International Political Economy Series

Series Editor: Timothy M. Shaw, Visiting Professor, University of Massachusetts

Boston, USA and Emeritus Professor, University of London, UK

The global political economy is in flux as a series of cumulative crises impacts its
organization and governance. The IPE series has tracked its development in both
analysis and structure over the last three decades. It has always had a concentra-
tion on the global South. Now the South increasingly challenges the North as the
centre of development, also reflected in a growing number of submissions and
publications on indebted Eurozone economies in Southern Europe.

An indispensable resource for scholars and researchers, the series examines a vari-
ety of capitalisms and connections by focusing on emerging economies, compa-
nies and sectors, debates and policies. It informs diverse policy communities as
the established trans-Atlantic North declines and ‘the rest’, especially the BRICS,
rise.

Titles include:

Matthias Ebenau, Ian Bruff and Christian May (editors)

STATES AND MARKETS IN HYDROCARBON SECTORS
Critical and Global Perspectives

Jeffrey Dayton-Johnson
LATIN AMERICA’S EMERGING MIDDLE CLASSES
Economic Perspectives

Andrei Belyi and Kim Talus

STATES AND MARKETS IN HYDROCARBON SECTORS

Dries Lesage and Thijs Van de Graaf

RISING POWERS AND MULTILATERAL INSTITUTIONS

Leslie Elliott Armijo and Saori N. Katada (editors)

THE FINANCIAL STATECRAFT OF EMERGING POWERS
Shield and Sword in Asia and Latin America

Md Mizanur Rahman, Tan Tai Yong, Ahsan Ullah (editors)

MIGRANT REMITTANCES IN SOUTH ASIA
Social, Economic and Political Implications

Bartholomew Paudyn
CREDIT RATINGS AND SOVEREIGN DEBT
The Political Economy of Creditworthiness through Risk and Uncertainty

Lourdes Casanova and Julian Kassum

THE POLITICAL ECONOMY OF AN EMERGING GLOBAL POWER
In Search of the Brazil Dream

Toni Haastrup, and Yong-Soo Eun (editors)

REGIONALISING GLOBAL CRISES
The Financial Crisis and New Frontiers in Regional Governance
Kobena T. Hanson, Cristina D’Alessandro and Francis Owusu (editors)
MANAGING AFRICA’S NATURAL RESOURCES
Capacities for Development

Daniel Daianu, Carlo D’Adda, Giorgio Basevi and Rajeesh Kumar (editors)
THE EUROZONE CRISIS AND THE FUTURE OF EUROPE
The Political Economy of Further Integration and Governance

Karen E. Young
THE POLITICAL ECONOMY OF ENERGY, FINANCE AND SECURITY IN THE
UNITED ARAB EMIRATES
Between the Majilis and the Market

Monique Taylor
THE CHINESE STATE, OIL AND ENERGY SECURITY

Benedicte Bull, Fulvio Castellacci and Yuri Kasahara

BUSINESS GROUPS AND TRANSNATIONAL CAPITALISM IN CENTRAL
AMERICA
Economic and Political Strategies

Leila Simona Talani

THE ARAB SPRING IN THE GLOBAL POLITICAL ECONOMY

Andreas Nölke (editor)

MULTINATIONAL CORPORATIONS FROM EMERGING MARKETS
State Capitalism 3.0

Roshen Hendrickson
PROMOTING U.S. INVESTMENT IN SUB-SAHARAN AFRICA

Bhumitra Chakma
SOUTH ASIA IN TRANSITION
Democracy, Political Economy and Security

Greig Charnock, Thomas Purcell and Ramon Ribera-Fumaz

THE LIMITS TO CAPITAL IN SPAIN
Crisis and Revolt in the European South

Felipe Amin Filomeno

MONSANTO AND INTELLECTUAL PROPERTY IN SOUTH AMERICA

Eirikur Bergmann
ICELAND AND THE INTERNATIONAL FINANCIAL CRISIS
Boom, Bust and Recovery

Yildiz Atasoy (editor)

GLOBAL ECONOMIC CRISIS AND THE POLITICS OF DIVERSITY

Gabriel Siles-Brügge
CONSTRUCTING EUROPEAN UNION TRADE POLICY
A Global Idea of Europe
Jewellord Singh and France Bourgouin (editors)
RESOURCE GOVERNANCE AND DEVELOPMENTAL STATES IN THE GLOBAL
SOUTH
Critical International Political Economy Perspectives

Tan Tai Yong and Md Mizanur Rahman (editors)

DIASPORA ENGAGEMENT AND DEVELOPMENT IN SOUTH ASIA

Leila Simona Talani, Alexander Clarkson and Ramon Pachedo Pardo (editors)
DIRTY CITIES
Towards a Political Economy of the Underground in Global Cities

Matthew Louis Bishop

THE POLITICAL ECONOMY OF CARIBBEAN DEVELOPMENT

Xiaoming Huang (editor)

MODERN ECONOMIC DEVELOPMENT IN JAPAN AND CHINA
Developmentalism, Capitalism and the World Economic System

Bonnie K. Campbell (editor)

MODES OF GOVERNANCE AND REVENUE FLOWS IN AFRICAN MINING

Gopinath Pillai (editor)

THE POLITICAL ECONOMY OF SOUTH ASIAN DIASPORA

Patterns of Socio-Economic Influence

Rachel K. Brickner (editor)

MIGRATION, GLOBALIZATION AND THE STATE

Juanita Elias and Samanthi Gunawardana (editors)

THE GLOBAL POLITICAL ECONOMY OF THE HOUSEHOLD IN ASIA

Tony Heron
PATHWAYS FROM PREFERENTIAL TRADE
The Politics of Trade Adjustment in Africa, the Caribbean and Pacific

International Political Economy Series

Series Standing Order ISBN 978–0–333–71708–0

You can receive future titles in this series as they are published by placing a stand-
ing order. Please contact your bookseller or, in case of difficulty, write to us at the
address below with your name and address, the title of the series and one of the
ISBNs quoted above.

Customer Services Department, Macmillan Distribution Ltd, Houndmills, Basing-

stoke, Hampshire RG21 6XS, England
This page intentionally left blank
Gangster States
Organized Crime, Kleptocracy
and Political Collapse

Katherine Hirschfeld
Associate Professor, University of Oklahoma, USA
© Katherine Hirschfeld 2015.

All rights reserved. No reproduction, copy or transmission of this

publication may be made without written permission.

No portion of this publication may be reproduced, copied or transmitted

save with written permission or in accordance with the provisions of the
Copyright, Designs and Patents Act 1988, or under the terms of any licence
permitting limited copying issued by the Copyright Licensing Agency,
Saffron House, 6-10 Kirby Street, London EC1N 8TS.

Any person who does any unauthorized act in relation to this publication
may be liable to criminal prosecution and civil claims for damages.

The author(s) has/have asserted his/her/their right(s) to be identified as the

author(s) of this work in accordance with the Copyright, Designs and Patents
Act 1988.

First published 2015 by

PALGRAVE MACMILLAN

Palgrave Macmillan in the UK is an imprint of Macmillan Publishers Limited,

registered in England, company number 785998, of Houndmills, Basingstoke,
Hampshire, RG21 6XS.

Palgrave Macmillan in the US is a division of St Martin’s Press LLC,

175 Fifth Avenue, New York, NY 10010.

Palgrave is the global academic imprint of the above companies and has com-
panies and representatives throughout the world.

Palgrave® and Macmillan® are registered trademarks in the United States,

the United Kingdom, Europe and other countries.

ISBN: 978–1–137–49028–5

This book is printed on paper suitable for recycling and made from fully
managed and sustained forest sources. Logging, pulping and manufacturing
processes are expected to conform to the environmental regulations of the
country of origin.

A catalogue record for this book is available from the British Library.

A catalog record for this book is available from the Library of Congress.
Contents

List of Figures and Tables ix

Preface x
Acknowledgments xiii

1 Introduction 1
1.1  Secret Vices 1
1.2  What Is Organized Crime? 3
1.3  Evolutionary Stable Strategies 7
1.4  Abbreviated Case Study: Post-Soviet Russia 10
1.5  Gangs as Primitive States 12
1.6  Collapse and Regeneration 17
1.7  Darwinian Political Economy 19

2 What Is Organized Crime? 23

2.1  Formal versus Informal Economies 24
2.2  Organized Crime as Racketeering 26
2.3  Descriptive Vignette: Camorra 27
2.4  The Organization of Crime 28
2.5  Racketeering in Prison Economies 29
2.6  The Organization of a Stateless Campus Economy 30
2.7  Labor Rackets 31
2.8  Gambling Rackets 33
2.9  Prohibition 35

3 Failing Economics 38
3.1  Contaminated Markets 38
3.2  The Cold War in Economic Thinking 39
3.3  The Road to Friedmanistan 44
3.4  Experimental Vignette: The Other Invisible Hand 46

4 The Evolution of Racketeering 49

4.1  Behavioral Economics Meets Behavioral Ecology 49
4.2  Evolutionary Stable Strategies 51
4.3  Cheating and Systemic Complexity 54
4.4  Racketeering as an Evolutionary Stable Strategy 57
4.5  ESS Thinking: Farming and Raiding 57
4.6  From Raiding to Protection Rackets 61
viii Contents

 4.7  Supply and Demand 62

 4.8  The Geography of Protection 65
 4.9  Narrative Vignette: Raiding and Trading on the Steppes 65

5 Organized Crime and Kleptocracy 68

 5.1  From Gangs to Primitive States 68
 5.2  The Underworld as Prehistory 69
 5.3  Territoriality, Leadership, Violence 69
 5.4  Prehistoric Gangster-States 73
 5.5  Early European Gangster-States 75
 5.6  Mafia Branding: The Exquisite Corpse 76
 5.7  Narrative Vignette: Under the Cartels 77
 5.8  The Gangsterization of Democracy 80
 5.9  Scenes from a Kleptocracy 83
5.10  Cuba Case Study 84
5.11  Comparative Vignettes 92
5.12  Hispañola 93
5.13  Haiti 95
5.14  Zaire 98
5.15  Post-Soviet Gangster-States 99
5.16  Narrative Vignette: After the USSR 99
5.17  Postscript: American Exceptionalism? 101

6 Things Fall Apart . . . and Rebuild 104

 6.1  Collapse as Conundrum 104
 6.2  Progress and Underdevelopment 106
 6.3  The State as Exaptation 109
 6.4  Secondary State Formation in Prehistory 111
 6.5  Collapse and Regeneration 112
 6.6  Gray Zones and Demapping 113
 6.7  Yugoslavia/Bosnia 117
 6.8  Moldova and Transnistria 120

7 Darwinian Political Economy 122

 7.1  Research Redux 122
 7.2  Evolutionary Stable Strategies 123
 7.3  Darwinian Political Economy 126

Notes 129

References 151

Index 171
List of Figures and Tables

Tables

1.1 Partial List of Anecdotal Terminology Used by Different

Researchers to Describe the Fusion of Organized Crime
and State Power 16
4.1 Original Payoff Matrix for Hawks and Doves Game
(taken from Smith, 1982:12) 52

Figures

3.1 Visual Representation of Utopian Thinking in

20th Century Political Economy 43
4.1 Supply/Demand Curve with Hypothetical Mafia
Threshold Triggered When Demand Is Very High and
Supply Is Low 64
6.1 Spencerian Misrepresentation of Human Evolution
Implying Directionality and Progress 105

ix
Preface

This research originally developed out of frustration with the inability of

social scientists to explain the catastrophic outbreak of organized crime,
violence and instability that erupted after the fall of the USSR in the
1990s. I was a graduate student during these years and felt these events
were of great historic importance, so it was disturbing that none of the
faculty in my PhD program could explain why these events occurred.
At the time, the study of political economy in anthropology was
dominated by Marxist scholars who romanticized the Soviet Union and
dismissed organized crime as part of the degeneracy of capitalism, even
though other capitalist countries were not experiencing these problems.
This Marxist language seemed as unhelpful as the aggressive privatiza-
tion rhetoric voiced by conservative economists. Both ideologies had
blind spots about the problem of organized crime.
In 1994 Larry Summers (one of President Clinton’s key economic advi-
sors) testified before Congress and claimed the administration’s “shock
therapy” programs were producing excellent results:

Russia has achieved impressive gains in privatization and in liberali-

zation of its economy . . . Throughout the region, bold reform has led
to the best results . . . I would conclude that reform is like a bicycle,
far more likely to be stable if moving rapidly . . . I conclude that
recent events . . . serve to indicate that our strategy . . . to create the
institutions of a civil society and a market economy, coupled with
conditional financial support, is the appropriate one (1994:5–10).

Only a few years after these rosy predictions, Russia fell into a mas-
sive financial crisis driven in part by years of unchecked racketeering,
corruption, asset-stripping, rent-seeking and bank fraud. The country
underwent rapid decline and experienced dramatic increases in poverty,
violence and disease. Twenty years later, Russia has re-emerged as Putin’s
Kleptocracy – a corrupt, authoritarian regime with imperial ambitions
and a poor human rights record (Dawisha, 2014).
Social scientists still have not been able to explain this course of events.
There is a theoretical void surrounding the political economy of organ-
ized crime and kleptocracy that does not bode well for making sense of

x
 Preface xi

international security trends in the 21st century. Why did organized

crime emerge in such a violent and destabilizing form during the 1990s?
How did the mafia wars and state failure of the immediate post-Soviet
era develop into authoritarian kleptocracy over time?
Readings in evolutionary biology turned out to offer a powerful but
unconventional answer for these questions. These models predict how
expanding gangsterism in an informal economy might result in the
remapping of formal political boundaries to create unstable kleptocratic
regimes. Initial proposals to develop a new Darwinian model of politi-
cal economy, however, were not supported by funding agencies. As a
result, the research for this book has been done incrementally over the
past two decades, as a sideline curiosity to my primary work on health
trends in Cuba.
Two junior faculty grants from the University of Oklahoma funded
trips to the National Archives in Washington, DC; College Park, Mary-
land; and Fort Worth, Texas, where I was able to explore declassified
criminal intelligence files, Bureau of Narcotics records, diplomatic cor-
respondence and other archival material detailing the intersection
between organized crime, instability and kleptocratic state formation in
20th-century Cuba. This intensive case study of Cuba was supplemented
by further reading in post-Soviet studies, behavioral ecology, criminol-
ogy, political theory, archaeology and history. Additional case studies of
organized crime and kleptocracy were compiled from secondary sources,
including journalistic and scholarly works from the Dominican Repub-
lic, Haiti, Russia, Central Africa, Central Asia and Eastern Europe.
The Darwinian model presented here proposes a new vocabulary for
the study of political economy and organized crime. It repurposes tools
and concepts from anthropology, archaeology and behavioral ecology
to explain and predict the evolution of organized crime in unregulated
systems of exchange and the subsequent transformation of these rack-
eteering groups into unstable kleptocratic states. The fact that this work
developed out of anthropology means that it does not conform to cur-
rent methodological norms of political science or economics. Profes-
sional economists may find it troubling to see qualitative historical data
used to challenge deeply held beliefs about the ability of unregulated
markets to achieve equilibrium. Criminologists may find my defini-
tional generalizations about organized crime to be simplistic or redun-
dant. Political theorists may not accept my proposal that “civilization”
and “the state” originally emerged out of territorial conflicts between
warring organized crime groups.
xii Preface

While the individual elements of this work may have these and
other limitations, I believe it offers important contributions to schol-
ars interested in the intersection of political economy, criminology and
international relations. It proposes a new way to explain complexity,
stratification and state formation in prehistoric as well as contemporary
populations and links archaeological research on secondary state for-
mation with contemporary studies of warlords and failed states. Recent
work in all of these fields has been limited by an outdated 20th-century
vocabulary that defines key concepts like “free markets,” “the state,”
“crime” and “corruption” in artificially static ways that limit under-
standing of post-Soviet transitions, warlordism, emerging kleptocracies
and other contemporary problems. My hope is that this work will stimu-
late new ways of thinking and generate new research that will allow
scholars to better understand how these forces are combining to shape
international political economy in the 21st century.
Acknowledgments

I have been extremely fortunate to find supportive and enthusiastic edi-

tors in Christina Brian and Timothy Shaw, who felt this book would be
a good fit for Palgrave’s International Political Economy series. Timo-
thy Earle generously read through an early draft and provided excel-
lent advice for revisions. Peter Reuter offered insightful suggestions on
the introductory chapter. I must also thank two anonymous reviewers,
whose criticisms turned out to be most useful. Any remaining errors are
exclusively my own.
Additional gratitude goes to my colleagues in the Department of
Anthropology at the University of Oklahoma. I am fortunate to work
with this diverse and talented group of scholars. Diane Warren and
Bonnie Pitblado deserve extra thanks for their timely encouragement.
Michele Eodice, Howard Stein, Peter Cahn, Loretta Bass, Rita Keresztesi
and Lucas Bessire have all offered varieties of helpful publication advice
over the years.
Taylor Smith, Keli Mitchell and Misty Wilson have provided outstand-
ing administrative support at all levels. Curt Tweddell donated time and
talent to help produce the artwork, along with Clint Hansen and Scott
Hull, who produced a fantastic visual creation in a short amount of time.
Additional thanks also go to Suzanne Harrell, Dean Kelly Damphousse
and Associate Dean Victoria Sturtevant in the College of Arts and Sci-
ences at the University of Oklahoma. They have made my time as
department chair far more pleasant than I ever envisioned it could be,
and their combined administrative wisdom has saved me from grievous
mistakes on more than one occasion.
The University of Oklahoma has also been generous in providing pub-
lication support. Subvention funds from the College of Arts and Sci-
ences and the Vice President for Research have been instrumental in
completing this work. The research was facilitated in part by two Junior
Faculty fellowships I received in 2003 and 2006. These small seed grants
allowed me to spend two extremely productive summers working in
archival collections in Washington, DC; Tampa and Miami, Florida; and
Fort Worth, Texas. I also cannot express enough gratitude to the helpful
staff at all of the National Archives facilities I have visited over the years.
The riveting description of life in Mexico’s cartel zones (“Under
the Cartels”) is reprinted with generous permission from the literary
xiii
xiv Acknowledgments

magazine N Plus 1. The excerpt from Roberto Saviano’s Gomorrah is

reprinted courtesy of Farrar, Straus and Giroux; the sections from Jack
Weatherford’s Genghis Khan and the Making of the Modern World are
included with permission from Random House, as is the short narrative
from Misha Glenny’s brilliant McMafia.
I must also thank Charles Rutheiser, who introduced me to James Ell-
roy’s fiction back in the 1990s and has remained steadily interested in
seeing this work develop, and also to Mark Ridley, who taught my origi-
nal transformative graduate seminar in evolutionary theory all those
years ago. If I had it to do over again, I would become an evolutionary
biologist.
On the home front, my husband Corson deserves extra love and
thanks for putting up with me during the writing process. This book is
dedicated to him for staying by my side and remaining supportive even
during the most stressful writing interludes. The next book will be his,
and then it will be my turn to return the favor.
1
Introduction

1.1  Secret Vices

This book is the product of an odd confluence of events: a secret predi-

lection for lurid crime fiction that unexpectedly collided with readings
from a graduate seminar in evolutionary biology many years ago. In a
rational world, these divergent realms would not intersect. The reason
I started reading lowbrow crime novels in the first place was to escape
the highbrow tedium that characterized my anthropology graduate
seminars. (There are only so many long-winded discussions of Gramsci
and Bourdieu one can endure.) Late-night infusions of lean, minimalist
crime fiction offered a compelling antidote to the rhetorical excesses of
postmodern theory. But evolutionary biology turned out to be anything
but tedious. It was quite enthralling, and over time the class readings
began to compete with my stash of pulp fiction until I became equally
immersed in both genres. At some point, cognitive wires crossed, and
evolutionary theory suddenly sparked a whole new way of thinking
about organized crime.
The initial collision came from a passage in The Big Nowhere, a par-
ticularly sordid James Ellroy novel that I read at the same time I was
assigned Robert Axelrod’s classic, The Evolution of Cooperation. Like all
Ellroy books, The Big Nowhere features an array of interlocked subplots
wound tightly across the seedy underworld of 1950s Los Angeles. One of
the ongoing points of tension in the story is a violent gangland rivalry
between two groups of mobsters: the respective outfits of Jack Dragna
and Mickey Cohen. Dragna and Cohen were real-life gangsters of the fif-
ties but are fictionalized in the novel. The key twist in the story, and the
element that makes Ellroy’s fiction uniquely chilling, was that this mafia
rivalry played out as a series of conflicts between corrupt police offic-
ers in the LA county sheriff’s department, who were protecting Mickey
Cohen’s rackets, and corrupt cops in the Los Angeles city police depart-
ment, who were protecting Jack Dragna’s rackets.

1
2  Gangster States

Gentler crime novels feature idealistic police officers crusading to

suppress or at least infiltrate the drug economy of the underworld. But
in Ellroy’s fiction, there are no white hats. The police were as deeply
involved in the drug trade as the gangsters, and it was often difficult
to draw a clear line between them. These fictional cops had minimal
interest in protecting the public and instead dedicated their energies to
protecting the territories of their preferred racketeers against the incur-
sions of rival gangster-police.
It was all very disturbing to read. But the more I thought about it,
the more perversely rational Ellroy’s scenario began to appear. Rational,
that is, in purely economic terms. But this is one of the key insights that
come from studying evolutionary biology: natural selection frequently
produces things that are wretchedly amoral from a human point of
view, like nasty predators and parasites, but entirely logical from an evo-
lutionary point of view. The trick is to suspend one’s initial revulsion
and stay focused on the logic of the system. Under what conditions
does a parasitic way of life lead to improved survival or increased repro-
duction? The desirability of the trait in question is irrelevant in these
equations.
Reading Ellroy’s fictional portrayal of gangster-police in Los Angeles
triggered a similar psychological response—initial revulsion followed
by an intuitive sense that the cold logic of economics would implicitly
favor such a scenario. If we look at what is actually happening in Ell-
roy’s novel, what we see is that two groups of gangsters have used police
(the LAPD and the LASD) to organize and defend economic monopolies
within specific geographic territories. By selectively arresting any of Jack
Dragna’s dealers who attempted to sell heroin in Mickey Cohen’s terri-
tory, the LASD effectively maintained Cohen’s monopoly on the heroin
trade within its jurisdiction. The LAPD did the same for Jack Dragna. So
the municipal boundaries of the LAPD and LASD became the de facto
territorial boundaries of each organized crime group.
In an amoral and profit-driven universe, using police to create and
enforce monopolies this way would represent a profitable innovation,
as it would result in an exponential increase in revenues. Monopolies
are lucrative for monopolists, even though they are frowned upon by
advocates of free trade. But there are no agencies to protect free trade
or consumers’ rights in the underworld. So why wouldn’t ambitious
entrepreneurs use violence to create monopolies if there were no police
or government to prohibit such innovations? Criminologists’ and jour-
nalists’ descriptions of the drug trade and other underworld economies
certainly suggest that this kind of behavior is common in these markets.
 Introduction 3

At this point, language becomes confusing. In the unregulated subter-

ranean economy of the drug trade, there are no police. Except that fre-
quently there are. But they are not the same kinds of police one finds in
blue uniforms on street corners or in the offices of the FBI or the Securi-
ties and Exchange Commission. Instead of regulating markets to ensure
free trade, or protecting the property rights of citizens against the preda-
tions of criminals, the underworld is policed by gangsters who use vio-
lence to organize and defend economic monopolies. So really there are
two very different forms of policing going on: one (in the upper world)
that results in protection of private property and individual rights and
another (in the underworld) that creates monopolies and aggregates
wealth into the hands of monopolistic gangsters.
James Ellroy’s unique genius as a writer of noir fiction was to conflate
these two forms of policing into one. In The Big Nowhere, the upper-
world police (the LAPD and the LASD) were corrupted into serving as
underworld monopoly enforcers. This book, however, is not about the
corruption of municipal police departments by organized crime groups.
It is instead about developing a vocabulary to describe and predict the
evolution of territorial underworld monopoly enforcement. What forces
facilitate the evolution of repressive economic monopolies in the state-
less realm of the underground economy? What are the implications
of this evolutionary process for larger patterns of social, political and
economic stratification in human societies, past and present? These are
some of the core questions this book seeks to address.

1.2  What Is Organized Crime?

At this point, some definitions would be useful. What is organized

crime? I am using the phrase here to mean the literal organization of
unregulated markets into hierarchical, extractive monopolies through
the use of violence or threats of violence to outlaw entrepreneurship
and restrict economic competition within a defined geographic terri-
tory. This is not a universally accepted definition, and these concepts
continue to be debated by criminologists (Anderson, 1995; Caiden and
Alexander, 1985; Ekblom, 2003; Klerks, 2003; Maltz, 1985; Naylor, 2002,
2003; Rawlinson, 2003; Reuter, 1985, 1995; Woodiwiss, 2003). These
definitional issues will be explored in Chapter 2.
Part of the problem in accurately defining organized crime emerges
from the way people outside of criminology intuitively form definitions
based on movies or television. Few people in academia have studied or
interacted with actual gangsters, but popular culture is steeped in the
4  Gangster States

mythology of The Godfather and The Sopranos. In these cinematic rep-

resentations, organized crime is frequently portrayed in ethnic terms,
as synonymous with “the Mafia” (see Klerks, 2003). Mafias, in turn, are
defined as Italian or Sicilian families who engage in a range of crim-
inal activities imported into the United States with them during the
19th century. Early FBI documents describing organized crime in the US
strongly reinforce this “alien conspiracy view” (Rawlinson, 2003:135).
This linguistic construction does have elements of truth. There are
established Mafias in Sicily that have been described as having impor-
tant branches operating in the United States and abroad (Gambetta,
1993; Mandel, 2011; Sterling, 1990; Saviano, 2006). But the tendency to
equate Sicilian or Italian Mafias with the entire phenomenon of organ-
ized crime obscures the fact that many non-Italians, as well as many
native-born US citizens, have also engaged in these kinds of activities.
Drawing ethnic boundaries around the phenomenon of organized crime
is clumsy and imprecise, not to mention offensive to millions of law-
abiding immigrants (1).
James Ellroy’s fictional portrayal of organized crime in Los Angeles
was primarily economic rather than ethnic. The goal of the multieth-
nic criminal groups portrayed in The Big Nowhere was the organization
and territorial defense of economic monopolies within the informal
economy. Or to put it another way, the organization of crime was about
the economic monopoly, not the ethnicity, kinship or rituals of the
organizers.
Shifting the focus in this direction offers improved definitional clar-
ity for scholarly research. In this regard, the economic term “racket”
does a better job of capturing the essence of this phenomenon than the
ethnic term “mafia.” This linguistic reorientation shifts the focus of the
inquiry away from men of Italian descent (with their inevitably colorful
nicknames and cinematic personas) and toward the economic activities
or illicit businesses that essentially define organized criminal groups.
This is not to say that colorful men of Italian descent are not interesting.
They are. But one of the goals of this book will be to argue that their
presence is not required for crime to become organized.
If organized crime is defined as an economic rather than an ethnic
activity, it becomes possible to explore how previously unseen laws of
economics might act to shape the dynamics of this sector. Or to put it
another way, building a new definition of organized crime as a poten-
tially rational (though still immoral) economic phenomenon allows for
the generation of an innovative set of research questions. Why are some
informal economies composed of decentralized systems of exchange
 Introduction 5

based on peaceful cooperation between buyers and sellers while others

evolve into predatory, monopolistic rackets? What environmental fac-
tors facilitate the evolution of violent predation and hierarchical com-
plexity in unregulated economic systems? How does the emergence of
racketeering in an economic system help us better understand the ori-
gins of inequality, stratification and hierarchy in human history?
Anthropology is classified as a social science. But the field includes
archaeology and human evolution so that the insights of Darwinian
theory can be brought to the study of political economy in contem-
porary and prehistoric societies. This expanded multidisciplinary per-
spective shifts the focus of research to the way systems of exchange
evolve over time and the implications of these longitudinal changes
for the organization of productive enterprises from prehistory to the
present (2). The core thesis of this book, in fact, is that models from
evolutionary biology (specifically behavioral ecology) are more useful
than prevailing models in economics for understanding the evolution
of organized crime and racketeering in unregulated economic systems.
These Darwinian models are based in the mathematics of game the-
ory and predict that predatory, monopolistic gangsterism will read-
ily evolve in certain kinds of decentralized, unregulated systems of
exchange. This prediction contrasts with prevailing beliefs in the field
of economics, which view government regulation as interfering with
the self-regulation of markets. The Darwinian model presented here
suggests instead that under certain environmental conditions, “state-
lessness” (including retreat of a government regulatory apparatus in
a democratic state) may facilitate the rapid emergence of organized
crime (3).
Successfully constructing this argument, however, requires addi-
tional steps: 1) organized crime and racketeering must be more precisely
explored and defined; 2) some assumptions of contemporary economic
thinking must be examined and critiqued; 3) relevant models from evo-
lutionary biology must be introduced; and 4) an array of historical and
anthropological evidence must be compiled to argue for the validity of
this Darwinian approach.
The first five chapters of the book are correspondingly organized to
develop each of the points iterated above. Chapter 2 provides a basic
definitional overview of organized crime, arguing for the superiority of
an economic rather than ethnic definition of these activities. A brief
review of literature from criminology is presented, as well as several case
studies of racketeering obtained from archival research in declassified
FBI files and from secondary sources (4).
6  Gangster States

Chapter 3 explores the limitations of conventional 20th century

thinking in the area of political economy. The post-Soviet era has been
characterized by an aggressive resurgence of the ideas of Milton Fried-
man and other free-market fundamentalists (Black, 2005; Das, 2010,
2011; Kuttner, 1996; Smith, 2010; Stiglitz, 2002, 2010). These models
assume that markets achieve optimality when they are unperturbed by
government regulation. In other words, they believe that a market econ-
omy will be strongest when the polity is most restricted. Racketeering is
effectively rendered invisible in this language, as it is a non-governmental
force that corrupts markets away from optimal functioning. In the lim-
ited vocabulary of free-market fundamentalism, a market colonized by
racketeers is indistinguishable from a genuinely free market composed
of autonomous individual actors.
Economists typically focus their analyses on visible markets in sta-
ble polities for which there is abundant quantitative data (Dixit, 2004).
This limits the analytical gaze of the profession to the formal sector of
democratic regimes where economic actors ostensibly have protection
against organized crime and where accurate data collection is possible.
As Bill Black has wryly noted, “Economists are like the guy in the old
joke who loses his car keys one night on the north side of the parking
lot but searches for them on the south side because the light is better
there—they only study where they have data” (2005, Kindle edition).
As a result, organized crime and racketeering are not often explored in
the field of economics. These phenomena are instead relegated to the
domain of criminologists, who typically study racketeering through the
lens of law enforcement, as a deviant activity that undermines free mar-
kets and democratic government (5).
The criminological approach to understanding organized crime does
offer advantages for a society that prizes individual economic freedom
and rights of entrepreneurship. But relegating the study of organized
crime to the domain of criminologists creates a visual field defect that
limits scholars’ ability to fully grasp the significance of racketeering as a
naturally occurring political-economic phenomenon. In other words, if
the only social science that regularly examines organized crime defines
it as an intrusive pathology that contaminates an otherwise virtuous sys-
tem of exchange, it becomes difficult to perceive or explore the intrinsic
properties of organized crime itself.
Evolutionary theory brings no idealism to the study of human behav-
ior and is instead based on a single theory (Darwinian natural selection)
to explain all observed outcomes in the natural world. Furthermore,
these forces do not care about shaping evolutionary trajectories in ways
 Introduction 7

that human observers find desirable—there is no positive directional-

ity to evolutionary processes. If a given environment rewards violent
predators with increased survival and reproductive success, then preda-
tors will thrive in that environment, even though human observers may
view this development with some dismay. If the environment gives prey
animals an advantage, predator species will correspondingly suffer.
Many free-market fundamentalists, on the other hand, ascribe moral
virtue to unfettered markets and work from the assumption that reduc-
ing or eliminating government intervention will increase individual and
collective well-being (Das, 2010, 2011; Barker, 2013; Bair, 2012; Black,
2005; Kuttner, 1998; Smith, 2010). This assertion was stated rather
starkly by Yaron Brook and Don Watkins, who described markets as
capable of creating a “profoundly, perfectly, flawlessly moral economic
system” when left unperturbed by government regulation (2012:418).
Evolutionary theory, however, suggests that unregulated markets will
lead individual actors to pursue whatever behavioral strategy (including
gangsterism or violent monopolization of resources) guarantees maxi-
mum economic returns with minimum risk.

1.3  Evolutionary Stable Strategies

Chapter 4 introduces models from evolutionary biology and behavioral

ecology as an alternative framework for exploring the evolution of rack-
eteering in decentralized systems of economic exchange. Specifically, I
will argue that John Maynard Smith’s (1982) game theory models can be
used to explain the development of organized crime and racketeering in
economic systems. This argument is further developed by incorporation
of material from Robert Axelrod’s (1984) The Evolution of Cooperation, as
well as more recent work in evolutionary biology (Casti, 1995; Davies,
Krebs and West, 2012; Ridley, 1995).
Biologists use Smith’s concept of the ESS, or evolutionary stable strat-
egy, as a core component in modeling behavioral systems. This theory
predicts that in the absence of government regulation, racketeering will
naturally emerge in exchange networks at critical points along the sup-
ply/demand curve. The rationale for this argument comes from Axel-
rod’s work, which illustrates (using an array of computer simulations)
that behavioral systems based exclusively on cooperation are inherently
unstable over time. This is because the payoff for a single “mutant” aggres-
sor is extremely high in such an environment. The model was originally
developed to explain the way natural selection shapes the evolution of
animal behavioral systems (including predator/prey relationships), but
8  Gangster States

it has also been used to explain patterns of human social interaction

(Axelrod, 1984; Bender and Swistak, 1992; Davis, Krebs and West, 2012).
So if we envision a hypothetical stateless realm (6) with a decen-
tralized, unregulated system of exchange, evolutionary theory predicts
that if the value of commodity X increases to a certain critical thresh-
old, the payoff for using violence to gain monopoly control would be
so high that it would compel behavior in this direction. There is no
fatalism to this prediction. It simply proposes that the probability of
racketeering increases as the potential payoff rises and the associated
risks remain low.
In the language of evolutionary biology, we could say that a system
of decentralized, unregulated market exchange is inherently unstable
and unlikely to persist over time. This is because there is no authority
in place to protect property and outlaw theft, so transactions depend
on some degree of cooperation between economic actors. At some
point, the innovation of racketeering will emerge and persist due to
the high payoff generated by these activities and the fact that (without
state protection of property rights) individual economic actors have no
defense against predatory behavior. A racket is thus potentially more
stable than a decentralized system of economic exchange. This means
that once racketeering appears in an economic system, it cannot be
easily replaced by (or “invaded by,” to use the language of evolutionary
biology) a system of decentralized cooperative exchange. Decentral-
ized cooperative systems, on the other hand, can be invaded by the
behavioral innovation of racketeering. The key is stability: game theory
predicts that behavioral systems will naturally evolve toward increased
stability.
The most immediate insight to be gained from this perspective is that
using violence to gain monopoly control of strategic resources is eco-
nomically rational for profit-driven actors in a stateless realm. Without
government, there are no risks of incarceration, and economic compe-
tition can be eliminated with violence or threats of violence. Without
competition, prices can become wildly inflated, and profits increase dra-
matically. Gangsters who successfully create private armies of monopoly
enforcers would be able to enjoy lucrative and stable control of these
enterprises over time.
Such a scenario should (one hopes) evoke feelings of moral wrongness
in contemporary observers. But this is irrelevant from an evolutionary
or an economic point of view. Markets are configured by rather ruth-
lessly inhumane forces of supply and demand, despite the best efforts
(or not) of lawmakers to restrain these antisocial qualities. The point
 Introduction 9

is that the incentives for organizing monopolies from free-market sys-

tems of exchange will exert a powerful gravitational pull on rational
economic actors. The fact that this kind of economic activity is crimi-
nalized in the United States and other free-market democracies erodes,
but does not erase, the power of these incentives. Plus, the criminaliza-
tion of racketeering applies only within the formal, regulated sector of
the economy. Informal markets are by definition free of government
oversight, and it is this sector where racketeering tends to emerge and
flourish most consistently.
At this point, it is important to emphasize that studying racketeer-
ing from the naturalistic perspective of evolutionary theory should not
be taken as support for criminal economic behavior. Biologists often
employ the phrase “naturalistic fallacy” to protest the way scientifically
unsophisticated writers conflate the term “natural” with “better” or
“more desirable.” (It is easy to blame the marketing initiatives of health
food companies for this tendency.) As anyone who has studied nature up
close can attest, it is full of reprehensible life forms hostile to the human
species. Nasty creatures who want to eat us (including thousands of spe-
cies of intestinal parasites) are also natural, but no one would make the
mistake of thinking their naturalness makes them desirable additions
to the human gut (7). Instead we celebrate medical innovations that
diminish parasitism. The same logic should extend to anti-racketeering
laws.
The naturalistic perspective of evolutionary biology is, however, useful
for challenging the tendency of free-market fundamentalists to under-
stand and interpret the world in terms of what they believe ought to hap-
pen in unregulated markets instead of what actually transpires. Since the
end of the Cold War, economists working with international agencies
like the IMF have continued to press an anti-state vision of economic
development that hypothesizes a link between national prosperity and
reduction of the public sector. This has resulted in policies that embrace
privatization of public resources so that the ability of any government to
successfully regulate corporate or other private-sector economic activity
becomes greatly diminished (Stiglitz, 2002; Kuttner, 1997). These efforts
are based on an implicit belief that markets are inherently virtuous and
will produce greater public good and prosperity when left undisturbed
by government intervention (Barker, 2013; Stiglitz, 2002). As many
critics have noted, the sacredness of these assumptions has rendered
them largely immune to falsification, despite many observable failures
in recent years (Barker, 2013; Das, 2011; Galbraith, 2010; Kuttner, 1997;
Lowenstein, 2010; Smith, 2010; Stiglitz, 2002).
10  Gangster States

1.4  Abbreviated Case Study: Post-Soviet Russia

A powerful case study of racketeering evolving in a quasi-stateless realm

can be seen in the events surrounding the demise of the Soviet Union.
Shortly after the fall of the USSR, policymakers in the United States and
Europe encouraged rapid privatization and sought to aggressively dis-
mantle the Soviet state. In keeping with the assumptions of free-market
fundamentalists, these policies were viewed as the speediest path to the
creation of democratic government, civil society, free-market capital-
ism and improved well-being for post-Soviet citizens (Ezrow and Frantz,
2013; Satter, 2003; Stiglitz, 2002; Volkov, 2002).
But things did not go as planned. Instead of rapid progress toward
civic freedom and democracy led by the liberalization of markets, Rus-
sia and other post-Soviet states experienced catastrophic outbreaks of
organized crime that devastated the economy, increased political insta-
bility and greatly impoverished citizens (Cooper, 1999; Dadmer, 2003;
Fituni, 1995; Glenny, 2008; Handelman, 1995; Kupatadze, 2012; Nicaso
and Lamothe, 1995; Satter, 2003; Shlapentokh, 2007; Stigiltz, 2002;
Volkov, 2002).
Painful statistics support this assessment. By 1997, organized crime
groups had gained control of at least 40 percent of the entire Russian
economy (Satter, 2003:131). In 1998, 80 percent of Russians surveyed
agreed that “criminal structures exercised significant influence” in
the country, and 51 percent agreed that “real power in Russia belongs
to criminal structures and the mafia” (quoted in Ezrow and Frantz,
2013:Kindle edition location 7108).
The Central Intelligence Agency also estimated that the majority of
large Russian banks “were either directly tied to organized crime or
engaged in other illegal activity” (Satter, 2003:131). In 1995, two crimi-
nologists stated that “approximately 700 legal financial and commercial
institutions have been created by criminal entities for the purpose of
money laundering” in Russia (Waller and Yasmann, 1995).
In one year, over 30 bankers were assassinated by criminal cartels
fighting for monopoly control of the financial sector (Nicaso and Lam-
othe, 1995). Assassination attempts were made against the deputy chair-
person of the state bank, a vice president at the bank Pervoe O.V.K., the
chairperson of the central bank, the deputy minister of finance and the
head of the Unified Energy System of Russia (detailed in Shlapentokh,
2007). According to Stephen Handelman, for much of the early 1990s,
“armed gangs roamed the [Russian] countryside, plundering farmers
and attacking police” (1995:5). In 1993 alone, nearly “2000 automatic
 Introduction 11

rifles, 140 machine guns, six anti-tank missile launchers and 33 grenade
launchers were confiscated from criminals” in Russia (Cooper, 1999:22).
The human costs of this rapid escalation of violence and racketeer-
ing were enormous (Parsons, 2014). During one particularly turbulent
period, almost all of the personal savings held by Russian citizens effec-
tively disappeared from banks (Satter, 2003:47). The national treasury
was similarly plundered. Life expectancy declined sharply, and the
country’s GDP fell by half (Parsons, 2014). The annual inflation rate
reached over 2000 percent (Satter, 2003). One researcher has described
Russia’s decline as follows,

Rapid ThirdWorldization of Russian society showed how feeble is the

wall, once so apparently strong, between the rich North and the poor
South. The seemingly eternal welfare of a developed industrial society
in the USSR turned practically overnight into a chaotic universe of
Third World problems: mass poverty, hunger, regional conflicts and
ethnic wars, deindustrialization and huge foreign debt, corruption
of the elites and governing juntas, bloody coups d’état, outbreaks of
long forgotten diseases, refugee problems, environmental degrada-
tion and societal and state collapse (Fituni, 1995:143).

The globalization of banking and finance also meant that these devel-
opments in Russia were not isolated or contained. By 1998, ­Russia’s
economy had become so unstable that its currency collapsed. To any-
one paying attention to the gangsterization of banking and the paral-
lel conversion of the government into a “mafiacracy” (Konanykhine
and Gratcheva, n.d.), this should not have come as a surprise. Most US
economists, however, did not acknowledge the corrosive expansion of
organized crime in Russia. These trends were not factored in quantita-
tive risk models developed by external investors, who instead predicted
that these newly “free” markets would soon bring about peace and
prosperity.
This blindness resulted in a chain of unfortunate events that ulti-
mately led to the bankruptcy of an enormous American hedge fund
named Long Term Capital Management (LTCM). LTCM was run by two
Nobel Prize-winning economists who failed to incorporate the destabi-
lizing variables of organized crime and political corruption into their
risk models for Russia. As a result, they were unable to anticipate Rus-
sia’s rapid financial collapse. The costs of this misperception were ampli-
fied by highly speculative derivatives trades that formed the basis of
LTCM’s investments. If not for aggressive intervention by the US Federal
12  Gangster States

Reserve, the collapse of LTCM would have destabilized the entire global
economy (Lowenstein, 2001).
These events in post-Soviet Russia have not been satisfactorily
addressed by economists, who do not identify a causal link between
aggressive anti-state privatization and rapid formation of warring organ-
ized crime groups fighting to gain monopoly control over the country’s
remaining productive enterprises. While Joseph Stiglitz has used terms
like “mafia capitalism” (1997:254) to describe the result of privatiza-
tion in Russia, he does not propose a mechanism to explain why IMF
policies would lead to this particular outcome. One criminologist has
also blamed “rapid economic liberalization” for Russia’s problems with
organized crime in the 1990s (see Beetham, 2003:x), but an exact mech-
anism to explain this relationship is not identified.
This work seeks to correct this shortsightedness by developing a new
vocabulary to explain the evolution of organized crime, racketeering and
violence in aggressively deregulated markets or in other quasi-­stateless
realms. This task will be accomplished with tools from behavioral
ecology, which render the dynamics of organized crime more visible
than conventional economic modeling.
The relativistic perspective of cultural anthropology also informs this
work. A look around various corners of the world suggests that racketeer-
ing may actually be more common than the optimal, equilibrating free
markets celebrated by contemporary economists. This observation sug-
gests that economists may be falsely naturalizing what is actually a very
unnatural and culturally specific phenomenon—their vision of optimal,
virtuous unregulated markets. The inverse is also true: racketeering may
be a more primal (though certainly not desirable) mode of organizing
human economic behavior.

