments and so on is reported in the papers. So we can see that democracies have these zones where nothing can be decided.

When we look at authoritarian regimes, we don’t see how they make decisions, because the common feature of all authoritarian regimes is that decision-making is secret.But it’s a secret for very clear reasons. Firstly, because secret decision-making is non-accountable. Secondly, if you make decisions in secret nobody can lobby you and try to influence you. Thirdly, secrecy is, I think, a very valuable feature, of the regime of a dictator, because it creates an automatic loyalty test. If you want to know if your subordinates or colleagues are loyal, you share secret information with them and you watch what they do with it. So, suppose for example, I say to you ‘here’s a government secret, two plus two equals five, don’t tell anybody’, and then, a few weeks later, I hear back from somebody else ‘oh, did you know that two plus two equals five?’, I’ll know something about you, which is that you behaved disloyally with my secret.

Authoritarian regimes have this quality of secrecy, which means that we don’t know how they make decisions and we can only really find out when regime change takes place, when the system collapses, we can go into the system as historians, look in the archives, and study how secrecy worked. And this is something we can now do with the former Soviet archives. We can look at them, we can see that they’re full of documents stamped ‘secret’ and ‘top-secret’, but it wasn’t known at that time – there was a system in secrecy, and we can see how it worked. We can see a couple of things. One is that secrecy changed the behavior of people in the system, so, for example, you violate secrecy – you’re punished. That’s frightening. So we can look at Soviet government in moments when secrecy was pushed up. One of the things I’ve done is to look at 1949.

In the 1947 Stalin, quite by surprise, ordered a round of tightening up of secrecy, and it gradually filtered through the state. In 1949 he hit the GULAG.

We see this very interesting moment when suddenly, under new instructions, camp commandants were writing to Moscow, saying ‘we can’t do business’.

Now what was the business of a labour camp? It was to receive materials and supplies, and to supply output. A GULAG camp was a business like any other: they had to receive receive supplies, to supply output to others. The problem that these camp commandants had was ‘we can’t do business without revealing a state secret, namely, that we exist’. There’s this moment when the whole GULAG economy seems to be at risk of melting down, and then we see how people found their ways around this, because they couldn’t allow it to melt down. But we also see that this problem became a problem for superiors as well as for people down at the bottom, and we watch how they dealt with it. And they dealt with it by doing nothing. They dealt with it by putting off the solution; they went through endless committee meetings ‘should we try this, should we try that’. Lots of different solutions were discussed and presented, nothing was done. So what we can see is that they were frightened to do anything, and the procrastination and delay were one of the consequences of this round of tightening up on secrecy.

As well as behavioral changes, we can also look at procedures. Anyone who’s worked in the Soviet archives will possibly have become aware that these archives contain an awful lot of documentation which is extremely boring; nobody in their right minds would want to spend any time reading it. Essentially, there are lots of pieces of paper that count other pieces of paper. A lot of them are called ‘acts of receipt and transfer documentation’, акты об unichtozhenii dokumentacii , destructions of documentation. There’s a huge quantity of zhurnaly vhodjashhih i vyhodjashhih dokumentacii . What these are, are the evidence of a system, of accounting of a secret paperwork. One of the features of this system of secrecy was that the existence of secrets was also secret, and so this documentation too is all secret, and the system was secret.

The system of accounting of secrets was itself a government secret, well we can see it now. And one interesting question is how much time do people spend servicing this system. Well it’s a very crude measure, but you can count, it’s not always easy to count, but one of the things I’ve done is working with a microfilm archive which is in the Hoover Institution in California, so I bought an archive on microfilm from Lithuania, this is the Lithuanian special archive of the Lithuanian KGB.

The unique feature of this archive is that it has an excellent electronic catalogue that lists the documents file by file. It’s a big archive, there’s a million pages in it, and you can count, file by file, roughly one third of this archive is documentation that counts other documents. Well you can think to yourself ‘does that mean that one third of KGB time was spent protecting its own secrets?’ What about other parts of the Soviet economy? Because the system that the KGB operated, it also enforced on every enterprise, every ministry, the State Bank, the Lithuanian Gosplan. The KGB inspected them all to verify the regime’s secrecy. Did they too spend a third of their time counting their own paperwork? We don’t know. I’m speculating. We don’t have evidence on this, but it’s a question. One that I think historians are trying to answer.

So the summary that I’d like to give to you, is that we see the problems of democracies in the present day, we don’t see the problems of authoritarian regimes and the cost they have to incur in order to preserve their lack of accountability, because it’s secret. We can only learn this from historical records. But when we look at historical records, we see that actually it was potentially hugely expensive. The enormous amount of skilled and qualified bureaucratic time was spent doing nothing but keeping paperwork away from the public. If you look at China today, China has a new problem, the problem of a post paper age. China has a world of the internet. We know that China has hundreds of thousands of people employed in censoring Chinas internet. It spends billions of dollars on software applications, enabling it to control microblogging and this sort of things. So these are the present day analogues of the kind of things that Soviet Union had to do in the age of paper, when you couldn’t have an access even to a photocopier without the precious доступ.