Stanford University

Corruption

Anti-Terrorist Finance in the United Kingdom and the United States

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This article adopts a two-tiered approach: it provides a detailed, historical account of anti-terrorist finance initiatives in the United Kingdom and United States--two states driving global norms in this area. It then proceeds to a critique of these laws. The analysis assumes--and accepts--the goals of the two states in adopting these provisions. It questions how well the measures achieve their aim. Specifically, it highlights how the transfer of money laundering tools undermines the effectiveness of the states' counterterrorist efforts--flooding the systems with suspicious activity reports, driving money out of the regulated sector, and using inappropriate metrics to gauge success. This article recognizes that both states consider the fight against terrorism to be partly military but also a matter of bringing certain democratic principles to bear. Critics have been quick to condemn some of the measures for their encroachments into civil liberties. My goal is not to measure the success of the laws according to any particular ideology but rather, accepting the governments' democracy-promoting goals, and the role these play in generating domestic and international support, to clarify which components do not appear to serve the states' aims.

This article won Stanford Law School's Carl Mason Franklin Prize for 2005-2006, for most distinguished written work in international law.

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Assessing the Quality of Democracy

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The latest volume in this popular series focuses on the best ways to evaluate and improve the quality of new democratic regimes. The essays in part one elaborate and refine several themes of democratic quality: the rule of law, accountability, freedom, equality, and responsiveness. The second part features six comparative cases, each of which applies these thematic elements to two neighboring countries: Brazil and Chile, South Africa and Ghana, Italy and Spain, Romania and Poland, India and Bangladesh, and Taiwan and Korea.

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Larry Diamond

Main Institution in the Country is Corruption, The: Creating Transparency in Angola

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The story of how the Angolan government was induced to begin creating checks and balances, from a starting point of massive corruption, is a case study in building institutions from scratch. A dysfunctional state has been driven by a combination of domestic and external pressure to take some initial steps toward accountability.

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Best hope for Hussein trial is to validate rule of law in Iraq

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What should we expect from the trial of Saddam Hussein? Full justice will likely elude the court, since Hussein faces only a partial list of possible charges. The trial probably won't quell ethnic and sectarian conflicts, either. But the trial could teach a valuable lesson about the place of law in a democratic state, writes CISAC's Allen S. Weiner in this Los Angeles Times op-ed.

The prosecution of Saddam Hussein and his co-defendants is off to a rocky start. As of last week, the trial has been adjourned twice after only a day and a half of proceedings; two of the defense lawyers have been murdered, perhaps by Iraqi security agents; and Hussein has showered the judges with contempt and challenged the legitimacy of the tribunal.

Can the trial in fact succeed? That depends on what we think are its goals.

The principal rationale for criminal justice is retribution--to punish those who have harmed others and violated society's norms. But retribution--or revenge--could be achieved without courts and due process. Trials also ordinarily produce reliable determinations of guilt or innocence, but few people, either inside or outside Iraq, have genuine doubts about Hussein's guilt.

The success of the Hussein trial, then, should be judged by whether it can also accomplish any of the broader goals that criminal prosecutions can serve in societies that have experienced widespread atrocities:

1) Providing justice for victims and documenting history. Trials enable victims to confront their abusers, a psychologically important step in the social re-integration of victimized groups. Trials also generate an authoritative record of the crimes committed by a previous regime. This can compel other groups in society--including perpetrators--to acknowledge that abuses occurred and can refute subsequent attempts at historical revisionism. This is today viewed as one of the important legacies of the Nuremberg trials.

The Hussein trial could provide a forum for victims, but only if the tribunal is allowed to address the full range of atrocities perpetrated by his regime. At this point, Hussein is being tried only for crimes committed in connection with a single episode--the killing and torture of residents of the village of Dujail after an assassination attempt on Hussein in 1982. Iraqi prosecutors have said that, after the Dujail case, they will pursue other cases involving the killings of tens of thousands of Shiites and Kurds.

A full airing of the vast tableau of Hussein's crimes, however, could take years; the trial of former Balkan strongman Slobodan Milosevic on crimes of comparable scope before the Yugoslavia War Crimes Tribunal in The Hague has been underway for almost four years. Such a timeline is unlikely to satisfy Iraqi street protesters demanding a swift trial and hanging of Hussein. Prime Minister Ibrahim Jafari's declaration that the Hussein trial "is not a research project" suggests the Iraqi government may feel pressure to sacrifice the goal of giving Hussein's victims a chance to record the atrocities they suffered in the interests of swift retribution.