1.5  Gangs as Primitive States

Anthropology also brings a uniquely longitudinal perspective to the

study of organized crime and racketeering. How have these forces con-
figured systems of economic exchange in human history and prehis-
tory? A look back in time reveals that states themselves are relatively
recent innovations, dating back only about 10,000 years in the 150,000-
plus years of humanity’s existence as a species. States that criminalize
racketeering and organized crime are more recent still, dating back only
a few hundred years, and remain quite unevenly distributed around
the world. This expanded temporal perspective suggests that racketeer-
ing may have been a much more longstanding and influential force in
 Introduction 13

human history than systems of market exchange. In fact, when looking

back at some European states prior to the modern era, it is not uncom-
mon to see state power itself regularly used as a tool to organize and
defend economic monopolies (Andreas and Nadelmann, 2006; Earle,
1998, 2002; Gilman, 1981; Foucault, 1977; Paoli et al., 2007; Scott, 1972;
Shlapentokh, 2007; Tilly, 1985, 1990; Volkov, 2002).
At this point, language again becomes problematic. If a formal pol-
ity dedicates its security forces to organizing and defending economic
monopolies within defined geographic territory, is it an organized crime
group, a government or a hybrid of the two? Exploring these questions
results in an unexpected bonus: a novel theory to explain the evolution
of kleptocratic states.
Chapter 5 develops this concept further, again taking inspiration from
the fictional world created by James Ellroy in The Big Nowhere. In the
novel, a key element of the conflict between the respective outfits of
Jack Dragna and Mickey Cohen emerged out of the way their respective
monopolies became territorialized by the inscription of invisible bounda-
ries on the physical landscape of the city. In The Big Nowhere, each group
of gangsters controlled territory that was demarcated by the bureaucratic
jurisdiction of the affiliated police force. Mickey Cohen controlled space
that corresponded to the jurisdictional boundaries of the Los Angeles
County Sheriff’s Department. Jack Dragna’s realm mapped onto the
jurisdiction of the LAPD. The point at which these two hostile gangs
collided constituted a dangerous borderland as each racketeer sought to
increase his market share by encroaching on his rival’s territory.
Similar territorial dynamics have been described in a number of non-
fiction accounts documenting the history of organized crime groups in
major US cities and abroad (Dadmer, 2003; Reid and Demaris, 1964;
Gambetta, 1993; Glenny, 2008; Skaperdas and Syropoulus, 1995). These
examples illustrate how in the negative cartographic space of the infor-
mal economy or other stateless realms, it may be possible to observe
rackets undergoing a second set of evolutionary transformations: from
extractive economic monopolies to geographically marked polities. If a
racket is understood to be an ESS, then it is not vulnerable to invasion
by alternative behavioral strategies. But an established racket represents
a significant concentration of wealth with ongoing earning potential.
So it is vulnerable to invasion by rival racketeers. In the event of such
a challenge, the inscription of geographic or political boundaries formal-
izing the economic territory of each racketeering group emerges as a
logical way to stabilize these conflicts. It is this step—the inscription of
imaginary lines on the landscape that demarcate territories of monopoly
14  Gangster States

economic control—that I am arguing constitutes a pathway of primor-

dial state formation.
To elaborate, evolutionary theory predicts that in a stateless realm with
an established system of exchange, racketeering is likely to emerge as an
evolutionary stable strategy. Stable, however, does not mean perpetually
fixed or static. The analytic gaze of evolutionary biology is dynamic and
longitudinal. This means the evolution of a racket from a decentralized
system of exchange should not be regarded as the fixed end point of a
singular evolutionary process. The evolution of rackets is better thought
of as an initial transition from which secondary transitions will follow.
Some rackets may be unsuccessful and disaggregate over time, creating
an evolutionary trajectory characterized by repeated cycles of economic
organization and disorganization, hierarchy and decentralization. Other
racketeers may be highly successful over time and use their resources to
formalize their extractive apparatus, expand outward and claim defined
geographic territory.
Established rackets are hierarchical and expansive with a marked
division of labor. Police and security forces must become increasingly
formalized in order to maintain the integrity of the monopoly. Transac-
tions must be monitored to make sure the racketeers remain strategically
insinuated throughout networks of exchange. These racket-police may
also supervise the levying or taxes or other forms of tribute in exchange
for “protection” of regular commerce. All of these activities require an
administrative apparatus that gives established rackets rudimentary
governmental qualities: political hierarchy, division of labor, economic
stratification, surveillance, standing police or army, an asymmetrical
social contract roughly equivalent to a protection racket, powers of
enforcement and a monopoly on violence within a defined geographic
territory. Coincidentally, this combination of traits represents the char-
acteristics anthropologists (and some historians) have used to define
“the state” (Cohen, 1978; Classen and Van de Velde, 1987; Earle, 2002;
Marten, 2012; Tilly 1990).
As it turns out, some researchers have already described racketeering
groups as “primitive states” (Skaperdas and Syropoulus, 1995). This sug-
gests the existence of an evolutionary continuum between organized
crime groups and polities or between gangsters and governments. This
language also suggests that some primitive kleptocratic states should be
more rightly thought of as maturing gangs. While these authors do not
hypothesize an evolutionary mechanism or specific gang-state pathway,
they do iterate a number of observable similarities between organized
crime groups and governments, including “near-monopoly in violence,
 Introduction 15

long-life, organization and de facto boundaries . . .” (Skaperdas and

Syropoulus, 1995:62).
Chapter 5 formalizes an evolutionary model for the progression of
established racketeering gangs into territorial polities or primitive klep-
tocratic states. It is important to recognize, however, that states that
evolve out of the geographic inscription of racketeering are fundamen-
tally different entities than states that govern stable democratic regimes,
even though the same word is used in both cases. To avoid confusing
these two very different kinds of states, I will differentiate them into
kleptocratic gangster-states and stable democratic states for the remainder
of this work. This distinction has artificial elements, as it is possible for
gangster-states to evolve into democratic polities and vice versa (these
pathways will also be explored in Chapter 5). But for now, this linguistic
construction serves as a useful rhetorical device.
The key element that distinguishes gangster-states from democratic
states is the use of security forces (police and armies), not to defend
or protect the rights of individual citizens but as tools of monopoly
enforcement, wealth aggregation for elites and economic-territorial
expansion. A brief, hypothetical example will clarify this distinction. In
a democratic state, if you get robbed, you call police to arrest the thieves
and return your property. The assumption is that agents of the state are
obliged to protect citizens’ property rights. In a gangster-state, if you get
robbed, it is likely to be by the police, who will have used their author-
ity to arrest competing groups of thieves and establish a monopoly on
thievery for themselves. In this case, the assumption is that citizens do
not have innate rights to property. The leadership instead claims own-
ership over wealth, persons and productive enterprises within their
domain, and police are granted rights of confiscation and looting as a
reward for loyal monopoly enforcement. A classic example of this comes
from the former Zaire (now the Democratic Republic of the Congo),
where one observer described Mobutu’s army as operating “a mafia,”
with officers giving soldiers “a blank check to ransom and loot” defense-
less citizens (Lemarchand, 2003:41) (8). These dynamics offer some sup-
port to Theodore Dalrymple’s observation that many of the world’s poor
are not intrinsically poor, they have just been repeatedly robbed until
they have nothing left—in this case, by their own predatory officials
(Dalrymple, 2010).
The term “corruption” is commonly used by political scientists and
journalists to describe extractive, kleptocratic regimes of this sort (Ale-
mann, 2004; Blake and Martin, 2006; Geddes and Neto, 1992; Mun-
giu, 2006; Porta, 2004; Rose-Ackerman, 1978; Scott, 1972; Wraith and
16  Gangster States

Simkins, 1963). One of the goals of Chapter 4 will be to argue that this
term does not have much utility when applied to gangster-states. The
term “corruption” suggests that these regimes aspire to be democratic
but have somehow been led astray by malevolent forces, such as greed
or rent-seeking behavior on the part of public officials. Gangster-states,
however, are not Westphalian states that have become corrupted by bad
actors. Economic predation, territorial expansion and wealth extraction
are the organizing principles of their existence. Governance in the inter-
est of citizens is an afterthought, if it is considered at all.
Predatory kleptocratic regimes of this sort have been described in many
places around the world, but because they are rhetorically constructed as

Table 1.1  Partial List of Anecdotal Terminology Used by Different Researchers to

Describe the Fusion of Organized Crime and State Power.

Place Time Terminology Source(s)

El Salvador 1980s Protection-racket Stanley, 1996
state
Dominican 1930s to 1960s Cartel Wiarda, 1968
Republic masquerading as
a sovereign state
North Korea 2000s Mafia state Grietans, 2012;
Uzbekistan Rasanayagam, 2011
Golden Triangle 1990s Pseudo states Segell, 1999
ruled by drug
warlords
Nigeria 1990s Corruptocracy Glenny, 2008
Sierra Leone 1990s Post-state society Reno, 2003
Venezuela 1830 to 1900 Caudillo state Wolf and Hansen,
1972
Kyrgyzstan and 1990s Captured by Kupatadze, 2012
Tajikistan organized crime
Bolivia, Panama, 1980s and 1990s Narcocracy Krasna, 1996
Haiti,
Togo 1980s Empty state Piot, 2008
Ghana 1970s and 1980s Vampire state Frimpong-Ansah,
1992
Zaire 1980s Institutionalized Lemarchand, 2003
kleptocracy
Liberia, Somalia, 1990s Warlord states Reno, 1999;
Albania, Rwanda McNulty, 1999;
Tripodi, 1999;
Makinda, 1999
 Introduction 17

corruptions of an idealized norm, there has been no recognition of com-

mon features for comparative research. Instead there is an abundance
of anecdotal evidence and improvised vocabulary, detailed in Table 1.1.
Archaeologists and historians have also described similar patterns
of coercive resource extraction in prehistoric and early modern states.
Elites in these regimes have been described as strategic monopolists who
maintain their privileged position by securing control over economic
production and systems of exchange for key commodities (Earle, 2002;
Classen and Van de Velde, 1987; Shifferd, 1987). The use of violence to
organize and defend monopolies has also been described as a common
feature for a number of early European polities (Gilman, 1981; Scott,
1972; Shlapentokh, 2007; Tilly, 1985, 1990).
Chapter 5 proposes that all of these scholars are describing cultur-
ally and historically specific iterations of the same fundamental politi-
cal economy: the tendency of geographically marked polities to emerge
secondarily to the organization of racketeering in unregulated systems
of economic exchange. In gangster-states, security forces organize and
defend economic monopolies for elites rather than protecting individual
property rights. Chapter 5 argues for the necessity of modeling this as a
naturally occurring phenomenon that is most likely to evolve in stateless
realms (including the “prestate” era of human history) or in any other
situation where commerce is unprotected and markets become too free.
This approach represents a significant departure from existing models in
comparative politics that rely on imprecise and ethnocentric terms like
“corruption” or “warlordism” to explain the violence and economic pre-
dation of gangster-state political economies. Shifting perspective in this
way also renders many seemingly irrational aspects of these polities more
comprehensible, including their tendency to become destabilized by their
own predations and eventually undergo processes of decline and collapse.

1.6  Collapse and Regeneration

Chapter 6 will explore instability, collapse and regeneration as phases

in the larger evolutionary cycle that links organized crime, racketeering
and kleptocratic gangster-states. Collapse is not a predetermined end
point in this model. Stable democratic regimes can and do evolve out
of gangster-states. But democratic transitions do not create the same
problems as failure and collapse, so these positive evolutionary trajec-
tories are not problematized here. Political collapse, on the other hand,
increases regional instability and creates humanitarian emergencies that
require international intervention. Warfare, famines, ethnic massacres,
18  Gangster States

desperate refugee populations and lethal epidemics of preventable dis-

ease can all be found with disturbing regularity in these situations (see
the case studies compiled by Easterly, 2006; Ezrow and Franz, 2013;
Gros, 1996; Millikin, 2003; Rotberg, 2003; Zartman, 1995; along with
the personal narratives compiled by human rights activists such as
Walzer, 2008; Brodzinsky and Schoening, 2012).
In Chapter 6, I argue that the trauma and violence of collapse can-
not be understood without addressing the fundamental importance of
racketeering as a covert force of political integration, disintegration and
ultimately regeneration. In an extractive gangster-state, resources can
easily become exhausted, since there are no limits on elites’ competitive
expansion and conspicuous consumption. When economic production
becomes unsustainable, gangster-state polities may contract geographi-
cally or disaggregate altogether. Security forces lose control of peripheral
regions, and the remaining productive enterprises may become insuffi-
cient to support the territorial integrity of the polity. In these cases, the
political geography of the state and its associated economy will contract
simultaneously, and widespread disruptions may result for populations
in liminal borderlands.
Or, paradoxically, gangster-states may become victims of their own
success, attracting armies of rival kleptocrats who use violence to take
over the lucrative productive apparatus of the regime’s political econ-
omy. In other words, the demise of the polity may be configured by prior
collapse of economic production, or (in the case of a hostile takeover)
the conquest of the polity may leave systems of economic production
largely unchanged. In this second scenario, disruption may be minimal,
as one group of extractive elites simply displaces another.
Chronic, unresolved territorial contests between rival racketeering
groups can produce catastrophic destruction and entrenched human
misery. Economic production and commerce become severely disrupted,
as there are no longer any guarantees of property rights or systems of
contract enforcement for peasant producers. Productive enterprises
in border zones become subject to predatory raiding, retaliation and
destructive violence from rival racketeer-armies seeking to destroy one
another’s resource base. When production becomes fatally disrupted,
essential commodities become increasingly scarce, and supply/demand
curves can rapidly extend to levels that make conflict and looting inevi-
table. When this happens, contests between rival racketeers will cor-
respondingly escalate. Famines, epidemics and widespread poverty may
persist for extended periods of time (9).
The perspective of evolutionary biology, however, remains longitudi-
nal and dynamic. This means a failed or collapsed state is not viewed
 Introduction 19

as an end point whereupon civilization vanishes, as is often implied by

scholars in political science and international relations (see Zartman,
1995). Gangster-state collapse is instead modeled here as a dual process
of destruction and regeneration, with the formation of a new territorial
polity superimposed upon the demise of the old. Hussein Adam uninten-
tionally captured this dynamic in his article on Somalia’s collapse, which
he titled, “A Terrible Beauty Being Born” (1995:69, emphasis added).
Conventional models in political economy do not recognize conflicts
between rival warlords or racketeers as constituting an initial phase of
state formation. Instead, these contests are interpreted as evidence of
deepening state failure, symbolizing a descent into Hobbesian anarchy
from which there is no return. In this literature, warlords and organized
crime groups are labeled “non-state actors” and are described as imped-
ing the efforts of international development specialists to reconstitute a
new political order (Ezrow and Frantz, 2013; Josselin and Wallace, 2001;
Marten, 2012; Reno, 1998; Rotberg, 2003; Zartman, 1995; Markowitz,
2013). In the model presented here, however, these conflicts are under-
stood as destructive collisions that will eventually result in the genera-
tion of stable new polities. In some cases, this may take the form of
carving up a failed state into “regional fiefdoms,” as was seen in Somalia
(Rotberg, 2003), or simply taking over the administrative apparatus of
an existing national government, as was allegedly the case in Bolivia’s
“cocaine coup” of the 1980s (Levine, 1990a).
When new gangster-states form out of these conflicts, they remain
vulnerable to the destabilizing predations of rival racketeers operating
in the margins of the informal economy. Narcotics are often smuggled
in order to gain revenues to purchase weapons, which then allow for
underworld gangsters to initiate territorial expansion. If these groups
grow powerful enough, they may eventually challenge the monopolies
of the gangster-state in power. Territorial conflicts will ensue, and the
destructive/regenerative cycle begins anew.

1.7  Darwinian Political Economy

The model presented here represents a divergence from existing litera-

ture in political economy and criminology. Instead of expanding or fur-
ther specializing scholarly language, it seeks to simplify a multiplicity of
terms and concepts into a parsimonious model that reenvisions organ-
ized crime and kleptocratic state formation (and, ultimately, kleptocratic
state disintegration) as phases of a universal, bidirectional evolution-
ary process. This is accomplished by proposing that violent “non-
state actors” (typically described as strongmen, warlords, gangsters,
20  Gangster States

chieftains, mafiosi or caudillos) represent culture-specific iterations of

racketeers, who seek to form extractive political economies based on ter-
ritorial monopoly control of strategic resources. These non-state actors
are simultaneously engaged in the task of state building (by attempting
to expand and formalize their territories of monopoly control) and state
destruction (by attempting to expand and formalize their territories of
monopoly control).
The polities built by this process are hierarchical, extractive, unsta-
ble gangster-states and should be understood as forming, unforming and
reforming around the territorial contests and asymmetrical trickle-up
economies of racketeering. These kinds of regimes have been described
anecdotally by researchers and journalists using an array of improvised
terms. The model presented here also seeks to reduce this expansive
vocabulary by proposing these regimes should be understood as cultural
and historically specific iterations of racketeer-driven gangster-states.
These regimes typically feature extremes of wealth and poverty, public
displays of violence and terror by security services and unsustainable
over-consumption by avaricious elites that leads to political instability,
decline or collapse. In some cases, these economic polities may go on to
develop a bureaucratic apparatus of government that eventually facili-
tates a transition to democratic rule; in others, they may collapse, disag-
gregate or become colonized by rival gangster polities.
This model reflects the fundamental ethos of Darwinian theory: it
posits that a wide array of variations in form can be explained through
the action of one simple mechanism. In Darwin’s case, the proposed
mechanism used to explain the origin of species was “descent with
modification.” This transformed biologists’ understanding of the natu-
ral world from one of static life forms predetermined by a Creator in a
mythical past to one of dynamic, observable evolutionary process ongo-
ing in the present, with no directionality and no fixed end point in the
future. This shift in perspective reconfigured the temporal framework
for studying life on earth from a past creation to a contemporary pro-
cess. This allowed biologists to reconstruct extinct phylogenies from the
geological record and use data about past life to predict future trends.
These innovations transformed the natural sciences.
In the model presented here, a single mechanism is proposed to
explain the origins of hierarchy, complexity and stratification in many
prehistoric and contemporary human political economic systems: the
evolutionary stable strategy of racketeering. This shift in perspective
relocates the origins of state formation from a remote and distant past
 Introduction 21

to an observable process in the present, visible in the territorial contests

of racketeer-warlords operating in the peripheral space of the informal
economy or other stateless realms. States are not understood as fixed
entities in this model but as transient cartographic inscriptions that
expand or contract together with the expansion or contraction of the
underlying racketeer-economy. This model also does not regard organ-
ized crime as an exclusively modern vice but as an ancestral human eco-
nomic activity that played a role in the evolution of prehistoric states.
This Darwinian approach generates new possibilities for innovative
research and predictive modeling in comparative politics, international
relations, criminology and anthropology. It will also produce a certain
degree of existential discomfort, as it challenges many cherished West-
ern beliefs about Enlightenment progress and civilization (10). The
Darwinian worldview also does not produce very optimistic scenarios
for the future, as it suggests that organized crime and kleptocracy are
natural political economies that evolve spontaneously under certain
environmental conditions. In this model, democratic governments are
understood as humanistic, stabilizing innovations, but democracy does
not necessarily represent a one-way path out of primordial gangsterism
and kleptocracy (11).
The larger implications of this are not cheerful, as it raises the pos-
sibility that democracy may only be a transient phase between pre- and
postmodern iterations of gangster-state kleptocracy (12). But the price
of holding on to failed models is also high. Prevailing theories of politi-
cal economy remain steeped in the legacy of Enlightenment progressiv-
ism, even though these beliefs appear increasingly discredited by global
events. Neither Soviet Marxism nor free-market fundamentalism has
offered a compelling explanation for the rapid demise and violent after-
math of the USSR or the subsequent transformation of many post-Soviet
republics into “emerging kleptocracies” or contemporary “feudal states”
(see Glenny, 2008; Shlapentokh, 2007).
Over 20 years have passed since Vaclav Havel first asked for “new sci-
entific recipes and new ideologies” to help post-Soviet citizens cope with
the rapid, successive failures of both Soviet socialism and post-Soviet
capitalism (Havel, 1991). No one in the USSR or in the West antici-
pated these failures, and no one knew even what to call them as they
unfolded (Eisenstadt, 1992; Havel, 1991; Gleason, 1997; Kolakowski,
1992; Malia, 1994; Manuel, 1997). Applying the insights of behavio-
ral ecology to the study of organized crime offers a new vocabulary to
explain the expansion and contraction of socioeconomic complexity in
22  Gangster States

prehistoric and contemporary societies. This model also allows for more
successful understanding of the array of entrenched humanitarian prob-
lems (increased poverty and socioeconomic stratification, banking cri-
ses, instability, dictatorships, epidemics and violent conflicts) that have
emerged to define these regimes in the contemporary era.
2
What Is Organized Crime?

Concise definitions of organized crime are surprisingly elusive. There

is little consensus within or between the disciplines of criminology,
anthropology, political science, economics or sociology as to the exact
meaning of the term (Armao, 2003; Caiden and Alexander, 1985; ­Kenney
and Fickenauer, 1995; Reuter, 1985a, 1985b; Van Duyne, 2003). In many
cases, the phrase “organized crime” is used interchangeably with words
like “mafia,” “gangsterism” and “racketeering.” These terms, however,
all have different connotations and imprecise meanings.
Caiden and Alexander have critiqued the term “Mafia” as imply-
ing the existence of “an alien conspiracy . . . of Sicilian origins” that
does not correspond with the historic reality of organized crime groups
operating in the United States and abroad (1985:1) (1). But in popular
discourse, the term is still used colloquially to refer to Sicilians or Italian-
Americans involved in illicit smuggling, bootlegging or gambling activi-
ties. Typically it is used with a definite article, as in “the Mafia,” which
implies that there is only one Mafia, and its constituent members are
predominantly Italian. These attitudes still influence the thinking of law
enforcement. As Moises Naím has stated, “Consciously or not, investi-
gators around the world took the model of the American and Sicilian
Mafia as their blueprint” (2005:5).
If another ethnic group is linked to organized crime activities, it is
often given an additional ethnic modifier. California’s “Mexican mafia”
(a notorious prison gang) requires an additional descriptor to designate
non-Italian ethnicity (Valdez, 2009). Researchers in the 1970s and 1980s
also spoke of a Cuban mafia as well as a Dixie mafia, while r­ esearchers
in the 1990s were concerned with the rise of a new Russian mafia
(Anderson, 1995; Handelman, 1995; Nicaso and Lamothe, 1995). Even
though most contemporary criminologists would argue that the ethnic
model of organized crime has become obsolete, a review of two contem-
porary anthologies (Allum and Siebert, 2003; Edwards and Gill, 2003)
suggests that these assumptions remain embedded in the field. There is

23
24  Gangster States

also a tendency among criminologists to portray organized crime as a

uniquely modern or recent phenomenon (2).
Historians and journalists have also written about organized crime as
it relates to larger trends in American history (see Asbury, 1927; Deitche,
2004, 2007; Sante, 1991). The example of Prohibition, for instance, has
been used to explore the dramatic expansion of organized crime groups
in the United States during the 1920s and 1930s (Giancana and Gian-
cana, 1992; Haller, 1992; Lacey, 1991; Messick, 1971; Russo, 2001). This
research, however, is often narrowly focused on specific historical time
periods or individual biographies and does not typically include eco-
nomic analysis, quantitative research or generative modeling.
A few innovative researchers have authored highly original books
and papers that explore the economic logic and political dimensions
of gangsterism and organized crime activity (Fiorentini and Peltzman,
1995; Gambetta, 1993; Glenny, 2008; Haller, 1992; Kenney and Finck-
enauer, 1995; Maltz, 1985; Naylor, 2002, 2003; Reuter, 1985, 1995; Tilly,
1985; Scott, 1972; Skaperdas and Syropoulos, 1995; Van Duyne, 2003;
Volkov, 2000, 2002; and the papers collected by Caiden and Alexander,
1985). The model presented here expands and elaborates on the obser-
vations of this diverse group of scholars.

2.1  Formal versus Informal Economies

Defining organized crime begins with an assessment of the kinds of

activities in which organized criminals (for lack of a better term) are
commonly engaged. Smuggling, extortion, labor racketeering, narcot-
ics trafficking, loan sharking, protection rackets, homicide, theft and
corruption of public officials are all commonly associated with organ-
ized crime groups. These activities are individually quite diverse. A
very different set of skills, equipment and personnel, for instance, is
required for labor racketeering as opposed to international drug smug-
gling. But these activities do have one important commonality—they
are all illegal.
The illegality of organized crime necessarily locates it and its con-
stituent activities outside the purview of formal, empirical observation
or control by agents of the state, such as police or banking regulators.
As such, organized crime operates in a stateless realm—the negative
political/economic space that is located within, between or beyond
­
the territorial boundaries of individual nation-states. This placeless,
­apolitical geography also locates organized crime beyond the gaze of
rigorous research in the social sciences. In other words, the very diverse
 What Is Organized Crime? 25

activities of organized crime can (by virtue of their common illegality)

be said to take place in the informal, unregulated and frequently under-
studied sector of the economy.
This should not be taken to mean that there are no points of c­ ontact or
interconnection between the formal and informal economies. It is quite
common for organized crime groups to seek influence in the ­formal
political sector to facilitate expansion of their activities or to use the
banking facilities of the formal sector to covertly transfer their p
­ roceeds
from the informal to the formal sector. Another zone of interconnection
is the tendency for legal businesses to adopt some of the shady tactics of
organized crime groups in their quest to maximize profits (3). As Robert
Naylor has stated, “The main problem today may not be criminals tak-
ing over and subverting legal businesses so much as legal business using
criminal methods and therefore sometimes contracting with career
criminals for particular jobs to achieve profit targets” (2002:36). But for
the sake of simplicity and definitional clarity, I will temporarily define
organized crime based on a disaggregation of formal and informal sec-
tors of the economy.
While the majority of organized crime activities can be said to take
place in the informal sector, this does not mean that all activities in
the informal sector of the economy constitute organized crime. As
many anthropologists and sociologists have pointed out, informal
economic activities are often simply small-scale commercial trans-
actions between buyers and sellers in a subterranean or unregulated
market that for various reasons falls outside the boundaries of the
formal economy (Jones, Lindauer and Romer, 1991; Henken, 2005;
Ritter, 2005).
The key point of distinction between organized crime activities in
the informal economy and unorganized black, gray or parallel markets
hinges on the concept of “organization” itself. In other words, some
informal markets become targeted for colonization (or organization)
by criminal syndicates who employ violence or threats of violence to
establish monopoly control of commodities and commerce. Informal
markets that are composed of autonomous individual buyers and sell-
ers are by definition unorganized, and thus do not constitute organ-
ized crime, even though they may fall outside the boundaries of state
control or regulation. These unorganized informal markets are truly
“free,” meaning that there is no coercion or fraud, no form of regula-
tion and no exploitation of buyers or sellers. In the case of organized
crime in the informal economy, however, most, if not all, of these
negative conditions apply.
26  Gangster States

2.2  Organized Crime as Racketeering

What is a racket? One expert has described rackets and racketeers as

“polluting” or distorting legitimate markets (Reuter, 1985:49). The form
this typically takes is one of either fraudulently or coercively manip-
ulating various components of the market (i.e., labor, capital, supply,
demand, prices, buyers or sellers) so that the entire system of exchange
becomes rigged to concentrate wealth in the hands of the racketeers.
Misha Glenny has described these practices as creating “trickle-up” eco-
nomics (Glenny, 2008). In a racket, individual buyers and sellers are not
participating as autonomous agents but engage in economic behavior
(buying, selling, producing, consuming) that is manipulated by racket-
eers through violence, threats of violence, deception or fraud.
If we hypothesize an imaginary informal market for widgets, for
instance, that is free of racketeering or other interference, it could very
well resemble the sort of marketplace envisioned by Adam Smith or
­Milton Friedman: individual buyers and sellers engaging in arm’s-length
transactions that result in increasing optimization of price and improved
quality of goods. In this scenario, the market is generally free of malign
influences that might disturb this ostensible progression toward the
common good.
If this same market, however, were to be colonized or organized by
racketeers, sellers might be threatened with violence if they do not sur-
render a percentage of their earnings for protection. Competing widget
manufacturers could be threatened or killed to consolidate monopoly
power. Criminal gangs might also establish exclusive control over raw
materials and charge producers wildly inflated prices. Buyers could be
coerced or manipulated into purchasing poor quality, overpriced widgets
rather than freely evaluating the merits of individual sellers’ goods. Some
ambitious racketeers might even seek to maximize their profits by impos-
ing all of these conditions simultaneously: monopoly control over raw
materials, rapid inflation of prices, deceptive manipulation of buyers,
exploitation of sellers and violent elimination of economic competitors.
When these conditions have been achieved, the market for widgets is
no longer autonomous, decentralized or free. It has become organized
into a hierarchical structure that can rapidly concentrate wealth in the
hands of a small number of individuals and potentially sustain itself
over multiple generations. As Robert Naylor has observed, “The objec-
tive of organized criminal violence . . . is not to facilitate a one-time
transfer of wealth but to enhance the group’s position in the ongoing
marketplace . . . the purpose is to achieve monopoly power” (2002:15).
 What Is Organized Crime? 27

These tactics include physical destruction of rival businesses, public

displays of torture for those who subvert the economic control of the
gangsters’ monopoly and ruthless exploitation of labor in construction
trades. All of these elements are visible in Roberto Saviano’s vignette
describing the business activities of the Camorra.

2.3  Descriptive Vignette: Camorra

. . . [T]he Caserta Camorristi define themselves [as] nothing more

than businessmen. A clan made up of violent company men and killer
managers, of builders and landowners. Each with its own armed band
linked by economic interests . . . And where pacific persuasion and
common interest didn’t work, violence did: threats, extortion, destruction
of transport vehicles. They beat up their competitors’ drivers, plundered
their trucks, and burned their depots. The fear was so widespread that in
the areas controlled by the clans it was impossible not only to distribute
but to find someone willing to sell brands other than those imposed
by the Casalesi. In the end, consumers paid the price: in a situation
of monopoly and a frozen market, retail prices were controllable due
to a lack of real competition . . . They burned alive Francesco Salvo,
who owned and worked at a bar called The Tropicana: punishment for
having dared to replace Bidognetti video poker machines with those of
a rival clan . . .
The building trade is a turning point for affiliates. After working as
a killer, extortionist, or lookout, you end up in construction or trash
collecting . . . While the white-collar elite the bosses believe they control
are living the good life, others are dying of work. All the time. The speed
of construction, the need to save on every form of safety and every sort
of schedule. Inhuman shifts, nine, twelve hours a day. Saturdays and
Sundays included. A hundred Euros a week, plus 50 more for every ten
hours of Sunday or evening overtime. The younger ones even do fifteen
hours, maybe by snorting cocaine. When someone dies on a building
site, a tried-and-true mechanism goes into effect. The dead body is taken
away and they fake a car accident . . .
And so when I tread up stairs and across rooms, or when I take the
elevator, I can’t help but notice. Because I know. And it’s a perversion.
And so when I find myself among the best, among the really successful
businessmen, I feel ill. Even though these men are elegant, speak
quietly and vote for leftist politicians, I smell the odor of lime and
cement emanating from their socks, their Bulgari cuff links and their
28  Gangster States

bookshelves. I know. I know who built my town and who is building

it still. I know that tonight a train will leave Reggio Calabria and at
a quarter past midnight it will stop in Naples on its way to Milan.
The train will be packed. And at the station the vans and dusty Punto
automobiles will pick up the kids for the new construction sites. An
immigration without a fixed point that no one will study or evaluate
since it survives only in the footprints of cement dust, nowhere
else . . . I know how much of the blood of others is in every pillar (Saviano,
2006:191–218).

2.4  The Organization of Crime

Organizing a disorganized market is not a simple task and would be

beyond the capacity of a single individual. Racketeering is not an indi-
vidual crime but a collective endeavor accomplished by stratified, hier-
archical groups, consisting primarily of male coalitions (though female
racketeers are not unknown), with a marked division of labor. The
nature of these groups is quite variable, from intensely personalistic and
kin-based to more casual or corporate, but the collective nature of the
endeavor remains an essential component of the phenomenon. Kenney
and Finckenhauer (1995:25) have crafted a definition that emphasizes
these traits and is worth quoting at length:

The attributes of the actors and the acts that make organized crime in
fact organized include a self-perpetuating, organized hierarchy, a crim-
inal conspiracy, which exists to profit from providing illicit goods
and services in public demand or providing legal goods and services
in an illicit manner. The co-conspirators may comprise a crime fam-
ily, a gang, a cartel, or a criminal network, but these characteristics
are not important to the definition. These same co-conspirators may
also share certain ethnic identities, but that too is not essential to
their being defined as organized crime groups. Essential to the defini-
tion of organized crime is the use of violence or the threat of violence
to facilitate criminal activities and to maintain monopoly control of
markets [emphasis in original].

Following this, it is possible to construct a definition of organized

crime that centers on the organization of economic activity in the
­informal sector of the economy through violence, fraud and/or coercive
manipulation of specific markets and their constituent personnel and
commodities. This definition differs from most colloquial definitions in
 What Is Organized Crime? 29

that it focuses attention on the economic structures created by criminal

enterprises rather than the individual psychology, social organization
or ethnic background of the people engaged in these activities. The key
element of the proposed definition of organized crime that will be used
in this work, therefore, is the economic term “racket” rather than the
ethnic term “Mafia.” To paraphrase Caiden and Alexander (1985), the
advantage of this definitional approach is that it focuses attention more
appropriately on the nature of the crime rather than the ethnicity or
psychological character of the criminal. It also does not impose any spe-
cific temporal horizons on this activity. In this model, racketeering is
not presented as a moral vice that emerged only in the 19th or 20th
century. Instead it is understood to be an ancestral pattern of economic
behavior that will spontaneously evolve and “organize” economic sys-
tems under certain conditions. A series of brief vignettes and case studies
provide further insight into these patterns.

2.5  Racketeering in Prison Economies

Prisons are ideal environments in which to study the evolution of rack-

eteering in systems of exchange. Prisoners must surrender rights to
personal property while incarcerated, and they inhabit an intensely regi-
mented environment in which they are not allowed choices as to food,
clothing or recreation and have little or no access to popular consumer
goods. Even though prisons are highly controlled environments, forces
of supply and demand persist, and most prisons maintain a complex
subterranean economy of contraband goods and services. Some of these
are relatively innocuous consumer goods such as cigarettes, food, soap,
art supplies or cosmetics (see Prewitt, 2006). But there are also markets
for more dangerous items like drugs, alcohol, cell phones or weapons
(LeDuff, 2000; Woodfill, 2012).
Research on informal prison economies reveals that prison gangs and
gangsterism evolved as a way to regulate these clandestine networks of
exchange (Valdez, 2009). In other words, prison economies are not com-
posed of autonomous individual buyers and sellers conducting transac-
tions in a free market. Instead, commerce is controlled by gangs, who
use violence and threats of violence to guarantee contracts and protect
commerce (Johnson, 1997; Marchese, 2009). One prison gang in Cali-
fornia initially formed in the 1950s, when individual prisoners “banded
together for protection from another group” (Valdez, 2009). Once this
gang formed, non-organized prisoners became increasingly vulnerable,
requiring the formation of opposing gangs. The end result was the rapid
30  Gangster States

evolution of multiple competing gangs within the California prison sys-

tem, organized along racial and ethnic lines (Newhouse, 2009).
In addition to controlling supply routes of contraband, prison gangs
also maintain a rudimentary system of law and order that includes sys-
tems of contract enforcement and conflict resolution that facilitate the
flow of commerce (Johnson, 1997). Gangs also aggressively market pro-
tection to new inmates, especially those perceived to be of middle-class
background who are assumed to have stores of wealth that can be easily
plundered (Earley, 1993).
It is also important to recognize that prison gangsterism is not driven
exclusively by the pre-existing criminality of the population, though
this certainly plays a role. Individuals who have been gangsters on the
outside will certainly have the knowledge and skills to join or organize
protection rackets in jail. But other factors are also significant, particu-
larly the economic environment of the prison, which is informal and
unregulated.

2.6  The Organization of a Stateless Campus Economy

A similar pattern of gangs and gangsterism evolving to protect com-

merce in a non-criminal population can be seen in a historical exam-
ple from Cuba. During the 1930s, the campus of the University of
Havana became a stateless realm when it was declared an autonomous,
non-­governmental territory following a student-led revolution in the
early 1930s (Aguilar, 1972; Alvarez del Real, 1942; Geyer, 1993; Lamar-­
Schweyer, 1938; Lumen, 1935; Matthew, 1953, 1956; Phillips, 1935,
1949, 1959; Suchlicki, 1969; Thomas, 1998). In the years prior to this
revolution, a violent dictator undertook a series of brutal crackdowns
on student protestors. When the students (along with some dissenting
military factions and a radical professor) succeeded in overthrowing
­
him, one of their first acts was to declare the campus an autonomous
space, meaning no government agents were allowed to pass through the
gates from approximately 1937 until 1953.
One of the unintended consequences of this ruling was that the campus
became used as a transshipment center for weapons, narcotics and other
forms of contraband, as well as a hideout for international fugitives (4).
The specifics of these arrangements are not entirely clear. This was a
time of great political unrest in Cuba, and archival documents do not
clearly identify whether student groups were trafficking in contraband in
order to purchase weapons for revolutionary movements or whether the
­weapons were purchased simply to secure the passage of contraband (5).
 What Is Organized Crime? 31

It is clear, however, that rival student gangs fought bitterly for control
of the stateless territory of the university campus. As one New York Times
reporter described, “The presidency of the University Student Federa-
tion has been won more than once at revolver point” (9 October 1949).
Throughout the 1940s and early 1950s, there are numerous reports of
weapons caches found on campus, chronic gang warfare between rival
student groups and collusion between radical students and international
organized crime groups. This pattern persisted until the autonomy of
the campus was revoked by Fulgencio Batista in 1953 (see Thomas,
1998; New York Times, 24 September 1953). This development, however,
should not be taken as a sign of increased rule of law in Cuba but as an
example of a gangster-state (the Batista regime) taking control of smug-
gling and contraband from rival non-state gangsters (6).

2.7  Labor Rackets

Labor rackets also offer an example of the way violence can be used to
organize both sides of a market (labor and capital) so that wealth accu-
mulates into the hands of racketeers. In a labor racket, gangsters seek
control over strategic interstitial spaces between labor and capital so that
they can organize both sides of this market to extract maximum wealth
for themselves. This is accomplished in two ways: extorting money from
laborers (in the form of union dues or pension funds) and using control
over labor to extort money from business owners or capitalists (in the
form of strikes or threats of work interruption). In this way, organized
crime groups are able to insert themselves into the strategic interstitial
spaces between labor and capital and “squeeze” both sides of these con-
flicts to generate maximum revenues.
These dynamics were central to many of the turbulent labor disputes
that took place in New York in the 1920s and 1930s. While a sympa-
thetic Marxist might regard the conflicts of this era as textbook exam-
ples of class struggle, deeper analysis reveals that many violent conflicts
between labor and capital were actively orchestrated to enrich organized
crime groups.
In the 1920s, racketeers in Brooklyn were well aware of the strategic
importance of dock workers in maintaining supply chains for large cor-
porations that relied on time-sensitive imports. Gangsters successfully
exploited this vulnerability by using violence to take over the longshore-
men’s union. When a union leader attempted to break free of organ-
ized crime control in the 1930s, he was killed and his body dumped
in a lime pit (7). Using violence in this way allowed gangsters to gain
32  Gangster States

monopoly control of cargo passing through the waterfront area. Rack-

eteers used the union as a tool to extort money from commercial busi-
nesses engaged in importing key materials or goods. If a fruit importer
wanted his cargo unloaded before it rotted, for example, he would have
to pay a significant premium to the syndicate-controlled unions for
timely labor cooperation. A business owner who resisted these extor-
tion attempts could easily find himself unable to compete in the market
altogether—his cargo would spoil on the docks while his competitors
had no interruption in the flow of goods.
Control of labor unions also allowed racketeers to engage in simul-
taneous extortion of workers and owners. As Giancana and Giancana
cynically described,

Controlling the union brought home . . . an important truth: control

a work force and you control the livelihoods of countless families
sustained by those jobs. By threatening union members with loss
of work, the gangsters could marshal the efforts of husbands, wives,
sons and daughters in support of virtually any scam the gang could
dream up (1992:72).

Racketeers also used their control of labor unions to gain control over
lucrative pension funds and union dues revenues. At the time, there
were no federal, state or local laws that regulated the use of these union
funds, so this form of extortion was not technically illegal and went
largely unnoticed by government authorities.
There are also numerous accounts of organized crime groups who alter-
nately hired out “muscle” (meaning low-tier enforcers) as strikebreakers
for management one week and then as “union thugs” on behalf of
organized labor groups the next. By doing this, organized crime groups
were able to gain control of strategic interstitial spaces between labor
and capital and to squeeze both sides of this market to extract wealth
from both sides. As one memoir describes,

. . . [T]he Combination [i.e., criminal syndicate] . . . muscled in on any

side: union, management, strikers, strikebreakers. Such labor groups
as the plasterers’ union (in which Louis Capone and his brother [Al]
were powers), the painters’ union (in which several murders were
done during a war in the early thirties) and the longshoremen (play
toy of Anastasia, the dock czar) felt the impact especially forcefully.
Many operators of large trucking fleets and bakers who supplied
the city with its daily bread had to pay tribute. Few independent
 What Is Organized Crime? 33

shopkeepers—from department stores to delicatessens—were free

from protection rackets (Turkus and Feder, 1992[1951]):121).

