Bangladesh's gamble

As the Awami League's current predicament shows, repressive regimes-even when delivering prosperity-cannot keep their populace content

Recent events in Bangladesh will inevitably spill over to the rest of the subcontinent. Guessing how things will turn out in the world’s eighth-most populous nation will occupy many commentators.

Bangladesh’s last government was authoritarian. The ousted government “won” extremely flawed elections after Opposition leaders were jailed, and the nation’s constitution, which asked for an impartial interim government to conduct national elections, was ignored.  Much blood was spilt in the last few weeks, as the government tried unsuccessfully to ride out public protests.

But it would be wrong to claim the government was an absolute failure. It provided a stable macro-environment and delivered strong growth for many years. Indeed, it delivered enough growth to arguably bring about an economic miracle in an impoverished country. It wasn’t entirely undemocratic either, in that it afforded a measure of protection to minorities.

The Awami League’s unspoken bargain with the Bangla electorate was that the government would be repressive, but it would deliver prosperity. Very few governments have actually been able to keep that particular bargain. The maps of Eastern Europe, Africa, Latin America and the former Soviet Union are dotted with authoritarian regimes, many of them resource-rich, which have delivered repression, without growth.

In the last 80 years, only a handful of undemocratic East Asian “tiger” economies have managed to deliver growth. Most have, with the exception of India’s northern neighbour and Vietnam, also graduated to becoming full-fledged democracies. The resource-rich nations of West Asia have also prospered, though growth remains uneven there.

This brings us to one of the most common fallacies of political science: Democracy is often decried as antithetical to development. It isn’t. An authoritarian regime can deliver growth if ruled by an enlightened despot. But very few authoritarian regimes actually do deliver prosperity. Democracies have a higher strike rate. The richest nations in the world are democracies. 

The fallacy arises from the few shining examples mentioned above, while all the many counter-examples of repressive regimes, which did not deliver growth, are conveniently ignored. Another reason why this fallacy is perpetuated is that repressive regimes are easier to negotiate with, particularly for corporations and even other governments. It is easier to bribe one strongman (or woman as the case may be) and gain favours than to convince an entire smorgasbord of politicians to give concessions. Multinational corporations therefore have an incentive to support authoritarian regimes and propagate the myth.

If we delve further back into history, it’s the same story. The absolute monarchies of earlier eras equate to the authoritarian regimes of today. In the era of absolute monarchies, very few kingdoms enjoyed sustainable growth. One member of a dynasty would improve the lot of the subjects but the next three rulers would dissipate the gains.

The Enlightenment and the Industrial Revolution came to fruition in places that were relatively democratic. The most gains in productivity and prosperity were seen in those nations. The most striking example is perhaps Japan. The Emperor became a constitutional monarch in 1868 and Japan industrialised at warp speed. Similar things happened in Europe. While many nations of Western and Northern Europe remain titular monarchies, most of those countries adopted democratic models early.  And, of course, the United States saw innovation and breakneck industrialisation.

One concern for Bangla-watchers is that undemocratic regimes are often replaced by regimes that are even worse, or by civil wars. Quite apart from the former Soviet Republics, we could look at Iran, Libya, Egypt, and other hotspots for such examples.

The other learning from Bangladesh is that prosperity is often not enough to keep a repressed populace happy. If there’s a slight blip in growth, dissatisfaction spills over into the streets because there is no recourse to the ballot. Even the People’s Republic has seen its share of protests, including a rather large one in 1989.

In South Korea and Taiwan, the transition to democracy came without too many tremors. In other nations like Indonesia and the Philippines and Thailand, the movement towards democracy has been less smooth.

There are lessons here for India as well, with some indicators showing that growth has really been K-shaped.