2) Contributing to peace and reconciliation. Particularly in societies emerging from ethnic or sectarian conflicts, criminal trials individualize responsibility for abuses. They thus allow victims of atrocities to move beyond collective condemnation of the ethnic or religious groups from which their abusers came, enabling once-divided groups to begin to reconcile.

But the Hussein trial seems more likely to inflame sectarian tensions than to soothe them, at least in the short term. It gives Hussein a platform from which to challenge the Shiite-dominated government and to rally Sunni insurgents. Shiites and Kurds, frustrated by delays in having Hussein face the justice they believe he deserves, may escalate attacks against Sunni or Baathist targets. The net result may be a spiraling pattern of vigilantism and counter-vigilantism.

3) Promoting the rule of law. Subjecting a former dictator to a court of law, rather than a firing squad, can commit a transitional regime to due process and the rule of law. But early indications do not give hope that the Hussein trial will promote this goal. Last-minute legal changes--such as the elimination of the right of defendants to represent themselves--have been made for political, rather than legal, reasons. Tribunal officials have been selectively targeted for dismissal by the de-Baathification Commission headed by Ahmad Chalabi.

Moreover, Iraq's president announced in September that he had learned from one of the tribunal's investigating judges that Hussein had confessed to ordering executions during the notorious Anfal campaign, raising further questions about the judicial independence of the tribunal. Even the decision to try Hussein for the Dujail killings before the completion of investigations of more serious atrocities appears to be politically motivated. The government hopes to demoralize Hussein loyalists by securing a swift conviction on the easiest charges to prove.

Even under the best of circumstances, the Hussein trial could not possibly accomplish all three of these goals simultaneously. Hussein's crimes are so numerous that no trial can produce both a full historical accounting and swift justice. Iraq may be better served by establishing a truth commission to write a comprehensive history of the abuses of the Hussein era. Efforts to manage the trial to promote political stability in Iraq are unlikely to succeed and will only reflect a continuation of the Hussein-era tradition of executive branch manipulation of the courts. Addressing Sunni grievances, protecting minority rights and sharing Iraq's wealth is the way to promote reconciliation.

The best hope for the Hussein trial to be meaningful is for the Iraqi government to accord him full due-process rights and to refrain from further interference and manipulation. If the Iraqi government accepts the constraints of the rule of law, the Hussein trial can teach Iraq the valuable lesson that the state may punish citizens, even one as detested as Hussein, solely on the basis of laws impartially applied, not on the whims or caprice of the ruler.

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The Influence of the Investigation of Illegal 2002 Presidential Election Funds on the Politics and Economy of Korea

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From August 2003 to May 2004, the Korean Supreme Prosecutors' Office, under the leadership of Ahn Dai-Hee, then-chief of its Central Investigation Department, conducted a major investigation of the use of illegal funds in the 2002 presidential election.

This criminal investigation, Korea's largest, targeted illegal activities of leaders of the major political parties and major Korean conglomerates, which had funneled illegal funds to the political parties.

The independent and strictly evidence-based investigation resulted in the arrests and indictments of numerous political and business leaders, and revealed serious corruption in Korean politics and business (also referred to as "government-business collusion").

Mr Ahn's talk will include personal reflections on the investigation and discussion of its impact on political reforms in Korea, including how the investigation helped to significantly reduce corruption in Korea.

Ahn Dai- Hee is Chief Prosecutor of the Seoul High Prosecutors' office. He began his legal career as Army Judge Advocate after passing the national bar examination in 1975 and while still a student at Seoul National University. A prosecutor throughout his career, Mr Ahn's straightforward leadership of the Korean Supreme Prosecutors' Office's investigation into illegal funds in the 2002 presidential election earned him national recognition. Mr Ahn's publications include Criminal Tax Law published by Bobmunsa in 2003.

