The Dictators Handbook

Summary

The Dictator’s Handbook: Why Bad Behavior is Almost Always Good Politics by Bruce Bueno de Mesquita and Alastair Smith is a provocative exploration of the rules that govern political power. The authors argue that whether in democracies, dictatorships, or corporations, leaders prioritize staying in power above all else, because if they didn't somebody else who did, would replace them soon.

The book is not as good as I had hoped because it inspired one of my favorite videos of all time–Rules for Rulers by CGP Grey. But they present the same framework explaining how political systems operate, emphasizing the importance of coalitions and the self-interested behavior of leaders. It's just that the video is so much better at showing and guiding the same concepts that reading the book felt kind of redundant at times.

Key Ideas

The Selectorate Theory:

There is only a subset of people necessary to decide who stays in power, political decisions are designed to favour this subset of people. Leaders aim to maximize loyalty within the winning coalition, often by distributing private benefits rather than serving the broader public good. The public is split into people whose voices matter and those where it doesn't because they can't influence politics.

The biggest difference between a democracy and a dictatorship is the number of people whose support matters to form political governments. CGP grey calls this the keys to power. In democracies there are many, in dictatorships only a few.

The corollary of this is that Leaders, regardless of their system have to focus on maintaining power. They make decisions based on what secures their position, even if it harms the public and will profit the selectorate over anybody else, because that's what keeps them in power.

This means that corruption and cronyism are rational strategies for maintaining power in systems with small coalitions (and to some extent even in big systems). Leaders prioritize enriching their loyal supporters over improving governance or public welfare and if they don't they get replaced by leaders who do.

• Leaders are as strong as their support base. Keeping the coalition loyal is the foundation of political survival.
• Leaders prioritize policies that secure their position over those that benefit society at large.
• Larger coalitions in democracies force leaders to serve broader interests, resulting in better governance and public goods.
• Reforming governance requires altering the size and structure of coalitions to align leaders’ interests with public welfare, in other words, changing the system requires changing the incentives -> a powerful lesson also found in Charlie Mungers Almanack.

Overall, this book argues convincingly that the good and bad behavior of political figures, that we see in day to day life is motivated by the same set of incentives. And that fundamentally political change is hard to achieve because political systems have a "grain" defined by their incentives, and going against the grain doesn't happen. Therefore the only way to affect political systems is by changing them from the ground up so that their incentive structures for people in power, happen to be aligned with the broader population.

In a way, democracy is a flawed attempt of doing that. Flawed, because democracy still suffers from the same problem (although to a lesser extent) because some voter groups are more important than others in deciding and influencing the outcome of the vote and therefore politicians will cater to them more at the exclusion of the public good.

The book sheds light on the universal rules of power across political systems and emphasizes the role of incentives in shaping governance. It is both a guide to understanding political behavior and a call to reform systems to align leadership with the public good.