These tactics were successfully replicated with a number of other

unions across the country. The Chicago syndicate allegedly gained
control over the film projectionists’ union in the early 1930s in order to
extort money from Hollywood movie studios (Giancana and G ­ iancana,
1992:71). If the studio wanted a film shown across the country, it
would have to appease the demands of the racketeer-controlled union.
Another enterprising group of racketeers allegedly gained control of all
jukeboxes in the city of Chicago and used this control to extort money
from the music industry. “Monopolizing the city’s jukeboxes also gave
the Syndicate enormous clout with the entertainment industry; a new
song wouldn’t be a hit if it didn’t receive exposure” (Giancana and
Giancana, 1992:135).
In 1927, one New York City gangster realized that the entire garment
industry could be made vulnerable to extortion if he gained control of
the central hubs of the trade, defined as the relatively small 1800-­member
cutters’ union combined with the garment truckers’ union. Without
the cooperation of these labor groups, no garments could be made or
shipped. Eventually this operation succeeded, allegedly netting close to
a million dollars a year for the gangsters (Turkus and Feder, 1992[1951]).
In other words, labor racketeers are highly strategic in choosing which
markets to colonize—they select those in which labor can be most suc-
cessfully wielded to extort money from profitable industries. Transpor-
tation, for instance, offers tremendous possibilities in this regard. A
country’s transportation network is a centralized hub through which
all commerce must pass. Organized crime penetration of trucking and
transport workers (including the lucrative Teamsters Union pension
fund) in the 1940s and 1950s was quite legendary, and by the late 1950s
it had grown to such proportions that Robert Kennedy described it as “a
grasping octopus, a tidal wave of corruption about to engulf the nation’s
capital . . .” (Kennedy, 1960:122).

2.8  Gambling Rackets

Similar patterns of strategic cheating and manipulation are also visible

in the operation of illegal gambling establishments. In an unorganized
or “free” gambling market, players make wagers based on known odds
for certain games. In a gambling racket, however, gangsters cheat by
using a variety of tactics to stimulate artificial demand for gambling
34  Gangster States

(such as advertising false winnings) and then rigging the games so that
the payout rates are much smaller than would be dictated by chance
alone.
These practices were common in Cuba prior to the legalization of
gambling in the mid-1950s. One legendary casino game known as “raz-
zle” or “razzle-dazzle” had all the key elements of a successful gambling
racket. Demand was artificially primed by offering tourists low-cost
travel packages, cheap alcohol and orchestrated public displays of fake
winners who presented themselves around casinos with piles of cash
allegedly won at the tables. One Saturday Evening Post reporter described
such a scene rather memorably as follows:

I had watched . . . with growing amazement at the open and una-

shamed swindle. The game at which the sweating little executive was
losing $1000 every half minute is known to the carnival grift as “raz-
zle.” No casinos outside Havana, indignant gambling men told me,
would allow it. Not even the losers can describe razzle clearly. All
they remember is that the game is played with eight dice and that
you “can’t lose” if you double your bet with every roll. The double-
or-nothing gimmick, the speed of play, the glib spiel of the houseman
combine to one end: to beat the sucker. Hemmed in by shills to left,
right and from behind—as in a vise—the trapped “rabbit” is skinned
for everything he has on him, and sometimes for his bank account at
home (Velie, 1953:179).

The “sweating little executive” described in this article lost over $8000
in only 11 minutes of play (whereupon he promptly fainted and fell
over). The racketeers, however, were not yet done with him. Since most
tourists did not carry large amounts of cash with them to Cuba, the
casino operators accepted personal checks. Many of the fleeced tour-
ists would regret being swindled when they regained their senses and
would lodge complaints with the US Embassy, whereupon they would
be told by the Consul to stop payment on the check before it could clear
at their bank in the United States. To preempt this strategy, one of the
casino owners opened a check-cashing service that effectively thwarted
stop payment orders by arranging to have casino receipts flown by char-
ter plane to Miami every night and processed before the stop payment
orders could be received by the home banks (8). Similar practices were
reported at other Havana casinos in the early 1950s, which one FBI
informant described as “all crooked” with the lone exceptions of Meyer
Lansky’s craps game at the Montmartre Club (9).
 What Is Organized Crime? 35

2.9 Prohibition

Another example of the emergence of racketeering in a newly “free”

market comes from the prohibition of alcohol in the United States.
When a formerly legal commodity for which there is high market
demand comes under new political or legal restrictions, it can result
in a significant expansion of the informal economy. In 1915 (before
Prohibition), the city of Philadelphia collected over one million dol-
lars in taxes on “the production of fermented liquors, distilled spirits
and documentary stamps” (Scientific Station for Pure Products, 1916).
Assuming market demand remained relatively constant after enactment
of the Volstead Act, the millions of dollars formerly collected by the
State of Pennsylvania would be lost to the public sector, while the profits
of the trade would be transferred to racketeers and bootleggers in the
informal economy.
These profits were further amplified by monopoly pricing and adul-
teration of alcohol. “Drinks that once cost a nickel before Prohibition
could cost fifty cents or more after the enactment of the new laws”
(Drowne and Huber, 2004:14). The quality of bootleg alcohol was also
notoriously bad, as racketeers sought to maximize profits by adulterat-
ing “genuine scotch, rye and gin by diluting it with water and adding
coloring, flavoring and more alcohol” (Drowne and Huber, 2004:14).
Similar practices continue today with the prohibition of narcotic drugs.
A pharmacological study of heroin seized by police in Australia revealed
an average purity rate of only 50 percent, which is more or less consist-
ent with reports from other nations (Maher, Swift and Dawson, 2001).
Prior to the passage of the Pure Food and Drug Act in 1906, adulteration
was also common in many foods and drinks (such as milk and meat) as
well as in patent medicines.
In short, these examples all reveal the core elements of successful
racketeering. In some cases, violence or threats of violence are used to
“muscle in” on an unorganized market, followed by strategic manipu-
lation of supply and demand, buyers and sellers or labor and capital
so that all sides of economic transactions are organized to maximize
profits for the racketeers. The result is an organized hierarchy, policed
by enforcers who intentionally thwart natural patterns of supply and
demand or manipulate prices to sustain the racketeers’ economic
monopoly and build vast concentrations of wealth. In other cases, rack-
eteers take advantage of lax or unregulated markets in the formal sector
to engage in adulteration of goods or other forms of fraud or market
cheating.
36  Gangster States

An earnest reader might well ask at this point, “But where were the
police?” Presumably if the police were doing their jobs, none of these
examples of racketeering or the organization of illicit commerce would
have been possible. A closer examination, however, reveals that this
assumption is problematic.
In the example of labor racketeering in New York, gangsters were
able to take advantage of lax laws that did not explicitly prohibit labor
racketeering. While many citizens and legitimate businesspeople were
deeply disturbed by these developments, the legal infrastructure was not
adequately developed to fully prosecute these activities. Labor racket-
eering was frequently invisible to all but a very few individuals who
could easily be intimidated into silence. In many cases, gangsters could
seize control of unions without detection and use the unions to extort
money from capitalists and laborers and gain control of pension funds
with no one the wiser. Even though authorities were vaguely aware of
these activities, it was difficult for them to grasp the extent of the prob-
lem since few people were willing to complain openly about organized
crime control of labor. According to one New York Times article, shippers
in New York were so afraid of retaliation that they refused to file formal
complaints about racketeering, even to a government panel appointed
to investigate labor abuses (New York Times, 10 December 1930). The
lack of strong, consistent anti-racketeering statutes also made prosecu-
tion of these crimes much more problematic in the 1920s than in later
years.
Adulteration of bootleg alcohol also did not occasion much atten-
tion or sympathy from police. During Prohibition, alcohol was an illegal
commodity, and police were much more concerned with arresting ship-
pers, importers and (occasionally) consumers than with guaranteeing
the quality of alcoholic beverages. In other words, when the market for
alcohol was transferred to the informal economy, there was no oppor-
tunity to inspect or regulate production. Quality declined, as individual
consumers had no way of detecting toxic adulterants, except by suffer-
ing grave illnesses or death, at which point it would be too late to switch
to a new supplier.
In the case of Cuban gambling, police themselves were deeply
enmeshed in the operations of illicit casinos. The Cuban police, in fact,
often stationed a representative in the casinos to control unruly patrons
who were angry at being swindled, not to prosecute rigged or illegal gam-
bling. In short, the answer to the question “Where were the police?” in
Cuba is that they were facilitating the organization of gambling rackets.
 What Is Organized Crime? 37

Revenues from racketeering in the informal economy extended outward

to corrupt the security forces of the formal polity.
The issue of political corruption, however, is significantly more com-
plex than this brief discussion would indicate. To begin with, the term
“corruption” itself is quite imprecise and misleading—it compresses a
highly variable and dynamic range of behavior into a single concept
with an overly broad and imprecise definition. The term “corruption”
is also problematic in that it assumes the prior existence of a legiti-
mate polity that is then corrupted by racketeers—clearly not the case in
Cuban casinos of the 1940s. A cursory look across national boundaries
and through history reveals that in many countries it is difficult if not
impossible to differentiate the police from the gangsters.
To fully grasp the nature of the relationship between organized crime
in the informal economy and its relationship to a formal polity requires
a much more nuanced theoretical vocabulary than is presently avail-
able. Before this vocabulary can be developed, however, some additional
definitional and explanatory work must be completed with respect to
the phenomenon of organized crime itself.
3
Failing Economics

3.1  Contaminated Markets

How do rackets evolve? What structural forces compel them to expand

or contract over time? Conventional researchers in the field of econom-
ics rarely ask these kinds of questions. The evolutionary origins of rack-
eteering are not problematized in the field. While some economists have
engaged in extensive study of informal economies and criminal markets,
the perspective of these works is typically cross-sectional rather than
longitudinal, meaning these researchers study observable processes in
the contemporary era rather than exploring longitudinal patterns over
time. Overall, studies of criminal economic activity occupy a narrow
niche in the field as a whole (1).
Most economists are trained to study observable processes in the
visible sector of the economy, where transactions are assumed to be
regulated by a stable, democratic government, and buyers and sellers
all make rational choices (Black, 2005; Dixit, 2004; Hirshleifer, 2001;
Smith, 2010). These assumptions reflect the aspirational world inhab-
ited by most economists. But from an anthropological point of view,
democratic governments that regulate markets and protect individual
rights are recent innovations that are still not the norm in many socie-
ties around the world.
The anomalous qualities of democratic government and market regu-
lation are further obscured by use of the word “corruption” to describe
political economies that deviate from this norm. Racketeering, organ-
ized crime and kleptocracy are actually quite common (2). Discarding
these undemocratic, unfree political economies (or economic polities) as
corruptions of a Western ideal invalidates or marginalizes them as legiti-
mate objects of study in their own right (3).
The tendency of many contemporary economists to define markets
unregulated by government as “free” also means that the field has no
consistent vocabulary to describe systems of exchange that are rendered

38
 Failing Economics 39

unfree by monopolistic racketeers. The core assumptions of prevailing

theory in economics (general equilibrium and ergodicity) instead main-
tain that unregulated free markets create prosperity and strengthen civil
society if undisturbed by government intrusion (Hirsch, 2010; Smith,
2010; Kuttner, 1996). In the words of Ezrow and Frantz,

Neoliberals claim that free markets, instead of governments, are

the most efficient means of resource allocation. They assume that
individuals are rational and self-interested, which allows markets to
operate best. Development, as they see it, can only take place when
markets are given the freedom to operate freely. The ‘state’ (adminis-
trative institutions) is viewed with disdain because the state is seen as
an instrument of interference with the market (2013:Kindle edition
location 1798).

The study of racketeering is largely relegated to the field of criminol-

ogy, where it is regarded as a pathological contaminant to be excised
by law enforcement. The focus in this field is typically on controlling
crime rather than modeling its evolutionary origins in a hypothetical
state of nature. Peter Klerks, for instance, describes conventional teach-
ing materials in criminology as organized around Hollywood-inspired
ideas of “La Cosa Nostra.” He also notes that Western law enforcement
practitioners have effectively exported this ethnic (and ethnocentric)
model through international collaborations (2003:98–9).
Social science research on organized crime also tends to focus on prac-
tical issues like psychological profiling, forensic accounting and patterns
of incarceration and rehabilitation rather than theorizing the evolution-
ary origins of racketeering itself. As Robert Naylor has stated, “Much of
the failure to comprehend the true impact of profit-driven crime . . .
results from the fact that there has, to date, been little attention paid
to what profit-driven offenders actually do and to the economic effects
their actions actually have” (2003:36).

3.2  The Cold War in Economic Thinking

The reason many scholars have not fully problematized the origins
of racketeering stems in part from the ideological polarization and
binary language that dominated the field of political economy during
the Cold War. For most of the 20th century, theory and language in
this area were heavily influenced by bitter conflicts between Marxist
40  Gangster States

socialists on the left and anti-communist free-market fundamentalists

on the right. Each of these philosophies maintained its own totalizing
vision, its own Doctrine of Progress and its own idealistic plans for
creating prosperity and improving humankind through economic and
social engineering. Each ideological extreme correspondingly viewed
the other as the primary obstacle in realizing its utopian vision (Berger,
1974, 1977).
Marxists believe in liberating society from the predations of capital-
ism. Fans of Hayek and Friedman believe in liberating society from the
predations of government by unleashing the power of markets. The
implicit religiosity of each ideological pole promoted the development
of bitter conflicts and a good deal of faith-based, magical thinking dur-
ing the 20th century (Barker, 2013; Gurian, 1964; Berger, 1986; Hol-
lander, 1998; Horowitz, 1993, 1999; Kolakowski, 1977, 1978; Malia,
1994; Nelson, 2002; Talmon, 1960).
Until the 1990s, orthodox Marxists routinely dismissed evidence of
economic and humanitarian catastrophes in the planned economies
of the USSR and its satellite nations. Reports of censorship, falsification
of economic and health indicators, devastating famines and mass incar-
ceration were rejected as “distortions of the bourgeois press” or prob-
lems created solely by the “imperialist hostility” of the United States
(Daniels, 1991; Hollander, 1998; Horowitz, 1999) (4).
Leftists continued to believe in the legitimacy of Marx’s vision of com-
munism well in to the 1990s and did not let empirical disappointments
diminish their hopes for a revolutionary future. The cumulative effect of
these practices was to shield Marxist theory from unpleasant intrusions
of non-conforming reality, including the questions raised by the abrupt
collapse of the USSR.
The harsh realities (as opposed to the utopian ideals) of Soviet power,
however, were highly influential in shaping the philosophy and world-
view of those on the opposite end of the ideological spectrum. Hayek’s
belief in the virtues of markets and the venality of government resulted
in part from witnessing the bureaucratic overgrowth, political repres-
sion and economic stagnation that occurred in Marxist revolutionary
states. Examples of suffocating Soviet bureaucracy were common in this
literature, leading these scholars to assert that any government interven-
tion in markets was a threat to human well-being. In this rhetoric, mar-
kets are championed as forces of individual liberty to be unleashed as
an antidote to the repressive intrusion of government in human affairs
(Black, 2005; Brook and Watkins, 2012; Friedman, 2002[1982]; Hayek,
1944, 1988).
 Failing Economics 41

Since the 1990s, ongoing revelations of Soviet atrocities have made it

difficult for even the most committed Marxists to maintain their ideo-
logical militancy. Leftists have been forced to reckon with the multi-
ple failures of centralized planning, including the inability of planners
(even with dictatorial security forces at their disposal) to override natu-
ral market forces of supply and demand. The science of economic plan-
ning in Marxist regimes was continually subverted by the spontaneous
appearance of subterranean markets (similar to prison economies) that
evolved to counteract the brutal shortages and inefficiencies of the state
sector (Eckstein, 1993; Feschbach and Friendly, 1992; Berger, 1986;
Hayek, 1944, 1988; Henken, 2006; Hirschfeld, 2007; Ledneva, 1998;
Kolakowski, 1992; Parsons, 2014; Peréz-López, 1995; Ritter, 2005; Ver-
dery, 1996).
The pervasiveness of the informal economy in ordering household
consumption and exchange networks in Marxist countries also led to an
ironic development. Over time, the planned socialist economies of the
Soviet bloc unleashed a virulent form of unregulated capitalism in the
informal sector, at the same time the capitalist economies of the West
increasingly sought to tame markets with more complex forms of regula-
tory control. Minimum wage laws, child labor restrictions, overtime pay,
food and drug laws and social security are all government policies that
have combined to soften the myriad abuses of unregulated 19th century
capitalism. These social welfare policies were accompanied by anti-trust
legislation, housing subsidies, building codes, federal insurance for bank
deposits, federal backstopping of corporate pension plans and rules that
prohibit co-mingling of customer deposits and investment funds at
brokerage houses (for a more detailed discussion along these lines, see
Berman, 1963). By the middle of the 20th century, industrial capitalism
had evolved into a very different entity from the capitalism of Marx’s
era, yet the vocabulary of the left still does not successfully differentiate
these variations (5).
When looked at from this perspective, 19th century terms like “social-
ism” and “capitalism” appear increasingly unhelpful for making sense
of political-economic arrangements in any country. Where in the con-
tinuum of state control does capitalism end and socialism begin? In
recent US presidential elections, it has become common to hear govern-
ment spending proposals denounced by the opposing party as socialism.
China is technically still a socialist country but has unleashed market
forces to create economic growth and improved living standards for
much of the population in recent years. Cuba also remains Marxist-­
Leninist in its political rhetoric yet has implemented a number of market
42  Gangster States

reforms that are often advertised as a pathway for restoring revolution-

ary purity to the regime (6). Cubans themselves informally describe their
political economy as “socio-cap,” an ironic hybrid that was understood
to represent the worst of both systems: the stifling bureaucracy, political
repression and consumer shortages of planned economies together with
the inequality and stratification of free-market capitalism (Hirschfeld,
2007).
These contradictions suggest that it may be more useful to think of
socialism and capitalism as polarizing ideological constructs that framed
key battles of the Cold War but provide little utility in explaining the
actual political economy of a given locale. All governments regulate mar-
kets at some level, so the idea of “pure” capitalism is a misnomer (7).
Marxist regimes with centralized economic planning are also full of
thriving informal markets and associated criminal subcultures, so they
are not fully socialist (Berman, 1963; Hayek, 1944; Ledneva, 1998;
­Handelman, 1995; Kupatadze, 2012).
Figure 3.1 offers a visual representation of the religious aspects of 20th
century political-economic thought. To the left lies the idealized space
of Marxitopia, an imaginary utopia that Marx predicted would emerge
once the global proletariat took power and replaced market forces with
centralized economic planning. The right represents the competing
space of Friedmanistan, the imaginary future that Milton Friedman
believed would emerge once markets were perfectly liberated from gov-
ernmental oversight and allowed to reach transcendent states of opti-
mality and equilibrium.
The middle terrain reflects the non-utopian (and correspondingly
less glamorous space) of Keynesian political economy, where market
exchange is ostensibly regulated by a democratic state in order to curb
abuses, protect private property and soften extremes of inequality. In the
Keynesian world, neither markets nor government approaches perfec-
tion or optimality. Rather, the goal is to use state power to engineer the
economic architecture in a way that limits predation and facilitates eco-
nomic betterment of the population as a whole. As Kregel has described
it, “The real question [of Keynesian economics] . . . was how . . . [free
markets and state planning] might be integrated to produce the most
acceptable results in practice” (1990:133). Keynesians never agree on the
exact formula for accomplishing these goals, and much work in this area
is devoted to decidedly non-utopian discussions of banking regulations
and trade agreements.
As events of the 20th century revealed, the revolutionary path that
was supposed to bring humanity closer to the perfect equality and
 Failing Economics 43

Figure 3.1  Visual Representation of Utopian Thinking in 20th Century Political

Economy.
44  Gangster States

prosperity of Marxitopia turned out to be a disappointment. Instead of

collective harmony and prosperity, the planned economies of the Soviet
Union were characterized by massive consumer shortages, inefficiency,
bureaucracy, stagnation, censorship, repression and human rights
abuses. As Jeanne Kirkpatrick (a legendary anti-communist) once stated,
“The problem with Marxist revolutions is that the road to Utopia will
pass through Gulag” (1982:110). This connection appears unremarkable
today. But for most of the 20th century, ideologically committed Marx-
ists refused to acknowledge this relationship.
Once the true extent of problems in the Soviet system was revealed
in the 1990s and early 2000s, many believers lost faith in the p­ romise
of Marxitopia. With their ideological gaze no longer fixated on this
utopian horizon, scholars could begin to explore how the various catas-
trophes of the Soviet system were created by the secular utopianism of
Marxist theory itself (Berger, 1986; Kolakowski, 1977, 1992; Louw, 1997;
Hayek, 1988; Manuel, 1997; Malia, 1994; Talmon, 1960).

3.3  The Road to Friedmanistan

The decline of Marxitopia as an idealized destination for humankind

has led to a surge in the popularity of Friedmanistan in the post-Soviet
era. The failure of the Soviet system itself was taken as evidence for the
desirability of Friedmanistan as a new destination for humankind. Free-
market fundamentalism rapidly became the dominant paradigm in eco-
nomic thinking after the fall of the USSR (Barker, 2013; Black, 2005;
Das, 2010, 2011; Hirsch, 2010; Kuttner, 1997; Lowenstein, 2010; Smith,
2010; Stiglitz, 2002, 2010).
These ideological scholars typically assume that markets are naturally
self-correcting when left undisturbed by government and that deregula-
tion will create greater prosperity and social well-being over time. The
belief stems from the assumption that sellers with shoddy or adulter-
ated goods will not get repeat business and will not be able to compete
favorably with honest merchants. Buyers who renege on payments will
not be welcome in the future. The end result is supposedly a gradual
progression toward prosperity and collective good as manifest in the
optimization of prices, innovation, stability and consumer satisfaction
(see Brook and Watkins, 2012).
These assumptions create an intellectual foundation for aggressive
restriction of government regulation or oversight, as government is
thought to be the only force capable of interfering with the progression
of markets toward optimality and equilibrium. This is painfully apparent
 Failing Economics 45

in Larry Summers’ 1994 Senate testimony, when he interprets the rapid

disintegration of the Soviet state as a positive indicator for the future of
Russia. Summers’ testimony reflects the prevailing belief that the expan-
sion of unregulated markets means the eventual growth of democracy
and civil society (Summers, 1994). The existence of rampant organized
crime, violence, protection rackets, looting and instability during these
years clearly does not register in his analysis.
These observations are consistent with the ideological vision of free-­
market economics, which rhetorically constructs markets as naturally vir-
tuous and pure and government as inherently oppressive and stagnant.
Former Federal Reserve chairman Alan Greenspan has been described
as one of the most fervent of these ideologues. In the words of Roger
Lowenstein, “People might be flawed, but markets were pure . . . [Alan]
Greenspan’s was a Rousseauean vision of markets as untainted social
organisms—evolved . . . from a state of nature” (2010:30). As a result of
this vision, Greenspan refused to consider the possibility that reducing
government control of banking and finance might lead to unwanted
outcomes, such as an increase in speculation, criminality or fraud.
Some critics have argued that these beliefs have become so deeply
embedded in the economics profession that they are now considered
immune to falsification. As one economic historian stated in an inter-
view with Newsweek in 2010, “The range in which dissent happens is so
narrow. In a sense they [economists] still cannot imagine the system can
operate to undermine itself” (quoted in Hirsh, 2010).
Renewed faith in the secular utopianism of free-market economics has
also led international agencies like the IMF and World Bank to push
aggressive privatization initiatives as a pathway to increased prosper-
ity throughout the post-Soviet world and in many developing countries
(Stiglitz, 2002). Anti-government rhetoric remains increasingly common
among policymakers in the United States. A large number of European
countries are also facing massive cutbacks in government spending as a
result of austerity measures mandated by international lending agencies
as well as overall recessionary contraction (Barker, 2013; Stuckler and
Basu, 2013).
Unfortunately, free-market fundamentalists are not able to perceive
the economic and human wreckage that results from trying to propel
humanity closer to the ideals of Friedmanistan. Negative outcomes are
explained away with the same naive optimism that Marxists once used
to explain away the gulag. This oversight is unfortunate, as it blinds
policymakers to the correlation between aggressive anti-government
deregulation and rapid growth in racketeering and organized crime.
46  Gangster States

To paraphrase Jeanne Kirkpatrick’s original critique of communism,

the problem with excessive anti-government privatization is that the Road
to Friedmanistan will pass through Mafia. This connection is not visible
within the current framework of contemporary economic modeling but
can be seen with tools borrowed from evolutionary biology and behav-
ioral ecology. The predictions that emerge from these models can then
be tested with longitudinal case studies drawn from archival and histori-
cal research.

3.4  Experimental Vignette: The Other Invisible Hand

An excellent example of the curious visual field defect that prevails in

neoclassical economic thinking can be seen in the following experi-
mental vignette. This example of the power of ostensibly free markets
appeared on the popular National Public Radio program Planet Money
in December 2010 and was a radio dramatization of an experiment per-
formed by an economist named Joel Waldfogel (8).
The experiment goes like this: ten treats are handed out to a group
of schoolchildren. Each child is given something different, from highly
desirable chocolates to a much less exciting box of raisins. Each of the
students who receives a treat is asked to score its value on a scale of 1
to 10. When all of the numbers are tallied, the total value, or aggre-
gate satisfaction score, adds up to 50, for an average score of 5 for each
child. At that point, the children are asked how they might go about
improving the satisfaction level but without adding any new candy to
the classroom.
“We should be able to . . . you know . . . give it around. Like trade . . .,”
one of the children responds.
So the reporters agree to allow the kids to swap their candy. What
­happens (according to the reporter) is an immediate “trading frenzy.”
At the end of the trading session, the children are again asked to quantify
the value of their candy. The aggregate satisfaction score now totals 82.
The lesson of this exercise was to provide a concrete experiential exam-
ple of the greater efficiency of market exchange for allocating resources
and fulfilling human needs over other systems of resource allocation.
The NPR story was broadcast on Christmas Eve 2010 and was intended
as an ironic example of the painful inefficiency of gift-giving—an activ-
ity that was no doubt preoccupying a majority of NPR listeners at that
very moment.
There is more to this story than meets the eye. In classical economic
theory, the phrase “invisible hand” refers to the ability of markets to
 Failing Economics 47

create aggregate satisfaction through a series of self-interested individ-

ual choices. This is believed to be the best way to rationally allocate
resources and produce optimally efficient outcomes with no external
direction whatsoever. These forces are clearly apparent in the classroom
experiment—no one attempts to control or regulate the children’s trad-
ing, yet each child ends up with a higher satisfaction score at the end of
the experiment than at the beginning.
But the economist who designed the experiment overlooked the pres-
ence of a second set of invisible hands. None of the observed increase in
efficiency would have been possible if not for the presence of authority
figures (in this case, teachers and other adults) who served to police these
exchanges and ensure cooperation on the part of buyers and sellers. Pre-
sumably these individuals would have intervened to prevent undesira-
ble behaviors like shoving, bullying, stealing, extortion or hoarding that
would have interfered with the goal of facilitating the emergence of a
peaceful, cooperative system of exchange. The presence of enforcement
authorities in the classroom effectively protected the property rights of
less-aggressive students and prevented the development of cheating.
The failure of economists to notice these regulatory agents, much less
consider their impact, makes the conclusions drawn from this experi-
ment a bit artificial. In fact, the experiment could also be interpreted as
an example of the way economists subconsciously interpret data so as
to guarantee results that are in keeping with their preferred theoretical
models. In this case, the prevailing assumption is that unregulated mar-
kets produce efficiency and social good, so the presence of regulation in
the system of exchange is overlooked. The potential impact of hunger
on patterns of economic behavior is also not incorporated as a variable
in this experiment. Similar kinds of assumptions are embedded in eco-
nomic modeling: all actors in a market are initially defined as “rational
economic men” who will all behave the same way given a similar set
of choices. Variation between individual consumers that might impact
trading behavior (such as extreme hunger) is not considered relevant to
economic modeling.
To truly model the behavior of unregulated systems of exchange, the
researchers should have placed a basket of candy and other snacks unat-
tended in the front of the room every day. There would be no penalties
for cheating, stealing or hoarding other than those created and enforced
by the children themselves. What differences might emerge in this alter-
native scenario? At some point, it seems likely that one or more bullies
would emerge to gain monopoly control of the candy supply, either
individually or in a fractious coalition. Weaker children would probably
48  Gangster States

abstain from competing altogether, peacefully surrender their candy

and retreat to a corner of the room away from the combat.
This hypothetical scenario is not intended to cast aspersions on the
character of schoolchildren. It is simply intended to identify all of the
relevant variables that contribute to the optimal functioning of a system
of exchange. Many schoolchildren in these circumstances would prob-
ably try to behave honorably and seek to institute a system of resource
allocation based on fairness and consideration of others. But at some
point, in the absence of any deterrents, innovations of cheating, stealing
or hoarding seem likely to develop. Once cheating becomes established,
the system becomes hierarchical.
Of course, no one should actually do such unethical experiments. No
one has to. The schoolyard bully who steals candy and runs a lunch
money extortion racket is familiar enough to most Americans that he
(less often she) requires no experimental verification. Most adults only
have to think back to their own school days to recall the predations of
these bullies on the vulnerable members of the student body.
The goal of this example is to illustrate that the original NPR exper-
iment was correct in some ways—a market can better satisfy human
needs than top-down resource allocation or random gift-giving. But the
ability of markets to perform this function is contingent on the exist-
ence of a stable political authority that will intervene to protect property
rights for all citizens, ensure fairness in trading and punish cheats. The
fact that free-market fundamentalists so often fail to notice or appreciate
this other “invisible hand” speaks volumes about the myopic limita-
tions of their models and the ethnocentrism embedded in their assump-
tions about the world.
4
The Evolution of Racketeering

4.1  Behavioral Economics Meets Behavioral Ecology

The use of behavioral ecology to model the evolution of racketeering

and organized crime in unregulated systems of exchange does have
some points of overlap with the emerging field of behavioral econom-
ics. Behavioral economists maintain that psychological variables have
measurable impacts on individual economic decision making and
behavior (Camerer and Loewenstein, 2004). Much research in this area
is conducted in laboratory settings so that subjects can be rigorously
studied under controlled conditions. This approach also allows psycho-
logically oriented economists to explore neurological substrates of eco-
nomic behavior, such as reciprocity and altruism (Fehr and Schmidt,
2004). Behavioral economics also has implications for research with
non-human primates, whose behavioral systems have also been shown
to include notions of fairness as well as systems of reciprocity and
exchange (see de Waal, 2010).
This chapter will attempt to expand the frontiers of behavioral eco-
nomics by integrating tools and concepts from evolutionary biology and
behavioral ecology to explain how organized crime and racketeering can
naturally evolve as regulatory mechanisms in unregulated systems of
exchange. This approach differs from that of previous research in that it
is not intended to demonstrate the relevance of a behavioral approach
to an audience of neoclassical economists (Camerer, 2004). Nor is the
research experimental, as the subject matter does not readily lend itself
to laboratory simulation or participant observation.
The goal of this chapter is instead to contribute to Camerer and
Loewenstein’s stated objectives for the field of behavioral economics
itself: to make fresh predictions and to parsimoniously explain a range
of data with one simple mechanism (2004:41). In this case, the mecha-
nism I am proposing is the “evolutionary stable strategy” (ESS) originally
developed by Maynard Smith in the 1980s to explain how evolution

49
50  Gangster States

acts to shape behavioral systems. Applying the concept of the ESS to

the problem of racketeering provides researchers with a new set of tools
for understanding how organized crime and racketeering can evolve in
markets and how these unwanted behaviors create such problems as
violent monopolies, market failures, kleptocracy and political/economic
instability or collapse.
Expanding the scope of behavioral economics this way requires that
additional tools and concepts from anthropology and evolutionary biol-
ogy be imported and applied to the study of economic exchange. These
include: 1) an assumption that populations are composed of individu-
als who may engage in a range of competitive or cooperative economic
behaviors; 2) an assumption that economic behavior takes place in a
dynamic, stochastic environment that may alternately reward or punish
certain behavioral strategies; 3) an assumption that behavioral systems
will evolve toward stability and that the most stable systems may be
polymorphous with multiple behavioral strategies linked in dynamic
equilibrium.
These imported concepts create a very different set of foundational
assumptions than those in the field of economics itself. Most economic
modeling is built on the assumption that populations of consumers
are composed of interchangeable “rational economic men” (Barker,
2013; Smith, 2010). Society itself is erased in these models, and human
populations are reduced to aggregates of decontextualized individuals.
Research in behavioral economics also remains focused at the level of
the individual, and group patterns are modeled as aggregates of indi-
vidual choices (1).
Ecologists (as well as epidemiologists and social scientists who model
behavior at the population level) would argue that economists base their
models on flawed assumptions. The assumption of rational economic
man, for instance, means economists model the behavior of groups as
an aggregate of individual decision making. This means surrounding
environmental conditions (including variables in the social environ-
ment) are excluded from analysis. Ecology is based on the assumption
that environments are inherently dynamic and stochastic. In ecological
modeling, individual actors may employ a range of competitive or coop-
erative behavioral strategies to secure access to scarce resources, and the
success of any strategy will be configured by the strategies of surround-
ing actors.
This approach allows ecologists to successfully model longitudinal
patterns of behavior change at the aggregate population level. Under
conditions of extreme shortage, for instance, individual competition for
 The Evolution of Racketeering 51

resources will be much greater. When this occurs, atypical behavioral

variants may become more successful if they allow these individuals to
more successfully compete in changed environmental conditions.
Ecologists also emphasize the fundamental importance of variation
in all populations. Natural selection acts on variation so populations
are never modeled as aggregates of interchangeable individuals. Oth-
erwise there would be no way to understand how systems change over
time. Removing variation in favor of a single representative consumer
or rational economic man renders a naturally dynamic world artificially
fixed and static.
Ecologists also use concepts like “frequency-dependent selection” to
model the way natural selection acts to sustain multiple behavioral phe-
notypes within a population. Frequency-dependent selection describes
the advantages some behavioral variants confer simply by being sta-
tistically uncommon. An example would be a single pair of predators
introduced into a population of cooperative prey animals. Under these
circumstances, each predator will be highly successful, and as a result
the proportion of predators will increase over time. At a certain point,
however, larger numbers of predators will have to compete with one
another for dwindling prey resources. When this occurs, predators will
suffer reduced fitness from the energy costs of increased competition.
The presence of predators will also select for less trusting behavior in
prey animals, and this trait is likely to diminish over time.
In this scenario, the success of predatory behavior will be high as long
as the frequency remains low. The more predators that appear in the
population, the harder each one has to work to secure a meal and the
more evasive and defensive the prey animals become. Eventually a point
of equilibrium is reached at which numbers of prey and predators are
sufficiently balanced to sustain both populations over time (Davis, Krebs
and West, 2012:117).

4.2  Evolutionary Stable Strategies

Phases of behavioral equilibrium are modeled with the mathematics of

game theory. John Maynard Smith developed the concept of the evo-
lutionary stable strategy as a way to identify how behavioral systems
evolve toward stability. In Smith’s work, a behavioral strategy is under-
stood as a behavioral phenotype—the way an individual behaves in
response to a certain stimulus. An ESS is then defined as “a strategy such
that, if all members of a population adopt it, then no mutant strategy
could invade the population under the influence of natural selection”
52  Gangster States

Table 4.1  Original Payoff Matrix for Hawks and Doves Game (taken from Smith,
1982:12).

Hawks Doves
Hawks 1/2 (V-C) V
Doves 0 V/2

(Smith, 1982:10). In these models, the population is assumed to be infi-

nite, and “pairwise contests take place between two opponents” that
allow the interactions to be modeled in the form of a matrix (1982:10).
Smith’s original iteration of this matrix was termed the Hawks and
Doves game. The terms refer to specific behavioral strategies of creatures
that engage in repeated contests with one another—not literal hawks
and doves. The terms are used to describe contrasting behavior strategies
that emerge in contests or competition for resources. Hawks are defined
as individuals who always escalate conflicts and continue to escalate
until injury occurs or until the opponent retreats. Doves engage in
threat displays but will not escalate a conflict, and they retreat at once if
their opponent escalates. The success of either strategy is to some extent
configured by the relative proportion of each variety of competitor. As
the proportion of hawks and doves in the population changes, so does
the corresponding success of each strategy. Hawks facing other hawks
will be more likely to suffer a net loss of fitness due to injuries obtained
during contests. Doves facing other doves will not suffer injuries since
they don’t actually fight. But they will waste a lot of time and energy in
displays.
Each of the various iterations of the hawk-dove conflict is assigned a
numerical score to model the fitness costs and benefits of each strategy.
The first quadrant models a hawk-hawk (H H) contest. Each individual
is given a 50 percent chance of winning over its opponent and a 50
percent chance of losing and being injured. V is used to represent the
increase in fitness resulting from a successful challenge, and C repre-
sents the costs of injury that result from pursing an aggressive hawk
strategy. The second quadrant models a hawk-dove (H D) contest and
shows hawks receiving full rewards (V) while the doves lose. The final
iteration (dove versus dove or D D) results in a tie, with the fitness ben-
efits divided by the two competitors.
The key variable in this equation is V. In other words, behavioral strat-
egies that lead to the greatest increase in fitness will leave more descend-
ants in the next generation. The population of each generation thus
reflects the relative success or failure of the strategy used by its parents.
 The Evolution of Racketeering 53

If we have a population comprised solely of doves, a single mutant hawk

will be able to reap large fitness rewards, since it will have no costs for
aggressive behavior or escalating conflicts. In this scenario (to use the
language of Maynard Smith) we can say that a population of all doves
can be “successfully invaded” by hawks. A world of all doves is therefore
unstable and unlikely to persist over time, since the payoff for a single
aggressive hawk will be very high.
The payoff for hawks, however, is not infinite. Once a mutant hawk
appears in a population of doves, its higher fitness score means that
subsequent generations will have increasing numbers of hawks as they
outcompete the more gentle doves. As a result, there will be an increased
likelihood of hawk-hawk competitions over time. As these hawks chal-
lenge other hawks and compete over prey, there is an increased prob-
ability of injury or death that reduces the net fitness level of the hawk
behavioral strategy. So a population composed of all hawks is also unsta-
ble and vulnerable to invasion by more peaceable doves, who do not
suffer injuries in their contests. So we can assume that neither an all-
hawk world nor an all-dove world will have long-term stability. Since
both of these behavioral strategies are vulnerable to invasion, neither is
an ESS. Instead (in the words of Smith), “the evolutionary stable strategy
(ESS) addresses the question of how the population should distribute
itself in order to achieve an optimal balance between the two pure strat-
egies” (quoted in Casti, 1995:71).
The equations used in ESS computations typically come from empiri-
cal measurements obtained during field research projects. One group
of intrepid biologists, for instance, attached tiny lead weights to the
bellies of funnel web spiders in order to quantify the degree to which
increased body mass conferred an advantage in contests over desirable
grassland territory (detailed in Smith, 1982). These contests typically
consisted of two spiders, one artificially enhanced with supplemental
belly weights, staring motionlessly at one another for ten or 20 min-
utes until one retreated from the contested territory. The equilibrium in
this case involved the evolutionary trade-offs between the energy costs
of maintaining an increased body size versus the competitive advan-
tage gained against other spiders in defending desirable territory. Simi-
lar studies have sought to measure ESS patterns in foraging behavior
in wagtails (a species of bird), mating behavior in natterjack toads and
territorial defense in golden-winged sunbirds (detailed in Davies, Krebs
and West, 2012:125–6).
The evolution of ESS patterns has also been modeled through com-
puter simulation. In 1984, Robert Axelrod published The Evolution of
54  Gangster States

Cooperation, which detailed the results of computer modeling for ESS

problem solving. Axelrod’s research also confirmed Smith’s predictions
that a world characterized exclusively by behavioral cooperation is
inherently unstable due to the rewards that can be obtained by cheat-
ing or predation. These computer simulations also demonstrated that
populations composed exclusively of aggressive predators are similarly
unstable and thus vulnerable to invasion by more cooperative behav-
ioral strategies. The key message of Axelrod’s work, in fact, reiterated
Smith’s observation that systems composed exclusively of behavioral
cooperation or behavioral aggression are inherently unstable, and either
extreme will evolve toward an ESS that resembles a “tit-for-tat” behavio-
ral repertoire that allows each individual to express a range of coopera-
tive and aggressive behaviors in response to the behavior of surrounding
actors (Axelrod, 1984).

4.3  Cheating and Systemic Complexity

Another important point of contrast between the assumptions of the-

ory in economics and evolutionary biology concerns the way each field
conceptualizes the problem of cheating. Economists typically regard
cheating as a temporary contaminant that corrupts an otherwise vir-
tuous market system (2). In evolutionary biology, on the other hand,
a “cheat” is an innovation or mutation that allows one individual to
subvert the defenses of another or otherwise gain an advantage over a
competitive rival. Cheating is a mutation that destabilizes an ESS, as it
requires the cheated species to adapt to new behaviors. Over time these
dynamics can produce dramatic increases in the complexity of a behav-
ioral system, as it creates an evolutionary arms race between cheater and
cheated.
An excellent example of the way cheating increases the complexity of
a behavioral system comes from John Casti’s description of cleaner fish:

Certain species of fish clean parasites off fish of a different species.

This is a situation in which both parties gain: The cleaners get a
hearty meal, while the fish being cleaned avoid the sores and diseases
that would otherwise result from the parasites. The most remarkable
aspect of this situation is that the cleaner fish are never eaten by
those they’re cleaning, even though this could easily happen. Fur-
thermore, it’s often the case that other types of fish try to imitate the
cleaners, rushing in to bite big chunks off the fish being cleaned. In
these cases, the big fish happily gobble up the pretenders despite the
 The Evolution of Racketeering 55

fact that the pretenders have developed high-level camouflage tech-

niques to fool them (Casti, 1994:66).

