Institutional collapse, by removing the foundations supporting the rule of law such as an efficient judiciary, opens the way for a new organization of power. By necessity, this power must revolve around personal bonds (when no judiciary can enforce a contract, personal trust is all that remains). Some see in these new relationships a rebirth of feudalism. The analogy is mistaken. We are witnessing the emergence of the mafia state. Several European countries already fit the definition; others might follow.
In the mafia state, one must pay to receive protection by the state. Citizenship becomes irrelevant, both as a tangible status (foreigners might benefit from state protection) and as a concept (political activity is ignored as long as it does not threaten the godfather). What matters is loyalty and payment of protection money.
Institutional collapse and neo-feudalism
Institutional collapse used to be a metaphor but the actual collapse of the Morandi bridge in Genoa on August 14, 2018, and the 43 it left dead gave it a tragic embodiment. Much of the responsibility for the catastrophe lays in the lack of concern the private companies that ran the bridge had for safety, compounded by the fact these companies financed the politicians in charge of overseeing them.1
Everywhere one looks, the institutions tasked with supporting the political order of post-war Europe are in trouble.
Those in charge of making the law, the parliaments, are mistrusted, sometimes for good reason, especially when lawmakers, in an attempt to boost their own visibility, push for utterly senseless legislation (the French parliament regularly votes to forbid corporeal punishment of children, for instance, although it has been illegal since 19942).
Those in charge of keeping the powerful accountable, the press, have lost much of their bite when the digitization of the media challenged their monopoly on attention.3
Those in charge of finding and communicating the truth, universities, have been demoted to “providers of human capital” for the benefit of corporations.4
Even private or semi-private organizations, such as hospitals, nursing homes, transport companies and banks have seen their main purpose swapped for a new and universal one: sending more money to shareholders.
The main cause of this shift is neoliberalism, an ideology that favors private interactions over institutional organization.5 Some proponents of neoliberalism saw it as way to emancipate people from overly protective institutions. However, for this “left-wing” neoliberalism to function, a strong judicial system would have been needed, in order to enforce private contracts. In its absence, any contract becomes a power contest between parties. As you have personally experienced if you ever tried to read, let alone negotiate, a contract with your phone company of energy provider, left-wing neoliberalism never stood a chance in practice. The ongoing privatization of the police and the judiciary, in the form of private security firms and arbitration courts, is the final step in the disintegration of the institutional fabric that upheld the rule of law.
With the rule of law gone, what remains are personal relationships. French legal scholar Alain Supiot predicts that a new kind of feudalism must emerge from a society ruled by personal bonds.6
I found this analysis very convincing until, that is, I read more about feudal societies. Personal allegiances were certainly very important in feudal Europe, but power relationships still had to respect certain rules, guarded by a series of institutions, such as the Pope, parliaments, courts of justice and more.7 Feudalism is much more complex than Supiot assumes it to be.
A much more appropriate comparison for political relationships that emerge from the rubbles of the rule of law is the mafia.
Mafia and the business of protection
The concept of mafia is omnipresent but very poorly understood. A reason for our lack of understanding of the phenomenon lies in the inherent danger there is in approaching the underworld, no doubt because too deep an investigation in this field is likely to severely reduce the researcher’s life expectancy.
Nevertheless, Italian social scientist Diego Gambetta attempted to frame the issue in a 1993 book, The Sicilian Mafia. In it, he defines the mafia as an organization that offers protection independently of the state. Criminal activities, he writes, can be performed by a mafia group as well. It then becomes a consumer its own protection while running other businesses, much like a bank might invest money for itself as well as on behalf of its clients.
However, the defining character of a mafia is that it sells protection to criminal groups or to individuals who require it to carry out an illegal transaction. (This is why the mafia saw unions, which provided protection to workers, as its main enemy, and why some unions drifted to become mafia-like organizations.)
This explains why the Sicilian mafia guaranteed transactions on the horse or vegetable markets of Palermo, for instance. It was cheaper for sellers and buyers to pay the mafia than to operate under the legal framework, where they would have had to pay the value-added tax.
For Gambetta, the mafia did not and does not expand especially aggressively. Instead, it goes where there is demand for protection. And there is a powerful argument to be made that the need for protection in politics grew in the last two decades.
Neoliberalism and sophisticated corruption
The neoliberal ideology forced private contractors to take over many of the activities of the state, from garbage collection to healthcare or education. This, in turn, led to the multiplication of public procurements. Public contracts have always been a boon for politicians and contractors intent on making money (public contracts are a “money fountain”, in the words of a retired marseillais mafiosi8) because many see them as crimes without victims. The increase in public contracts required by the privatization of public services, all things being equal, must have led to an increase in what scholar call “sophisticated” corruption.9
In the few cases of corruption that have been thoroughly scrutinized, such as the construction industry in the Québec province of Canada, the link between corruption in public procurements and the mafia were evident.10 Italian clans in Québec organized the collusion between contractors and civil servants. They were paid in exchange for ensuring that both parties to the corruption deal received their agreed share.
