Anocracies Risk Business Stability -- Business Leaders Can Safeguard Democracy

Key Quotes

"The political instability task force is run or was run by the CIA. It existed from 1994 and it shut down in August of 2023. I don't know why they shut it down, but one of its goals was to help the US government predict what countries around the world were likely to experience significant political violence and or significant political instability within the next two years."

Barbara F. Walter explains that the CIA's Political Instability Task Force aimed to forecast global political violence and instability. This task force utilized a model developed by political scientists and data analysts to identify predictive factors for such events. Walter highlights the task force's objective of providing foresight to the U.S. government regarding potential international crises.

"It turns out that the most unstable place to be as a government is in this middle zone. Political instability and political violence is extremely rare in strong healthy democracies. It's actually relatively rare in hardcore autocracies. Almost all of the violence and the significant instability--and that's political, economic, and social instability--happens in this middle zone."

Barbara F. Walter identifies a critical concept: the "middle zone" between democracy and autocracy is the most unstable for governments. Walter clarifies that both strong democracies and hardcore autocracies experience less political instability and violence. The highest risk, according to Walter, occurs in partial democracies, which exhibit significant political, economic, and social volatility.

"The second factor was whether citizens in those partial democracies were organizing their political parties mainly around race, religion, or ethnicity rather than ideology. So instead of joining a political party because you were a conservative or a liberal or you were a communist or a capitalist, you were joining because you were black or white, you were a Muslim, you were a Christian, you were a Serb or a Croat."

Barbara F. Walter points out a second key predictor of instability: political parties forming around identity markers like race, religion, or ethnicity, rather than ideological stances. Walter contrasts this with traditional party affiliation based on political beliefs such as conservatism or liberalism. This reliance on identity-based organizing, as explained by Walter, is a significant risk factor for political instability.

"So if business were willing to get involved, it could have a big influence still ahead. More with political scientist Barbara F. Walter. What does the AI revolution mean for jobs, for getting things done? Who are the people creating this technology and what do they think? I'm Rana el Kalioubi, an AI scientist, entrepreneur, investor, and now host of the new podcast Pioneers of AI."

Jeff Berman, the host, emphasizes the potential influence of the business sector in safeguarding democratic stability. Berman introduces a segment discussing the AI revolution and its implications, featuring AI scientist Rana el Kalioubi. This transition highlights Berman's view that business leaders, alongside political leaders and voters, form a crucial pillar for strengthening democracy.

"So I would say to business leaders who really care very deeply about stability in all its forms--economic stability, political stability, social stability--anocracies, those partial democracies, are the most unstable economically. They have lower rates of GDP per capita, lower rates of economic growth, lower rates of of investment, and you can go down the list."

Barbara F. Walter advises business leaders that anocracies, or partial democracies, present the greatest economic instability. Walter details that these environments are characterized by lower GDP per capita, reduced economic growth, and decreased investment. Walter's analysis suggests that businesses prioritizing stability should be wary of operating in such political systems.

"I think one is is simply to start planning right? You break collective action problems by beginning to coordinate and maybe one one way to to answer the question is to give you some examples. You guys, if you've been following Brazil, follow what's happening in Brazil in real time. It's really extraordinary."

Barbara F. Walter suggests that business leaders can address collective action problems by initiating planning and coordination. Walter uses the example of Brazil to illustrate how coordinated action can be effective. Walter points to the business community's role in Brazil's democratic process as a model for influencing political outcomes.