Intricate behavioral systems like this appear quite remarkable. How can
lowly creatures like fish restrain their appetites in such a s­ ophisticated,
discerning and cooperative way? The system appears to have all the ele-
ments of intentional design, along with human qualities of cooperation
and communication. Biologists, however, understand these kinds of
complexities as produced by the forces of evolution and natural selec-
tion, driven in part by the innovation of cheating.
The relationship of the two fish species described above is explicable
in evolutionary terms, and this explanation centers on the most funda-
mental concepts of evolution: variation followed by differential survival
and differential reproduction. Many generations ago, ancestors of contem-
porary cleaner fish were probably opportunists who used their speed
and maneuverability to sneak in and grab snacks and bites of flesh off
of larger, predatory fish. But in this population of pre-cleaner fish there
would have been variation. Some would have been more aggressive
about sneaking bites of the larger fish, and some would have been more
reticent. If the more aggressive individuals were more likely to get eaten
by the big fish, the behavioral traits of later generations would come to
reflect more reticence. Correspondingly, the population of predator fish
would also have a continuum of variation, and individuals who were
more tolerant of cleaner fish progenitors would have increased their
ability to survive and reproduce, due to decreased parasite burdens. Over
enough generations, a cooperative behavioral interaction evolved that
led to increased survival of both species: the cleaner fish got ample food,
and the predatory fish had their parasites removed.
The second half of the story, however, is also important. As Casti
describes, a new variant of “fake” cleaner fish has arisen, with mark-
ings virtually identical to legitimate cleaner fish. These imitators use
their camouflage to try and cheat the system and sneak in for bites of
actual flesh instead of parasites. This development is also explicable
through natural selection. The existence of legitimate cleaner fish will
favor mimicry in other species. Non-cleaner fish who resemble cleaner
fish will be able to get closer and snatch more illicit bites of large fish
than non-cleaner fish who do not resemble cleaner fish. This will give
individuals with these traits a slight survival advantage, so that over
time a population of pseudo cleaner fish will eventually evolve. While
traits that appear to constitute cheating may appear morally wrong to
humans, they are “right” in evolutionary terms, since the sole criteria
56  Gangster States

for evaluation of a trait in evolutionary biology is its contribution to

increased fitness. To what extent does the trait in question lead to differ-
ential survival or differential reproduction?
When examined in these terms, the evolution of cheating in a behav-
ioral system is not viewed as an unwanted contaminant but is instead
understood as the logical outcome of variation, environmental change,
frequency-dependent selection and other evolutionary dynamics.
Cheating behavior will increase in the population when it increases fit-
ness for those who cheat. Furthermore, the existence of cheating creates
new selection pressure for the development of sophisticated detection
systems on the part of the cheated.
If the mutually beneficial relationship between cleaner fish and
predator fish is to be maintained over time, predator fish must be able
to detect real from fake cleaner fish. Just as natural selection favored
mimicry in the pseudo cleaner fish, it will also favor increased cheating
detection abilities in the predator fish. This has clearly taken place—
imitation cleaner fish (which appear visually indistinguishable to a
human observer) are quickly gobbled up, while real cleaner fish are
left alone. The evolution of behavioral cheats has elevated the behav-
ioral system to a new level of complexity. The existence of a dynamic
environment, however, means that behavior that constitutes success-
ful cheating (or adaptation to cheating) in one generation may prove
maladaptive later, so that the system never remains static over the
long term.
Axelrod’s computer simulations have offered evolutionary biology a
rich tool with which to model how natural selection acts to configure
patterns of behavior. But the implications of these studies have not been
limited to the animal world. Axelrod himself has successfully applied
his findings to a number of diverse scenarios, including complex human
interactions involving patterns of cooperative behavior that spontane-
ously evolved between rival armies during World War I. While contem-
porary social theorists may resist the thought of using game theory and
computer simulations to predict patterns of behavior in a complex spe-
cies like Homo sapiens, Axelrod’s analytical tools have been employed
by a diverse array of scientists in a remarkably wide range of contexts
(Bender and Swistak, 1992; Jones, 2008; Rankin and Taborsky, 2009;
Yamamoto, 2009).
Research with human populations, however, cannot be undertaken
with the same degree of methodological rigor as research with spiders
or cleaner fish. Axelrod’s discussion into the behavior of armies dur-
ing WWI was based on comparing predictions of computer modeling
 The Evolution of Racketeering 57

with library research in secondary historical sources. This kind of his-

torical proof is not as rigorous as empirical, firsthand observations
undertaken by field biologists. But it does illustrate that “ESS think-
ing” can be usefully and provocatively applied to a range of events
and processes for which it is not feasible to undertake observational
research (Davies, Krebs and West, 2012:142). The remainder of this
chapter will be taken up with this kind of hypothetical modeling to
better understand the way these tools from behavioral ecology can
explain the evolution of racketeering and organized crime in systems
of exchange.

4.4  Racketeering as an Evolutionary Stable Strategy

Is racketeering an ESS? It is not possible to test this hypothesis directly,

since the organization of markets into rackets cannot be observed in
real time or manipulated experimentally (3). But it is possible to employ
ESS thinking together with historical and archaeological case studies to
think through the questions raised by the study of organized crime.
Evolutionary theory, for instance, predicts that systems of economic
exchange in a stateless environment would be inherently unstable, since
in the absence of legal authorities, transactions depend on cooperation
between buyers and sellers. In a world where there is no authority to
police economic transactions, guarantee property rights or enforce con-
tracts, there is nothing to inhibit the innovation of cheating or eco-
nomic predation. When cheating occurs, other actors must modify their
behaviors in response to the cheat, and over time, the behavioral system
will increase in complexity.

4.5  ESS Thinking: Farming and Raiding

These dynamics can be clarified by exploring a hypothetical scenario: a

group of independent farmers in a stateless realm who engage in small-
scale agricultural production. Farms are inhabited by kin groups, and
enough grain is produced so that a modest surplus accumulates each
year and is stored in a granary. The surplus is a store of wealth and is
used for trade. Under these conditions, the community is vulnerable to
theft or parasitic raiding by non-agriculturalists because the economic
incentives are high and the costs are comparatively low. The rules of
frequency-dependent selection suggest that the first kin group to rec-
ognize the potential rewards from shifting to raiding as a subsistence
strategy will be the most successful. While social norms would certainly
58  Gangster States

discourage this kind of behavior, these rules would be undermined by

powerful economic incentives (4).
If a farming community has a limited supply of arable land and an
exponentially increasing population, eventually some groups will
become landless. This could also become a pathway for the evolution of
raiding behavior. If surrounding farms produce unguarded surplus, and
there is no organized security force or army to protect wealth or punish
theft, raiding becomes viable as a mode of subsistence.
In this kind of environment, the first kin group to abandon farming
and begin raiding would initially be very successful. A field of mature
wheat or a herd of cattle represent a tremendous investment of resources
and great store of wealth. Farmers are fixed in the landscape and cannot
easily retreat from the threat of economic predation. They are locked
into specific locations that have the necessary amounts of sunlight, ara-
ble land and water to make successful crops. It is much less expensive for
a farmer to surrender a percentage of productive output than to aban-
don a cultivated field.
The incentives for shifting from production to raiding are visible in
one historical example from the American underworld. Arnold Roth-
stein was a famous Chicago gangster in the 1920s whose early smuggling
enterprises involved transporting contraband liquor across the Atlan-
tic to be sold at a very lucrative markup in eastern seaboard cities like
New York and New Jersey. His initial success in these enterprises quickly
inspired a number of imitators. As soon as these rival groups purchased
ships and developed their own smuggling networks, Rothstein sold his
boats and concentrated his energy on raiding the contraband of these
new entrants in the market. One historian described the economic logic
of this decision as follows:

Let others invest money and take the time and trouble to bring in
the liquor. It still had to be unloaded, carried to warehouses, and
eventually sold and delivered. A few tough, armed gangsters could
seize the precious cargo and sell it for the same price with none of the
overhead (Messick, 1971:24).

A similar example can be seen in the evolution of raiding behavior

along newly developed roadways in the American West. In the 1800s,
gangs of raiders in the United States often concentrated their energies
around isolated roads in underpopulated territories. These were the clas-
sic “highwaymen” who subsisted by stealing the unprotected wealth
carried by long-distance travelers. The more highwaymen who preyed
 The Evolution of Racketeering 59

on travelers within a given territory, however, the less likely travelers

were to take those particular routes. Under those circumstances, raiders
would have to reduce their predations to a level that would not discour-
age travel or find new territories. The end result was a system of tolls that
lightly taxed travelers but did not discourage travel (Tyler, 1964).
Similar incentives would prevail in our hypothetical community of
farmers. If the community had not previously experienced raiding or
theft, farmers would have no defenses. Their toolmaking and labor
would have been invested in agricultural production, with little extra
energy or resources available for weaponry or defense. Furthermore,
in keeping with the logic of frequency-dependent selection, as soon as
one kin group successfully abandons farming in favor of raiding, their
success will serve as an incentive for others (5). With multiple groups
of raiders in the landscape, the remaining farmers will have to choose
between shifting energy away from farming and into defensive fortifica-
tions or simply surrender a percentage of their grain stores to raiders. Or
they may abandon farming and become raiders themselves.
Unfortunately, all of these choices will result in diminished agricultural
output. The existence of parasitic raiders will diminish resources available
to farmers even if the farmers are successful in defending their crops. The
risk of raiding and the need for defense means farmers will have less time
and energy for tending crops. They must either intensify production to
fund energy investments in defense, abandon farming and become raid-
ers themselves or suffer increased levels of economic predation.
One potential solution to the problems posed by increasing numbers
of raiders in a farming community is the formalization of relations of
“protection” between groups of farmers and a single group of raiders.
In this case, both parties have an incentive to limit predation to levels
that allow both groups (farmers and a single group of raiders) to sustain
and reproduce themselves over time. This point of equilibrium will be
similar to that of other parasite-host ecologies.
In the biological world, parasites colonize a host because this is more
efficient than growing a body of one’s own. As mammals who grow our
own bodies and are therefore vulnerable to parasites, humans typically
fail to appreciate the economic advantages of the parasite lifestyle. But
in evolutionary terms, there is much that is right about parasitism. So
much so, in fact, that an inventory of the world’s life forms reveals that
most are parasitic (Price, 1980).
To be successful, parasites must avoid resource extraction that fatally
depletes the host. The goal of parasites is instead to secure a comfortable
place to live (such as the human gut) with a ready supply of nutrients
60  Gangster States

that will support new generations of parasites. Natural selection typi-

cally shapes the host-parasite relationship so that it diminishes the over-
all health and functioning of the host but is seldom a direct cause of
death itself. A parasite that kills its hosts quickly will not leave as many
survivors in the next generation as parasites that are more modest in
their resource extraction.
In the case of our farming community, raiders are not robbing nutri-
ents inside the body but are diminishing the overall resources available
to the farming community by stealing grain stores. Raiders are extra-
corporeal parasites, and the same evolutionary forces will act to curtail
their predations. If the farmers’ output declines below a certain mini-
mum survival threshold, both groups will ultimately perish. Successful
parasitism means the health of the farming community will suffer, but
the system will favor some constraints on raiding that allow populations
of farmers to successfully reproduce themselves.
Under these circumstances, farmers can do their own ESS thinking
and conclude that it is less destructive to surrender a percentage of their
surplus production to a single group of raiders than to risk complete
ruin from multiple destructive raids. A pricing mechanism is also at
play: racketeers are free to set virtually any price they want on the ser-
vice (protection) they are providing. From the farmers’ point of view,
even a 90 percent loss is preferable to the 100 percent loss they would
face if their crops were burned or destroyed. These forces will create a
system of increasing downward economic pressure on farmers, as raiders
will seek the maximum level of extraction the system will allow. Farmers
must be kept alive to farm, but not much more.
A good deal of paleopathological evidence suggests that early agricul-
tural societies were afflicted by this kind of “macroparasitism” (Brown,
1987; McNeill, 1976; Cohen, 1987, 1991). Archaeological analysis of
human burials from early agricultural populations reveal consistent
extremes of wealth and poverty consistent with the trickle-up econom-
ics of racketeering. There is abundant skeletal evidence of growth stunt-
ing, malnutrition and increased mortality for peasant farmers, while
elites are typically buried in elaborate tombs with extensive displays of
wealth and property (Brown, 1987; Cohen, 1987; McNeill, 1976). Some
of these health declines result from increased infectious disease burdens
caused by changes in human and animal ecology associated with agri-
cultural subsistence (Cohen, 1991). But much of the increased mortality
appears to be related to poverty and malnutrition, suggesting that early
agricultural populations underwent significant health declines when
they became incorporated into early states.
 The Evolution of Racketeering 61

When raiders compete with one another, they must also use the sur-
plus they obtain from farmers to fund new investments in weaponry
and defensive technologies. This can create an arms race between raid-
ing groups that further depletes the agricultural base. Raiders who can
support the largest army will be the ones who can effectively retain
monopoly control of an entire region. But armies are expensive to
build and maintain. Larger armies mean the productive base of farmers
must support a growing population of non-productive soldiers as well
as specialized craftspeople engaged in weapons production. All of these
expenses will require some combination of agricultural intensification
combined with increasing downward economic pressure on farmers.
At this point, the farmer-raider system of exchange has begun to
resemble the kind of balanced polymorphism produced by frequency-
dependent selection. Two alternative behavioral strategies maintain one
another in dynamic equilibrium. Too much raiding means too little
farming is going on to support the system. Too much farming creates an
opportunity for increased raiding. A system of all farmers is increasingly
vulnerable to raiding. A system of all raiders will have no agricultural
surplus to raid.
It is logical to predict that the farmer-raider economy would even-
tually stabilize or find a point of equilibrium with the development
of something resembling the informal “taxation” of a classic protec-
tion racket. Farmers would agree to an exclusive relationship with one
group of raiders, who would then protect them from other raiders. This
would create an asymmetrical mode of exchange that limits the para-
sitic extraction of raiding to sustainable levels. It is a racket rather than
a legitimate form of exchange because it would not be necessary for
farmers to purchase protection if raiders were not threatening to steal
their crops in the first place. Once relations of protection are formal-
ized, the behavioral system cannot revert to a defenseless egalitarian
­community—the protection racket becomes an ESS. It can be invaded
by rival racketeers but not by a decentralized system of cooperative
exchange. The innovation of protection stabilizes the level of predation
so that agricultural production can continue in a way that guarantees
the survival of both groups.

4.6  From Raiding to Protection Rackets

Protection rackets differ from simple theft or looting in that the goal is
not a one-time transfer of wealth but is instead to establish an ongoing
extractive presence within an existing system of exchange. Protection
62  Gangster States

rackets are most likely to emerge and flourish where wealth and prop-
erty are unprotected, meaning where there is no government or other
stable political authority in place to defend property rights or adjudi-
cate conflicts regarding economic transactions. As Diego Gambetta has
astutely noted, thieves do not like to be robbed any more than the rest
of us (Gambetta, 1993). In a stateless realm, rational economic actors
will recognize the incentives for seizing or threatening unprotected
wealth this way.
In such an environment, protection rackets emerge as a way to secure
the continuity of production and exchange. Racketeers guarantee the
flow of goods and services will continue and productive enterprises will
remain viable over time. So even though racketeering is built on vio-
lence and coercion, there are elements of a rudimentary, asymmetrical
social contract between the racketeer and those who are coerced into
purchasing protection.

4.7  Supply and Demand

At this point, another question must be asked—if rackets evolve in

response to the inherent instability of unregulated systems of exchange
in the informal economy, then why don’t all informal systems of
exchange evolve into rackets? The answer to this question can be mod-
eled by exploring the extreme ends of the supply/demand curve. In
other words, ESS thinking suggests that there is a critical threshold of
reward beyond which the payoff for using violence to organize and
defend a monopoly begins to greatly exceed the startup costs and per-
sonal risks.
In the field of economics, supply/demand curves are always drawn as
continuous lines, but common sense suggests there must be disconti-
nuities in extreme situations of very high demand and low supply. At a
certain point, high demand coupled with scarcity will compel individu-
als to act in radically different ways than in situations where need is not
so extreme. Rational economic man may become irrational under these
circumstances and engage in a range of behaviors that would not occur
in more ordinary circumstances.
A more realistic graph of supply/demand curves would include a
transformative threshold whereupon human behavior crosses over into
“Extremistan,” and previous rules governing economic or social behav-
ior no longer apply. The term “Extremistan” is taken from The Black
Swan (Taleb, 2008), which opens with a division of the world into two
asymmetrical mathematical landscapes: the “quiet uneventful province”
 The Evolution of Racketeering 63

of Mediocristan and the realm of extraordinary events, which he terms

“Extremistan.”
In Extremistan, normal probabilities cease to apply, and small events
can suddenly and without warning initiate radical reconfigurations of
the known world. Another way to think about the dynamics of Extrem-
istan is to look at a standard bell curve. The vast majority of the space
represents the predictable world of Mediocristan. The extreme ends of
the curve (or the “tails”) are where things cease to progress via standard
deviations and instead represent dramatically improbable departures
from known patterns or events. The visual representation of the bell
curve unnaturally flattens these statistically unlikely end zones so that
their potential significance is overlooked. Investment and banking pro-
fessionals refer to these ends as representing “tail risk,” for the tail of
the bell curve. Tail risk events move markets very dramatically in short
periods of time—they represent abrupt, transformative, non-standard
deviations where market prices can become radically disconnected from
value. Taleb gained fame as an investor (in part) from developing a strat-
egy to profit from tail risk (Taleb, 2008).
For the example presented here, the extreme end of the supply/demand
curve is hypothesized to constitute a “hypothetical mafia threshold” or
a zone in which new behaviors (such as theft, violence, raiding, racket-
eering, homicide) suddenly become exponentially less risky and more
profitable. Once these new behaviors become established, the entire
system of exchange becomes transformed in a way that is not readily
reversible.
This proposal is contrary to much thinking in contemporary eco-
nomic modeling but is supported by real-world observations. It is not
hard to find examples of criminal behavior appearing in normally
tranquil zones of exchange if an unusual event suddenly propels the
supply/demand curve into extreme territory. During the early months
of the 2009 H1N1 influenza pandemic, for instance, several public
health organizations prepared documents to help municipal police
departments prepare for organized theft and raiding of vaccine sup-
plies that would occur if the virus mutated to a more lethal form
(Luke and Rodrigue, 2008). In other words, public health profession-
als predicted that a severe pandemic would elevate the value of the
flu vaccine (a limited commodity) to the point where armed gangs
would attempt to seize control of shipments in order to sell individ-
ual vaccine doses at exorbitant prices. The H1N1 pandemic remained
quite mild as influenza pandemics go, but there were still instances
of hijacked vaccine shipments as well as counterfeiting and theft of
64  Gangster States

Figure 4.1  Supply/Demand Curve with Hypothetical Mafia Threshold Triggered

When Demand Is Very High and Supply Is Low.

antiviral drugs like Tamiflu (http://www.wrdw.com/news/health/

headlines/69361057.html and http://metro.co.uk/2009/07/20/guards-
to-protect-swine-flu-drug-depots-285319/).
Correspondingly, if the demand curve moves downward or the level
of supply proves unsustainable due to environmental deterioration or
other unpredictable circumstances, the costs involved in racketeering
may begin to exceed the available profits, and the system will be vul-
nerable to collapse or disaggregation. In a normal year, flu vaccine is
not normally a product that generates a lot of attention from organ-
ized crime groups, so theft, hijacking and counterfeiting do not usually
occur.
While it is possible to imagine a scenario whereby a racket (like any
other ESS) becomes destabilized and reverts to an unorganized state,
such a scenario is not likely to persist over time. If the supply/demand
curve and the associated economic payoffs remain relatively constant,
the newly “disorganized” market will again be vulnerable to coloniza-
tion by a new group of racketeers.
 The Evolution of Racketeering 65

4.8  The Geography of Protection

Once a protection racket evolves in a given system of exchange, it will

have a natural tendency to expand until it achieves coverage of an entire
geographic region. If only a few producers or consumers purchase pro-
tection, those who remain outside the system will become increasingly
attractive to raiders, driving the expansion of racketeering. As Gambetta
has described,

. . . [A]s more and more dealers buy protection, the risk to those who
do not increases, for if the protection is effective, predators will con-
centrate their efforts on the unprotected. As a result, there will be
progressively more genuine incentive to buy protection, which would
act as a catalyst for a chain reaction in which everyone ends up buy-
ing protection simply because everyone else is doing so (1993:30).

The nature of the market for protection also guarantees that it must
be organized as a monopoly. Sellers of protection will not tolerate the
presence of rival racketeers in their economic territory. They instead
claim sole ownership of the productive apparatus of individual entre-
preneurs and possibly even the collective output of an entire geographic
region. Those who resist paying for protection will be likely to have
their business (or their person) destroyed. This gives the racketeers de
facto monopoly on violence within their established geographies, mak-
ing them congruent with Max Weber’s definition of the state (Gerth and
Mills, 1958).
In short, rackets evolve as fundamentally economic entities, devoted
to extracting and concentrating wealth in the hands of racketeers. But
rackets are also stratified and hierarchical, and racketeers frequently
assume government-like administrative control over their territories
and constituent populations. If basic rules of behavioral ecology drive
the evolution of racketeering from unorganized systems of economic
exchange, then these forces are also driving the parallel evolution of a
rudimentary form of government.

4.9  Narrative Vignette: Raiding and Trading on the Steppes

The boy who became Genghis Khan grew up in a world of excessive tribal
violence, including murder, kidnapping, and enslavement . . . From this
harsh setting, he learned, in dreadful detail, the full range of human
emotion: desire, ambition, and cruelty . . .
66  Gangster States

If the Mongols had nothing to trade, they raided the herders they could
find on the steppe or in isolated valleys. The attackers used the same tactics
in approaching human prey as animals, and at first sign of attack, the
targeted victims usually fled, leaving behind most of their animals, the
material goods of their homes and whatever else the attackers might want.
Since the object of the attack was to secure goods, the attackers usually
looted . . . and rounded up the animals rather than pursuing the fleeing
people. Because the raiders wanted goods, casualties in this type of struggle
remained low . . . Hunting, trading, herding and fighting formed a seamless
web of subsistence activities in the lives of the early Mongol tribes . . . This
alternating pattern of trade and raiding supplied a slow, but steady, trickle
of metal and textile goods moving northward . . .
The position of a steppe khan rested on his ability to win in battle and
to ensure a steady supply of trade goods . . . Frequently a new tribe emerged
from the steppes to displace the older tribe that had grown weak and
dissipated from several generations of soft city life. In a long-established
cycle, a nomadic army swept down from the steppe, conquered the peasants
and the cities to the south, created a new dynasty, and, after a few years,
fell to the attack of another marauding tribe . . .
In all the centuries of raiding and trading, no leader had brought back
to his homeland nearly the amount of goods as Genghis Khan . . . Year by
year, he gradually defeated everyone more powerful than he was, until he
had conquered every tribe on the Mongolian steppe . . . In conquest after
conquest, the Mongol army transformed warfare into an intercontinental
affair fought on multiple fronts stretching across thousands of
miles . . . In twenty-five years, the Mongol army subjugated more lands and
people than the Romans had conquered in four hundred years. . . . At its
zenith, the empire covered between 11 and 12 million contiguous square
miles . . . As Genghis Khan’s cavalry charged across the thirteenth century,
he redrew the boundaries of the world. His architecture was not in stone
but in nations. Unsatisfied with the vast number of little kingdoms,
Genghis Khan consolidated smaller countries into larger ones . . . In
nearly every country touched by the Mongols, the initial destruction and
shock of conquest by an unknown and barbaric tribe yielded quickly to
an unprecedented rise in cultural communication, expanded trade, and
improved civilization (Weatherford, 2004).

This historical example reveals all of the key dynamics described

above. Genghis Khan began his life in a subsistence economy devoted
to agriculture, with competing kin groups engaged in destructive
­patterns of raiding and retaliation with one another. Leadership status
 The Evolution of Racketeering 67

was conferred upon individual khans if they demonstrated an ability

to successfully increase their own wealth through raiding and defend
their kin from retaliatory raids from others. The more wealth a family
obtained, however, the more they had to invest in protection and the
more ­vulnerable they became to predatory attacks by bands of mobile
raiding groups. As Weatherford describes, successful khans would even-
tually grow weak from “soft city life” and be overthrown by new groups
of raiders sweeping down from the steppes.
Over time, these patterns produced a prototypical feudal society char-
acterized by “a series of regional civilizations” that had no knowledge of
one another (Weatherford, 2004:Kindle edition location 122). Genghis
Khan’s remarkable success stemmed in part from the way he was able
to seize wealth from isolated, regionally stratified enclaves and use it to
engineer a shift in loyalties on the part of conquered populations from
immediate kin groups to the larger ethnic/national group of Mongols
as a whole. This was accomplished with fairly ruthless social engineer-
ing tactics, such as killing leaders and aristocrats of every conquered
group so that the peasant producers would immediately transfer their
loyalty to the Mongols. The larger the Mongol army and civilization
grew, the more impossible it became for any other group to successfully
defend itself, until the Mongols gained control of an enormous swath
of territory that ultimately linked Europe and Asia into one vast inter-
connected political economy. All of the hierarchical complexity, wealth,
stratification and governance structures that ultimately developed in
the Mongol empire could not have happened without the original inno-
vation of raiding.
5
Organized Crime and Kleptocracy

5.1  From Gangs to Primitive States

Gangster-states are defined here as chimeric, transitional political econo-

mies that temporarily formalize the extractive economic monopolies of
racketeering over marked geographic territory. Once territorial bounda-
ries become established, the racket resembles a rudimentary kleptocratic
state, with the security forces repurposed beyond monopoly enforce-
ment into activities more typically associated with government. These
may include the organization of economic production, conflict resolu-
tion and territorial defense. Gangster-state territories are not fixed or
static, as kleptocratic elites will seek to colonize surrounding territory
if conditions are favorable. On the other hand, the extractive core of
racketeering creates an impetus for conflict with neighboring groups as
well as exhaustive depletion of resources that may ultimately lead to
political-economic decline or collapse.
This is a dynamic Darwinian model of political economy, with rack-
eteering hypothesized to be the energetic core that drives subsequent
phases of state formation, expansion, collapse and ultimately regen-
eration. Or, to put it another way, gangster-states are modeled here as
territorial polities that emerge, expand and contract secondarily to the
organization, expansion or contraction of racketeering in the economy.
There is no notion of directionality or progress in this model. The basic
evolutionary building block of the ESS is instead understood to organ-
ize political-economic complexity and stratification in greater or lesser
degrees of hierarchy and complexity.
If there is no pre-existing polity in place, the emergent organiza-
tional structure of the racket becomes the institutional scaffolding for
the development of a proto-state, and the stateless realm is no longer
stateless over time. This would be an example of primary gangster-state
formation. Primary gangster-states begin as rackets dedicated to raiding
or other forms of wealth extraction, with elites asserting these rights

68
 Organized Crime and Kleptocracy 69

through public displays of violence. Over time, marked polities form

out of territorial conflicts between rival racketeering groups. Primary
gangster-states have few if any pretensions to legitimacy or democratic
governance. They evolve as economic polities with security forces and
stratification emerging first in the context of racketeering then trans-
forming over time into primordial institutions of governance and ter-
ritorial defense.
The individual polities produced by this process will have unique
qualities determined by the historical and cultural specificity of their
surroundings. But there will be convergence of internal structures due
to the fact that core evolutionary processes will be consistent. This is
analogous to the way evolution and natural selection in the biological
world produce infinitely diverse and variable life forms over time. The
end result is a set of common evolutionary processes that produce his-
torically and culturally specific variations.

5.2  The Underworld as Prehistory

This model of political economy does not relegate the evolution of the
state to a remote and distant past that is inaccessible to contemporary
researchers. Instead, it posits that the same processes that originally led
to the formation of prehistoric states is ongoing in the contemporary era,
visible in territorial contests between rival racketeering groups fighting
to organize and defend underworld monopolies. Because these conflicts
take place in the negative cartographic space of the informal economy,
they are unmapped, and their significance is easily overlooked by con-
temporary researchers. A survey of literature from criminology, history
and archaeology, however, reveals that the dynamics of underworld ter-
ritoriality, leadership and violence today appear consistent with the way
scholars in archaeology have described state formation in prehistory.

5.3  Territoriality, Leadership, Violence

Precise information on underworld territoriality is hard to come by, in

part because it is not considered a significant variable by criminologists
and is not mapped by cartographers. A few criminologists have explored
the issue (Gambetta, 1993; Densley, 2014), along with a pair of intrepid
archaeologists (Ayala and Fitzjohn, 2013). Peter Reuter has also described
illegal markets in New York as organized by racketeers and characterized
by “monopolistic competition with some degree of territoriality.” He
70  Gangster States

goes on to note that these conditions create a strong incentive for “com-
petitive violence“ between groups, since an aggressive competitor can
effectively increase his own wealth and power by “muscling in” on his
neighbor’s market share (Reuter, 1984:140).
There are also a number of descriptions provided by journalists,
though these works tend to focus exclusively on Italian-American organ-
ized crime groups in the United States. The five boroughs of New York,
for instance, were allegedly divided up by the five leading Mafia families
of the early 20th century. Florida was similarly partitioned (1). The lack
of a visual reference for underworld territoriality makes it difficult for
outsiders to perceive the significance of these boundaries.
Diego Gambetta has also described Sicilian Mafia families as “territo-
rial oligopolies” that predate the founding of the Italian state (Gambetta,
1993:110). Gambetta also describes the inscription of these geographic
boundaries as motivated by the necessity of regulating commerce under
Mafia control. “This type of regulation [of protection rackets] is easier if
the protection market and the geographical territory coincide, as cus-
tomers are more readily policed within territorial rather than functional
boundaries” (1993:70). In other words, research into organized crime
reveals a tendency for racketeers to inscribe their monopoly economic
control on the physical landscape as well as on the physical bodies of
their subordinates.
Researchers who study warlords also focus on territoriality (Cooper,
1999; Ezrow and Frantz, 2013; Marten, 2012; Markowitz, 2013;
McNulty, 1999; Rich, 1999; Segell, 1999). Unfortunately, criminolo-
gists who study organized crime and political scientists who study
warlordism have not discovered that their respective definitions of
these phenomena are virtually interchangeable. Kimberly Marten, for
instance, defines warlords as “individuals who control small pieces of
territory using a combination of force and patronage” (2012:Kindle
edition location 152). Marten goes on to discuss other components
of warlordism, such as levying taxes, providing security to businesses
through deployment of personal militias, protecting transit and redis-
tributing wealth in the form of public services to local populations.
One Afghan warlord is described as sharing wealth and providing pub-
lic goods for his population but also stifling economic growth by main-
taining monopoly control of a lucrative transportation route (Marten,
2012: Kindle edition location 290–303). Marten then makes a compari-
son with the way anthropologists have described chiefs, or the phase
of cultural evolution that commonly precedes state formation (Earle,
1998, 2002).
 Organized Crime and Kleptocracy 71

Marten does not view contemporary warlords as equivalent to state

builders in feudal society, since today’s warlords “arise and exist inside
states where they are at least tacitly protected by domestic or foreign
state leaders” (2012:Kindle edition location 566). In the model presented
here, however, contemporary warlords are defined as equivalent to pre-
historic state builders, and their control of physical geography inside a
contemporary nation-state is understood as reiterating earlier processes
of state formation. Warlords are gangsters who have grown powerful
enough to transition out of the stateless realm of the informal economy
and seize formal territory within an established nation-state, similar to
the way cartel zones have become colonized by drug gangs in northern
Mexico and along the US border.
Gambetta and other criminologists have also described how organ-
ized crime groups take on governing roles within their territories, acting
as agents of conflict resolution, keepers of public order, distributors of
wealth, defenders of property rights and organizers of commerce and
capital investment (Gambetta, 1993; Glenny, 2008; Grossman, 1995;
Kupatadze, 2012; Lacey, 1991; Lee, 1999; Maltz, 1985; Marten, 2012;
Skaperdas and Syropoulos, 1995; Volkov, 2002). As one researcher noted,
“professional criminals are often perceived as ‘good men’ in their local
societies, frequently acting as dispute arbitrators” (Kupatadze, 2012:27).
Biographers and journalists have also described gangsters and warlords
as skilled politicians who provide a range of public services for their
communities (Davis, 1994; Glenny, 2008; Handelman, 1995; Kupatadze,
2012; Lacey, 1991; Lee, 1999; Levine, 1990; Marten, 2012; Volkov, 2002).
One powerful mafioso based in south Florida was known to generously
redistribute wealth by providing hospital care for needy children from
his neighborhood. He was “adored and revered” (as well as feared) by
area residents (Pacheco, 1994). Another famous drug lord in post-Soviet
Kyrgyzstan organized the construction of a much-needed pedestrian
bridge for his community, inspiring such affection from local villag-
ers that they erected a plaque in appreciation (detailed in Kupatadze,
2012:1). A former DEA agent described feeling conflicted in his under-
cover work because so many of the high-level drug lords he worked with
were men of intense personal integrity and honor. In his memoirs, these
mafia kingpins are portrayed as more sympathetic characters than many
of his DEA supervisors, who often come across as dishonest, self-serving
bureaucrats (Levine, 1990, 1993).
According to Gambetta, Sicilian mafiosi instinctively understand the
fundamental importance of reputation and honor in their role as eco-
nomic-polity leaders. These traits are viewed as essential ingredients for
72  Gangster States

successful racketeering in the same way they are for any legitimate busi-
ness enterprise or political leadership:

Reputation, a ‘good name,’ is an asset of great value which in busi-

ness commonly refers to the expected quality and reliability of a
commodity or dealer and acts as a guide for buyers . . . Dealers in
protection are no exception. As in all other businesses, a good reputa-
tion attracts customers and keeps competitors at bay. By far the most
striking feature of a mafioso’s reputation is that it saves directly on
production costs. Car manufacturers benefit from a good reputation,
but they still have to produce cars. By contrast, a reputation for cred-
ible protection and protection itself tend to be one and the same
thing. The more robust the reputation of a protection firm, the less
the need to have recourse to the resources which support that reputa-
tion (Gambetta, 1993:43–4).

A key element of honor and reputation in the underworld is the stra-

tegic, rather than indiscriminate, use of violence. Violence is viewed as
legitimate and honorable if it is directed at members of rival organized
crime groups or insubordinate members of one’s own group. Within
their individual domains, mafiosi maintain a monopoly on violence
and control commerce by providing protection to individual merchants.
This includes protection from unauthorized theft, or a rudimentary,
asymmetrical notion of property rights. Any theft or transfer of property
that is not sanctioned by the warlord/mafioso threatens to bring dis-
honor and invite challenges, as it suggests the elites do not fully control
individuals and commerce within their domain.
Laws of supply and demand coupled with the basic inefficiency of
monopolies, however, will tempt aspiring entrepreneurs to engage in
private economic activity that subverts the inflated prices and ineffi-
ciencies of monopolistic racketeers. This may take the form of theft and
reselling of key commodities by lower-ranking mafiosi or direct embez-
zlement of funds or goods. Since these activities disrupt the integrity
and stability of the racket, they are the crimes that are punished most
harshly in gangster-state territories. Private or unsanctioned economic
activity (including theft) is equated with disloyalty, as it undermines
racketeers’ implicit ownership of property, persons and trade. As Michael
Maltz has stated, “ . . . [E]ven if an organized crime group engages only
in victimless crimes, even if it has both a monopoly in its enterprises
and docile, stable employees, customers and associates, violence may
be required to keep both competition and rebellion down” (1985:26).
 Organized Crime and Kleptocracy 73

Public displays of violence and terror are used to discipline those guilty
of insubordination and restore faith in (as well as create demand for) the
protection sold by racketeers.
Rival racketeering groups, however, are excluded from these social con-
tracts and are instead understood to be competing for rights of parasitic
extraction upon the subservient population. Attacks on rivals, therefore,
do not bring dishonor but reaffirm the power and legitimacy of racket-
eers to provide protection. Patterns of raiding and retaliatory violence in
border zones will be common, as each group seeks to increase its market
share and defend its reputation at the expense of its rivals.
These patterns of territoriality and violence are currently visible in
the organized-crime–controlled regions of the US-Mexican borderlands.
Rival racketeering groups are competing with one another for control
of lucrative smuggling routes as well as with the formal security forces
of the Mexican state. Cartels have successfully gained control of large
sections of the region’s geography and have implemented a rudimen-
tary system of personalistic law and order consistent with the principles
outlined above. Border zones between cartel territories are among the
most violent, as each group attempts to expand its political-economic
resources at the expense of its rivals.
The ability of outsiders to perceive these emergent gangster-polities in
Mexico is facilitated by Stratfor’s map of cartel territories (available here:
http://www.stratfor.com/weekly/mexicos-drug-war-balkanization-leads-
regional-challenges#axzz3E3CVHuBL). When the geographic contours
of the underworld are mapped in this way, it becomes easier to visualize
the evolutionary continuum between gangs and states. While each of
these zones of cartel control is located within or around the larger polity
of Mexico, each is also seeking to establish itself as a (gangster-)state-
within-a-state. Cartels also form alliances with one another against the
formal Mexican state but still compete for control over lucrative smug-
gling territory and resources.
Each cartel proto-state also extends beyond the territorial boundaries
of Mexico itself and includes smuggling pipelines and distribution cent-
ers in the United States and other foreign countries. Revenues from this
informal economy are estimated to be nearly $45 billion or about half
the GDP of the formal sector of the Mexican economy (2).

5.4  Prehistoric Gangster-States

Exploring the political economy and social organization of territo-

ries under the control of organized crime groups reveals a number of
74  Gangster States

parallels with the way archaeologists and historians have described the
political-economic organization of prehistoric and early modern states.
In their comparative study of early states, for instance, Classen and Van
de Velde detail patterns of rule consistent with territorial protection
rackets: political domination by a narrow strata of elites who control
subjugated populations by means of extensive “tributary relations” over
defined geographic territory (1987:4).
This description has been echoed by a number of anthropologists,
who describe prehistoric state formation as characterized by resource
monopolization, social stratification, conflict and inequality (Classen
and Van de Velde, 1987; Cohen, 1978; Earle, 2002; Shifferd, 1987; John-
son and Earle, 1987). In her comparative study of 22 early states, Patricia
Shifferd described centralized control of economic activity as a key fac-
tor driving state formation (1987). She also noted extensive evidence of
“intra and intersocial conflict and instability” accompanying political
centralization in early states, suggesting that surrounding groups were
integrated into monopolistic hierarchical polities under some duress
(1987:39). This is similar to the way archaeologists have characterized
the Ottoman Empire as a “gigantic tribute-levying machine” that sur-
vived only by seizing new territory (Prunier and Gisselquist, 2003:109).
Roberto Carniero has also pointed out that primary state formation
typically occurred in geographically circumscribed areas (1970, 1988).
In other words, the world’s earliest states evolved in geographic regions
that were rich in natural resources necessary for intensive agricultural
production but surrounded by uninhabitable terrain that created barri-
ers to expansion. Two commonly cited examples include the Nile river
valley in Egypt and the lush intermountain valleys in the high Andes
of Peru. Both of these regions are conducive to agriculture, with sta-
ble climate and abundant supplies of sunshine and water for irrigation.
Both are also surrounded by hostile environments: arid deserts or frigid
mountaintops. Carneiro has theorized that these geographic boundaries
facilitated the evolution of socio-political complexity by simultaneously
encouraging population growth and limiting geographic expansion.
The resulting resource competition and conflicts are viewed as driving
technological innovations (such as irrigation) as well as the formaliza-
tion of political hierarchies, inequality and stratification.
Carneiro’s circumscription thesis is also consistent with the evo-
lutionary model presented here. Geographic circumscription places
sharp limitations on the supply of arable land and water in an environ-
ment characterized by increasing demand due to population growth.
If the supply/demand curve of these strategic resources reaches the
 Organized Crime and Kleptocracy 75

critical threshold described in Chapter 3, the probability of racketeering

groups emerging to seize control of these lucrative resources will cor-
respondingly increase. Population growth also typically follows a shift
to agricultural subsistence. Behavioral ecology suggests that increasing
population in a region with sharp limitations on the supply of arable
land will compel some landless groups to shift to raiding behavior if
they are unable to subsist on their own agricultural production.
Timothy Earle has also identified monopoly control of strategic
resources (including over labor, agricultural and/or craft production)
as a key development underlying social stratification and the develop-
ment of political/bureaucratic complexity in several early state societies
(2002). In other words, economic monopolies are formed by elites as a
way to finance the expansion of social hierarchies and institutions of
political control. The structural integrity of the polity becomes depend-
ent on these economic engines of state finance, and any disruption in
economic production may result in failure or contraction of the polity.

5.5  Early European Gangster-States

Charles Tilly’s historical work on early European states also reveals a

number of continuities with the dynamics of underworld territorial-
ity and violence described above. One of Tilly’s most famous articles
describes state formation in Europe as consisting of equal parts “war-
making, state-making and organized crime” (1985). In this article, Tilly
argues that early European elites were “coercive and self-seeking entre-
preneurs” similar to what would today be considered organized crime
groups (Tilly, 1985:169–70). In a later work, Tilly also described a num-
ber of early European state-makers as analogous to gangsters operating
protection rackets: “. . . at a price . . . [they] offered protection against
evils that they themselves would otherwise inflict, or at least allow to be
inflicted” (1990:75). Tilly’s observations echo those of crime historian
Gus Tyler: “the underworld is organized along feudal lines” (1962:234).
Tilly’s (1990) work on early European state formation also includes
a number of maps detailing the ever-changing boundaries of Euro-
pean polities between the years 990 and 1992. The dynamic contours
of these polities (visibly animated here: http://www.youtube.com/
watch?v=nq0KNfS_M44) represent expanding and contracting political
boundaries configured by warfare and territorial violence. These military
conflicts were often instigated by dynastic monarchies seeking to expand
their control at the expense of their neighbors. This longitudinal tem-
poral perspective also lends support to the idea that political-economic
76  Gangster States

boundaries are naturally dynamic, forming and dissolving in response

to territorial battles driven between rival racketeer/monopolists.

5.6  Mafia Branding: The Exquisite Corpse

Another point of comparison between contemporary organized crime

groups and prehistoric or early modern states emerges in the way ritual-
ized displays of violence and terror are used to establish monopoly claims
on resources. In the opening scenes of Discipline and Punish, Michel Fou-
cault describes several spectacles of public torture in premodern France.
In one narrative, a criminal is thrust onto a scaffold for public viewing,
while “the flesh [is] torn from his breasts, arms, thighs and calves with
red-hot pincers . . . then his body drawn and quartered by four horses and
his limbs and body consumed by fire, reduced to ashes . . .” (Foucault,
1977:3). Foucault interprets this scene as a performance orchestrated by
elites to dramatize the social relations of domination and submission
upon which feudal society was ordered. These hierarchies were literally
inscribed on the bodies of deviant or disloyal subjects or anyone who
was perceived as challenging the power of local elites.
Public displays of violence play a similar role in ordering underworld
relations of domination and control today. Individuals judged to have
brought dishonor to the leaders of an organized crime group are fre-
quently killed and their tortured bodies publicly displayed as a warn-
ing to discipline others. In some cases, the bodies are inscribed with
messages that warn onlookers of the price they will pay for similar acts
of insubordination. These displays serve as powerful visual reminders
of racketeers’ claims to monopoly ownership of property and persons
within their domain.
One crime writer described these killings as a form of public brand-
ing that marks a racketeering group’s control over a given economic
environment:

The reason for the killing in most cases is not to get rid of an individ-
ual who may have balked at the orders and extortions of the under-
world but to serve notice on other individuals that the word of the gang
is law. Hence, the killing of a person would be a great waste, unless
it were established publicly that this particular individual was killed
because he defied the demands of the underworld. And so the gang
leaves its trademark on the victim. The trademarks vary from time to
time and place to place, but every knowing crime investigator knows
the mark of the mob. This mark is the ‘commercial,’ the brand, the
 Organized Crime and Kleptocracy 77

means whereby one killing becomes a means of perpetuating a going

business. The underworld has found that it pays to advertise (Tyler,
1962:231, emphasis in original).

In 2009, over 5000 people were killed in drug-related violence in

­ exico, and journalists have noted a shift in recent years from hidden
M
or private killings (corpses displayed in places visible only to underworld
rivals) to public displays intended to terrorize all onlookers into submis-
sion. In March 2013, CNN reported that seven bodies had been left sitting
in white plastic chairs of a central plaza in Uruapan, Mexico. Messages
were left on poster boards pinned to the bodies with icepicks, warning
onlookers against insubordination (Sholchet, 2013). One of the poster
boards allegedly stated, “Warning, this is going to happen to all mug-
gers, pickpockets, thieves of cars, homes and pedestrians, kidnappers,
rapists and extortionists” (http://www.borderlandbeat.com/2013/03/7-
executed-in-uruapan-michoacan-found.html). The individuals displayed
in the photograph had presumably challenged the cartel’s monopoly on
violence by acting as entrepreneurs unsanctioned by the leadership.
These exhibitions are understood as a strategy for cartel leaders to
symbolically expand their claims of domination to all observers within
their established territories. Ordinary citizens with no ties to the drug
industry are increasingly subject to the rule of cartel leaders and vulner-
able to conscription into these territorial battles.
The ability of cartels to expand in this way emerges in part from the
retreat of the formal Mexican state (and its institutions of democratic rule
and conflict resolution) from these territories. The following vignette,
published anonymously in the online literary journal N+1 captures the
experience of this terror from an ordinary citizen’s point of view.