Another theoretical argument pointing to an increase in the need for protection lies in the efforts made to reduce corruption starting in the 1990s, such as the OECD’s 1997 Anti-Bribery Convention. By making corruption illegal, these laws prevented politicians willing to collect commissions on certain deals (such as oil or arms sales) to use state protection. Instead, they now have to seek outside agents to guarantee a deal.
At the very least, this increase in anti-corruption legislation offered more opportunity to blackmail politicians engaging in corruption, which might have made it easier for corrupt politicians to hold each other in check.11
The government’s mafia-like activities
Despite this very likely increase in the need for protection for politicians and civil servants, that governments are linked to violent actions that resemble organized crime is nothing new. Some even go so far as saying that corruption did not change at all, only the reporting of it did.12
From the 1950s until the 1970s, for instance, the French government helped organize and protected the heroin trade between Indochina, Marseille and the United States.13 Between 1960 and 1982, the Service d’Action Civique was a an armed group carrying out violent actions, including murders and robberies, at the behest of Gaullist politicians.
The secret police of East Germany, the Stasi, was also as violent as any criminal group. It followed personal allegiances (from the 1970s onwards, it recruited mostly among the officers’ sons) and donned many a gangster’s attributes, such as sunglasses and leather jackets.
However, never did either the SAC nor the Stasi provide protection to politicians autonomously. On the contrary, the Stasi remained, quite consciously, under the orders of the ruling (and only) party, the SED,
Both the French and East-German examples do not describe mafia states. In both cases, the criminals operated under the auspices of, and separate from, the government. In a mafia state, the head of the government is the head of the protection business.
To see the difference, look no further than the personal wealth of those involved. In France, the criminals running the heroin trade did enrich themselves, but they remained at the orders of president Charles de Gaulle, who led a famously ascetic life.14 East-German “bonzes” did live lavishly in their private city of Wandlitz but remained far from acquiring the wealth of godfathers. (A proof of this could be the lack of political and financial power of the bonzes’ children.)
“Thieves of state”
The ideas I have laid down so far are twofold. In the one hand, the institutions underpinning the rule of law are in free fall, creating a need for protection and enforcement.
Without institutions to provide protection to citizens under the rule of law, the market for protection opens. Corporations often rely on private arbitration courts to avoid going through a clogged public justice system. Smaller firms and private persons hire security guards because they have a (real or perceived) need to supplement an ineffective police. Even if enforcement still remains a state monopoly, private entrepreneurs jump in when they see an opportunity; this is how the mafia grows.
On the other hand, the need for protection - the commodity the mafia provides - increases among politicians (because of new opportunities and more stringent anti-corruption laws).
Because of their power over administrative organs when in office, politicians can effectively become providers of protection themselves. When the institutions that are supposed to keep politicians in check become toothless because they have no more budget, politicians have a free hand to exchange state violence (or the absence thereof) for monetary compensation. A vicious circle reinforces the power of venal politicians over state institutions as the first amass money while the second plunges into disrepair.
That both roles, politician and seller of protection, merge into one is the logical economic conclusion of the process taking place, were it only because it is simpler for all involved to have one single source of protection. Instead of paying taxes to the state, those who can afford it pay the godfather. Indeed, Bálint Magyar, a Hungarian politician-turned-author who wrote The Post-Communist Mafia State: The Case of Hungary, mentions that one of the reasons for the success of Viktor Orbán, Hungary’s current political leader and godfather, was that local businesses were tired of having to pay protection money to several political parties. They pushed for the success of Orbán’s Fidesz to simplify and reduce their protection expenditures.15
In her brilliant 2015 book, Thieves of States, Sarah Chayes shows that, in several countries, power follows a pyramid structure where money flows to the top, paid to a national godfather in exchange for the right to keep doing business - essentially protection. Even if the term of mafia only show up in her book in the case of Tunisia, she argues that the mechanism is no different in Afghanistan, Nigeria, Uzbekistan and Egypt.
Whether in Hungary or Afghanistan, the mafia state runs alongside the official organs of the administration. After all, they are still needed for the country to function and for the mafia bosses to extract wealth from it. Unlike most 20th-century dictatorships, where the state was at the service of the ruling party, the mafia state operates in the shadows. It is not only more efficient (there is no need for the mafia to be concerned with running the country), it also allows for the impossibility to be held to account. Responsibility requires some embodiment, were it only a paper trail of orders, which the mafia does without. It much prefers oral orders, sometimes purposefully vague, and, above all, loyalty and discretion.
Setting up a mafia state
The key feature of the mafia state is that protection is not given to all, as is the case under feudalism or in a welfare state (although it is sometimes selectively distributed), but must be paid for.
