How Dictators Lie about Economic Growth

A new study uses a novel technique to measure economic activity—in a way that can't be manipulated by autocrats. And it turns out despots have been rigging their economic data for decades.

Thank you for reading The Garden of Forking Paths. Part of this article is for paid subscribers only. If you’d like to support my work, please consider upgrading. If not, apologies for cluttering your inbox. I humbly beg for your forgiveness.

The Myth of Benevolent Dictatorship

“At least they make the trains run on time.”

That’s the refrain of dictator apologists, the last cynical bastion of defending the indefensible. They may be immoral monsters, but darn it, those immoral monsters know how to manage an economy.

This is the Myth of the Benevolent Dictator, a pernicious lie that millions around the world cling to, as they advocate against democracy. The propagandists in palaces are all too eager to spread the lie, hoping that the world will turn a blind eye to atrocities, so long as they come with a few extra points of GDP growth.

Too often, they’re proved right.

In 2013, for example, Rwanda’s dictator, Paul Kagame, got branded “the global elite’s favorite strongman.” Kagame understood that Western donors wanted results. They were sick and tired, he realized, of pouring money down the drain into corrupt regimes with autocrats who stole it to enrich themselves. To extract the most foreign aid from them, Kagame would need to be different. He’d need to not just promise results, but show them.

Better yet, he could do so while invoking a magic word—a word so powerful with donors that if international economists established a fetish website, it would be their top search term:

Metrics.

Kagame showed donors his methods, which involved a contract called an imihigo, in which local officials would guarantee to deliver certain specific goals, each measured carefully to ensure they delivered. This included the most minute and strange measurements, including the number of cows successfully inseminated in a certain period. And he delivered: Rwanda, on paper, was an unbridled success story, an astonishing turnaround triumph, from genocide to gangbuster GDP numbers. Most years, Rwanda’s official GDP growth rate hovered between 5 and 10 percent.

Stellar results garnered praise from political rockstars across the globe. The Clinton Global Initiative gave Kagame an award; Kagame met Bono and Bill Gates; Tony Blair repeatedly praised him. It turns out that good economic results for dictators are treated a bit like the medieval indulgences doled out by the Catholic Church to those who paid for them: they magically absolve your other sins.

Kagame won his last “election-style event” (a more accurate phrase than “election” in this case) with 98.8% of the vote, numbers that would have made the late Saddam Hussein shed a tear with pride. And yet, in Rwanda, there have been repeated instances of torture, murder, assassinations, and a string of other human rights abuses.

The Myth Gets Shattered

For decades, then, economic growth has been the last line of defense for morally abhorrent regimes that deserve to be shunned, isolated, and universally condemned. But the apologists didn’t reckon with two serious problems with the dictators-produce-growth narrative.

The first reckoning is more banal. The second revelation is more of a bombshell, revealed by a remarkable new research technique to catch autocrats in their own lies. Because, as new research has shown, dictators are juking the stats.