5.7  Narrative Vignette: Under the Cartels

The Narcos I grew up with killed only certain people. That’s why, in those
years, we didn’t breathe the same air that people breathe now in Monterrey,
the air that makes them not want to park far away from the entrance to the
theater when they go to the movies, that makes well-heeled women afraid
of even going to the supermarket. On the border, when I lived there, there
were shootouts, even bombs. But it was the bad guy’s house that got blown
up. The guy in the business. If you had nothing to do with that particular
industry, your house was safe . . .
Not long ago some of my younger cousins went to a birthday party. The
parents of the birthday boy discreetly excluded a narco’s son who went to
78  Gangster States

the same school. The day of the party the boy calmly showed up, smartly
dressed, and with a chauffeur. He brought a huge present. The hosts of
the party received him. Everyone understood the message. I suspect that
the adults that afternoon exchanged the same glances I had learned to
recognize in Monterrey . . .
A customer was leaving a store where they rent movies and sell candy
when two men got out of a car, which they left running on the sidewalk.
The men grabbed the customer, forced him into the car, and drove away.
An acquaintance who witnessed the incident told me, still shaken from
the scene, ‘Then I got in my car because nobody did anything, and I went
to City Hall, because I know there’s always a patrol car parked there.’ He
knocked on the bored police officer’s window and described everything he’d
seen, down to the hair on the men’s faces, as any decent, concerned citizen
would do. ‘They told me I’d better go home.’ He didn’t understand. I said to
him, The cops did their duty with regard to you, at least: they protected you.
He complained that they hadn’t done anything. Because he still believes in
the duty of the authorities. Because he doesn’t know that nothing is gained
by reporting crimes, and that a lot can be lost . . .
There is no way to count the dead. We hush them up. We silence the
bodies dissolved in acid. We silence the bullets to the head. We don’t
know what to call it. We say, Se lo llevaron, they took him, because the
truth—they killed him—is too terrible. And too common. And we resist
the thought that death and torture live so comfortably among us. We don’t
want to look at death. We busy ourselves with the living. Even if among
the living are, as they say now in Tamaulipas, los malos. The other day
someone referred to los de la letra—those of the letter—and everyone
understood. Nobody calls them by their name, Los Zetas. Whereas those
beyond their reach define them so clinically: ‘the armed wing of the Gulf
Cartel.’
Outsiders talk forthrightly about the elite former soldiers who were
recruited into the drug trade in the Nineties, and point to them directly
as those responsible for the violence in the campaigns to eliminate rival
cartels. In the United States and Europe they spell out ‘kidnapping’ with
all its letters when they talk about our cities . . . and they don’t feel our
shame . . .
The silence we kept before was for the sake of caution and comfort. It
wasn’t fear. Like the fear we felt when we saw the first heads: detached
from bodies, arranged on top of cars in residential neighborhood. The
corpses that carry messages carved with ice picks. Before, these things
weren’t visible. Public acts of terror: a grenade that exploded in Michoacán
in the middle of a crowd celebrating Independence Day. The cynicism. The
 Organized Crime and Kleptocracy 79

absence of trust in the authorities, in institutions. Realizing that nobody

is in charge. A few days ago, in a prison in Torreón, in the bordering
state of Coahuila, a group of gunmen walked in to kill three people and
release nine others, without anyone showing any resistance. Not even the
prisoners are safe.
The terror of thinking about torture, physical pain—but we all keep
going. We bury the fear. We ignore it . . . People put on their rubber boots
and step in the blood. There is no novelty. We no longer cover our mouths
in shock when we hear the latest. What happens after a group of gunmen
arrive in the small town of Creel, in Chihuahua, and kill thirteen people,
among them a one-year-old? What follows the fear? Anger? The faceless
dead. Bodies that go unclaimed, out of fear. We go out only to find that
young people, women and children with their faces covered, have blocked
the biggest avenue in the city. Two hours stuck in traffic because the guys in
the luxury SUVs paid them each 500 pesos to build barricades and protest
the presence of the army in their neighborhoods. We come to the conclusion
that no one can protect us. Why so much fear? Because there aren’t rules
anymore. Or maybe there are only two: They run the show, and nobody is
safe (Anonymous, 2010).

In this emotional vignette, the author is describing two parallel trends

in the cartel zones of Mexico. The first is the retreat of formal insti-
tutions of democratic government and loss of citizenship, personhood
and property for individuals living in these zones of contested power.
Democratic state protection of individual human and property rights is
eroding in these spaces. The statements that “nobody is in charge” and
“no one can protect us” attest to these trends (3).
The second transformation is the replacement of the institutions of a
quasi-democratic state (based on rights of juridical personhood and pri-
vate property) with parallel institutions of an emergent gangster-state,
which offer no such protections for human life or property. Instead,
the social relations of cartel territories are reminiscent of the way Clas-
sen and Van de Velde have described the social structure of prehistoric
states: “two basic strata . . . the rulers and the ruled . . . with political
domination of the former and tributary relations of the latter” (1987:4).
There are no rights to individual property or personhood in these
spaces, except for those granted by the cartels, and the price of earning
these privileges is high: personal loyalty to cartel leaders and abdica-
tion of unauthorized individual economic activity. As Renate Siebert has
observed, “Living . . . with mafia violence . . . transforms citizens into
subjects” (2003:40).
80  Gangster States

5.8  The Gangsterization of Democracy

It is tempting to classify stable democratic states as immune to these

racketeer-driven cycles of political-economic expansion and contrac-
tion. After all, democratic reforms offer a compelling pathway out of the
negative cycle of kleptocratic resource exhaustion and violent conflict
that characterize polities organized around racketeering. Democracy
and redistribution create institutions of stability and population well-
being that extractive gangster-states sorely lack. Unfortunately, estab-
lished democratic states are still vulnerable to reversion to this ancestral
form. Modern democracies remain at risk due to the destabilizing pres-
ence of racketeering in the peripheral space of the informal economy.
Organized crime groups form invisible proto-states within and
between the boundaries of established democratic states that evoke Solz-
henitsyn’s metaphor of the “spellbound archipelago” of hidden labor
camps in the USSR (1973). The gulag was not marked on any maps but
was composed of a chain of “invisible islands” hidden within the for-
mal geography of the state. This meant the gulag was everywhere and
nowhere, invisible and unknowable to ordinary citizens until they were
arrested and incarcerated. The experience of arrest marked a transition
from a known mapped world to an unmapped non-space that in many
cases existed only a few steps from their previous lives. Gulag memoir-
ists inevitably recount an overwhelming sense of disbelief at the time of
arrest (Vilensky, 1999:5). Solzhenitsyn captures the geographic surreal-
ism of these experiences in the following passage:

We are happily borne . . . down the long and crooked streets of our
lives, past all kinds of walls and fences made of rotting wood, rammed
earth, brick, concrete iron railings. We have never given a thought to
what lies behind them. We have never tried to penetrate them with
our vision or our understanding. But there is where the Gulag coun-
try begins, right next to us, two yards away from us . . . (1972:3–4).

The informal economy of the underworld forms a similar archipelago

of invisible space in stable democratic regimes. When ordinary citizens
stumble upon a drug-smuggling enterprise or a human-trafficking net-
work operating in their neighborhoods, they often react with the same
incredulity described by Soviet citizens who suddenly found themselves
in transit to unmarked prison camps.
In 1994, the New York Times published a story detailing a raid at a
“stash house” in Queens (James, 1994). The newspaper described the
 Organized Crime and Kleptocracy 81

house as looking entirely innocent and blending invisibly into its sur-
roundings. It “looked as if it belonged in the suburbs rather than in
Queens,” with “neatly trimmed hedges, mowed lawns and numerous
trees” (James, 1994). But inside police discovered 86 kilos of cocaine,
several handguns and over $700,000 in cash. Neighbors interviewed by
the news media expressed shock and indignation. One nearby resident
stated, “they [cocaine traffickers] tried to hide their heinous business
by fitting in.” The media reinforced this image of alien invasion by
concluding the story with the following statement: “For Fred Rizzi, an
architectural draftsman who lives across the street . . . [d]rugs, and the
evil they represent, had come to his beautiful, quiet and until now, safe
block” (James, 1994).
But this representation is not entirely accurate. Organized crime
constitutes a vast transnational enterprise that includes transportation
networks, logistics coordinators, warehouses, banking, finance, loss pre-
vention and retail sales outlets. The ready availability of illicit goods in
urban and rural areas of the United States suggests that these networks
consistently connect with a nationwide customer base. In other words,
illicit markets are everywhere in the United States but blend impercep-
tibly into the landscape so as to not attract attention from law enforce-
ment. The message of the drug house in Queens is not one of alien
invasion but one of a very commonplace activity that suddenly became
visible to outsiders.
If law enforcement in democratic regimes becomes weak, racket-
eers may begin to operate more openly. At that point, the smuggler’s
archipelago of transportation and trade networks becomes visible to all
citizens, not just those engaged in illicit commerce. Any weakening of
the core institutions or security forces of a democratic state creates an
opportunity for racketeers to expand beyond the confines of the infor-
mal economy and encroach on formal systems of governance. In these
cases, national political boundaries will remain unchanged, and vestiges
of democratic institutions (such as periodic elections) may persist. But a
truly democratic polity is incompatible with a racketeer economy, and
eventually the institutions of democracy will fail if the economy is over-
taken by racketeering.
Organized crime groups may find a way to penetrate the formal
apparatus of government and gain control of security forces in order
to repurpose them back into agents of monopoly enforcement and pri-
vate wealth aggregation. Democratically elected leaders may themselves
be unable to resist the allure of racketeering and repurpose the secu-
rity forces of the state toward private wealth building. In these cases,
82  Gangster States

the state will become increasingly extractive, kleptocratic and unstable,

even though nominal institutions of democracy may persist.
Some elements of this pattern can be seen in Brazil, where gangsters
have established control of favelas and other impoverished urban areas
in major cities. Within these zones, gangs control commerce and pro-
vide rudimentary public services to local populations (4). The Brazilian
government periodically challenges these groups, recognizing them as
threats to national sovereignty. In 2010, the New York Times reported
that Brazilian military and police forces invaded several of the most
notorious urban neighborhoods in Rio de Janeiro. Following this inva-
sion, the commanding officer stated, “Today we are assured of the state’s
victory and the power of the state” (Domit and Barrionuevo, 2010). In
other words, Brazilian military teams intuitively understood these raids
as motivated by a need for the formal democratic state to recapture ter-
ritories that had fallen under the control of organized crime. Only by
pushing these emerging gangster-states back to the peripheral space
of the informal economy (with its associated cartographic invisibility)
could the Brazilian government maintain popular confidence in its own
authority and legitimacy. This victory was symbolized by the army’s
strategic placement of a large Brazilian flag over the highest point of the
raided shantytown (Dumit and Barrionuevo, 2010).
A similar pattern has been described in South Africa, where gangs have
established control of some urban neighborhoods and used their mili-
tary power to deny entry to members of the formal security forces of the
South African government. On several occasions, these organized crime
groups have celebrated their control with visual spectacles of ownership,
including parades through the streets of Cape Town, during which they
“openly brandished their weapons” (Segell, 1999:41).
Joshua Krasna has described similar dynamics in his study of politi-
cal instability and narcotics production in Latin America (1996). In this
paper, he describes how narcotics trafficking creates “rival parallel states”
in countries like Peru, Colombia, Bolivia and Mexico. One part of the
country is run by the central government, and other regions fall under
the control of an “informal, shadow, but no less real . . . [state] run by
the traffickers” (p. 4). These shadow governments frequently win popu-
lar support by engaging in high-profile acts of public works and redis-
tribution. Traffickers in Jamaica, Honduras, Bolivia and Colombia, for
instance, have sponsored neighborhood health clinics, schools, housing
projects, church renovations and sports stadiums (Krasna, 1996:4).
If democratic states falter, or are not strong enough to defend their
territories against these subterranean encroachments, racketeers may
 Organized Crime and Kleptocracy 83

continue to expand until they gain control over the formal security
forces of the police and army. When this happens, these forces can
become repurposed back into agents of monopoly enforcement for elites,
and the state evolves (or devolves) from democracy to a gangster-driven
kleptocracy. This would be an example of post-democratic or tertiary
gangster-state formation: the expansion of organized crime groups operat-
ing in the informal economy into formal institutions of the democratic
state, so that police and security forces become repurposed back into
agencies of monopoly enforcement for elites. If these struggles become
contested—for example, if different branches of the armed forces fall
under the control of rival racketeering groups—prolonged civil conflict
may result, with a phase of destructive state failure followed by recon-
figuration of territorial boundaries under new kleptocratic elites (5).

5.9  Scenes from a Kleptocracy

The study of kleptocratic states is often confounded by the use of the

word “corrupt” to describe these extractive economic polities. While
some scholars have attempted to develop formal typologies to analyze
failed kleptocratic states (see Gros, 1996; Ezrow and Frantz, 2013; Rubin,
1988), these studies are often static and cross-sectional. The model pre-
sented here proposes that these regimes should be studied longitudi-
nally, where the evolutionary progression from gangster to kleptocrat
(and back again) becomes visible.
My own historical research has focused on exploring the relationship
between organized crime, conflict and kleptocratic political succession
in 20th century Cuba (6). The Cuban case is revealing in several impor-
tant ways: it shows that it is possible to witness (via historical records)
racketeers operating in the informal economy use smuggling revenues
as a way to fund arms purchases, stage an insurrection and gain control
of the state. Once installed in office, these same groups become avari-
cious kleptocrats who built up military and security services to expand
monopoly control over key sectors in the economy (7). This forced
political opposition groups to become more active in the informal econ-
omy, since they are increasingly shut out of participation in the formal
sector.
In Cuba, these dynamics created amplifying cycles of militarization,
arms trafficking, conflict, kleptocracy and ultimately state failure. For
much of the 20th century, Cuba endured destructive cycles of dictator-
ship and insurrection. The instability and violence of these events led
to periods of political collapse, with armed groups seizing control of
84  Gangster States

productive enterprises (like sugar mills) and claiming ownership of large

tracts of territory. Smaller comparative vignettes taken from secondary
sources offer some additional examples of this pattern. Other represent-
ative examples can be found in Africa and several post-Soviet locales.
While these political economies are all located in very different cultural
contexts, the overall pattern remains consistent.

5.10  Cuba Case Study

Conventional scholarly histories of Cuba rarely address the role of the

informal economy in configuring the island’s political conflicts and pat-
terns of instability during the 20th century (8). This is unfortunate, as
it leaves the historical force of organized crime overlooked and unex-
plored. When the role of racketeering is examined, it becomes clear that
(in the words of James Scott), “the surreptitious politics of this arena is
so decisive that an analysis which ignored it would be not simply inac-
curate but completely misleading” (Scott, 1972:2).
Archival research reveals that state power in Cuba has been repeatedly
used to organize and defend economic monopolies for elected officials
during the 20th century. In the first half of the 20th century, political
parties on the island often resembled rival groups of raiders, fighting
with one another to secure monopoly rights to wealth extraction from
the country’s productive enterprises, including sugar plantations and
the lucrative vice markets of the informal economy.
Ideological conflicts between political parties were manifestations of
this economic competition. Out-of-power coalitions were blocked from
participating in the economy and were heavily taxed by their politi-
cal opponents (9). Electoral contests frequently became violent as rival
gangster-kleptocrats maneuvered to gain control of the public sector.
Over time, these dynamics eroded institutions of democratic govern-
ment, including electoral processes as well as the judiciary and legisla-
tive branches. These institutions persisted in shell form, but over time
governance was increasingly done via executive decree. During these
years, the national treasury was repeatedly looted, and large external
debts were incurred to foreign banks. Public health and sanitation were
neglected, while gangster-politicians spent lavishly to build personalis-
tic armies to attack rivals and expand their own monopolies (Hirschfeld,
2007).
These conflicts began in the early years of the republic, shortly after
the Spanish-Cuban-American War, when groups of demobilized soldiers
and bandits formed coalitions under the command of former generals
 Organized Crime and Kleptocracy 85

(Schwartz, 1989). Eventually several of these raiding/bandit groups coa-

lesced around General José Miguel Gómez, an aspiring caudillo, who
orchestrated an uprising with the goal of seizing control of the national
treasury. This insurrection destabilized the fragile Estrada Palma regime
and resulted in a second United States military occupation. The with-
drawal of US troops in 1909 led to another outbreak of electoral violence
orchestrated by Gómez and his followers.
After the second US occupation, Gómez went on to serve as president
of Cuba from 1909 to 1912. Cuba was ostensibly a democracy and a
protectorate of the United States during this time, but electoral con-
flicts between Gómez and his rivals turned increasingly violent. Political
gangsters stationed gunmen near polling places to intimidate members
of the opposition, who threatened their rights of resource extraction. As
one journalist reported, “Cubans . . . are cowed [by their politicians] . . .
When election day comes around Doña Pilar makes ice cream, and her
two men stay safely at home and eat it . . . they are still noncombatant”
(Wright, 1910:125).
Once elected, Gómez legalized gambling and instituted a national
lottery to channel revenues into the hands of his supporters. The next
scheduled presidential election was correspondingly viewed as a threat
to the Liberal Party’s monopoly control over these lucrative industries,
and public-sector employees were expected to defend their interests by
attacking Conservative rivals. Electoral violence escalated as each group
fought for rights of monopoly enforcement that came with control of
the executive branch. In September 1912, a violent riot broke out in
Havana between followers of Gómez and members of the opposing Con-
servative Party. Many bystanders were wounded by gunfire. A few weeks
later, another gunfight erupted between parties in Havana’s Parque Cen-
tral, with several hundred shots fired (New York Times, 26 October 1912).
Soon after, one congressman attempted to shoot a rival in the House
of Representatives in a fight over the spoils of a lucrative railway con-
cession (Wright, 1910:187). The following spring, a Conservative Party
mayor was assassinated by rival members of the Liberal Party. Two days
later, a Liberal Party mayor was assassinated in retaliation (New York
Times, 15 April 1913).
In 1916, the police chief of Havana was gunned down by political
gangsters, allegedly for raiding the opposing party’s illegal gambling
establishments. Control of gambling casinos was exceptionally impor-
tant for political fundraising, and each party maintained its own net-
work of illicit gambling clubs. To help retain monopoly control of
these industries, Cuba’s leaders passed legislation granting themselves
86  Gangster States

immunity for entrepreneurial activities in vice markets (Chapman,

1927:341). Once these laws were in place, out-of-office coalitions were
at a disadvantage, since their casinos could be raided and assets seized
by police officers aligned with the opposing party.
During these years of conflict and caudillismo, Cuba’s noncombatant
citizens were denied meaningful participation in government and were
“crushed by heavy taxation” (Wright, 1910:194). This primarily took the
form of customs duties, which were imposed on all food imports. Public
revenues were brazenly looted by politicians or funneled into military
spending to wage war against rival gangster-politicians. One observer
described the Cuban government under Gómez as “the most expensive
and extravagant in the world” (Lindsey, 1911:150). After leaving office,
President Gómez allegedly spent $250,000 to build a mansion and lived
lavishly from investments in mines and sugar plantations acquired dur-
ing his presidency. He assumed office with little personal wealth but left
power with approximately $8 million (Beals, 1934:214). This fortune
was allegedly acquired through “monopolization of lottery collector-
ships, personal evasion of customs, rental of buildings, road building
and junk iron sales” (Beals, 1934:214).
The increasingly extractive qualities of the Cuban government made
office-holding a lucrative enterprise. As the wealth available to political
leaders increased, so did electoral violence. During the 1917 presiden-
tial election, three members of the Conservative Party electoral board
were killed, along with at least 30 other political operatives (Chapman,
1927:373). Electoral violence by the Liberal Party left swaths of Eastern
Cuba under the control of Liberal partisans, who established their own
realm of territorial control, complete with taxation and adjudication
processes. Various rebel/bandit groups roamed the countryside parasiti-
cally extorting additional “taxes” from sugar cane plantations by threat-
ening to burn cane fields (10).
The armed forces became highly politicized and increasingly divided
along party lines. The rural guard supported Menocal and the Conserva-
tive Party, and the regular army supported Gómez and the Liberal Party.
President Menocal responded to these challenges by issuing over 200
pardons to members of his own party who had engaged in political
violence or homicide against rivals. Once released from jail, these men
served as an armed faction of political gangsters that reinforced Meno-
cal’s political and economic power (Beals, 1934:298). These divisions
nearly brought the country to civil war, and the United States ultimately
sent troops into Eastern Cuba to quell unrest during the elections of
1916–17 and protect the sugar crop from arson. After the withdrawal of
 Organized Crime and Kleptocracy 87

US troops, Menocal suspended constitutional guarantees for the remain-

der of his term in office and continued to loot the treasury. As one critic
observed, “Half a billion in taxes were collected while he [Menocal] was
president, but the only signs of progress . . . that remain are the presi-
dential mansion and a bronze and marble statue of Antonio Maceo”
(Beals, 1934).
The same pattern repeated in 1921 when Menocal selected his suc-
cessor (Zayas) and rigged elections on his behalf. During this time,
the national bank was looted by political cronies of the president and
temporarily closed. The Cuban government had to borrow $US48 mil-
lion from New York banks to fund government operations. To win
the election, Zayas signed an amnesty bill that freed 1000 felons from
jail, including two former cabinet officers, three former provincial
governors and one exiled deputy. These criminals also served as a de
facto political mafia and were used to intimidate opposition voters
and increase the president’s control over key smuggling networks,
including the transport of bootleg alcohol from Cuba to the United
States during Prohibition (Chapman, 1927; Norton, 1926; Beals, 1934;
Spinden, 1920).
From 1900 to 1923, approximately 16 similar amnesty and immunity
bills were passed, along with 349 pension acts and retirement laws for
civil servants (including one which made government pensions inherit-
able) (Chapman, 1927:518). The amnesty bills allegedly granted elected
officials immunity from “[e]lection crimes, graft, revolution, blackmail
and political murder” (Norton, 1926:83).
This pattern was further amplified when Cuba became established as
an offshore smuggling center for bootleg alcohol and other contraband
during the 1920s. As the size of the informal economy expanded with
the enactment of Prohibition in the United States, the potential rev-
enues that could be gained from holding political office dramatically
increased. Cuban politicians quickly took advantage of this wealth-
building tool and used their powers to establish joint ventures with
North American organized crime groups based in New York, Tampa,
New Orleans and Chicago.
US Coast Guard intelligence reports from this time detail numerous
collaborative smuggling efforts between Cuban leaders and North Amer-
ican racketeering groups. Cuban officials also used their political power
to sabotage Coast Guard interdiction efforts. In some cases, the Cuban
military was instructed to impound American patrol boats and prevent
customs officials from seizing illicit cargo. This official state protection
of smuggling allowed the island’s informal economy to rapidly expand.
88  Gangster States

During these years, the public treasury was repeatedly looted, preda-
tory taxation was imposed on the population and the police and army
were repurposed to defend the economic monopolies of the leadership.
In the words of one New York Times correspondent,

The idea that politics is a spoils system and that political office is a
means of enriching the individual rather than serving the public was
one of the evil inheritances from Spanish rule. It is still the prevail-
ing attitude in Cuba, despite many honorable exceptions. Padding
of public payrolls, bribing of legislators, graft in public expenditures
of all kinds, open raids on the national lottery funds, outright theft
of public funds—these have been the rule in Cuban politics in the
last fifty years. To them, violence and gangsterism were added by
Machado and kept up in varying degree under every administration
since (Matthews, 1952).

These practices effectively corroded institutions of democracy on the

island and resulted in increasing dictatorial rule followed by periods of
violent conflict, instability and state failure. The Cuban constitution
centralized power in the executive branch, and “gradually both legisla-
tive and judicial branches through patronage and graft became servile
instruments in the hands of the president” (Phillips, 1934:11).
The dramatic expansion of the informal sector during Prohibition
meant that the police and armed forces had to increase in size to pro-
vide protection for smuggling ships and other government racketeering
enterprises. The Cuban armed forces increased tenfold between 1900
and 1920: from 1700 men during the Estrada Palma administration to
over 18,000 men by the time Zayas took power (Chapman, 1927). By the
late 1920s, the Cuban military had increased again to over 30,000 men
(Norton, 1926). These trends continued in the 1940s and 1950s, leading
to runaway costs and high levels of foreign debt.
The forces driving these developments were largely invisible to out-
siders, who looked on with bewilderment and frustration while the
Cuban government borrowed heavily to finance expansion of the
armed forces, neglected public health and education and repeatedly
thwarted international agencies seeking to limit the flow of contraband
into the United States, Canada and Europe. One observer noted that
in 1909 the average Cuban was paying over $12 per capita in customs
duties, compared with only $2.22 in France and $1.72 in Italy. By the
early 1920s, this figure had increased to over $30 per capita in Cuba,
with the majority of these revenues going to the military or the private
 Organized Crime and Kleptocracy 89

hands of public officials (Chapman, 1927; Jenks, 1929). One New York
Times reporter criticized Cuba’s excessive military spending in the early
1930s as follows:

The army and navy appropriation of $10 million is the largest item
in the [Cuban] national budget. Four new fighting planes have been
purchased. Shipments of arms and ammunition are pouring into
Cuba constantly, despite the fact that there is no necessity for Cuba
to arm against any foreign enemy. The military forces are in complete
control throughout Cuba . . . The formation of the first company of
the militia comes as a surprise to the public, owing to the large defi-
cit already apparent in the 1932–1933 budget and the heavy loans
which Cuba has just contracted to pay on her foreign obligations
(New York Times, 11 January 1933).

In addition to the regular military, Cuban leaders also maintained

personalistic armies of hardened criminals who were granted lucra-
tive monopolies in vice and smuggling in exchange for expanding the
wealth and power of the executive. President Machado’s private army
was referred to as the “Porra” and described as “a gang of criminals
organized . . . to do private killings” (Phillips, 1934:18). The Porra alleg-
edly were given monopoly concessions in prostitution and gambling,
with a percentage of earnings surrendered to the chief of police and the
secretary of government (González, 1935:157). Two parallel racketeering
groups were also allegedly organized out of the military and the office of
Public Works (González, 1935:161).
During this time, Cuban officials also began to target leaders of politi-
cal opposition groups with the same public acts of violence Italian mafi-
osi display toward rival racketeers: “Killing and death occurred exactly
in the same way as among the gangsters of Chicago and with the same
Thompson machine guns” (Lamar-Schweyer, 1938:30). Opposition lead-
ers were frequently denied property rights through predatory confisca-
tion, looting or bureaucratic extortion. Public displays of violence and
torture replaced the modern penal system put in place by the US occu-
pying army in the early 1900s. As one journalist described, “Machado
has reverted to the use of . . . medieval castles in the country [to incar-
cerate opposition leaders]; completely devoid of sanitation, dark, humid
and filthy” (Beals, 1934:299). One student activist was allegedly fed to
sharks kept in a special pool underneath Havana’s Morro Castle, and his
remains thrown onto a public beach to terrify passers-by (Tampa Tribune,
15 April 1933). Anti-government protesters were machine-gunned on
90  Gangster States

the streets of Havana by Porra on several occasions (Tampa Tribune, 7

August 1933).
By the end of the 1920s, any vestiges of democracy in Cuba had van-
ished. President Machado repeatedly suspended constitutional guaran-
tees and declared martial law. The judicial branch was subordinated to
the power of the executive (Chapman, 1927). Years of violent repression
and unrest followed. When a coalition of opposition groups finally suc-
ceeded in taking power in the early 1930s, the new leaders initiated total
changeovers in the leadership of the police and army and used these
new security forces to loot remaining stores of wealth held by the previ-
ous leadership. In keeping with norms of gangster-state rule, property
rights were granted only to those loyal to the new regime. One New
York Times correspondent described rampant looting in the aftermath of
Machado’s departure as follows:

Such a joyful looting! . . . The home of every member of the cabinet

was looted and wrecked. Fine collections of rare books were divided
among those who could not read. Beautiful china, valuable objects of
art were borne away . . . Some families of the Cabinet members had
fled, taking in many cases not even a change of clothing. Personal
effects, letters, jewelry, everything was grabbed by the looters . . . Nor
was it only the homes of officials of the Machado regime which were
looted. The houses of the mistresses of various high officials were
sacked and burned (Phillips, 1959:42).

Acts of ritual violence and degradation were also directed toward

deposed Machadistas similar to the kinds of terror seen in Mexico’s cartel
zones and in Foucault’s descriptions of premodern France. In the fall
of 1933, angry rebels marched through the streets of Havana carrying
the desecrated corpses of deposed high-ranking officials of the Machado
regime. A few days later, the chief of the Porra was disinterred (he had
previously been shot by a firing squad), and his decomposing body was
dragged through the streets, strung up on a lamp post, set on fire and
finally dumped into the sea (see Tampa Morning Tribune, 13 August 1933,
and 21 August 1933). This violence was specifically directed at the chief
of police because he was the one who had been in charge of orches-
trating and defending the Machado regime’s racketeering endeavors,
including public acts of violence and torture against opposition leaders
(González, 1935).
After Machado was overthrown, anti-Machado radicals and student
groups formed a new political party (the Auténticos) together with a
 Organized Crime and Kleptocracy 91

new Army of the Caribbean to defend their interests. Surviving elements

of the old Cuban military regrouped under different leadership—that
of sergeant Fulgencio Batista. During the 1940s and 1950s, these two
groups competed as rival kleptocrats. They waged chronic low-intensity
warfare against one another to establish and defend their own monop-
oly control of the public sector and to increase their market share of
the country’s lucrative smuggling economy and vice markets. Whenever
one group was in power, the leadership of the rival group took refuge
in exile, knowing that their lives and property would not be protected.
Each of these Cuban political-military groups also maintained collab-
orative relationships with international organized crime groups to facili-
tate expansion of Cuba’s vice trades and smuggling economy. Batista’s
relationships with organized crime groups have been documented by
historians and journalists (Lacey, 1993; Cirules, 2003). One FBI report
from 1956 also noted that Batista’s henchmen were provided with 50
percent of the take from all slot machines on the island, plus an addi-
tional 30 percent import tax levied on all gambling equipment brought
to Cuba. Eventually all of the gambling revenues from one casino were
deposited in the hands of Batista’s officials “to keep them happy and
keep pressure off other groups.” Sellers of national lottery tickets were
expected to kick back $10 per week to the police chief, giving him an
estimated income of over $16,000 per week from lottery vendors alone.
One FBI report stated, “there is hardly a section of the Department of
Investigation [under Batista] which does not operate some sort of shake-
down even if it is limited to mere bribes on arrests. . . . The . . . head of
the robbery detail is estimated to be worth $200,000” (11).
Batista’s chief rivals (the Auténtico Party) also engaged in similar pat-
terns of kleptocratic looting. Their time in office (from 1944 to 1952)
was marked by extensive raiding of the national treasury and expansion
of joint ventures in vice and smuggling. One Auténtico president was
indicted after leaving office for misappropriation of over $40 million
(New York Times, 19 March 1951). A cabinet official (the minister of the
treasury) and four subordinates were also arrested for allegedly embez-
zling $174 million (New York Times, 24 June 1950).
The Auténticos also purged the Cuban police and military of key
Batista supporters, in part so that they could form their own alliances
with international organized crime groups. Several key Batista support-
ers who were arrested or killed after the election, and over 150 army
officers, fled to Mexico (New York Times, 22 November 1944; New York
Times, 26 October 1944). The new president (Grau San Martin) created
a paramilitary force of 5000 students “to keep order” in Havana since
92  Gangster States

many members of the military still remained loyal to Batista (New York
Times, 23 November 1944). Grau’s armed group of students went on to
form the core of the Caribbean Legion, an international brigade that
had ties to both United States and Soviet intelligence operatives (12).
Government under the Auténticos was also done by executive decree,
with the judicial and legislative branches increasingly rendered irrel-
evant to public administration (New York Times, 19 January 1947). In
1946, President Grau signed approximately 3000 executive decrees, and
the Cuban Congress approved only 20 laws (Phillips, 1959:238). The
campus of the University of Havana continued to serve as a base of oper-
ations for all manner of criminal smuggling activity. The brother of one
Auténtico president allegedly used some of these armed student gangs to
seize monopoly control of narcotics smuggling on the island for several
years (Thomas, 1998).
The Auténtico looting spree came to an end with Batista’s return to
power in a coup d’état in 1952. This marked the final expansive phase
of Havana’s vice economy. From 1952 to 1959, a dazzling array of lav-
ish hotels and casinos were built, and hundreds of Batista’s followers
grew rich from casino payoffs, smuggling and graft. Early anti-Batista
activism appears to have been confined to rival grafters from the Autén-
tico Party, but a new strain of moral purity began to express itself in an
oppositional youth movement headed by an anti-corruption crusader
named Eddie Chibas. Chibas founded the Ortodoxo Party as an anti-
vice campaign that attracted many young, idealistic Cubans, including
Fidel Castro. Eventually all of the anti-Batista groups joined forces to
overthrow the general in 1959, and the rest (as they say) is history (13).

5.11  Comparative Vignettes

Gangster-state political economies are not limited to small or remote

countries. Similar challenges to democratic rule have also taken place in
many US cities over the years, including major metropolitan areas like
New York and Chicago. In 1912, the New York Times reported on escalat-
ing violence between two armed gangs who served as “decisive cogs in
our electoral machines.” In exchange for violence and intimidation of
voters, these political gangsters were given “practical immunity in their
life of graft and violence during all the other days of the year” (New York
Times, 9 June 1912).
One historian has also described New York as having a “gangster
era” of municipal government in the late 1800s when “elections were
decided by repeat voters and poll-box smashers, by the intimidation
 Organized Crime and Kleptocracy 93

and beating of citizens before they could cast their votes . . . (Sante,
1991:260). A US diplomat who was sent to Cuba in the 1920s to address
problems of widespread racketeering and corruption in the Zayas regime
described a profound sense of shame as he returned to Chicago and
witnessed similar patterns of graft, corruption and electoral violence at
home (described in Guggenheim, 1934).

5.12 Hispañola

Political gangsterism and kleptocracy are also readily visible in the 20th
century histories of Cuba’s closest neighbors. In the Dominican Repub-
lic, Rafael Trujillo was in power for over 30 years, and during that time
he was estimated to have gained control of between 65 and 85 percent
of all productive enterprises in the country (Goff and Locker, 1969:267).
This was accomplished by using the security forces of the state to organ-
ize and defend economic monopolies in salt, sugar, tobacco, insurance,
timber, cattle, coffee, rice, cacao and gambling (Wiarda, 1968). Accord-
ing to one observer, Trujillo preferred to recruit his security forces “from
the criminal element” so that he could more effectively “squeeze the
population . . . and literally starve his people to death for the sake of
building up his own private income” (Wiarda, 1968:86).
In the 1930s, Trujillo used his security forces to take over the island’s
salt industry, whereupon he raised retail prices from 50 cents per 100
pounds to three dollars (Hicks, 1946:67). These business tactics alleg-
edly earned him over $400,000 per year in personal income from salt
alone. During this time, all government workers were required to sur-
render 10 percent of their income to Trujillo’s political party, which
allegedly brought in another $500,000 per year (Hicks, 1946). Trujillo
also established a monopoly on rice (the most important staple of
the Dominican diet) and increased the retail price over 200 percent
in just a few years (Hicks, 1946:69). After a particularly devastating
hurricane, he appointed himself president of the country’s Red Cross
so that he could gain control of aid dollars flowing into the country
(Hicks, 1946).
During this time, Trujillo also seized prime farmland and cattle
ranches, staffed them with prison labor and had the owners arrested.
Some fled to exile in the United States. As one observer described, “all
opposition was overcome through the comparatively unrefined tech-
niques of beatings, murders or forced exile” (Wiarda, 1968:52). These
tactics allowed the Trujillo family to gain control of over 50 percent of
the arable land in the country—an estimated 700,000 acres (Wiarda,
94  Gangster States

1968:83). Trujillo eventually expanded his control of beef production to

include monopolies in the capital city’s slaughterhouses as well.
By the 1950s, over 100 members of the Trujillo family were employed
by the Dominican government or worked for government-owned busi-
nesses. Family members held two senate posts, six diplomatic assign-
ments and controlled the army and defense forces (Wiarda, 1968:74).
By the end of his rule, Trujillo had transformed the entire apparatus of
government so that it became “the legal servant of . . . [his] agricultural,
industrial, and commercial enterprises . . . the Dominican Republic was
converted into an economic cartel with the appearance of a sovereign
state” (Wiarda, 1968:83).
A final word must also be said about ethnic violence and human
rights abuses during Trujllo’s rule. As described above, racketeers estab-
lish asymmetrical social contracts with their exploited populations by
exchanging protection for goods and services. These transactions are
forced in that no one would voluntarily purchase protection unless
threatened with violence. Rival racketeering groups (along with their
subservient populations) are understood to be economic competitors,
and any wealth and property controlled by rival organizations is tar-
geted for theft or seizure. Public acts of violence or successful raiding
against rival groups enhances status and credibility for sellers of protec-
tion: it proves the legitimacy of their product and demonstrates their
ability to successfully terrorize enemies.
It is not uncommon for protection racket boundaries to overlap with
emerging ethnic boundaries. As Frederick Barth has demonstrated, lines
of ethnic differentiation often develop around zones of resource com-
petition (1969). Or to put it another way, resource competition between
neighboring groups often serves to instigate ethnogenesis, or the forma-
tion of a bounded group identity.
In the 1930s, Trujillo’s security forces massacred thousands of Hai-
tians who had crossed into the Dominican Republic as temporary agri-
cultural workers. Prior to the massacre, Dominican soldiers were allowed
to kill Haitians “with impunity,” though there were no sustained, coor-
dinated attacks (Hicks, 1946). But in the mid 1930s, these attacks began
to escalate, and in October 1937 the Dominican army engaged in a mass
assault that killed an estimated 10,000 to 20,000 Haitian laborers (Hicks,
1946; Wiarda, 1968). This was done primarily in the form of machete
attacks against men attempting to leave the Dominican Republic and
return to Haiti.
Trujillo’s instigation of these attacks is usually attributed to boundary
tensions between the two countries. Shortages of arable land in Haiti
 Organized Crime and Kleptocracy 95

were described as leading increasing numbers of Haitian peasant farm-

ers to form settlements near Dominican borders. The casual violence of
Trujillo’s response to these boundary tensions is very much in keeping
with the dynamics of gangster-state rule. Non-citizens are denied basic
rights of personhood, and public displays of terror and violence against
rivals enhance the reputation of the leader. Similar dynamics are vis-
ible in other ethnic massacres that have occurred during gangster-state
conflicts, including the “ethnic cleansing” that took place in Bosnia in
the 1990s (Rieff, 1998) and Suharto’s sustained attacks on East Timorese
who opposed his rule (Ellis, 2008).

5.13 Haiti

Duvalier’s economic predations in Haiti during the 1970s and 1980s

also fit the pattern described above. During his reign, Duvalier allegedly
used state power to establish monopoly control of tobacco, flour, gam-
bling, insurance and the national lottery (Ezrow and Frantz, 2013). One
researcher has described the political economy of the Duvalier regime
as follows:

Government is virtually the only source of wealth in Haiti. Given the

uninstitutionalized, coercive basis of the regime and the absence of
any limits—either legal or traditional—predatory corruption was vir-
tually unchecked. The annual budget, composed mostly of customs
and excise taxes, was the dictator’s personal purse to dispose of as he
saw fit . . . On their own, the Tonton Macoute as well as civilian and
military officials were free, so long as they enjoyed Duvalier’s confi-
dence, to extort what they could from the public (Scott, 1972:85).

This description of Haiti during the Duvalier years echoes an example

provided earlier in this text that bears repeating. In a democratic state, if
you are robbed, you call the police to catch the perpetrators and restore
your property. In a kleptocratic gangster state, if you are robbed, it is
likely to be by the police, who will use their powers to arrest competing
thieves and thus secure a monopoly on thievery for themselves.
In his discussion of Haiti, Scott (1972) also makes an interesting set
of comparisons between social relations in the Duvalier regime and
in feudal Europe. In Stuart England, for instance, commercial groups
were also rendered dependent on the “favor and protection of govern-
ment” in order to conduct business. During this time, state power was
used to grant monopoly privileges to certain firms or impose arbitrary
96  Gangster States

levies “that could either bring about their ruin or ensure their success”
(1972:49).
As many international observers have noted, Haiti still remains one
of the most impoverished countries in the hemisphere. Some ­anecdotal
reports suggest that the predatory dynamics of the Duvalier regime
still remain in place and that foreign aid has now become a focal
point of political looting. The detailed narrative provided by Timothy
Schwartz provides many examples to support these conclusions. ­Haitian
police, for instance, are described as “totally unreliable in the case of
crime, indeed inclined to save the criminal and persecute the victim”
(Schwartz, 2012:Kindle edition location 585).
One government road-building initiative in rural Haiti was alleg-
edly controlled by a local strongman who “monopolized access to jobs
on the road . . . forcing anyone who worked on the project to give
him a twenty-five percent kickback from their paychecks” (Schwartz,
2012:Kindle edition location 616). This same individual also controlled
road-building materials and sold them for profit in the informal econ-
omy in addition to falsifying land titles and selling supplies to UNOPS
(the United Nations Office for Project Services). The result was to greatly
inflate the cost of road building while sharply reducing the quality and
quantity of the final product.
In another example of government predation, a local state coopera-
tive in Haiti advertised a banking service to peasant farmers, promising
to pay interest at 23 percent per month on cash deposits. Most farmers
were skeptical, but a few intrepid souls opened savings accounts. After a
few months, they saw their balances grow and encouraged their friends
to participate as well. Encouraged by these small successes,

[T]he poor throughout Haiti flocked to the Cooperatives with

their meager savings, some even mortgaging their land to raise
money. . . . [One peasant] put all of his US$5000 in the Government
Cooperative. The next month, government officials absconded with
all the funds—US$250 million (Schwartz, 2012:Kindle edition loca-
tion 3786).