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Ahn Dai-Hee Chief Prosecutor Speaker Seoul Supreme Prosecutors' office
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Korea Program

The Rule of Law and Democracy in Mexico

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Alberto Díaz-Cayeros

Encina Hall, C149
616 Jane Stanford Way
Stanford, CA 94305

(650) 725-0500
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Senior Fellow, Freeman Spogli Institute for International Studies
Professor, by courtesy, of Political Science
alberto_diaz-cayeros_2024.jpg MA, PhD

Alberto Díaz-Cayeros is a Senior Fellow at Stanford University's Freeman Spogli Institute for International Studies (FSI), and co-director of the Democracy Action Lab (DAL), based at FSI's Center on Democracy, Development and Rule of Law (CDDRL). His research interests include federalism, poverty relief, indigenous governance, political economy of health, violence, and citizen security in Mexico and Latin America.

He is the author of Federalism, Fiscal Authority and Centralization in Latin America (Cambridge, reedited 2016), coauthored with Federico Estévez and Beatriz Magaloni, of The Political Logic of Poverty Relief (Cambridge, 2016), and of numerous journal articles and book chapters.

He is currently working on a project on cartography and the developmental legacies of colonial rule and governance in indigenous communities in Mexico.

From 2016 to 2023, he was the Director of the Center for Latin American Studies at Stanford University, and from 2009 to 2013, Director of the Center for US-Mexican Studies at UCSD, the University of California, San Diego.

Affiliated faculty at the Center on Democracy, Development and the Rule of Law
Co-director, Democracy Action Lab
Director of the Center for Latin American Studies (2016 - 2023)
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A Dynamic Model of the Demand for the Rule of Law in Post-Communist Economies

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We investigate the demand for the rule of law in post-Communist economies after privatization under the assumption that theft is possible, that those who have "stolen" assets cannot be fully protected under a change in the legal regime towards "rule of law," and that the number of agents with control rights over assets is large. A demand for broadly beneficial legal reform may not emerge because the expectation of a legal vacuum increases the expected relative return to asset-stripping, and strippers may gain from a weak, corrupt state. The outcome can be inefficient even from the narrow perspective of the asset-strippers.

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Karla Hoff Speaker The World Bank
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Why China's Rise Will Be Peaceful: Hierarchy and Stability in East Asia

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Realpolitik pessimists, power transition theorists, and others see China's rise as inherently destabilizing. However, China has already been growing rapidly for almost three decades, and there is little evidence that the region is devolving into balancing, nor that China's rise is causing undue alarm in the region. China's expected emergence as the most powerful state in East Asia has been accompanied with more stability than pessimists believed because hierarchy, not balancing, is emerging in East Asia. Dr. Kang explains the relationships between dominant and secondary states in a hierarchic system. Furthermore, on the one hand, China has provided credible information about its capabilities and intentions to its neighbors. On the other hand, East Asian states actually believe China's claims, and hence do not fear -- and instead seek to benefit from - China's rise. This shared understanding about China's preferences and limited aims short-circuits the security dilemma.

David Kang has scholarly interests in both business-government relations and international relations, with a focus on Asia. His book Crony Capitalism: Corruption and Development in South Korea and the Philippines (Cambridge University Press, 2002), was named by Choice as a 2003 Outstanding Academic Title. He is also author of Nuclear North Korea: A Debate on Engagement Strategies, co-authored with Victor Cha (Columbia University Press, 2003). Kang is a Stanford alumnus (B.A. 1988, anthropology and international relations) and holds a Ph.D. in Political Science from the University of California at Berkeley.

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David Kang Visiting Professor, Shorenstein APARC and Associate Professor of Government, Dartmouth College Speaker
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Afghanistan at Halftime

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In a recent op ed, CDDRL's J. Alexander Thier discusses Afghanistan's landmark September 2005 elections. He notes, however, that while this is an encouraging sign, Afghanistan is far from out of the woods in terms of establishing itself as a stable state.

Afghanistan held its landmark legislative elections this Sunday. Almost exactly four years after 9/11, and the invasion that followed, Afghanistan will have, for the first time in its history, a democratically elected constitutional government. That is something remarkable, and cause to celebrate - but only in the way that one cheers hopefully during a tough game at halftime.

Everything we know about democracy promotion and post-conflict reconstruction tells us that Afghanistan is far from out of the woods. Even after significant international intervention, many failed states remain unstable, or relapse into conflict and chaos. Remember Haiti? The United States invaded in 1994 and oversaw reconstruction and elections in 1995 and 2000, as international forces slowly withdrew. By 2004, U.S. and United Nations Forces were dispatched to the troubled island again. Haiti is not an outlier. World Bank studies show that countries coming out of civil war are forty percent likely to return to war within five years. It took one horrific hurricane to turn New Orleans to chaos. Imagine the effects of 25 years of war.