To this end, politicians-turned-godfathers (or vice versa) must centralize protection payments, chiefly by ensuring that they receive a share of all commissions paid to access public procurements, and they must remove any challenge to their rule, so that clients of protection understand that they need not pay anyone else (which they would do to hedge against a possible change in government).
The greater autonomy of police forces helps tremendously in setting up a mafia state because its coercive force can be directed by its bosses, be they police chiefs or politicians. In the United States, the 1970 RICO Act, ostensibly passed to fight the mafia, allowed the government to pursue political opponents, for instance.16 Legislation enacting a “right to loot” by the police (which lets the police keep the proceeds of the goods it seized) also encourages a greater autonomy of coercion forces, which can then acquire wealth in their own right. Investigations have shown that they do make use of these provisions to the tune of billions of dollars per year in the United States.17
The process leading to the mafia state occurred in several countries (such as Russia and Hungary) and is currently taking place in the United States.18 While Trump is probably not quite a godfather yet, corporations and lower-level politicians do have to pay the Trump clan to secure favors.19
Power transmission
The mafia states comes to be when institutions become too feeble to prevent politicians from selling state protection (a process that is aided by legislation allowing for a greater autonomy of the police) and when clients of protection accept to pay only one protector.
Because it relies on personal relationships, the mafia state is not well equipped to deal with power transmission. Institutions are meant to dissociate power from their human bearer: their collapse makes it difficult to peacefully transmit power from one person to the next. Knowing who will succeed Putin or Orbán is probably the most important piece of information any entrepreneur in Russia or Hungary would like to know.
The mafia states of the early 21st century might evolve into something resembling feudalism in the future if, after a few failed power transmissions, only those that still have a few solid institutions (such as an order of succession) survive.
To see the mafia state as the petri dish from which other forms of political organization emerge is nothing new. Already in 1985, political scientist Charles Tilly made wave when he asserted that state making had much more in common with organized crime than with social contracts.20
Idealism would be another way out of the mafia state. A group of men and women, putting their ideals above personal wealth and convinced of the rightfulness of their ideas, could shake power structures enough for them to break. This could, of course, lead to outcomes worse than the mafia state.
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Notes
1. For a detailed account, see Genoa Bridge Collapse: The Road to Tragedy, New York Times, 6 September 2018.
2. Violence on children is forbidden by Article 222-13 of the penal code. French lawmakers nevertheless voted its interdiction in 2016 and will do it again in 2018.
3. I wrote on the topic many times, e.g. The media and the internet: The history of a failure.
4. I wrote on the topic in The collapse of academia.
5. For a short history of the rise of neoliberalism, see: Srnicek, Nick, and Alex Williams. Inventing the future: Postcapitalism and a world without work. Verso Books, 2015.
6. See for instance: Supiot, Alain. Governance by Numbers: The Making of a Legal Model of Allegiance. Hart Publishing, 2017.
7. Magyar Bálint makes a similar point in his book, see: Magyar, Bálint. Post-Communist Mafia State. Central European University Press, 2016. p.151
8. Colombié, Thierry, Milou. Truand: Mes 50 ans dans le milieu corso-marseillais, Robert Laffont, 2015.
9. Bergh, Andreas, et al. A clean house?: Studies of Corruption in Sweden. Nordic Academic Press, 2016. p.12
10. Industrie de la construction - Des liens confirmés entre la mafia et des entrepreneurs, Radio-Canada, 10 November 2010.
11. Gambetta, Diego. Codes of the underworld: How criminals communicate. Princeton University Press, 2011, p. 70.
12. See for instance, Why we stopped trusting elites, The Guardian, 29 November 2018.
13. See McCoy, Alfred W., Cathleen B. Read, and Leonard Palmer Adams. The politics of heroin in Southeast Asia. (1972) p. 40 ff.
14. On the wealth of Charles de Gaulle, see: Jean-Marc Philibert, L’argent de Nos Présidents, Max Millo, 2008.
15. Bálint, op. cit. p.53
16. This was noted by scholars in the 1990s, much before a Trump president became a possibility. See: Koenig, Daniel J. Organized Crime: A Canadian perspective. Albanese, JS; Das, DK; Verma, A. Organized Crime: World Perspectives. New Jersey: Prentice Hall (2003): 46-77. p.76
17. Stop and seize, Washington Post, 6 September 2014.
18. On the russification of politics in the United States and Europe, see: Snyder, Timothy. The Road to Unfreedom: Russia, Europe, America, Random House, 2018.
19. See for instance Trump Campaign Paid Millions to Trump Businesses During Midterms, Mother Jones, 14 November 2018.
20. Tilly, Charles. ‘War making and state making as organized crime.’ Violence: A reader (1985): 35-60.