It is worth noting that an identical banking scam became prevalent

in Russia in the early 1990s. In 1991, the Russian Exchange Bank began
offering a 20 percent interest rate on deposits. People were initially skep-
tical, but a major advertising campaign convinced many citizens to open
savings accounts. Over time, the companies grew very large. One bank-
ing and investment firm (called Russian Real Estate) opened 46 branches
 Organized Crime and Kleptocracy 97

in 280 cities in just a few years and advertised heavily on television

and radio (Satter, 2003). Then, just as suddenly as it appeared, Russian
Real Estate closed its doors, promised investors they would receive their
money and were never heard from again. This pattern was repeated with
other Russian banks throughout the 1990s. In the words of Satter, “By
the time many Russians finally caught on to what was happening, they
had been left completely impoverished, a condition that, in many cases,
would persist for the rest of their lives (2003:74–5).
This kind of fraud is commonly referred as a “mafia bust out” by crim-
inologists (see Pizzo, Fricker and Muolo, 1989). In a bust out, organized
crime groups seize control of a legitimate business and then liquidate
all of the assets to enrich themselves. This may take the form of coerc-
ing small business to surrender control to mafiosi, who then stage a sale
to liquidate assets, with the proceeds pocketed by the racketeers. One
group of journalists has alleged that these practices were common in
the US savings and loan industry and contributed to a number of bank
failures of the 1980s (Pizzo, Fricker and Muolo, 1989).
The private sector in Haiti has also been described as predatory and
deeply entangled with the kleptocracy of the public sector. Interna-
tional development agencies working outside of public channels to
deliver aid to suffering Haitians are heavily preyed upon by public and
private scammers and opportunists, leaving the neediest Haitians with
few resources. As a result, Haiti suffers from a “development paradox.”
Massive increases in foreign aid dollars (especially since the devastating
earthquake in 2010) have not led to any measurable improvements in
health or economic well-being for the poorest Haitians. In fact, Schwartz
notes an inverse correlation: more aid dollars seem to correlate with
increased poverty and disease:

Despite all the money dedicated to aiding and developing . . . condi-

tions had gotten steadily worse. Real income in the region had fallen
from per capita $US54 in 1977 to a mid-1990s level of US$22. Malnu-
trition among children zero to seventy-two months increased from
thirty to forty-six percent. Life expectancy had dropped from fifty-
two to forty-five years; more than one infant in ten was dying before
their first birthday . . . ten percent of the population experienced
debilitating diseases such as malaria, typhoid and hepatitis” (Kindle
edition location 1097).

Schwartz frames his book primarily as a critique of international aid

and development efforts in Haiti, arguing that foreign aid has created a
98  Gangster States

culture of dependency and corruption that enriches the Haitian elites

and maintains downward economic pressure on the poor. In the model
presented here, the state government is viewed as equivalent to an
organized crime group determined to establish and defend monopoly
control over productive enterprises on the island. Police do not spend
their time fighting crime or protecting citizens.
One of the more extreme ironies in Schwartz’s discussion of poverty in
Haiti is his conclusion that international drug smuggling was doing more
to lift rural Haitians out of poverty than all of the international aid agen-
cies combined. According to Schwartz, Haiti has been used as a transship-
ment point for international smugglers for many years. For decades the
revenues from this traffic were controlled by the police, army and political
leadership. At one point, however, a shipment of cocaine spilled while in
transit through a rural area, and peasants rushed in to scoop up as many
packets as they could carry. Two days later, truckloads of special police
forces (who provided security for cocaine traffickers) drove up to the vil-
lage and began systematically searching and looting peasant homesteads
to reclaim the lost cocaine on behalf of the cartels. Enough peasants suc-
ceeded in hiding their contraband that the village later established its
own smuggling pipeline to the United States, where the drugs were sold
to American distributors. This led to the first meaningful infusion of cash
in the village in many years and improved the lives of the peasant families
much more than most of the NGO efforts witnessed by Schwartz.

5.14 Zaire

No discussion of kleptocracy would be complete without mention of

Mobutu’s reign in Zaire. According to William Reno, Mobutu (who
held power from 1965 to 1997) organized all of the country’s produc-
tive enterprises into a vertical hierarchy of racketeering. Individual sub-
states or “fiefdoms” were allocated to local gangster-warlords who used
Mobutu’s support to maintain monopolies in diamonds, timber, gold,
coffee, cobalt and arms traffic (1998:149). The wealth obtained from
these endeavors was remarkable: the country’s gold mines were produc-
ing about 200 pounds of gold per month in the 1990s and close to $20
million per month in revenues from diamond sales (French, 1997b).
Timber, cobalt and copper were also extremely lucrative. The economic
logic of racketeering is inherently expansive, and over time, Mobutu’s
personal share of these industries continued to increase, until eventually
95 percent of national revenues came under his discretionary control
(Reno 1998:149).
 Organized Crime and Kleptocracy 99

Public services for citizens virtually disappeared in the later years

of Mobutu’s rule. Hospitals and schools were closed, roads were not
repaired and the only infrastructure developed was near mining areas,
to facilitate export. Eventually even these meager efforts declined, and
many productive enterprises were shut down rather than face further
predation from Mobutu’s military. Soldiers were not given salaries but
were expected to support themselves by theft and looting. In the later
years of his reign, Mobutu “used state power exclusively to help associ-
ates profit from clandestine trade, avoid taxation, and explore new rack-
ets in activities that made use of state regulatory power such as passport
sales, money laundering and drug trafficking” (Reno, 1998:154).
Immigrant groups from neighboring African countries were also tar-
geted for repeated theft and looting during these years (14). In a situ-
ation reminiscent of Trujillo’s attacks on Haitians, groups designated
as unwanted by Mobutu were disfigured or mutilated and “sent back
to their communities to display their injuries” as a warning to others
(Reno, 1998:161).

5.15  Post-Soviet Gangster-States

Similar patterns of expanding gangsterism and impoverishment have

been described in Russia and other post-Soviet republics. Alexander
Kupatadze observed “rampant corruption in every sector of the political
economic life” of post-Soviet Kyrgyzstan (2012:148). According to his
research, the ruling family regularly used state power, including preda-
tory taxation, fines and “pseudo-law enforcement measures” to gain
monopoly control over numerous national industries, including gold
mines as well as production of cooking oil, sugar, mobile phone ser-
vices, jet fuel supplies and mini-buses (Kupatadze, 2012:148). An early
journalistic account of crime in post-Soviet republics quoted a citizen
of Chechnya as stating, “The leadership here doesn’t fight the criminal
underworld, [because] it belongs to it” (Handelman, 1995:221).

5.16  Narrative Vignette: After the USSR

The collapse of the Communist superpower, the Soviet Union, is the single
most important event prompting the exponential growth of organized crime
around the world in the last two decades. Almost overnight, it provoked
a chaotic scramble for riches and survival that saw virtually every citizen
sucked into a vortex of violence. From the bitter wards of the Caucasus to
the shoot-outs in towns and cities, this was a deadly environment as a new
100  Gangster States

class of capitalists exploited the vacuum of power by seizing whole industries

and raiding the state coffers . . . The transformation traveled well beyond
the Soviet Union’s borders into all continents of the world as money poured
out of the country, looking for safe havens, some legal but most decidedly
dodgy. Throbbing at the heart of these extraordinary events was Moscow . . .
Appealing to the police for protection was futile . . . The police force . . . had
neither the intellectual nor the financial resources to adapt to the emergence
of capitalism. And so the state, slowly but momentously, started to concede
its monopoly on violence to so-called gruppirovki, or street gangs. But far
from being harbingers of anarchy, these groups of men—Afghan veterans,
street toughs, martial arts experts, former KGB officers, and every one of
them terrifying—were the indispensable midwives of capitalism.
Businessmen . . . understood that the gruppirovki were in fact privatized
law enforcement agencies. In contrast to their state-run counterparts such
as the Interior Ministry and the KGB, these flexible, self-organized gangs
had an instinctive appreciation that there was a vibrant demand for
“protection” or insurance services among the new business class. Instead of
paying taxes to the state (which had no idea how to tax the new small-scale
private enterprises), businessmen willingly handed over between ten and
thirty percent of their turnover to local thugs who would ensure in exchange
that they could continue trading, free from the violence of the gruppivorki
working on behalf of their competitors.
“We are prepared to work with the racket because it charges ten percent,”
a businessman from Omsk noted at the time. “The state takes 90 percent
in taxes and even more in fines.”
. . . In 1992, President Yeltsin’s team of enthusiastic reformers were
bent on introducing capitalism overnight, and Yeltsin obliged . . . For
the American economists and advisers who swarmed to the government
in Moscow, this was a unique opportunity. Russia’s economy was a giant
petri dish of Chicago-school market economics, but among the cultures they
were busy cultivating was a Frankenstein that skipped out the door of their
laboratory almost unnoticed . . .
Despite the murders and the shoot-outs, the Russian mob actually ensured
a degree of stability during the economic transition . . . By the mid-1990s
the Russian government estimated that between forty and fifty percent of
its economy was in the gray or black sectors, and it is within this context
that Russia and the outside world needs to understand the phenomenon of
organized crime . . . (Glenny, 2008:52–61).

Russia has recently been described as an “emerging kleptocracy” (Hard-

ing, 2010). In other words, the open gang warfare of the 1990s stabilized
 Organized Crime and Kleptocracy 101

when one group succeeded in gaining control of the national govern-

ment and began using the “legitimate” forces of the national police and
army to put rival mafias out of business. One of the rival mafias of the
1990s gained control of the state and used state security forces to put its
rivals out of business. Contemporary Russian political economy is now
described as “an essentially feudal system” where “state protection” is
the key to successful business initiatives (Spiegal, 2013). According to a
recent article in Der Spiegel, the Russian state has retaken control of more
than 50 percent of the country’s banks and 73 percent of the transporta-
tion industry. State control of the oil industry increased from 10 percent
in 1999 to 45 percent today (Spiegal, 2013).
This repurposing of state power into a tool of private wealth accu-
mulation has meant a corresponding neglect of public services similar
to that seen in Cuba in the 1920s and 1930s. As the unnamed reporter
from Spiegel phrased it, “Russia is plagued by plane crashes, burst pipe-
lines, and power-plant accidents. Though a proud member of the G-8
group of nations, it is often more akin to a developing country.” In keep-
ing with this pattern, political opposition in Russia has become hazard-
ous, with those opposing the regime increasingly subject to confiscation
of personal wealth and business enterprises.
It is also worth pointing out that Scott’s description of Haiti under
Duvalier and contemporary criticisms of Russia still rely on terms like
“corruption” to explain the conversion of the public sector into a tool of
wealth extraction through racketeering. As previously mentioned, this
term is misleading as it implies the existence of a legitimate democratic
polity that has been corrupted by a few bad actors. In actuality, gang-
ster-states evolve as extractive kleptocracies, even though these practices
typically make a mess of things from an outsider’s point of view. The
public treasury may be looted, productive enterprises driven to bank-
ruptcy by predatory taxation, public health programs abandoned and
legions of needy refugees may flow into neighboring countries. But the
leaders of these racketeer-states may themselves define their rule as a
great success, as personal enrichment was their primary goal in seeking
political power.

5.17  Postscript: American Exceptionalism?

The financial crisis of 2008 led some critics to assert that decades of
banking deregulation and free-market fundamentalism have allowed
racketeering to increasingly intrude into the formal sector of the US
economy (Naylor, 2002; Smith, 2010). In other words, deregulation has
102  Gangster States

served to legalize or legitimize business practices that would have been

considered criminal in the past. Writers like Bill Black have argued that
deregulation of banking and finance creates a “criminogenic” environ-
ment that allows fraud to thrive (Black, 2005, 2012). Other critics have
echoed these observations, and a number of journalists have described
corporate fraud and criminality as playing major roles in the 2008 finan-
cial crisis (Partnoy, 2009; Johnson and Kwak, 2010; Smith, 2010; Taibbi,
2010; Das, 2011; Lowenstein, 2010). Many of these narratives describe
government regulatory agencies as consistently turning a blind eye to
criminal behavior because of an overriding belief that free (meaning
unregulated) markets will ultimately self-correct (Bair, 2012; Barofsky,
2012; Johnson and Kwak, 2010).
Decades of deregulation have allowed business practices more com-
monly associated with racketeering enterprises of the informal economy
to become normalized in the formal economy. Enron, for instance, prof-
ited enormously from deregulation of energy markets, partly because
it allowed traders to engineer artificial shortages in supplies (including
orchestrating power blackouts in California) so that they could drive up
the price of their products. In the past, these business practices would
have been illegal. But deregulation created an “alegal” environment that
allowed these quasi-criminal activities to flourish (Partnoy, 2009:296).
Corporations like AIG, Merrill-Lynch, Lehman Brothers, WorldCom,
Bear Sterns, Wachovia, Washington Mutual, Long-Term Capital Man-
agement, Bankers Trust, Bank of America and many others have been
described as using similar tactics to increase their profit margins and
executive compensation packages (Partnoy, 2009; Johnson and Kwak,
2010; Lowenstein, 2010; Taibbi, 2010; Galbraith, 2008; Malone and Tan-
ner, 2012). Even quasi-government entities like Fannie Mae and Freddie
Mac used fraud to engineer rapid growth in executive bonuses. Accord-
ing to Gretchen Morgenson and Joshua Rosner, one Fannie Mae execu-
tive earned over $90 million in compensation between 1998 and 2003,
much of it from bonuses “directly tied to achieving earnings-per-share
targets through phony accounting” (Morgenson, 2011:320). All of these
firms underwent phases of rapid expansion and wealth generation for
executives and shareholders during the bubble years, followed by bank-
ruptcy and socialization of losses to the public sector after the crash.
This pattern suggests the United States may be gradually redefining
the role of government from regulator to enabler of corporate racketeer-
ing. For most of the 20th century, federal agencies like the SEC, FDIC
and CFTC monitored economic transactions so that consumers’ rights
and property were protected from fraud and theft. Even conservatives
 Organized Crime and Kleptocracy 103

believed these organizations provided stability to American capital-

ism by making sure markets were not rigged and consumers had some
degree of protection. Strong banking regulations were also viewed as
minimizing systemic risk, so that the rolling waves of bank failures that
impoverished so many Americans in the early years of the Great Depres-
sion would not be repeated.
In the post-Soviet era, however, free-market fundamentalists have
fought hard to eliminate government regulation of private industry,
including banking and finance. Deregulation allowed for exponential
increases in risky practices, such as the aggregation of risk in synthetic
investment products like collateralized debt obligations. This created
decades of increasing profits, followed by instability and crisis. The same
government that so scrupulously avoided intervening in markets during
bubble years intervened massively to bail out failed banks and unfreeze
credit markets during the crash. Private corporations were provided with
outsized bailout packages with few strings attached, which ultimately
transferred huge losses to the public sector while profits earned during
the boom phases were left in private hands. As Sheila Bair lamented,
“It made me wonder whether all of the bailout measures had been to
protect the system or make sure those guys didn’t have to skip their
bonuses” (2012:428).
This troubling pattern suggests the United States may be at risk for its
own post-democratic, gangster-state transition. Unlike Brazil and Cuba,
the gangsterization of the US economy is not being driven by racketeer-
ing groups from the informal economy expanding outward to colonize
the formal apparatus of government but by mainstream corporations
borrowing business practices from racketeering groups. The profits gen-
erated by manipulating markets mean huge gains in private wealth,
while the costs are increasingly transferred to the public in the form of
unsustainable national debt. Unless a significant revision of corporate
banking and finance is undertaken soon, the next collapse may prove
fatal to the US economy and the state.
6
Things Fall Apart . . . and Rebuild

6.1  Collapse as Conundrum

Joseph Tainter was the first anthropologist to explore political decline

and collapse in comparative perspective (1988). His book begins with
a contrarian observation: The presence of so many archaeological ruins
around the world suggests complex societies are transient and fragile,
and modern populations may not be immune to the forces that caused
these prehistoric civilizations to collapse. He describes these considera-
tions as presenting “a difficult mystery” since researchers have always
perceived “an inexorable trend toward higher levels of complexity”
in human societies (Tainter, 1988:3). Until the 1980s, explanations of
­collapse—when they appeared at all—were done in an ad hoc manner,
for one society at a time (Tainter, 1988:3). There was no comparative
modeling to establish common patterns.
The belief in increasing sociopolitical complexity as a universal trend
has its origins in Enlightenment philosophy. These thinkers believed
progress (meaning continuous improvement in all things over time)
was a natural law ordering evolution and human history (Berger, 1974;
Classen and Van de Velde, 1985; Gould, 1996; Kolakowski, 1978; Paz,
1990; Sanderson, 1990; Trigger, 1998; Ulam, 1966). The evolution of the
state was interpreted by these philosophers as the grand finale of human
cultural evolution in the same way the appearance of Homo sapiens was
understood as the ultimate end point of biological evolution (1). States
symbolized the dawn of civilization and transcendence over earlier ani-
malistic phases of savagery or barbarism.
These evolutionary models were also heavily racialized. Anthropolo-
gists in the 19th century believed that only biologically superior groups
(meaning Europeans and perhaps some Asians) were capable of attain-
ing civilization. The inferior, animalistic races were destined to be left
behind, fit only to be domesticated as slaves or ruled as colonial subjects
(Trigger, 1998).

104
 Things Fall Apart . . . and Rebuild 105

This odd comingling of social and biological evolution reflects many

of Herbert Spencer’s beliefs. Darwinian evolution does not have any
embedded notion of directionality or progress, but Spencer understood
social and biological evolution as meaning the natural progression of
lower forms to more complex forms. Many of Spencer’s assumptions
still persist in popular thought, leading to significant misunderstandings
about the nature of evolutionary process. This can be seen in the stereo-
typical image presented in Figure 6.1, which portrays the evolution of H.
sapiens as a stepwise linear progression from ape to man. (For a detailed
discussion of why this is wrong, see Gould, 1996; Dawkins, 1996.)
In actuality, apes did not evolve into humans as portrayed in the vis-
ual progression above. Contemporary apes and modern humans share
a common ancestor who lived millions of years ago, but that does not
mean that all evolution “tends toward the human form,” as one ficti-
tious 19th century anthropologist famously stated (2). Contemporary
apes are also descendants of prehistoric apes in the same way that con-
temporary mulberry trees or contemporary lizards are descendants of
their prehistoric ancestors. But these complex branching lineages have
been erased from the image above so that it better reflects the Doctrine
of Progress.
Spencer’s ideas were also manifest in the writings of early social
anthropologists who sought to rank non-Western cultures in stepwise
evolutionary schemas based on their perceived similarity to European
civilization (Classen and Van de Velde, 1985). This set of beliefs was
summarized by one of Spencer’s biographers as a vision of “history’s
path to perfection” (Peel, 1971:135). These evolutionary models reflect
a tendency to selectively parse historical and archaeological data in the
same way as the image above selectively parses biological data. Classen

Figure 6.1  Spencerian Misrepresentation of Human Evolution, Implying Direc-

tionality and Progress.
106  Gangster States

and Van de Velde have criticized this practice as falsely naturalizing

complexity as the end point of social evolution:

[T]he roads leading toward the present complexity are the major
concerns of general, or universal evolutionists . . . In other words,
research starts at the highest level of complexity in order to trace back
its origins and development. Small wonder that such an approach
invariably results in unilinear models that indicate an ever-growing
complexity (1985:8).

In other words, Enlightenment theories of state formation naturalize

complexity in ways that make decline and collapse existentially wrong,
as this inverse directionality violates the Doctrine of Progress. History
also has many paths to imperfection, but these parallel lineages are
excluded from analysis.

6.2  Progress and Underdevelopment

For the first half of the 20th century, belief in the Doctrine of Progress
was sustained by positioning impoverished, unstable, insecure regimes
as starting points on a linear developmental continuum. Two variants
of modernist ideology offered competing frameworks for improving
conditions in these “underdeveloped” countries: modernization theory,
which proposed that problems of underdevelopment be addressed by
facilitating economic growth, and Marxist/Leninist theory, which pro-
posed revolutionary socialism and state control of markets as the answer
(Berger, 1974) (3).
Modernization theory and Marxism both reflect modernity’s recon-
figuration of time from premodern, sacred “archetypal time” (described
by Octavio Paz as “time outside of time—the eternity of devils and
angels, the just and the damned”) to a linear, secular, irreversible “cult
of progress” that reconfigures human history as a narrative of ongoing
betterment (Paz, 1990:3) (4). The abrupt breakup of the USSR and its
rapid “devolution” from global superpower to violent mafiacracy in the
1990s threw this linear progressivism into question. Political collapse
was no longer a phenomenon of the remote past visible in archaeologi-
cal ruins; it appeared to be unfolding throughout the post-Soviet world
in ways that confounded modernist assumptions of linear, progressive
time. Modernity promised “a vista of infinite improvement” (Ulam,
1966:116), but in the mid-1990s, the post-Soviet world was looking a lot
more like humanity’s primitive past.
 Things Fall Apart . . . and Rebuild 107

Some observers interpreted the violent aftermath of the USSR as

a sign that the modern era itself had come to an end, creating bewil-
derment and grief at the loss of the anticipated “hypermodern” future
promised by Marxist theory (Chirot, 1994; Gleason, 1997; Havel, 1991;
Malia, 1994; Paz, 1990). Some Western scholars interpreted these transi-
tions as further evidence of progress, viewing the collapse of the Soviet
experiment as signifying a final global triumph for capitalism and liberal
democracy (Fukuyama, 2004, 2006). These optimistic scholars assumed
that post-Soviet transition problems were only temporary and that
democracy and free-market capitalism would soon bring peace and pros-
perity to these regions (5). During this time, overly optimistic Marxists
continued to anticipate real socialism would finally emerge in the wake
of the Soviet collapse (Kellner, 1996; Miliband, 1996; Resnick and Wolf,
1996).
As post-Soviet transitions grew more unruly, violent and kleptocratic
during the 1990s, some researchers moved away from the linear mod-
ernization/development paradigm and began speaking of these regimes
as “failed states” (Zartman, 1995a, 1995b). A failed state was described as
“a near-empty shell with a capital, a titular government, and the skele-
ton of some institutions but very little legitimate government control or
effect on the economy and on real lives” (Naím, 2005:27). The concept
of failed states blended somewhat with the pre-existing development
paradigm. The new goal became to channel “development” or foreign
aid in ways that would facilitate rehabilitation of failed states or cir-
cumvent the public sector altogether. Development assistance provided
through NGOs (non-governmental organizations) became increasingly
popular.
In 1995, William Zartman assembled one of the first anthologies
to explore failing states in comparative perspective. This collection
included a conventional array of cases from underdeveloped countries
in Africa (including Ghana, Ethiopia, Uganda, Somalia, Mozambique)
along with one non-traditional paper that compared the still-­unfolding
collapse of the Soviet Union to dynamics of state failure observed in
Angola (Fituni, 1995). In this paper, the author notes that his com-
parison would be rejected as “artificial and irrelevant” by conventional
standards of research in comparative politics.
At the time, Africa and post-Soviet Europe were understood to consti-
tute “two distant, non-overlapping worlds, so obviously different that
their comparison would be either forced or farfetched” (Fituni, 1995:143).
Prior to its collapse, the Soviet Union was secular, modern, industrial
and cosmopolitan. Angola, on the other hand, was tribal, postcolonial,
108  Gangster States

agrarian, ethnically fragmented and kin based. By conventional thinking

of the time, there was no way to undertake a meaningful comparison of
the two countries since they were located at different ends of a develop-
mental continuum.
Fituni’s paper challenged this temporal framework by asserting that
the collapse of the Soviet Union created underdevelopment that made
post-Soviet Russia similar to Angola. At the time, there was no language
in political theory to describe the process by which a developed European
country might (in a few short years) come to resemble an underdevel-
oped African country complete with violent warlords, ethnic conflicts,
impoverished refugees and resurgent epidemics of preventable diseases.
Fituni used the term “third worldization” to describe this process, but he
was largely alone in making this argument. Until it happened, the Soviet
collapse was unimaginable. When it did occur, many scholars felt it was
inexplicable within the framework of conventional models in the social
sciences (Eisenstadt, 1992; Havel, 1991; Kolakowski, 1992).
A number of recent works have been published that explore the
dynamics of failed and failing states in more detail (6). But these works
also struggle with the fundamental asymmetry of social theory in this
area. The Enlightenment bequeathed numerous theories of state forma-
tion but almost none to explain failure or collapse. There are also still
divergences between the way economists understand failed states and
the way political scientists approach these problems.
Economists typically understand failed states as manifestations of
failed economies caused by “persistent shortfalls in growth rates com-
pared to comparable countries” (Ezrow and Frantz, 2013:Kindle edition
location 2263). In other words, for economists, the solution is always
more growth. Economists also assume that political corruption and
kleptocracy are constrained by institutional boundaries and embed-
ded inefficiencies so that “absolute despotism” is unlikely (see Cool-
idge and Rose-Ackerman, 1997). Many scholars in political science still
model collapse in very unspecific ways “as additional cases of politi-
cal crisis or civil war” (Millikin and Krause, 2003:12). Neither political
science nor economics incorporates insights about collapse or second-
ary state formation from archaeology or anthropology. Instead, impre-
cise phrases like “Hobbesian anarchy” (which are nonsensical from an
anthropological point of view) are used to describe the chaos of collapse
(see Kaplan, 1994; Yannis, 2003) (7). As recently as 2013, L ­ awrence
­Markowitz wrote, “. . . theorizing on the sources and dynamics of state
failure remains surprisingly limited . . . the emerging debate has not
spawned a level of theory building commensurate with the human and
 Things Fall Apart . . . and Rebuild 109

financial  resources that practitioners have committed” (Markowitz,

2013:Kindle edition location 168).

6.3  The State as Exaptation

The model presented here rejects the one-way evolutionism and direc-
tionality embedded within Enlightenment models of state formation.
Instead, I present a Darwinian alternative that has no embedded notions
of directionality or progress and proposes that states are made and
unmade by the same invisible hands: racketeering and organized crime.
Racketeering organizes economic production to enrich elites and creates
a monopoly on violence with defined geographic territory. It creates the
institutional scaffolding that facilitates the subsequent development of
formal political institutions associated with bureaucratic states.
This alternative model of state formation makes it easier to visualize
inverse processes of territorial contraction, decline and collapse. Com-
petitive racketeering (when two racketeers fight to monopolize the same
resources or the same territory) can rapidly destabilize and disorganize
economic production. In these cases, resources are increasingly squeezed
from peasant producers to provision armies, leaving human and natu-
ral resources vulnerable to over-extension and collapse. Rival racketeers
also attack one another’s productive infrastructure, leading to rapid
economic and political decline. These conflicts resolve only when one
group of racketeers successfully sustains a monopoly on violence within
a given territory over time. This is the point at which production and
commerce can begin to regenerate. But this stable phase is also tempo-
rary, as any number of other variables can combine to reignite conflict.
In this model, the evolutionary phase from gang to state (and back
again) is inscribed geographically, visible in the expansion, contraction
or erasure of political-economic boundaries over time. Racketeering
(including territorial contests between rival racketeers) is correspond-
ingly understood to be the energetic core that drives the transformation
from one phase to another. This is a dynamic model in which no phase
is final, and there is no positive directionality to evolutionary process.
Instead, territorial gangs, kleptocratic gangster-states, democratic states,
empires and failed states are all understood as potential iterations of
a dynamic, longitudinal, bidirectional evolutionary process. Any phase
can “progress” to the next or the previous level, depending on the cir-
cumstances in a given area. Just as warring gangs can naturally stabilize
into territorial proto-states with fixed boundaries, bureaucratic states can
also evolve into post-state chieftaincies that decentralize territories of
110  Gangster States

political-economic control through violence and terror. Democracy may

or may not emerge as a stabilizing phase at any point in this process.
More insight into these evolutionary cycles can be gained by borrow-
ing another term from biology: exaptation. An exaptation is a structure
or trait that originally evolved for one purpose but ends up taking on a
different function as circumstances change over time. A common exam-
ple of exaptation found in biology textbooks is the trait of feathers on
birds. Feathers originally evolved for the purpose of temperature regula-
tion and became secondarily repurposed for flight.
In the model of political economy presented here, primary gangster-
states emerge as territorial exaptations of racketeering. This means that
the evolution of racketeering in an economic system drives the forma-
tion of an associated polity. Primary gangster-states form when the
administrative structures of successful racketeering groups become sec-
ondarily repurposed into institutions of governance over defined geo-
graphic territory.
Scenarios like this are pleasing to biologists because they follow the
law of parsimony, which mandates that the best explanation for a par-
ticular trait is the one that involves the fewest evolutionary steps. It
is more parsimonious, for instance, to assert that feathers originally
evolved for temperature regulation and then became secondarily rea-
dapted (or exapted) for flight than to posit that natural selection created
feathers twice over for two different purposes. By this logic, it is also
more parsimonious to assert that the defining traits of at least some
early or prehistoric states (administrative hierarchy, security forces,
social stratification, monopoly on violence, territoriality and organiza-
tion of economic production and exchange) evolved first in the context
of racketeering and were later repurposed for governance than to assert
that these complex institutions evolved twice over for different reasons.
This Darwinian model is also parsimonious in that it posits that the
same forces responsible for the initial evolution of stratified gangster-
states can also configure subsequent phases of resource exhaustion,
decline and collapse. If the economic engine of racketeering fails due to
one of these conditions, the associated territorial inscriptions will neces-
sarily contract or become reconfigured. When the state is modeled as
an exaptation of a successful racketeering enterprise, it becomes under-
stood as a dynamic entity whose life span is configured by the stability
of the underlying racketeer economy.
A racket cannot be easily “invaded by” a decentralized system of
exchange. So once racketeering has appeared in a behavioral system,
it is likely to regenerate as long as it remains profitable. Or to put it
 Things Fall Apart . . . and Rebuild 111

another way, if an organized racketeering economy decentralizes, it is

likely to become reorganized and recentralized over time, as the disor-
ganized phase is again unstable. This would be an example of secondary
gangster-state formation, or a new gangster-state that regenerates upon
the ruins of a failed gangster-state.

6.4  Secondary State Formation in Prehistory

This prediction is consistent with the patterns of secondary state formation

that archaeologists have observed in prehistory. Primary state formation
has been a relatively rare event, visible in only a few locations (Schwartz,
2006). Secondary state formation, on the other hand, has been far more
common but has received comparatively little attention among archae-
ologists. Until recently, the progressivist bias of the field led researchers
to focus on the origins of civilization rather than the aftermath (Carter,
2010; Parkinson and Galaty, 2007; Schwartz, 2006; Wright, 2006).
Recent research in archaeology has sought to address this issue, and
the result has been the development of a new “cyclical model” of politi-
cal evolution that includes phases during which “societies oscillate from
periods of urbanism and sociopolitical centralization to intervals of
ruralism and local autonomy” (Schwartz, 2006:4). Some of the forces
driving these expansive/contractive cycles from chieftaincy to state
have been discussed by Timothy Earle as follows:

The political economy is inherently competitive; since more is better

(more resources = more power), the political economy is inherently
growth oriented. Many are involved in ruling relationships, and the
institutions of complex societies depend on finance to maintain their
operations. The mobilization of a surplus requires a productive econ-
omy and its practical control. That control derives from command
over quite specific activities involving production, distribution and
even consumption (2002:9).

In this passage, Earle is describing the way stratified chieftaincies

emerge and expand into states when elites successfully monopolize
production of key commodities. When this occurs, it sets the stage for
future phases of political-economic expansion and upward aggregation
of wealth. Because there are virtually no limits on the ability of ambi-
tious, competitive chiefs (and their associated military forces) to con-
sume resources, parasitic growth and territorial expansion will become
the organizing principles of these emergent economic polities.
112  Gangster States

Individual chiefs are similar to warlords in that they compete for

wealth and status in ways that can easily exhaust peasant producers and
available resources or conversely attract the attention of rival racketeer-
chiefs. In either scenario, collapse and destruction may result, followed
by phases of regeneration, recentralization and expansion of a new eco-
nomic polity.
Lisa Cooper has presented a revealing case study of political/territorial
contraction and decentralization that took place in the Near East near
the end of the third millennium BC. During this time, peasant produc-
ers were largely freed from the heavy economic taxation of urban elites,
and their society became much less stratified and less complex, until it
“functioned at a very simple political and economic level of organiza-
tion” (2006:25). Over time, however, complexity regenerated and new
hierarchies emerged. Ancient Egyptian texts also describe periods of
political instability and near-collapse driven by “increasing civil unrest
and regional warfare,” with local militias terrorizing rural populations
similar to the way contemporary researchers have described the violence
of failed and failing states (Morris, 2006:60).
Longitudinal research in the Andes also shows many cycles of war-
fare-driven political-economic complexity and decentralization, during
which empires formed and fell apart into smaller regional kingdoms
(McEwan, 2006:92). This includes Tiwanaku culture, which fragmented
into smaller competing polities whose territorial contests eventually
“evolved toward the reconstitution of a state until they were overrun
by the Inca” (p. 92). Similar patterns have also been documented for the
Wari, who occupied the Ayacucho region of Peru (McEwan, 2006).

6.5  Collapse and Regeneration

Political science does not maintain a cyclical model of political evolu-

tion. Instead, contemporary states are still understood to be fixed terri-
torial/cartographic entities, and reconfiguration of territorial boundaries
is interpreted as a sign of intensifying state failure rather than collapse
and regeneration (Cooper, 1999; Grossman, 1995; Dadmer, 2003; Khadi-
agla, 1995; Rotberg, 2003; Lemarchand, 2003; Clark and Gosende, 2003;
Rich, 1999; Schutz, 1995; Zartman, 1995a, 1995b).
Robert Rotberg, for instance, describes how individual warlords seized
territory and fought with one another to extract wealth from the ruins
of the failed Somali state. Rotberg presents this as evidence of fatal,
irreversible collapse: a scenario of anarchic destruction orchestrated by
“non-state” or “sub-state” actors (2003:10). In the model presented here,
 Things Fall Apart . . . and Rebuild 113

however, the presence of rival warlords fighting to define new territo-

ries within the ruins of a failed kleptocracy is consistent with secondary
gangster-state formation—a process of regeneration that is superimposed
upon gangster-state failure as rival racketeering groups compete with
one another to organize a new regime out of the ruins of the old.
A state can be defined spatially or functionally—as lines on a map or as
a region under governmental control, recognized as sovereign by other
governments. In most democratic regimes, these axes align together
into a unified vision of “the state” as a fixed geographic/­governmental
entity. In unstable gangster-states, however, these geographies may
expand, contract or vanish as racketeering groups lose and gain con-
trol of specific regions. Areas rich in natural resources (such as mineral
wealth) may be seized by aspiring racketeer/kleptocrats to finance their
own arms purchases and challenge the rule of those in power.
This pattern was visible in Zaire in the late 1990s, when rebel groups
used revenues from diamond smuggling to fund weapons purchases
and expand their insurgency (see French, 1997b). During this pro-
cess, the underground economy—the smuggler’s archipelago of covert
mining ventures, underground transportation networks, black-market
commerce and illicit arms transactions—eventually emerged in visible
form as a geographically inscribed zone controlled by a rebel-racketeer
army. The demarcation of this geography as rebel territory was config-
ured in part by the retreat of the security forces of the Zairian state (8).
Once in control of these regions, rebel leaders organized contracts with
Canadian and American mining companies to rehabilitate zinc, copper,
gold, diamond and cobalt production facilities (French, 1997b). These
resources, combined with popular disgust at the ever-increasing preda-
tions of Mobutu’s security forces, eventually led to the complete dissolu-
tion of the national government.

6.6  Gray Zones and Demapping

Achille Mbembe and Charles Piot have used the term “gray zones” to
describe the decoupling of gangster-warlord cartographies from formal
political boundaries in Africa (Piot, 2010). Gray zones are equivalent
to “ungoverned spaces” (Clunan, 2010), “phantom or mirage states”
(Gros, 1996) or the interstitial “warlord territories” described by William
Reno (1998) and Kimberly Marten (2012). International security spe-
cialists find gray zones worrisome, as they often become sanctuaries for
­“terrorists, proliferators of weapons of mass destruction (WMD), narco-
traffickers and gangsters” (Clunan, 2010:3).
114  Gangster States

Gray zones emerge when cartographies are informally revised by

racketeer-insurgents in the process of gaining or losing territory to one
another within the defined political boundaries of an existing nation-
state. As one journalist has stated, “There is no other place on the planet
where political maps are so deceptive—where, in fact, they tell such
lies—as in West Africa” (Kaplan, 1994). William Reno described one of
these spaces in West Africa as “Taylorland,” a fluid warlord zone held
by Liberian strongman Charles Taylor in the 1990s (1999, 2003). At its
largest, Taylorland extended into neighboring countries, including parts
of Sierra Leone. In this space, Charles Taylor claimed monopoly rights
to lucrative resources such as diamond mines and timber concessions.
Funds from these industries were used to purchase weapons for his
troops on the international arms market to further expand his territorial
control (Richberg, 2014).
Human rights activists are deeply disturbed by gray zones, as they
are frequently sites of ethnic massacres and unrestrained gender vio-
lence (9). In one sense, gray zones are the ultimate free-trade zones, as
anything can be bought or sold, including human beings. Gray zones
are often home to human trafficking networks as well as other forms
of illicit commerce (Naím, 2005). Inhabitants are correspondingly left
without “rights and protections, without infrastructure and health
care . . . subject to violence two times over—the violence of neglect
and abandonment and that inflicted by those warlords and mercenary
armies . . .” (Piot, 2010:Kindle edition location 184–90).
Gray-zone conflicts are not restrained by norms of conventional war-
fare. Instead racketeer-warlords competitively terrorize local popula-
tions as a way to gain monopoly control of resources. In the words of
one former mercenary who fought in a gray-zone conflict in the Congo
in the postcolonial period, “No mind could take it all in and stay sane
while understanding the scale of the killing . . .” (Smith, 2012:Kindle
edition location 1199).
Non-combatant populations often try to flee these areas, abandoning
cultivated fields and amplifying the problems of hunger, disease and
desperation faced by refugees. Families who remain in their homesteads
become subjected to multiple predatory attacks by rival racketeer mili-
tias, each seeking to undermine the subsistence base of rivals by destroy-
ing the productive infrastructure of the region (10). One of the most
emotionally disturbing dimensions of gray-zone violence is the fact that
there is often no one left behind to claim or bury the dead. This has led
some African scholars to use the term “necropolities” to describe these
regions (quoted in Piot, 2010). In extreme cases, gruesome displays of
 Things Fall Apart . . . and Rebuild 115

mutilated bodies may persist for long periods of time, terrorizing onlook-
ers and indicating complete breakdown of kin relations and social order.
Smith described coming across a number of such scenes while fighting
in the Congo during the 1960s:

The jungle road out of Lisala . . . [held] sites of long-forgotten

firefights. No one had claimed and buried the dead. It was the rainy
season and the road was deep with red mud and slippery so the
corpses were pressed into the mud and partially buried when the
trucks ran over them . . . There was no sign of life in any village
(Smith, 2012:Kindle edition location 1621).

Some elements of this pattern were repeated in Zaire during the 1990s.
When Mobutu’s mirage state finally collapsed, urban areas were left
without the resources necessary to maintain morgues and organize buri-
als (see The Economist, 22 March 1997). According to the New York Times,
during this final phase of destruction, defeated Zairian soldiers stole
United Nations transport vehicles in order to further “pillage Zairian
towns rather than beating a tactical retreat or digging in to defensive
positions” (French, 1996). By doing this, they effectively completed the
evolutionary cycle from predatory gang to kleptocratic state and back
again. Many inhabitants implored rebel groups to advance into the capi-
tal city and restore order (see The Economist, 22 March 1997).
The complete failure of Zaire eventually resulted in the generation
of a secondary polity under the control of a former rebel commander.
But it is difficult to say if the Democratic Republic of the Congo (DRC)
has improved the lives of impoverished citizens. After decades of eco-
nomic predation and conflict under Mobutu, many zones of the DRC
remain gray, and mortality rates from displacement, malnutrition and
preventable diseases are high (IRC, 2007). Mining regions remain con-
tested spaces as new rebel groups (often backed by rival kleptocrats from
neighboring countries) try to “muscle in” on established smuggling net-
works to finance their own territorial challenges (11).
In Somalia, competing racketeer-warlords hijacked humanitarian
shipments of food, effectively amplifying gray-zone hunger and dislo-
cation into crises of starvation and famine in order to increase their
own political/economic power. Water reservoirs in enemy territories
were intentionally destroyed by rival clan militias during these conflicts
(see Adam, 1995). This is the terrible economic logic of racketeering:
the greater the level of hunger and desperation, the more power will be
gained by groups who find a way to monopolize scarce resources. This
116  Gangster States

is why humanitarian relief shipments became targets for predatory raid-

ing by Somali warlords. The desperation of rural populations ensured a
steady supply of donated goods would be shipped to Somalia by human-
itarian relief agencies (Clark and Gosende, 2003:141). These shipments
were heavily taxed by rival warlord armies as a way to resupply their
own forces and prolong the conflict. According to Clark and Gosende,
“Somalia’s warlords . . . monitored the operations of U.S. and humani-
tarian agencies. They threatened to take aircrews hostage, while unload-
ing food cargoes into waiting vehicles and demanding ‘taxes’ of several
thousand dollars in cash before the aircraft were allowed to depart”
(2003:141). It is not surprising that escalating violence was eventually
directed at relief agencies themselves. As the productive enterprises of
the country were systematically destroyed by rival warlord armies, infu-
sions of external supplies could mean the difference between success or
failure for any armed group.
Gray zones are not just an African phenomenon. There are many other
regions where racketeer-driven conflicts, displaced persons and stateless-
ness have become entrenched. In Colombia, over 300,000 people were
displaced in Antioquia province by conflicts between paramilitaries,
guerrillas and government forces between 1997 and 2006 (Brodzinsky
and Schoening, 2012:Kindle edition location 1663). Five hundred thou-
sand Colombians have also sought refuge in exile over the past decade,
having been displaced by internal conflicts, including territorial battles
fought to gain control of coca fields (Brodzinsky and Schoening, 2012).
Colombians who chose to remain in Colombia have often been vic-
timized by multiple armed insurgent groups who attempt to impose
their own forms of predatory taxation on rural peasant farmers. In one
especially lucrative coca-growing region, the FARC (left-wing insur-
gents) gained significant wealth from taxing cocaine smugglers. In the
late 1990s, right-wing paramilitary groups began contesting FARC’s ter-
ritorial control and initiated a campaign of terror to extinguish peasant
support for FARC. Homicide rates soared, increasing numbers of peas-
ant farmers abandoned their homesteads and “bombings, massacres and
public executions grabbed national headlines” (Brodzinsky and Schoen-
ing, 2012:Kindle edition location 4022).
Gray-zone violence looks and feels like the end of the world to resi-
dents and outside observers alike. Smith’s description of finding deci-
mated villages in the interior of the Congo with “no sign of life” attest
to the devastation that can result from these conflicts. At the same time,
racketeer-warlords can also act as agents of regeneration if they establish
monopoly relations of protection for trade, commerce and agricultural
 Things Fall Apart . . . and Rebuild 117

production. In Robert Rotberg’s discussion of Somalia, he describes how

warlord-controlled territories eventually developed “local security appa-
ratuses” and “sanctioned markets and other trading arrangements.”
Some of these leaders even established “an attenuated form of interna-
tional relations” (Rotberg, 2003:10).
Rotberg interprets these developments as evidence of ongoing failure
of the Somali state, and in that sense he is correct. But these activities
formed the basis of new post-Somali proto-states, whose racketeer-­warlords
may successfully regenerate economic production and commerce and
improve living conditions for the population over time, if predation can
be constrained.
Similar patterns of gangster- (or warlord-) driven collapse, followed
by gangster-warlord regeneration, have been described in other studies
of failed states, including post-Soviet Russia, (Kupatadze, 2012; Glenny,
2008; Handelman, 1995), Yugoslavia (Andreas, 2008; Rieff, 1996), Mol-
dova and Moldovan Transnistria (Glenny, 2008; Naím, 2005), Chechnya
(Handelman, 1995; Satter, 2003), Sierra Leone (Reno, 1999, 2003), Sudan
(Prunier and Gisselquist, 2003), post-Soviet Tajikistan (Dadmer, 2003;
Naím, 2005), Afghanistan (Segell, 1999), Zaire (Lemarchand, 2003; Reno,
1999) and over a dozen different African countries profiled in aggregate
by Ng’ethe (1995).