One of the main reasons failing countries continue to fail is economic. Economic recovery after war provides one of the best measures of the likelihood of long-term stability. International assistance can play a key role in jump-starting the economy and paying for basic government services, but it can take a generation to return to pre-war standards of living. The problem is that donor countries tend to be most generous in the first few years of the crisis - when local capacity to do something with those funds is limited. And just when the government starts to get on its feet - usually around the four-year mark - the assistance dries up.

The Afghan economy has seen remarkable growth rates over the last four years, but that is only half good. There is a truly free market now in Afghanistan - free from the rule of law. Much of the growth has come from the booming opium trade and other smuggling operations. While a strong economy is necessary to rebuild state and society, a criminal economy will necessarily destroy them both.

Politically, Afghanistan is getting its first taste of real elections - but it is far from being a stable democracy. There were more than 5,000 candidates in the legislative elections this Sunday, violence was relatively low, and turnout decent - all signs that political participation is blossoming. But nobody knows who will run the new parliament, or how it will function. It has no building and no staff. The only other parliament in Afghanistan's history, from 1965 to 1973, is widely blamed for increasing the polarization that led to civil war there. Since armed warlords still dominate many parts of the country, they will undoubtedly be strongly represented in the new legislature. As we have seen in places like Liberia and Serbia, post-conflict elections can produce quite undemocratic leaders.

What does this mean for Afghanistan? First, it means that the next four years will be as important there as the last four. Afghanistan's leaders, elected and otherwise, must put the cause of their nation before their factional, ethnic and venal interests. For our part, the United States and its allies must continue to support Afghanistan, financially and militarily, until it gets out of the danger zone. That means the same level of support for at least another four years.

Second, it means we have to shift our mentality there from short term to long term. If the United States has one overarching goal, it must be to build a legitimate Afghan state that is strong enough to survive and competent enough to deliver results. The Afghan police and legal system remain in shambles. Afghanistan's school system was rated the worst in the world last year by the United Nations Development Program. More international support needs to go to education, training a capable Afghan government, and supporting the rule of law.

Finally, it means something a little more intangible: continued political attention. If Afghanistan falls off the policy agenda in Washington, London and Berlin, the dangers that lurk there will prosper. Lagging reconstruction is already creating support for the ongoing Taliban insurgency. An unchecked opium trade keeps warlord armies well fed.

On this anniversary, we must remember the true cause of those grim attacks four years ago: Bin Laden and Al Qaeda had free reign of a failed state in chaos. We may not be able to find bin Laden, but we know where Afghanistan is located.

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David Kang

Shorenstein APARC
Stanford University
Encina Hall E301
Stanford, CA 94305-6055

(650) 725-6392 (650) 723-6530
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Visiting Professor
David_Kang.jpg PhD

David Kang is associate professor of government, and adjunct associate professor and research director at the Center for International Business at the Tuck School of Business at Dartmouth. He has scholarly interests in both business-government relations and international relations, with a focus on Asia. At Tuck he teaches courses on doing business in Asia, and also manages teams of MBAs in the Tuck Global Consultancy Program that conduct in-country consulting projects for multinational companies in Asia.

Kang's book, Crony Capitalism: Corruption and Development in South Korea and the Philippines (Cambridge University Press, 2002), was named by Choice as one of the 2003 "Outstanding Academic Titles". He is also author of Nuclear North Korea: A Debate on Engagement Strategies (co-authored with Victor Cha) (Columbia University Press, 2003). He has published scholarly articles in journals such as International Organization, International Security, Comparative Politics, International Studies Quarterly, and Foreign Policy. He is a frequent radio and television commentator, and has also written opinion pieces in the New York Times, the Financial Times, the Los Angeles Times, Chosun Ilbo (Seoul), Joongang Ilbo (Seoul), and writes a monthly column for the Oriental Morning News (Shanghai). Kang is a member of the editorial boards of Political Science Quarterly, Asia Policy, IRI Review, Business and Politics, and the Journal of International Business Education.

Professor Kang has been a visiting professor at Stanford University, Yale University, Copenhagen Business School (Denmark), the University of Geneva IO-MBA program (Switzerland), Korea University (Seoul, Korea) and the University of California, San Diego. He received an AB with honors from Stanford University and his PhD from University of California, Berkeley.

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