6.7 Yugoslavia/Bosnia

The Balkan conflicts of the 1990s offer an especially revealing example

of gangster-state collapse and regeneration. Unlike gray-zone conflicts
in remote areas of central Africa, the conflict in Bosnia took place in
a “modern” European state, with abundant international news media
present. This allowed for more in-depth reporting than is commonly
found in conflict zones. Several revealing narratives have emerged as
a result, including outstanding works by David Rieff (1995) and Peter
Andreas (2008). These texts reveal the powerful role of the underworld
in configuring Yugoslavia’s patterns of post-state conflict, failure, remap-
ping and regeneration.
Yugoslavia contained multiple ethnic groups (Serbs, Croats, Bosnians,
Gypsies, Jews, Muslims) who lived together more or less peacefully dur-
ing the Soviet era. There was no ethnic segregation, and intermarriage
was not uncommon. Yugoslavia contained six interior Soviet “social-
ist” republics: Bosnia/Herzegovinia, Croatia, Macedonia, Montenegro,
Slovenia and Serbia. There were also groups of diasporic Gypsies and
Muslims of Turkish descent throughout all of these regions.
118  Gangster States

When the Soviet Union collapsed in the early 1990s, individual ethnic
groups in Yugoslavia sought to establish new states based largely on the
internal territorial divisions of the six provinces. The Yugoslav military
had a large number of Serbs who were suddenly left without a formal
nation or a socialist revolution for which to fight. A fierce ethnic con-
sciousness arose, and Serb soldiers began “cleansing” other groups from
what they perceived to be their ancestral territories. Bosnians and Mus-
lims were denounced as enemy invaders, even though all three groups
had previously coexisted for many decades in the same neighborhoods.
Non-Serbs in these territories were systematically dispossessed of home-
steads and property. Those who resisted were killed, placed in concentra-
tion camps or forced into exile (Mahmutcehajic, 2003; Rieff, 1998) (12).
This outbreak of ethnic violence shocked and confused many observ-
ers, in part because it seemed so temporally, geographically and histori-
cally wrong. State failure and ethnic massacres were expected to happen
in “underdeveloped” parts of the world but not in modern “civilized”
Europe. David Rieff offers an excellent description of cognitive disso-
nance generated by these aspects of the Bosnian conflicts:

Even today so many cosmopolitan Sarajevans cannot quite take in

what happened to them. It is this cognitive dissonance, this mis-
understanding of their own historical situation, that has differenti-
ated the Bosnian reaction to the war that engulfed them from that
of Afghans or Angolans. In Bosnia, the universal pain that all wars
engender has carried with it that tinge of surprise of those who
believed that their material lives would always be happy . . . I think
now that I believed it too, imagining that for white Europeans at
least, the sanguinary epochs had ended definitively . . . What I could
not imagine was the sound of tank fire, and the ping of sniper’s bul-
lets resounding through the windows of high rises, across the neat
parks, the supermarkets and the gleaming cafes, the art galleries,
auto-body repair shops, and historic centers, of a city like Sarajevo.
I could not imagine these things any more than the Bosnians them-
selves could imagine them, before the unthinkable engulfed them
(Rieff, 1996:31–2).

This vignette illustrates the profound sense of unreality that developed

out of this and other post-Soviet conflicts. None of the conventional
ideologies of the late 20th century predicted that secular, cosmopolitan
cities would become overtaken by crude ethnic hatred and genocidal
violence. The events in Bosnia suggested a return to a much darker past
 Things Fall Apart . . . and Rebuild 119

that (as Rieff points out) was unimaginable to the majority of the inhab-
itants, as well as to many observers from surrounding countries (see
Mahmutcehaijic, 2003).
At the beginning of the conflict, Bosnia did not have a professional
army and was unable to protect its own imagined ethnic nation from
incursion by more highly trained Serbs. For protection, Bosnian lead-
ers repurposed powerful organized crime groups (with their associated
weaponry and racketeer-soldiers) into a defense force for the city of Sara-
jevo. This development was viewed positively by most residents, who
hailed the gangsters as a “patriotic mafia” protecting the fragile Bosnian
proto-state from invasion (Andreas, 2008:28).
This racketeer-army functioned reasonably well as a defense force. But
over time, capital accumulation began to take precedence over defense,
and it was no longer clear whether these troops were protecting Bosnian
civilians or their own lucrative monopoly on the city’s black-­market
commerce (Andreas, 2008; Rieff, 1998). The siege of Sarajevo lasted
almost four years. During that time, Serb forces surrounded the city and
launched daily assaults with sniper fire and mortar attacks and main-
tained a blockade that prevented most goods from entering or leaving.
To prevent mass starvation, the United Nations undertook humanitar-
ian relief operations in the form of an airlift of supplies delivered to
the Sarajevo airport, where they were relayed in convoys to distribution
points for the neediest citizens.
Bosnia’s racketeer-soldiers provided “security” for these daily UN ship-
ments and (similar to Somali warlords) soon began imposing predatory
taxation in goods and cash. Over time, this percentage was estimated to
reach approximately 30 percent of all humanitarian shipments (Andreas,
2008). Skimmed goods were sold at highly inflated prices on the black
market to desperate Sarajevans. According to Peter Andreas, the price of
a carton of American cigarettes at a UN retail store was increased tenfold
when resold on the black market (2008:49).
These perverse economic incentives shaped the later years of the con-
flict. In some cases, “aid convoys were deliberately stalled” by Bosnia’s
racketeer-army as a way to further inflate black-market prices for stolen
goods. These artificially engineered shortages exponentially increased
profit margins (Andreas, 2008:45). The end result was a prolongation of
the siege, which greatly intensified suffering of the captive civilian pop-
ulation. By the final years of the war, Sarajevo’s defenders were “increas-
ingly stealing from and terrorizing those they were supposed to be
defending” (Andreas, 2008:91). Aid convoys were hijacked and storage
facilities raided. Ordinary citizens were kidnapped by racketeer soldiers
120  Gangster States

and forced to dig trenches on the front lines. Others were killed simply
because military gangsters coveted their apartments. Shakedowns and
extortion were common.
Even more interesting was the way the expansion of the informal
economy facilitated the emergence of a parallel informal society that
forged bonds across ethnic groups in the underworld. Even while bru-
tal ethnic violence was ongoing in the upper world, the underworld
became a place of shared business interests, reciprocity and multiethnic
collaboration (Andreas, 2008).
These illicit trade networks helped forge post-conflict relationships
between leaders of the newly partitioned regimes. The wealth generated
by these activities also fueled the creation of a highly corrupt, quasi-
criminal group of political-military leaders (Andreas, 2008; Dlouhy,
1999; United States Government General Accounting Office, 2000). The
pre-conflict mafia helped build the post-conflict state, and once these
political gangsters became ensconced as public officials, they continued
to exploit the public sector for private gain. One New York Times arti-
cle claimed that nearly a billion dollars of aid sent for post-war recon-
struction in Bosnia was diverted to private hands (Hedges, 1999). A
US General Accounting Office report released in 2000 also stated that
“[w]artime underground networks have turned into political criminal
networks involved in massive smuggling, tax evasion and trafficking in
women and stolen cars” (General Accounting Office, 2000:2–3).

6.8  Moldova and Transnistria

Another example of gangsterism, remapping, collapse and regenera-

tion appears in the breakaway (but as yet unrecognized) republic of
­Moldovan Transnistria. This region is quite small—about the size of the
state of Rhode Island in the US—but it is home to two powerful indus-
tries, energy and weapons production, which made territorial control
of the region highly lucrative. In 1990, there was a “bloody, dirty lit-
tle war” during which a peripheral racketeer-polity was carved out of
the larger territory of post-Soviet Moldova (Glenny, 2008; Naím, 2005).
Gangster-politicians established monopoly control of arms and energy
production, as well as retail supermarkets, metallurgical plants and tele-
communications services (Glenny, 2008:91). By the early 2000s, Transn-
istria was exporting “vast quantities of Soviet shells and rockets . . . newly
manufactured machine guns, rocket launchers . . . mines, anti-aircraft
missiles” that fueled a number of violent conflicts around the world,
including civil wars in Africa and in the Balkans (Naím, 2005:57–8).
 Things Fall Apart . . . and Rebuild 121

Glenny describes all of Transnistria’s industries as operating on a

“trickle-up” business model, whereby revenues aggregate upward into
the hands of the leadership. The leadership consists of a single kin
group that Moíses Naím described as “a family-owned criminal smug-
gling enterprise” (2005:58). The borders of Transnistria are correspond-
ingly described as “criminal revenue-raising posts” where unofficial
border guards detain transient visitors until appropriate bribes are paid
(Glenny, 2008).
The violent phase of Moldova’s territorial reconfiguration lasted from
1990 to 1992. During these years, it would have no doubt earned a diag-
nosis of “failed or failing state” by most conventional metrics. There
was no functioning government, few public services, and the region was
captive to warring organized crime groups. Political geographies were in
flux, leading to an uncomfortable disconnection between cartographic
boundaries of Moldova and the actual spaces of territorial control by
various groups.
Eventually these conflicts stabilized with the inscription of a new
informal political boundary between Moldova and Transnistria, even
though this division is not fully realized cartographically. There was no
prolonged period of gray-zone terror in this case—only a few years of
civil conflict. Contemporary global atlases do not demarcate Moldovan
Transnistria as a separate polity from Moldova, despite the reconfigura-
tion of the region’s political economy and the imposition of border con-
trols since the 1990s. The stability imposed by this territorial division
has also led to some economic improvements and regeneration of com-
merce. But marked socioeconomic inequality and dramatic outflows of
migrants attest to the fundamentally predatory aspects of the Transnis-
trian government.
7
Darwinian Political Economy

7.1  Research Redux

This work began back in the 1990s, when a seedy crime novel collided
with a graduate seminar in evolutionary biology to generate an unusual
set of research questions: Is racketeering an evolutionary stable strategy?
Is the geographic inscription of protection rackets a phase of primary
and secondary state formation? How do conflicts between rival racket-
eers shape longitudinal patterns of inequality, political stability, state
formation and state failure?
These questions are not answerable with conventional research meth-
ods in anthropology. The underworld does not readily give up its secrets
to law enforcement professionals, much less social scientists. Prehistory
is temporally remote, and failed states are inhospitable places to con-
duct research. Organized crime, state formation and political collapse
cannot be easily simulated in laboratory settings.
These limitations, however, do not mean these questions are unan-
swerable. The indirect methods used in this work still reveal important
patterns and generate testable hypotheses (1). While this approach may
not reflect the same gold standard of empiricism as research in biomedi-
cal or physical sciences, indirect methods can advance knowledge and
contribute to scholarly debates about the political economy of organ-
ized crime and state formation.
Archaeologists, for instance, cannot observe prehistoric societies in
real time. Instead, they reconstruct the political and economic lives of
past populations by excavating and analyzing material remains. This
research suggests that monopoly control of resources was one of the
key traits driving the development of complexity in prehistoric societies
(Shifferd, 1987; Earle, 2002). Armies, agricultural subsistence, marked
geographic boundaries, warfare, complexity and economic stratification
all appear together as defining features of early states in widely divergent
cultural contexts (Brown, 1987; Carneiro, 1970, 1988, 2003; Classen and

122
 Darwinian Political Economy 123

Van de Velde, 1987; Cohen, 1978, 1991; Earle, 2002; Service, 1968, 1978;
Shifferd, 1987).
Criminologists cannot easily observe behavior like racketeering in the
contemporary era. But they can study aggregate data to identify com-
mon patterns. One of the most consistent patterns visible in the study
of organized crime is its overwhelming prevalence around the world.
Organized crime exists in all countries, regardless of surrounding politi-
cal, cultural or religious beliefs or whether the country has a socialist
or capitalist economic system. This is true even for extremely closed,
controlled environments such as prisons. Inmates have no right to pri-
vacy or property, yet they still manage to form sophisticated smuggling
gangs to oversee trade in contraband goods. The appearance of organ-
ized crime and racketeering in so many different cultural, geographic
and temporal contexts suggests the existence of a common evolutionary
mechanism.

7.2  Evolutionary Stable Strategies

The mechanism I am proposing to explain the evolution of organized

crime in all of these diverse temporal and spatial contexts is the evo-
lutionary stable strategy. Theory in behavioral ecology predicts that
systems of economic exchange based solely on cooperation will be vul-
nerable to invasion by behavioral strategies like racketeering. In this
context, racketeering is a form of cheating that includes undesirable
behaviors like thievery, raiding, violence and extortion.
Behavioral ecology also predicts that when cheating evolves in an
economic system, it will increase complexity. Racketeering involves
the formation of a monopoly whereby a small group of racketeers gain
monopoly control of supply chains for critical commodities and attempt
to manipulate both sides of a market—supply and demand—to maxi-
mize their own enrichment. The wealth produced by racketeering must
also be protected from pilfering and parasitic raiding. This propels the
evolution of new institutions to monitor the economic behavior of the
subject population and defend against territorial raiding from external
groups. Cheating propels the development of new behavioral strategies,
cycles of mutual adaptation and institutions of economic and political
control.
It is this evolutionary step—the formation of security forces or rack-
eteer police—that I believe creates the institutional scaffolding for
the subsequent development of sociopolitical stratification and state
124  Gangster States

formation. Security agents protect monopolies for elites by criminaliz-

ing entrepreneurship or other unsanctioned economic activity. These
planes of stratification are reinforced by public displays of violence and
terror that visually illustrate the penalties for subversion. The more suc-
cessful a racketeer monopoly becomes, the greater the incentives for
entrepreneurs to pilfer goods and undersell the inflated prices of the
leadership. This is a new form of cheating that will propel the system
toward increased complexity. Over the long term, these dynamics will
produce complex institutions to regulate commerce and maintain social
control as the behavioral system seeks stability.
External pressure from rival racketeering groups will also propel the
evolution of state-like qualities, including the inscription of territorial
boundaries. Protection must be organized as a monopoly, and monopo-
lies are easier to maintain within defined geographic boundaries. These
cartographies will be fluid, as the economic engines of racketeering are
inherently expansive and growth oriented. Neighboring territories held
by rival racketeer-polities represent tempting stores of wealth for raid-
ing or conquest. Any appearance of weakness in one racketeer-polity
will result in increased boundary testing and territorial aggression from
rivals. If conflicts become prolonged, one or both racketeer-polities may
fail due to over-extension of resources or absorption into the geography
of rivals.
Studying racketeering in contemporary societies offers additional
evidence to support these conclusions. When racketeering evolves in
the underworld of a stable democratic regime, it is constrained by the
need to remain invisible to authorities. The presence of security agen-
cies interrupts the evolutionary progression from gang to state and con-
tains organized crime within the unmarked geography of the informal
economy. Any weakening or instability of the surrounding democratic
state, however, can propel racketeering groups out of the underworld
and toward formal territorial inscription.
In this emergent phase, there is a transition from unmarked gang to
marked gangster-state, visible in the inscription and defense of territorial
boundaries. The warlord-controlled “mini-states” described by Kimberly
Marten and other political scientists would appear to fit this pattern, as
would Charles Taylor’s dictatorial, monopolistic “Taylorland” situated
inside Liberia and Sierra Leone (Marten, 2012; Reno, 1999).
When these geographies are in transition from gang to state (or back
again) they become “gray zones.” Gray-zone geographies fade in and out
of pre-existing polities as emerging racketeer groups gain or lose control
of defined territory. If multiple racketeering groups compete for control
 Darwinian Political Economy 125

in any one region, gray zones may become spaces of deeply entrenched
violence and human misery (2). Competitive destruction of infrastruc-
ture and public acts of terror may be routinely directed against the cap-
tive population. Relief agencies and peacekeeping troops can become
unwitting accomplices to these conflicts as aid convoys are hijacked and
used to resupply warring militias.
If a racketeering group succeeds in establishing itself as an autono-
mous sovereign polity, it will retain a kleptocratic core. There will be few
public-sector resources, and wealth generated by the country’s produc-
tive activities will be aggregated upward into the hands of elites. The
presence of gangster-kleptocrats in office will generate rival gangster-
kleptocrat insurgencies in the informal economy (see Grossman, 1999).
Longitudinal historical research illustrates that this pattern was mani-
fest in Cuba and other Caribbean countries during the 20th century (3).
While in power, Cuba’s racketeer-politicians used political power to gain
monopoly control of numerous industries, including the lucrative vice
markets of the informal economy. By the 1920s, the public sector was
increasingly impoverished, large international bank loans were used to
cover budgetary shortfalls and the country sank into a morass of debt,
instability and corruption. Coalitions of rival kleptocrats collaborated
with international organized crime groups during this time to smuggle
contraband, purchase weapons and seize control of the public sector.
Over time, the scope of these contests amplified until the government
became dysfunctional and impoverished. Parallel historical research in
Haiti and the Dominican Republic reveal similar patterns of kleptocracy
and racketeering in the regimes of Trujillo and Duvalier.
Behavioral ecology also predicts that behavioral systems naturally
evolve toward stability. This means that a stateless realm composed
exclusively of cooperative economic actors is easily invaded by racket-
eering. It also means that a stateless realm of violent political collapse
can be invaded by stabilizing innovations of protection rackets. In other
words, evolutionary theory predicts that failed states will not persist in
a state of anarchy but will naturally regenerate functional, productive
(though asymmetrical) political economies over time. These second-
ary states will also be extractive gangster-states, but they will regenerate
commerce and some degree of political order.
Useful evidence of the way racketeering serves a dual force of state
building and state destruction can be found in many secondary sources,
including recent studies of failed and failing states (Andreas, 2008; Eng-
vall, 2006; Ezrow and Frantz, 2013; Lemarchand, 2003; Marten, 2012;
Markowitz, 2013; Prunier and Gisselquist, 2003; Rasanayagam, 2011;
126  Gangster States

Satter, 2003; Tripodi, 1999; Yannis, 2003; Zack-Williams, 1990). One

of the most common patterns documented by scholars working in this
area is the way “non-state actors” come to dominate the landscape of
the failed regime. This term is unfortunate, as it does not accurately
convey the nature of these groups. Organized crime may begin as a non-
state actor, hidden in the contours of the informal economy, but it can
emerge into a state actor very quickly. Deposed racketeers can also tran-
sition into post-state actors or deterritorialized militias, similar to the
pattern seen in Zaire after the fall of Mobutu.
In other words, when gangster-states fall apart, they appear to collapse
into their constituent elements: warring organized crime groups. At this
point, the collapsed state becomes a gray zone. This is not “a black hole
into which a failed polity has fallen,” never to return (Rotberg, 2003:9).
Instead, it is a turbulent nebula of conflict out of which a secondary
gangster-polity will eventually emerge. Once new relations of protec-
tion become established, economic production and political organiza-
tion regenerate together with some degree of stability. This assertion is
supported by evidence from archaeology documenting the frequency of
secondary state formation in the wake of failed states or fallen empires.

7.3  Darwinian Political Economy

When these diverse strands of evidence are woven together, they support
a cyclical Darwinian rather than a linear or stepwise model of political
economy and sociopolitical evolution. A Spencerian worldview assumes
that continuous improvement in all things is the natural order of the
universe. Vestiges of these beliefs still influence thinking in econom-
ics and political theory. Economists focus their energies on generating
positive growth curves that naturalize “vistas of infinite improvement.”
Political scientists still regard the evolution of the state as a one-way
transition that symbolizes the emergence of civilization. Failed states are
seen as troubling aberrations, and political economies that do not con-
form to Enlightenment visions of the Westphalian state are described as
corruptions of an idealized norm.
Almost no one questioned the linearity of history or the inevitability
of progress during the first half of the 20th century. Between 1900 and
1950, the world witnessed a dizzying array of innovations (sanitation,
water, vaccines, antibiotics, transportation, refrigeration) that greatly
improved human health and welfare and led to an overwhelming sense
of optimism about the future. This was evident in a euphoric speech
given by a British Labor Party leader in the 1940s, in which he promised
 Darwinian Political Economy 127

the country would soon be delivered from “the giant evils of Want, Dis-
ease, Ignorance and Squalor” (quoted in Ulam, 1966:117).
By the 1960s, these goals had receded to a more modest vision: “to
close the gap in the balance of payments” (Ulam, 1966:117). A similar
scaling back of expectations took place in the futuristic visions of Soviet
leaders. The original Marxist idea of a perfect society of equality and har-
mony was downgraded around the same time to one of increased steel
production and “free rides on buses and railways” promised by Kruschev
(Ulam, 1966:117). As Adam Ulam dryly noted, “Those are not the kinds
of things which stir men’s hearts and imaginations” (p. 117).
The collapse of the Soviet Union in the 1990s further eroded popular
faith in the future, as post-Soviet societies seemed to be inexplicably
regressing into an array of premodern forms: gangster-kleptocracies,
warring chieftaincies, failed states and “contemporary feudal societies”
(Shlapentokh, 2007). These trends have only intensified in the first dec-
ades of the 21st century. Militarized interventions and failed state-build-
ing efforts in Iraq have left behind “a toxic brew of sectarian politics and
oil-fueled kleptocracy” (Khedery, 2014). At the time of this writing, parts
of the Middle East have become dominated by rival militias fighting to
establish a “medieval caliphate” funded by revenues gained from illicit
exploitation of petroleum reserves. Ethnic violence has erupted, and
entire communities of religious minorities have been killed and placed
on display in horrific ways (Khedery, 2014). Similar patterns are visible
in the reconstructed Afghan polity, which remains dominated by “war-
lords with dark pasts” who show little concern for improving health or
security for the population (Nordland, 2014).
Equally disturbing premodern trends have become visible in patterns
of global health. Diseases from the 19th century, like cholera, polio,
measles and whooping cough, have increased dramatically in recent
years, in part due to expanding gangster-state political economies that
make effective containment of infectious disease impossible (4). Charles
Piot has perfectly captured the sense of collective dismay generated by
these painful regressions in the title of his recent ethnography, Nostalgia
for the Future (2010).
A cyclical Darwinian model of political-economic evolution does
not view the emergence of premodern political economies or health
patterns in the contemporary era as a temporal or developmental
paradox. In a cyclical model, from a certain vantage point, the future
begins to look a lot like the past (5). Darwinian theory does not natu-
ralize the present complexity of human society but instead views it
as a recent and potentially fragile aberration. There are no “vistas of
128  Gangster States

infinite improvement” in a Darwinian worldview. The massive increase

in human population in the industrial era is instead understood in eco-
logical terms as increasing the probability that an aggressive parasite
(most likely a pathogenic microbe) will evolve to prey on us and reduce
our numbers. In Darwinian thinking, the past two centuries of rapid
population growth indicate increasing vulnerability for our species
rather than evidence of a predestined path of increasing complexity
and technological advance.
In the Darwinian model presented here, the evolution of the state (in
its original, primal form) is conceptualized as a temporary cartographic
inscription signifying that a racketeering group has grown powerful
enough to claim defined geographic territory. If successful, the group
may expand into an empire. If disrupted by rival racketeers or environ-
mental woes, it may contract or collapse. If racketeering remains profit-
able, a secondary gangster-state will regenerate, and the cycle will begin
anew. The individual phases of this process—the increasing complexity
of state formation and the decreasing complexity of state contraction—
are understood to be configured by the economic engine of racketeer-
ing, with the resulting polity formed as an exaptation of the racketeering
enterprise. All phases of this evolutionary process—state formation,
expansion, collapse and regeneration—are inherently violent and
destructive of human lives and subsistence. The innovation of democ-
racy may emerge as part of this cycle, marking a transition to a more
stable and potentially prosperous developmental phase. But Darwinian
evolution is inherently dynamic, and there are no fixed end points. The
existence of organized crime groups in the informal economy of stable
democracies may ultimately facilitate a new transition to this ancestral
gangster-state form, beginning the cycle anew.
Notes

1 Introduction
1 Criminologists may be perplexed to hear of anyone in the 21st century
describing organized crime in ethnic terms. But the field of cultural anthro-
pology remains organized around concepts of cultural determinism, rela-
tivism and historical particularism. Few anthropologists study organized
crime, but when they do it is most often explored through ethnographic
field research. This immersion generates powerful narratives of lived experi-
ence that provide a human voice to the more distanced analytical writings
of other social scientists (see Nordstrom, 2007, and the collected articles in
Ferrell and Hamm, 1998). Because they are focused on the ethnography of
lived experience, cultural anthropologists are not looking for economic laws
that configure longitudinal patterns of organized crime and racketeering.
Exploring the lived experience of crime does not generate an anthropological
theory of crime, since each narrative is embedded in its own ethnographic
specificity.
The atheoretical approach to organized crime found in anthropology is
reinforced by postmodern social theory, which challenges the very translat-
ability of Western concepts like “crime” or “corruption.” Any attempt by
anthropologists to develop a universal model of organized crime would most
likely be regarded as an act of cultural imperialism or hegemony by post-
modern scholars (see Cormaroff and Cormaroff, 2007; Penglase, Kane and
Parnell, 2009).
As a result, anthropology has no consistent approach to the study of organ-
ized crime. At a recent meeting of the American Anthropological Associa-
tion, in fact, I heard a distinguished scholar introduce his panel on organized
crime and illicit markets in South America by stating, “What is organized
crime? I have no idea.” In other AAA panels on crime, I have seen anthro-
pologists present organized crime in ethnic, cultural terms and in orthodox
Marxist terms without ever addressing the fundamental incompatibility of
these two approaches.
Marxist scholars interpret crime (especially among impoverished ethnic
minorities, postcolonial subjects or immigrant populations) as a form of
resistance to capitalist exploitation and hegemony. This approach is visible
in the works of Phillipe Bourgois (2002, 2009) and Jean and John Cormaroff
(2007). In these works, racketeering and violence in postcolonial states are
explained as a way for disempowered postcolonial subjects to gain access to
resources traditionally monopolized by European elites. Louis Perez’s work
on 20th century Cuba offers ideological justifications to explain crime and
corruption in Cuban politics during the early 20th century (1978, 1986).
Some Marxist anthropologists have also interpreted outbreaks of gangsterism
in the post-Soviet world as part of the larger pattern of Western imperialism

129
130 Notes

and colonial violence (see Callari, Cullenberg and Biewener, 1996; Spivak,
1996; Gibson-Graham, 1996).
The model presented in this work does not follow any of these anthropo-
logical traditions. The research is not ethnographic, and the guiding theory is
not Marxist or postmodern. Instead, I apply models from behavioral ecology
to predict the evolution of organized crime in systems of exchange and then
explore case studies through primary and secondary historical research. This
approach has more in common with the work of British social anthropolo-
gists than American cultural anthropologists, as it focuses on social relations
and stratification in a way that minimizes the significance of culture. There
are also some areas of overlap with works on cultural evolution in archae-
ology. These researchers remain curious about the origins of stratification,
inequality and complexity in human societies (for interesting reading in this
area, see Carniero, 2003; Earle, 1998, 2002; Sanderson, 1990; Trigger, 1998;
Wright, 2006; Parkinson and Galaty, 2007).
2 For useful anthropological discussions of the role of economic exchange in
structuring social life and political hierarchy in prehistoric chiefdoms and
states, see Earle (1998, 2002) and Sahlins (1974). These researchers have based
their work on insights obtained from socially informed economists like Karl
Polanyi.
3 Some scholars have argued that there is no such thing as a stateless realm in
the modern world, since all the earth’s territory is mapped by cartographers,
and no territory (except for Antarctica) falls outside of defined nation-states
(see Marten, 2012). If maps are the only indicators of the existence of a state,
this is true. But there are other stateless territories that do not appear on maps.
This includes the liminal space of the informal economy, which by definition
falls outside the control of the state, even when transactions take place within
defined national borders. Contested borderlands between nation-states can
become very lucrative smuggling territories and may be colonized by organ-
ized crime groups who become de facto security services for these zones. These
gangster-territories are not typically mapped by cartographers, even though
the formal state has technically ceded control of these lands to smuggling
cartels.
Political scientists and economists sometimes mistakenly conflate “state-
lessness” with anarchy, which is very troubling to anthropologists. Much
anthropological field research takes place in remote areas, among tribal
populations who may have little if any connection to a national govern-
ment. These tribal societies are not characterized by Hobbesian anarchy but
typically have kin-based systems of political authority and conflict resolu-
tion. For some classic readings in this area, see Lewellen, 1992; McGlynn and
Tuden, 1991; Leach, 1967; Bohannan, 1989.
4 Academic research on organized crime is often limited by problems of data
collection. It is difficult for researchers to study organized crime ethnograph-
ically in contemporary populations. Declassified historical records offer a
much better way to learn about the longitudinal dynamics of crime and
corruption in any one locale. These sources include police reports, consular
dispatches, narratives from confidential informants, transcripts of recorded
conversation and social network maps. Many of these documents contain
very specific economic data, such as estimates of the total dollar amount
 Notes 131

of narcotics traffic passing through a specific port or payoff rates for politi-
cians following a contentious election. Some documents provide a surprising
degree of detail about organized crime connections between leading political
figures and businesspeople. These facts and figures can be reassembled in
biographical and chronological form to create a mosaic history of the under-
world in a particular location. It is especially useful to triangulate multiple
record collections, since police and intelligence agencies typically conceal
information from one another in an attempt to protect the integrity of an
active investigation. The FBI and CIA were once rather famously opposi-
tional in this regard—they refused to share data and actively spied on one
another as much as or more than they spied on foreign operatives. When
sufficient time has elapsed for records to become declassified, it is possible to
review documents from multiple intelligence agencies to gain a much more
comprehensive picture of underworld events than could be obtained from
any one source.
5 Some interdisciplinary scholars have done truly innovative research that
bridges economics, criminology and political science. My own favorite works
in this area would include Andreas (2008, 2013); Acemoglu, Robinson and
Verdier (2004); Anderson (1995); Frye and Shleifer (1997); Gambetta (1993);
Gloster-Coates and Quest (2005); Naylor (2002, 2003); Naím (2005); Rasanay-
agam (2011); Reuter (1985, 1995); Skaperdas and Syropoulos (1995); Frye and
Shleifer (1997); Marcomiller and Young (1995); Grossman (1995, 1999); and
Zack-Williams (1990).
As a general rule, however, economists do not study criminal economic
activity. This is in part because economic activity in the informal sector does
not lend itself to robust empirical research or quantitative modeling. Infor-
mation obtained from criminals is inherently unreliable, and information
obtained from law enforcement is often fragmented and anecdotal. Crimi-
nologists are (by definition) interested in reducing or combating crime, and
this mandate commonly shapes research in the field. Focusing on crime con-
trol makes for a very different set of research priorities than understanding
the natural evolution of crime.
6 This stateless realm is hypothetical because it is not a literal place or time.
We know (because archaeologists tell us so) that states are a relatively recent
innovation for human societies. But it is not possible to use the archaeological
record to delineate a specific moment at which a state has evolved. We also
know (because historians tell us so) that states appear, disappear and recon-
figure their boundaries over time. These processes are also gradual and may
extend beyond a single human life span. Periods of statelessness may occur
that are only visible in retrospect. State collapse is by definition a time of vio-
lence and chaos and is difficult to study empirically.
7 A curious addendum has to follow this statement. It turns out that in some
circumstances intestinal parasites are desirable additions to the human gut.
People who suffer autoimmune diseases like IBS or Crohn’s disease have been
shown to benefit from intentional infection with benign intestinal parasites.
The reasoning behind this unconventional treatment is that the human gut
originally evolved in the presence of parasites, and the absence of these crea-
tures in contemporary populations may create pathologies of autoimmune
dysfunction. For details see Sachs, 2008.
132 Notes

  8 This description applies to many similar regimes around the world, past and
present. Markowitz (2013) offers observations from Tajikistan, where people
in certain regions of the country were described as “terrified of the secu-
rity and police agents” (2013:Kindle edition location 1924). Schwartz (2012)
described witnessing a surreal nighttime scene in rural Haiti that involved
agents of the SIMO (described as the “feared special police”) fighting with
cocaine smugglers, rural peasants and a local judge to retrieve and resell
packages of cocaine spilled during an aborted Colombian drug-smuggling
flight. According to Schwartz, “the judge reputedly made over US$500,000
before he was relieved of his judgeship by . . . superiors who were unhappy
at not getting their cut” (Kindle edition location 3699).
  9 Scenarios like this are commonly encountered by individuals from humani-
tarian relief organizations who are sent to provide emergency assistance to
starving non-combatants trapped in these contested territories. In the case
of Somalia, international donations of food aid became a new locus of com-
petition between gangster-warlords, who hijacked shipments and diverted
supplies to their own forces, further exacerbating the region’s famine and
humanitarian crisis. By the time a decision was made to send US troops to
provide humanitarian aid, approximately 80 percent of relief goods were
being looted (Ezrow and Frantz, 2013:Kindle edition location 8076). As a
result, at least 300,000 people died in Somalia from starvation, disease and
dislocation between 1991 and 1993 (Mills, Pham and Kilcullen, 2013). It is
not uncommon for international aid workers to express outrage and frustra-
tion when humanitarian aid supplies are looted by armed militias or diverted
by government kleptocrats. See Schwartz (2012) for a discussion of how these
dynamics have contributed to failed international relief and development
initiatives in Haiti.
10 In Full House, Steven J. Gould provides an insightful discussion of all the
ways Darwin’s ideas combined with the emerging science of paleontology
during the Victorian era to “dethrone” deeply held beliefs about the place
of humankind in the cosmos and the inevitability of progress over time
(1996:18–19). This expanded temporal perspective suggests a universe of ran-
dom catastrophes and periodic mass extinction events. The “deep geologic
time” unearthed by research in paleontology further diminishes the signifi-
cance of humanity in the cosmos. Or, as Gould put it in a public lecture I
attended in Atlanta, if the timeline of Earth’s history as a planet were repre-
sented by the distance between a man’s nose to the tip of his index finger,
all of human existence could be erased by the single pass of a nail file. This is
not a feel-good message.
11 Criminologists may have some difficulty with these assertions. Robert Lacey
has described the field as composed of equal parts “science, gossip and the-
ology” (Lacey, 1991:367). By this he means that criminologists struggle to
formulate a science out of fragmented and anecdotal information (gossip)
provided by unwilling and dishonest informants. The theology of organized
crime is what unifies the field in the face of these methodological challenges.
This is not a literal theology, but it occupies a parallel niche. The moral con-
sensus of criminology and law enforcement imposes order on underworld
violence by locating the origin of these atrocities in human wickedness and
vice. This approach shields law enforcement personnel from the trauma that
 Notes 133

would otherwise result from too much exposure to the chaotic violence and
suffering of this realm. Police must confront the bloody aftermath of organ-
ized crime conflicts and reconcile the dead bodies and brutality of this realm
on a daily basis. Constant exposure to chaotic homicidal violence is likely
to result in psychological stresses of alienation and “annihilation anxiety,”
which Robert J. Lifton has described as one of the most painful of human
emotions and the “forerunner of all human anxiety” (1961:70). Under these
circumstances, the emergence of quasi-theological beliefs about organized
crime is rational and protective.
Strong theology may be psychologically protective, but it also serves to
stifle innovation. The study of infectious disease offers a useful historical
analogy of these dynamics. In the early 1800s, lethal epidemics were under-
stood in theological terms as evidence of God’s displeasure with human
wickedness and sin (Johnson, 2006; Rosenberg, 1987). Physicians and reli-
gious leaders responded to outbreaks of cholera by calling for a national
day of prayer as well as increased vigilance against moral degeneration.
Eventually a contrarian physician decided to map cholera cases in two
London neighborhoods to see if the geographic distribution of the disease
could help determine a cause. This was doubly heretical, as it challenged
prevailing medical and religious beliefs about the origins of the disease. It
seemed unthinkable that a plague that produced such theological agony
(Why is God so capricious and cruel?) could be prevented by something
as mundane as sewer systems. This secular transformation, however, even-
tually laid the foundation for the modern science of epidemiology and
the first effective strategies for limiting the spread of waterborne diseases.
Exploring organized crime and kleptocracy from a secular, naturalistic per-
spective will hopefully offer similar strategies for improved prevention and
control.
12 As is almost always the case, clever science-fiction writers are ahead of social
scientists in imagining what a gangster-state future for the United States
might look like. One of the most ironic of these portrayals comes from the
opening pages of Neil Stephenson’s classic Snow Crash (1992). In this futur-
istic dystopia, the private sector is dominated by the mafia, and the gov-
ernment has retreated to a shadowy, secretive entity that does little more
than hoard electronic data obtained from massive surveillance of all citizens.
The mafia owns a chain of pizza parlors called CosaNostra Pizza that openly
advertise with giant billboards that say, “The mafia: you’ve got a friend in the
family!”

2 What Is Organized Crime?

  1 Unfortunately, one of the worst offenders in perpetrating the ethnic model
of organized crime was the Federal Bureau of Investigation (FBI), whose
early documents implicitly define organized crime as an Italian or Italian-
American phenomenon. Since that time, the Bureau has become much more
sophisticated. But for many years, the ethnic model prevailed. Some of the
earliest FBI documents pertaining to the Mafia can be downloaded at the
FOIA reading room: http://vault.fbi.gov.
134 Notes

2 In his paper on law enforcement in the Netherlands, Peter Klerks described

receiving a set of instructional materials for a class on organized crime that
focused almost exclusively on “infamous Mafia hoodlums” from the greater
New York area in the 1950s (2003:98). He describes this approach as repre-
senting “the predominant paradigm in the field” (2003:99). Mark Galeotti also
opens his 2001 paper on transnational crime with a similar temporal frame,
defining organized crime as an exclusively modern phenomenon (2001:203).
Monica Massari provides an excellent discussion of international organized
crime, but her case study material is largely drawn from Italy in the 20th cen-
tury (2003). This is also true in the paper by Robert Kelly and Rufus Schatzberg,
who rely on examples from Italian groups operating in the United States dur-
ing the 20th century (2003). Fabio Armao’s paper in Organized Crime and the
Challenge to Democracy offers a “global historical outline of mafia systems.” But
the starting point for this history is the year 1945, implying a relatively recent
origin for the phenomenon (2003:43). Armao also provides some comparative
examples from the “Japanese Yakuza and the Chinese Triads” (2003:29). This
language also reinforces the older ethnic model of organized crime by drawing
national or cultural boundaries around each of these criminal organizations.
The appearance of multiple warring Russian “mafiyas” in the 1990s was
the subject of much analysis by criminologists, but these works attempted
to draw comparisons between the known Italian examples and the rapidly
evolving post-Soviet situation. I would argue that these analyses were flawed
in that they attempted to compare organized crime groups operating in the
subterranean area of the informal economy inside a stable democratic regime
with organized crime groups expanding to fill the political void in a collaps-
ing state. Racketeering takes very different forms in each of these contexts.
In a democratic regime, the formal security services of the state work to keep
organized crime marginalized in the peripheral space of the informal econ-
omy. In a failed or collapsing state, organized crime groups become the formal
polity. Many Russians have anecdotally described their system in these terms
(see Glenny, 2008; Handelman, 1995; Satter, 2003). As one weary post-Soviet
resident stated in the early 1990s, “We pretend to vote and the government
pretends to govern . . . It’s the mafiya which runs everything” (quoted in
Handelman, 1995:340).
3 This is especially noticeable in some deregulated sectors of the US economy,
such as banking, finance and mortgage lending in the United States during
the early 2000s. For some insightful discussions of the way criminal activity
and fraud contributed to the 2008 economic meltdown, see Smith (2010) or
Das (2011). The narratives of Frank Partnoy (1997, 2009) offer a fascinating
(and disheartening) exploration of the quasi-criminal activities of mainstream
financial firms. For an earlier snapshot into how deregulation contributed to
widespread criminal activity in the savings and loan industry in the 1980s, see
Black (2005).
4 This discussion of smuggling is based on work in primary and secondary his-
torical sources. In addition to my ethnographic field research in Cuba in the
1990s, I have also conducted many years’ worth of archival research in vari-
ous government document collections at the National Archives in College
Park, Maryland; Washington, DC; and Ft. Worth, Texas. Research in these
government document collections has been supplemented by additional
 Notes 135

work in various collections at the University of Miami, Florida International

University, the University of South Florida and several US presidential librar-
ies. Newspaper archives (including the New York Times, the Dallas Morning
News and the Tampa Tribune) were also consulted to glean names and dates
of international narcotics seizures and arrests. My goal in all of this archival
work was to piece together a credible history of the underworld in Cuba
during the 20th century and to understand how political power was used to
organize and defend monopolies in the informal smuggling economy during
the 20th century. One very interesting unpublished memoir by a US Customs
agent details numerous arms and narcotics trafficking routes between the
United States and Cuba in the early 1950s, including several networks that
supplied the Castro rebels (see Zeigler, 1977). There are also a number of
descriptions of arms and narcotics smuggling through the university campus
in the 1940s and 1950s in various US government document collections,
including State Department counterintelligence files (RG 319 JFK Collection,
College Park NARA) and Narcotics Bureau files. FBI files (RG 233 JFK Collec-
tion, College Park, NARA) also describe close relationships between Cuban
student radicals and organized crime groups operating in the United States,
Canada and Europe.
It appears that the anti-Machado groups (including a secret branch of the
Cuban Communist Party sent by Stalin) originally collaborated with North
American bootleggers during Prohibition in order to fund weapons purchases
for various revolutionary movements. These relationships are detailed in cor-
respondence from Harry Guggenheim, who was briefly a US envoy to Cuba
in the early 1930s. By the 1940s, many of the student radicals from the 1920s
and 1930s had matured into political leaders and continued to maintain
relationships with international organized crime groups to fund their politi-
cal activities. In the 1940s, President Grau San Martin (a key figure in the
opposition to Machado) purged the police and army of Batista followers and
installed a new “Army of the Caribbean” for national defense. This army
worked together with a number of high-ranking government officials to set
up protected smuggling networks between Cuba and a number of US cities,
including Key West, Tampa and New York. A special airline allegedly served
as the primary vehicle for moving contraband internationally. These flights
were allowed to land at Camp Colombia (a large military base outside of
Havana) and were exempted from customs inspection upon arrival. Some
sources claim that this protected trafficking network was set up by Lucky
Luciano during his famous visit to Cuba in the 1940s. The US Narcotics
Bureau believed Luciano worked with Cuban military and political leaders
to make Havana the most important transshipment point for French Con-
nection heroin coming into the United States as well as raw coca paste from
the Andes that was processed in Cuban cocaine labs before final sale in the
United States and Canada. These events are described in National Archives
Record Group 170 (Bureau of Narcotics and Dangerous Drugs).
5 The students themselves may have also been confused on this point. One
notorious radical declared himself the head of a revolutionary socialist stu-
dent group (the MSR) and engaged in widespread extortion, kidnapping,
racketeering and violence during the 1940s and 1950s. Many other student
groups (the UIR, the ARG, El Bonche) also followed in this path, with their
136 Notes

revolutionary idealism derailed somewhere in the depravity of gangsterism

and crime.
6 The Batista regime was ultimately unsuccessful in this task. The campus
remained a focal point of student activism in the early 1950s. Many student
leaders (including Fidel Castro) maintained ties to the earlier generation of
leftist radicals who had originally seized power from Machado in the early
1930s and used these connections to finance and ultimately overthrow Batista
in 1959. Fidel Castro’s early revolutionary exploits were funded by Carlos Prio
Socarras, who began his career as a militant anti-Machado revolutionary and
eventually became president of Cuba from 1948 to 1952. Prio also had long-
standing ties to international organized crime, and a number of Prio’s close
associates (including his brothers Paco and Antonio) took monopoly control
over narcotics trafficking in Cuba in the early 1950s.
7 These events are detailed in Albert Anastasia’s FBI file. A redacted copy of the
file is available for download in the FBI’s FOIA reading room: http://vault.fbi.
gov/Albert%20Anastasia.
8 These details about gambling rackets in Cuba come from the FBI file of Nor-
man Rothman. This material is not available in the FOIA reading room. It is
currently housed with the JFK Collection (Record Group 65) in the National
Archives repository in College Park, Maryland.
9 When gambling was legalized in Cuba during the second Batista regime
(1952–59), Lansky’s operations expanded dramatically, and he was given the
most valuable gambling concessions in Havana. Many of the racketeers who
had previously fleeced tourists through razzle-dazzle and other rigged games
were arrested and deported. These arrests were given great publicity by the
Cuban government in the hopes of luring tourists back to the casinos. As
soon as the headlines about the arrests had faded from popular attention,
however, most of the deported gangsters were allowed back in the country
and quietly resumed their former activities. This time, however, the crooked
games remained relatively marginalized while Lansky’s comparatively honest
casinos dominated the market. A description of these events is found in Nor-
man Rothman’s FBI file, located in National Archives in College Park, Mary-
land. Additional information comes from FBI files of Charles Tourine and a
more general file on Cuban gambling and casino operations. The FBI appears
to have had a wide network of informants in the Cuban underworld during
this time, including Meyer Lansky’s brother Jake.

3  Failing Economics
1 As previously mentioned, there are a number of innovative economists who
do model the organization of racketeering and organized crime. See Acemo-
glu, Robinson and Verdier (2004); Gambetta (1993); Naylor (2002, 2003); Reu-
ter (1985, 1995); Skaperdas and Syropoulos (1995); Frye and Shleifer (1997);
Marcomiller and Young (1995); Grossman (1999).
2 The recently published work of Ezrow and Frantz (2013) has some excellent
comparative data on corruption and kleptocracy from several different regimes
around the world, including Indonesia, Haiti, the Dominican Republic, Geor-
gia, Russia, Mexico, Uganda, the Philippines, Kazakhstan and Bangladesh.
 Notes 137

Reno (1999) also presents some excellent data on kleptocratic looting in Sierra
Leone, Zaire and Nigeria.
3 An analogous situation once prevailed among microbiologists. Early in the
20th century, it was recognized that certain kinds of fungi could contaminate
bacterial cultures. Scientists would become frustrated when this happened,
since it meant that they would have to discard their cultures and begin experi-
ments anew. One scientist, however, suspected that the contaminants them-
selves might be of interest, and this shift in perspective eventually resulted
in the discovery of penicillin. In other words, when the language of science
constructs a substance or a behavior as an unwanted contaminant, it becomes
excluded from analysis. This protects the purity of existing models but ulti-
mately serves to limit the ability of researchers to grasp the significance of
unanticipated events and processes.
4 My own field of anthropology has been troubling in this regard. During all of
my years of undergraduate and graduate training, I never heard a single anthro-
pology professor describe the USSR or any of its satellites in anything other
than positive terms. This was particularly apparent in the area of comparative
health research. Soviet health statistics (now known to have been censored and
falsified) were held up as evidence for the moral superiority of socialism and
the necessity of Marxist revolutions as a precondition to improve the health of
the working class. Praise for the USSR in anthropology has diminished in recent
years as the true extent of environmental degradation, biowarfare research and
human rights abuses has become more widely known.
5 Many social scientists still use Marxist theory to explain social problems in
the contemporary era, despite the apparent uselessness of Marxism for pre-
dicting the repression and violence of Soviet society, the rapidity with which
the USSR collapsed or the widespread gangsterism that resulted in the after-
math. Social theorists still invoke capitalism as the cause of global poverty and
oppression. Irving Horowitz has used the term “leftist myopia” to describe
this tendency and has argued that postmodern leftists have “replaced uto-
pia with myopia” (1993:32). My own beliefs on this topic have been heavily
influenced by the writings of Soviet and Cuban dissidents (Edwards, 1993;
Hollander, 1983, 1998; Llovio-Menendez, 1988; Padilla, 1984) as well as theo-
rists such as Abbott Gleason (1997), Stephen Louw (1997), Leszek Kolakowski
(1977, 1978), Martin Malia (1994), Frank Manuel (1992) and Peter Berger
(1974, 1977, 1986).
6 In 1997 and 1998, I spent nearly ten months in Cuba conducting research for
my PhD thesis. This experience provided a fascinating glimpse into the pecu-
liar political-economic contradictions of late socialism in a struggling Soviet
satellite. After the fall of the USSR, Cuba experienced a severe economic col-
lapse as Soviet subsidies were eliminated virtually overnight. A number of
policies were enacted to try and prevent collapse. These included limited free-
market activities and licensing of private home-based businesses like small
restaurants. Only people with impeccable revolutionary credentials, however,
were allowed to participate in these privatized sectors of the economy. Gov-
ernment licensing restrictions served as a way to restrict capitalism to socialist
elites like high-ranking military or intelligence officers. Some Cubans referred
to these newly wealthy political types as Yummies: Young Upwardly Mobile
Marxists.
138 Notes

For a brief moment in the 1990s, free-market reforms and luxury hotels with
private beaches were touted as the most expedient path to achieving Marx’s
(and Fidel’s) vision of socialist equality. The decriminalization of American dol-
lars created considerable resentment among some sectors of the population:
one day holding dollars was punishable by a sentence of several years in prison;
the next day it was legalized and encouraged as a way to achieve socialism.
None of the prisoners serving jail terms were released when this policy change
was announced, as this would imply fallibility on the part of the regime. So
these Cubans were left to serve out their sentences even though their original
crimes had become revolutionary by the time of their release. By the end of the
1990s, when there were finally enough hotels in place to support the expan-
sion of the tourist trade, unauthorized renting of rooms to foreign visitors was
recriminalized. A “campaign against indiscipline” was launched that strove to
impose socialist purity on the increasingly decadent behaviors of new Cuban
elites. Black-market vendors were arrested, as were hundreds of prostitutes who
frequented tourist zones. This campaign was also short-lived.
7 A quotation from Mossimo Salvadori provides some useful detail on this point:

Socialists differed in what they intended by capitalism. For most, it was a

vague g­ eneral term including practically everything non-socialist. Every
economic system in which enterprises were owned privately they described
as capitalist, lumping under the same heading free enterprise economies
functioning in a free market under the stimulus of profit-making, domestic
exchange economies in which the role of c­ apital was minimal, corpora-
tive and welfare economies in which free enterprise was severely restricted,
neomercantilistic economies in which the free market had been sup-
pressed, and mixed economies in which the public sector played a greater
role than the private (1968:4).

8 The entire NPR program can be heard here: http://www.npr.org/blogs/

money/2010/12/27/132288035/why-economists-hate-presents-and-how-
seventh-graders-solved-the-problem).

4  The Evolution of Racketeering

1 This approach is apparent in the papers collected by Camerer, Loewenstein
and Rabin (2004) in their extensive survey of contemporary research in behav-
ioral economics. The papers in this collection make a number of important
contributions to the study of individual economic behavior. But there is no
modeling of aggregate population level trends or longitudinal evolutionary
patterns of behavioral economic systems. The limitations of this overly indi-
vidualistic approach have recently been critiqued by Terry Barker in a lec-
ture given at the University of Glasgow. In this talk, Barker points out that
neoclassical economists begin with the assumption that economic agents
are “rational and have full knowledge.” He points out that this formulation
“excludes social groupings” and “excludes evolution” (2013).
2 A typical example of the way economists conceptualize the problem of cheat-
ing in economic exchange is found in William Easterly’s book The White
Man’s Burden. The book is intended as a critique of Western aid efforts in the
 Notes 139

developing world and challenges a number of World Bank and IMF develop-
ment policies, including “shock therapy” for post-Soviet economies and other
failed utopian attempts to engineer free-market economies and democratic
governance. In the book, Easterly discusses the problem of cheating, and his
list of potential solutions reveals much about how economists see the world.
His suggestions are based exclusively in the private sector and include better
credit bureau reporting practices and more efficient debt collection agencies
(see Easterly 2006:88–95). Easterly also discusses organized crime and “Mafia-
like” organizations as potential providers of contract enforcement outside the
confines of the state. But he notes rather cryptically that this type of organiza-
tion “almost always overstays its welcome.” He concludes this discussion on
a decidedly ambiguous note, by stating, “Western social scientists don’t begin
to comprehend fully the complex process of state formation and rule of law in
the West, so they shouldn’t be too quick to predict how it will work anywhere
else” (p. 89).
3 Future researchers may develop a way to explore these predictions in labora-
tory settings. But empirical research is beyond the scope of this project, which
is focused more on generating new hypotheses for other researchers to test.
4 Readers without a background in anthropology will require some additional
discussion here. Most introductory anthropology classes begin by situating
humankind in evolutionary perspective. This includes presentation of a time-
line of human biological evolution as well as a timeline for various cultural
innovations. The vast majority of our time as a species has been spent in a
hunter-gatherer type of subsistence and social environment. These societies
are relatively egalitarian, populations are mobile and conflicts are typically
resolved by fissioning instead of warfare or violence (though homicide is not
unknown). Since these groups live off the land, there is very little surplus or
craft production, though trade within and outside the groups does take place.
Agricultural subsistence first developed around 10,000 years ago in the Middle
East, and industrial agricultural appeared only a few hundred years ago. Much
curiosity surrounds the transition to agriculture: Why would humans aban-
don hunting and gathering to take up farming? Paleopathological evidence
suggests this transition was very unhealthy for the majority of the popula-
tion. Skeletal remains from these communities show signs of growth stunt-
ing, nutritional stress, high rates of mortality, infectious disease and multiple
dental pathologies. The first signs of warfare, socioeconomic stratification and
craft specialization also occur along with this transition.
The hypothetical scenario presented here proposes that raiding behavior
most likely evolved together with production of agricultural surplus and that
this form of “cheating” is what underlay the subsequent emergence of sys-
temic complexity in early agricultural societies. A more specific evolutionary
pathway for this scenario would link increased population growth in early
farming communities with increased competition for desirable farmland and
water. For a variety of reasons, agricultural subsistence dramatically increases
human fertility. Even though death rates from infectious disease and malnu-
trition are high in prehistoric agricultural communities, the comparatively
high birth rate means population growth remained positive after transition-
ing to agricultural subsistence. Population pressures would presumably lead
to increased competition for arable land, with some kin groups dominating
140 Notes

the most desirable territories. Rival kin groups might end up in very mar-
ginal or unproductive lands and turn to raiding as a way to supplement their
resources. Raiding is likely to result in destructive cycles of feuding and retali-
ation, and even though farmers and raiders are linked in a single economy,
they may disaggregate into two distinct ethnic groups, each with its own
primary subsistence strategy. This pattern has been reported in several nota-
ble studies of ethnicity. Resource competition between groups seems to play
a consistent role in the creation and maintenance of ethnic boundaries and
ethnic tensions. For some classic case studies of this phenomenon, see the
articles collected by Barth, 1969.
5 This example illustrates the truth of a saying common to professional stock
traders: “First the innovators, then the imitators, then the idiots.” This refers
to the benefits of being the first to develop a new investment product, like
synthetic derivatives. The innovators are the ones who anticipate the next
big trend. Their success inspires dozens of imitators, who increase demand
and drive up prices. The idiots are the ones who buy in after the market has
peaked and who ultimately suffer huge losses. Several recent examples of this
pattern can be seen in the narratives of Das (2011), Lewis (2010) and Partnoy
(2009).

5  Organized Crime and Kleptocracy

1 For some interesting historical descriptions of mafia territories in the United
States, see Asbury (1927); Dietche (2004, 2007); Lacey (1991); Reid and
Demaris (1964); Russo (2001); Short (1984); Turkus and Feder (1992[1951]);
Tyler (1962).
2 These revenue figures are taken from Google Public Data. Mexican GDP and
smuggling revenue estimates come from http://knowledge.wharton.upenn.
edu/article.cfm?articleid=2695.
3 One survey of residents in Mexico City revealed that 90 percent “expressed
no trust in the police” (Ezrow and Frantz, 2013:Kindle edition location 6908).
This pattern is common in many failed states where citizens are caught
between rival organized crime groups (or warlords) fighting for monopoly
control of resources. It is rare for people living in these kinds of combat zones
to participate in survey research—usually everyone is too focused on basic
survival.
4 Erika Robb-Larkins, personal communication.
5 There is some evidence of this in Russia in the immediate post-Soviet period.
In Comrade Criminal, Stephen Handelman reported that different branches
of the military and intelligence services were competing with one another
to gain control over newly privatized state wealth and productive indus-
tries during the late 1980s and early 1990s. The security services fell into
economic competition with one another, seeking to gain monopoly control
of the country’s unprotected stores of wealth. This competition frequently
turned violent, as both groups had ready access to stores of weapons. The
end result was the repurposing of Soviet security forces away from their pre-
vious role as guarantors of public order (achieved by threatening dissidents
and outlawing criticism) and into a new role as predatory monopolists (Han-
delman, 1995).
 Notes 141

6 Cuba was chosen for several reasons. Cuba has a long history of close ties with
the US and had a heavy mafia presence during the booming casino years of
the 1940s and 1950s. There are abundant archival materials available in US
repositories.
7 This research involved the development of some unique archival methods
to create a thorough historical narrative from these fragmented, anecdotal
records. Early in my research it became clear that US government agencies
kept their information compartmentalized and were often more concerned
with protecting their own turf from encroachment by rival government agen-
cies. So diplomatic correspondence from the US Embassy in Havana might
include biographical background information on a group of Cuban politicians
for review by the State Department in Washington, DC. FBI agents monitoring
the activities of US organized crime groups operating in Havana might include
information to their superiors describing the smuggling operations or casino
skim received by those same politicians. Military Intelligence groups might
be monitoring the covert arms shipments of the same group of politicians.
US newspapers might carry police reports describing groups of Cuban revolu-
tionaries involved in weapons thefts from US military installations. In many
cases, these individual agency reports were referring to the exact same groups
of Cubans. Because their various activities (including colluding with organ-
ized crime groups, smuggling weapons, planning insurrections and eventually
running the country) were monitored by competing US agencies, the perspec-
tive of US officials became fragmented and incomplete. This became quite
evident in the late 1950s, when one US government agency was covertly pro-
viding arms and training to a group of Cuban rebels, whereupon another US
government agency would arrest the same rebels for violations of the Neutral-
ity Act.
By triangulating from multiple sources in this way, it became possible
to create a composite (though still incomplete) portrait of the fluid con-
duits between the Cuban underworld and the formal polity of the Cuban
(gangster-)state. Many of Cuba’s leading political figures from this era began
their careers as outlaws or political gangsters, seized power by force as insur-
gents, looted the country as kleptocrats, were unseated by rivals and returned
to the underworld to start the process anew.
8 Years of exploring the minutia of the Cuban underworld have left me deeply
cynical about the work of several leading historians in this area. Key elements
of the Castro regime’s self-serving hagiography have become repeated so
often, by so many historians, that these distortions are now widely accepted
as historical facts even though they are not supported by primary source mate-
rial. I have addressed some of these myths in my previous book (Hirschfeld,
2007), but more persist. Most troublesome is the tendency of leftist historians
to uncritically accept the Castro regime’s assertion that US imperialism was
solely to blame for Cuba’s widespread problems of poverty and other indi-
cators of underdevelopment prior to 1959. The history of the underworld
suggests instead that widespread looting and internecine warfare on the
part of the Cuban political gangsters played a major role in impoverishing
the nation. US policy toward Cuba vacillated between aggressive meddling
in Cuban affairs to more distanced laissez-faire manipulations. But neither
approach had much impact on politicians’ appetites for graft and looting.
142 Notes

Some remarkably detailed records of the complicity of Cuban politicians

in smuggling bootleg alcohol and other contraband (including narcotics
and illegal aliens) into the United States during Prohibition can be found in
the United States Coast Guard Intelligence files (RG 36). These are located
in the National Archives facility in Washington, DC. The officials who
kept these records clipped newspaper articles about smuggling cases and
penciled confidential notes in the margins, identifying specific trafficking
networks and describing their links to certain politicians.
  9 A similar situation prevailed in Colombia during the period known as la
violencia in the 1940s and 1950s. Bitter factionalism between political par-
ties frequently sent losing candidates and their supporters into exile, while
the winning parties looted their property. There were no ideological differ-
ences between parties at this time. They were divided into predators and
prey, depending on the outcome of local elections. For some individual
narratives detailing these events, see Brodzinsky and Schoening (2012).
10 Archival records from Eastern Cuba (including the Provincial Archives in
Santiago-de-Cuba) and the US National Archives in College Park, Maryland,
(RG 199) contain some remarkably frank descriptions of voting fraud, politi-
cal gangsterism and predatory raiding on the part of rival political groups.
Many Cubans were deeply unhappy with the partisan violence and racket-
eering activities of the rival political parties. Sugarcane planters repeatedly
petitioned the United States for greater protection. One confidential US
­military report from 1906 stated,
. . . Beyond the borders of the [sugar] estate, throughout the dense forest
land which surrounds it, there are known to dwell a number of lawless
persons who live largely by plunder and by contributions levied on their
weaker and more defenseless neighbors. Due to local conditions, the regu-
lation of this element is difficult even by means of a large number of the
agents of public order . . . Lately letters exacting the payment of money
and threatening the burning of cane in default of same have been received,
but the threats have not been executed and the authorities are on the track
of the authors of the crime. These blackmailing letters merely exemplify
what might occur without some amelioration of the means of communica-
tion and adequate protection of life and property, as great damage could be
done by lawless persons in this vicinity long before aid could come from
the municipal center . . . (Report from Francisco Sugar Company to United
States Military Occupation Leaders, 24 December 1906).
11 These facts and figures detailing graft in the Batista regime are taken from
various FBI and Narcotics Bureau reports from the 1950s. There are also sev-
eral criminal intelligence reports from Miami that are also included in declas-
sified FBI files housed in the National Archives in College Park, Maryland.
While the actual figures quoted in these reports may not be accurate, the
scale of the graft probably is. The most detailed of these reports can be found
in the NARA JFK Collection (RG 233 and RG 65). After the assassination of
Kennedy, the FBI turned over an enormous quantity of material to various
investigations. There are many files relating to organized crime operations in
Cuba in the 1940s and 1950s.
12 During the 1940s, the Caribbean Legion undertook several campaigns to
overthrow dictators in the region, including Rafael Trujillo (in the Dominican
 Notes 143

Republic) and Anastasio Somoza (in Nicaragua). A more idealistic faction

supported the leftist movement in Guatemala with the help of some Soviet
military officials and communist Spanish Civil War veterans. The Caribbean
Legion also organized the ill-fated Cayo Confites expedition to overthrow
Rafael Trujillo. This paramilitary force included an energetic young Fidel
Castro well versed in political gangsterism from his years as a student at the
University of Havana.
13 History is never really quite what it seems. The mythology of the 1959 revo-
lution is that Fidel Castro put an end to gangster-state predations in Cuba
and initiated a new era of socialist well-being. After a brief experiment with
“revolutionary gambling,” the Castro brothers did eventually close Cuba’s
casinos and put many international and national organized crime leaders
in jail. But many new predations were unleashed upon the Cuban popula-
tion. Entrepreneurship was outlawed in the name of socialist purity, and
the state gradually became a monopoly provider of all goods and services.
All of the social ills Hayek identifies with centralized economic planning
soon emerged: a coercive authoritarian (now dynastic) dictatorship, severe
shortages of basic consumer goods, censorship, criminalization of private
economic activity, rapid expansion of the informal economy and massive
military buildup. The regime’s elimination of casino gambling in the early
1960s should not necessarily be taken as a sign that it cut off all contact with
international organized crime groups. There are many allegations of narcot-
ics and weapons trafficking by the regime during the 1970s and 1980s (see
Eckstein, 1993; Oppenheimer, 1993). An elite force of Cuban agents was also
stationed in Panama in the 1980s, allegedly to safeguard Cuba’s joint smug-
gling ventures with Manual Noriega and the Medellín Cartel (see Kempe,
1990).
My own experiences living in Cuba certainly felt more gangster-statist
than socialist. Monopoly pricing was the norm in state-run supermarkets,
where basic consumer goods were often ten to 100 times more expensive
than from vendors in the informal economy. One writer described finding
a cabbage priced at US$17 in a state market (Tattlin, 2002). For purposes
of comparison, US$17 was slightly less than the average monthly wage
for most Cuban workers. A cabbage could be purchased in the informal
­economy for as little as 50 cents.
Not surprisingly, Cubans much preferred to purchase their household
goods on the black market and avoid the inflated monopoly prices of the
state-owned supermarkets. In response, the state enacted a major propa-
ganda campaign to characterize black-market trading as a “counterrevo-
lutionary” crime. Police began arresting door-to-door food vendors and
imposing hefty fines so that people would have to shop at the government’s
hard currency stores. While the language of the state’s campaign against
black-market vendors in the 1990s reflected the socialist ideology of the
Castro regime, the actual policies were much more reminiscent of Cuba’s
ancestral patterns of gangster-state kleptocracy. Or, as one Cuban woman
whispered to me, “As you know, all money has to pass through the pockets
of Fidel.”
14 This pattern has been described by Scott (1972:73) as “bureaucratic extortion
of pariah capital.” This phrase is useful in that it illustrates the way capital is
often divided into “legitimate” and “illegitimate” categories. This distinction
144 Notes

is often configured by cultural values or ethnic tensions. Scott describes an

example from Thailand in the 1950s, where Chinese businesspeople were
subjected to frequent extortion by Thai police. “In the context of Chinese
political weakness, the possibilities for extortion were enormous . . . Chinese
businessmen were harassed constantly by police raids, revocation of leases
or deeds, new control measures or sudden inspections” (p. 73). The common
trend underlying this pattern appears to be a vision of “the state” as protect-
ing only the wealth and property of those deemed legitimate citizens. This
makes immigrants, refugees and ethnic minorities highly vulnerable, as the
majority population may view them as unwanted intruders that threaten
the ethnic purity of the nation-state. In the 19th and early 20th centuries,
many Native American groups in Oklahoma became quite wealthy from oil,
gas and mineral exploration. Much of this wealth was effectively looted or
transferred via similar tactics of bureaucratic extortion to local white popula-
tions, including many professionals in the US Department of the Interior.
For examples, see Debo (1973) or Thorne (2003).

6 Things Fall Apart . . . and Rebuild

  1 These kinds of progressive evolutionary schemas were very pronounced in
pre-Boasian anthropology. The most famous unilinear typology was devel-
oped by Lewis Henry Morgan, who asserted that all societies pass through
distinct phases of “savagery, barbarism and civilization.” Morgan constructed
elaborate criteria (including specific kinship patterns, tools and subsistence
strategies) to classify human groups in these categories (see Harris, 2001).
Morgan was a contemporary of Spencer, Marx and Darwin, and all three
of these thinkers were influenced by one another. Marx’s writings are also
extremely progressive: The bourgeois state is understood as on its way to
something better—socialism. Socialism itself is a transitional phase before
the final utopia of communism, the end point of Marx’s stages of human
history (Classen and Van de Velde, 1985; Sanderson, 1990; Trigger, 1998). In
Marxist theory, the propellant that allowed humanity to progress through
these stages was not gradual evolution but rapid revolution—a cataclysmic
event that would bring about the promised “Kingdom of Reason” in a much
shorter period of time (Aaron, 1957:66; Buber, 1996[1950]; Gurian, 1964;
Salvadori, 1968; Talmon, 1960; Ulam, 1966).
These ideas continued to dominate social theory and public policy in the
first half of the 20th century. Early debates on immigration, for instance,
were highly influenced by the belief that biologically inferior immigrants
would dilute the “pure” racial stock of the United States and limit the
ascendency of the country as a whole. Because eugenicists believed that
the origins of civilization lay in race-specific biology, uncontrolled breeding
among different races was understood to put civilization itself at risk of col-
lapse. Birth control and sterilization of the unfit were developed as public
health prevention programs in part due to the influx of Italian, Irish and
other immigrants in the late 1800s.
  2 The phrase “all evolution tends toward the human form” comes from the origi-
nal film version of the H.G. Wells’ classic story The Island of Dr. Moreau, released
 Notes 145

in 1932 under the title Island of Lost Souls. In the film, a mad scientist has been
exiled to a tiny tropical island where he conducts vivisection and breeding
experiments intended to accelerate the evolution of animalistic natives (“sav-
ages”) into modern civilized humans. The film reflects all of the odd racial/
eugenic/evolutionary beliefs of the 19th century: the idea that evolution was
linear and stepwise; that white Europeans represented the final phase and ulti-
mate achievement of evolution; the notion that there were multiple species
of humans that could be ranked hierarchically, with the lowest groups indis-
tinguishable from animals; and the idea that eugenics and genetics could be
combined in ways that would allow human researchers to seize control of evo-
lutionary processes and optimize humankind through selective breeding.
 3 Peter Berger defines the 20th century as a time of fierce ideological com-
petition between these two dueling ideologies of modernism: the myth of
revolution embraced by the Soviet Union and the myth of growth embraced
by the United States and other Western democracies. The language of West-
ern economists exalts growth as the engine of progress in a neo-Spencerian
way. The language of Marxism exalts revolution and anti-imperialism.
Berger regards both ideologies as equivalent to cargo cults that promise
impoverished countries prosperity and redemption for adhering to a specific
ideological program. In Berger’s words,
The myth of growth first must be seen within the larger context of a
mythology of modernity . . . The prime guarantor of movement toward
the mythic goal is man’s a ­ bility to impose ever-increasing control over
both the natural and the social e­nvironment . . . In this mythologi-
cal context, the antiseptic concept of economic growth carries a heavy
freight of redemptive hope (Berger, 1974:13–19).
 4 In The Other Voice (1990), Octavio Paz includes a lengthy discussion of mod-
ernism and postmodernism in art and literature and observes that the very
idea of a society or an intelligentsia declaring itself to be “postmodern” is
flawed. “People have never known the name of the age in which they live,
and we are no exception to this rule. To call ourselves ‘postmodern’ is merely
a naive way of saying that we are extremely modern” (1990:54). He points
out that in the cultural logic of modernity, the only possible phase to fol-
low is ultramodern or hypermodern, since the future must always be better
than the past. For more insightful reading on the topic of modernity and
temporality, see Berger (1974); Buber (1996[1950]); Kolakowski (1977, 1978);
Talmon (1960); Ulam (1966).
 5 Francis Fukuyama is one of the most widely read political theorists of the
post-Soviet era (2004, 2006, 2012). His message is often Spencerian in its
assertion of directionality and progress in human political evolution. He
regards Western liberal democracies as the natural end point for human soci-
eties, and he interpreted the end of the USSR in these optimistic terms. This
analytical gaze minimizes the violence and instability of post-Soviet transi-
tions by dismissing them as bumps along the way to peace and prosperity. As
Fukuyama put it, “There had been a broad assumption in the years following
the fall of the Berlin Wall in 1989 that virtually all countries were transition-
ing to democracy and that failures of democratic practice would be overcome
with the simple passage of time” (2006:Ibooks edition location 25).
146 Notes

Fukuyama’s progressive narratives are not popular with anthropologists

as they classify contemporary indigenous populations at the “primitive”
end of the developmental continuum toward modernity. This relegates
these populations to the status of premodern relics or living fossils. One
passage in The Origins of Political Order describes an airline flight from
Australia to Melanesia as “traversing several thousand years of political
­
development” (2006:Ibooks edition location 18). Another passage poses
the question, “Why are Afghanistan, the jungle regions of India, the island
nations of Melanesia, and parts of the Middle East still tribally organized?”
(2006:Ibooks edition location 51). This kind of pre-Boasian language is dis-
tressing to anthropologists as it echoes 19th century paradigms that relegate
tribal populations to the lower “savage” rungs of humanity and unself-
consciously elevates other racial groups (primarily Europeans) as bearers
of civilization. While Fukuyama should be given credit for incorporating
anthropological and archaeological research into his analysis (unusual for
a political theorist), his insistence on parsing these sources to support a
Spencerian worldview weakens his arguments. A truly postmodern political
theory would rupture the linear evolutionary continuum that categorizes
contemporary tribal populations as relics of a prehistoric, pre-state, uncivi-
lized existence. Events in Bosnia in the 1990s certainly support rethinking
of the temporality and geography of tribalism (see Rieff, 1996).
 6 Two excellent edited volumes were published in the early 2000s (Rotberg,
2003; Milliken, 2003). Rotberg’s case studies were derived from a project
sponsored by Harvard “to analyze the post-Cold War phenomenon of
nation-state failure and collapse” (Rotberg, 2003:vii). His volume includes
discussion of failed states in Africa (Sierra Leone, Democratic Republic of the
Congo, Sudan and Somalia), along with Haiti, Colombia, Sri Lanka, Indone-
sia, Lebanon and Fiji. One post-Soviet example (Tajikistan) was also included.
Milliken’s collection includes one paper on post-Soviet Georgia (Demetrio,
2003) along with comparative discussion of African examples and the ongo-
ing problems posed by conflict and reconstruction in Iraq and Afghanistan.
 7 Cultural anthropologists typically work in remote locations among tribal
populations who may have little or no awareness that they are part of a
nation-state. These groups do not live in a state of anarchy but have fully
ordered social, political and economic lives. The concept of anarchy seems
to emerge from Hobbesian political theory, which was not based on any
empirical research in non-state societies but came instead from Eurocentric
assumptions about the lives of “primitive” people and the need to rationalize
colonization. There are several classic works in political anthropology that
explore indigenous systems of law, conflict resolution and property rights
(Bohannan, 1989; Leach, 1967; McGlen and Tuden, 1991). These works chal-
lenge the tendency of economists and political scientists to equate pre-state
and non-state realms with anarchy.
  8 For more detail on the contests between Mobutu’s security forces and rebel
groups, see the excellent coverage by The Economist (22 March 1997) as
well as the analysis provided by William Zartman in his Senate testimony
(1997).
  9 The situation in the Congo has been particularly brutal in this regard. For
details on the extreme predations endured by women in these conflict zones,
 Notes 147

see http://www.cbsnews.com/news/war-against-women/ or http://www.ituc-

csi.org/IMG/pdf/ituc_violence_rdc_eng_lr.pdf.pdf/.
10 The pattern of multiple predations by warring insurgents has been described
for peasant farmers in highland Peru during the years of the Shining Path—
see the papers collected by Steven Stern (1998)—also for small-scale farmers
in Colombia whose territories were alternately invaded by right-wing and
left-wing paramilitary armies, as well as the private armies of cocaine traf-
fickers (Brodzinsky and Schoening, 2010). One narrative written by a former
mercenary fighting in the Congo in the 1960s described local villagers as hor-
ribly abused by different militarized factions during post-colonial conflicts
(Smith, 2010). Cuba’s 20th century civil conflicts never reached the level
of violence and predation described by observers in Africa, but gray zones
did appear during several intervals of violent conflict during the first half of
the 20th century. In the early 1900s, the competition between Liberal and
Conservative Parties for political control was so extreme that local elections
would often send partisans of the losing party into exile in the United States,
as they expected to have their property seized if they remained in Cuba. The
immigration of the Arnaz family from Santiago, Cuba, to Hollywood in the
1920s allegedly resulted from these political tensions. Desi Arnaz Senior was
mayor of the city in the 1920s but had to flee when political rivals gained
control of the local government. Discussion of these conflicts and problems
of electoral violence in Cuba are documented in correspondence between
provincial officials in Oriente Province and the national government in
Havana, as well as in correspondence to the US State Department and offi-
cials in the Bureau of Insular Affairs, which oversaw US interests in Cuba in
the early part of the 20th century. These records are located in the National
Archives repository in College Park, Maryland, and include materials from
RG 59 (State Department Decimal Files), RG 199 (Records of the Provisional
Government of Cuba) and RG 90 (Records of the United States Public Health
Service).
11 The Council on Foreign Relations hosts a global conflict website that
offers updated information on the situation in the Congo and other con-
tested zones around the world: http://www.cfr.org/global/global-conflict-
tracker/p32137#!/?marker=25. See also http://www.un.org/apps/news/story.
asp?NewsID=46927#.U9xLH1bOyZY.
12 Some additional anthropological commentary must be added here about the
processes of ethnogenesis and its relationship to outbreaks of ethnic vio-
lence in failed and failing states. As discussed in Chapter 4, Trujillo’s mas-
sacre of Haitians in the 1930s has been explained as resulting from boundary
tensions between Haiti and the Dominican Republic. Thousands of Haitian
workers were slain in machete attacks near the shared border between the
two countries. This outbreak of violence initially seems as incomprehensible
as the violence that erupted in post-Soviet Yugoslavia. Haitians and Domini-
cans had mixed and intermarried for generations, and Trujillo’s own fam-
ily included several prominent Haitians (Hicks, 1946). These attacks did not
result from personal animosity on the part of Dominicans toward Haitians.
Instead I would interpret this violence as a public act of terror intended to
mark Trujillo’s claims of ownership over all resources (including people) in
the Dominican Republic. The slaughter of Haitians took place in Dominican
148 Notes

territory, in front of Dominican citizens, suggesting the larger message of

these attacks was to cleave the geography of the Dominican Republic into
binary categories of “us” (Dominicans under the protection of Trujillo) and
“them” (enemies outside this control). These public acts of violence cre-
ated an effective visual tableau to warn potential dissidents of the cost of
opposition.
This pattern of ethnic boundary formation is consistent with Frederik
Barth’s analysis of ethnic groups and boundaries discussed in his famous
book of the same title (1969). Barth identifies resource competition as the
ultimate source of ethnic boundaries. In the case of the breakup of the Soviet
Union, a vast array of what were formally public properties were suddenly
up for grabs by whoever could muster sufficient resources to make a claim.
In this context, rapid ethnogenesis is not unexpected, as it creates a way for
avaricious individuals to mobilize thousands of potential supporters and
to rationalize transfers of wealth from those outside the group. David Rieff
describes many elements of this process in his reporting from Bosnia in the
1990s. One of the earliest acts of the newly constituted Serbian army was to
dispossess other ethnic groups of valuable homesteads and property on the
basis of supposedly ancestral ethnic grievances. One vignette describes the
violence of this process as follows:
It was one thing to lay siege to Sarajevo, but in the ethnically mixed
villages of B­ osnia, the fighters could not pursue ethnic cleansing suc-
cessfully on their own. They had to transform those local Serbs who
were either still undecided about joining the fight or frankly opposed to
it into their accomplices . . . One common method used was for a group
of Serb fighters to enter a village, go to a Serb house, and order the man
living there to come with them to the house of his Muslim neighbor.
As the other villagers watched, he was marched over and the Muslim
brought out. Then the Serb would be handed a Kalashnikov assault rifle
or a knife . . . and ordered to kill the Muslim. If he did so, he had taken
that step across the line the Chetniks had been aiming for. But if he
refused, as many did, the solution was simple. You shot him on the spot.
Then you repeated the process with the next Serb householder. If he
refused, you shot him. The Chetniks rarely had to kill a third Serb. As
a fighter in Bosanska Krupa, who to my astonishment, boasted of the
tactic, informed me gleefully, “By the third house, they’re shitting them-
selves and asking you where you want the Muslim shot, and how many
times” (1998:110).

In other words, the rapid transformation of ethnic boundaries in Bosnia

from peaceful coexistence to bitter enmity was orchestrated intentionally to
facilitate (in Rieff’s words) “a crude land grab” (1998:100). One of the most
surreal elements of these ethnic hostilities was the tendency of individual
Serb soldiers to seek out lost childhood friends and family during the long
siege. By day, Sarajevans would be subjected to random mortar attacks and
sniper fire from the Serb forces surrounding the city. In the evenings or late
at night, it was not uncommon for Serb soldiers to phone their childhood
friends in the city and ask (in all sincerity) if their families were OK and if
they had survived the shelling (described in Rieff, 1998).
 Notes 149

7  Darwinian Political Economy

 1 The holism, cross-cultural perspective and generalism of anthropological
research makes the field especially useful for generating new hypotheses
that challenge prevailing assumptions about the world. Anthropologists
use long-term immersion and participant observation to help researchers in
other fields identify ethnocentric bias that may result in the development of
flawed research questions. This pattern has been especially useful in interna-
tional public health research, where anthropologists have used participant
observation to understand how culturally specific health behaviors impact
disease transmission and global health risks. In this work, I have tried to use
anthropology to generate a number of new questions for researchers in other
fields to explore. Can the hypothetical mafia threshold of the supply/demand
curve be quantitatively demonstrated with empirical research in behavioral
economics? Can re-examination of existing archaeological research provide
compelling evidence for the existence of prehistoric gangsters and racket-
eering? How do specific public policies enacted in the formal sector of the
economy (such as the creation of illicit markets in prohibited commodities)
facilitate the evolution of potentially destabilizing gangster-states in the
informal economy? Can intensive case studies of “non-state” actors in fail-
ing states reveal patterns of regeneration in the disorder of collapse? How
should international relations between democratic states and gangster-states
be organized? Is it ethical to prioritize stability over democracy?
  2 Gray zones are also spaces of contagion and may facilitate the rapid ampli-
fication of infectious disease outbreaks into epidemics that put the entire
global community at risk. When desperate refugees flee conflict zones and
colonize unfamiliar territory, they disrupt local ecologies and increase the
risks of zoonotic disease transmission. Gangster-states do not maintain pub-
lic health sectors, and mortality from preventable diseases is typically high.
International NGOs often try to fill the void, but they have no governmen-
tal authority in the areas in which they work. NGOs cannot build roads,
improve water or sewer systems, maintain quarantines or coerce behavior
change. Without these essential tools, public health work is fatally limited.
For a more detailed discussion of the relationship between civil conflict and
epidemic disease, see Laurie Garrett’s excellent analysis of Ebola fever on
CNN.com (Garrett, 2014). For a more general discussion of the global col-
lapse of public health in the 1990s, see Garrett (2001, 2014).
  3 These historical records may not be precise in all details, but they can use-
fully convey the magnitude of organized crime economies in a given locale.
In the case of Cuba, for instance, FBI reports from the 1940s and 1950s fre-
quently include estimates of illicit revenues earned by casino operations or
the percentage raked off and delivered to high-ranking government officials
in exchange for protection. The scale of activity in other vice markets (such
as narcotics smuggling, prostitution and human trafficking) is also esti-
mated, so it becomes possible to aggregate numbers and compare the scale
of the island’s illicit economy to the formal GDP. Does a country become
more politically unstable when the revenues from its informal economy are
significantly greater than the revenues from the formal sector? Data from
Cuba suggests this may be a fruitful area of research for future scholars.
150 Notes

 4 In addition to facilitating the evolution of new pathogens, gangster-state

political economies have also led to a resurgence of 19th century diseases.
Haiti’s ongoing problems with cholera exemplify this pattern. Cholera may
arrive in a country from a sick visitor, but it will not spread unless drink-
ing water supplies are contaminated by sewage. Countries with the great-
est cholera problems are often those with the most corrupt public sectors,
where funds for vital infrastructure development have been appropriated by
kleptocratic officials. Other public health regressions are being driven by pro-
cesses of evolution and natural selection. Malaria, tuberculosis and staph are
rapidly evolving into untreatable forms, and the Centers for Disease Control
recently issued a warning that we are nearing a “post-antibiotic era” (McK-
enna, 2013).
  5 Innovations in technology are transforming racketeer conflicts in ways that
give them a futuristic quality, even as they reproduce political economies of
the past. The “Medieval caliphate” of ISIS has been described as extremely
sophisticated in its use of social media (New York Times, 31 August 2014). The
growing presence of organized crime groups exploiting the Internet also sug-
gests that cyberspace has become the new postmodern geography of racket-
eering, with gangs and gangster-states competing to develop software to raid
the digital wealth of rivals (Kshetri, 2013). The fact that some of the most
aggressive cyber-gangs now operate out of failing states in West Africa and
Eastern Europe suggests a combined effort by leaders of these countries to
expand racketeering enterprises beyond physical geography of their marked
borders and into the spaceless realm of the digital world. Much of the world’s
wealth is now stored and transferred digitally, meaning cybercrime is likely
to become an extremely lucrative niche for future generations of racketeers.
References

Acemoglu, Daron, Robinson, James and Verdier, Thierry (2004) Kleptocracy and
Divide and Rule: A Model of Personal Rule. Journal of the European Economic
Association, 2(2–3):162–192.
Adam, Hussein (1995) Somalia: A Terrible Beauty Being Born? In, Collapsed States:
The Disintegration and Restoration of Legitimate Authority, William Zartman (ed.).
Boulder: Lynne Reinner, pp. 69–90.
Aguilar, Luis (1974) Cuba 1933: Prologue to Revolution. Ithaca, New York: Cornell
University Press.
Alemann, Ulrich Von (2004) The Unknown Depths of Political Theory: The Case
for a Multidimensional Concept of Corruption. Crime, Law and Social Change,
42:25–34.
Allum, Felia and Siebert, Renate (2003) Organized Crime: A Threat to Democracy?
In, Organized Crime and the Challenge to Democracy, Felia Allum and Renate Sie-
bert (eds). London: Routledge, pp. 1–24.
Alvarez del Real, Evelio (1942) Patrias Opacas y Caudillos Fulgurantes. La Habana:
Editorial La Veronica.
Anderson, Annelise (1995) Organized Crime, Mafia and Governments. In, The
Economics of Organized Crime, Gianluca Fiorentini and Sam Peltzman, (eds).
Cambridge: Cambridge University Press, pp. 33–60.
Andreas, Peter (2013) Smuggler Nation: How Illicit Trade Made America. Oxford:
Oxford University Press.
Andreas, Peter (2008) Blue Helmets and Black Markets: The Business of Survival in the
Siege of Sarajevo. Ithaca: Cornell University Press.
Andreas, Peter and Nadelmann, Ethan (2006) Policing the Globe: Criminalization
and Crime Control in International Relations. Oxford: Oxford University Press.
Anonymous (2010) Under the Cartels. N +1 Magazine. https://nplusonemag.com/
issue-9/translation/under-the-cartels/. Accessed 15 August 2014.
Armao, Fabio (2003) Why Is Organized Crime So Successful? In, Organized Crime
and the Challenge to Democracy, Felia Allum and Renate Siebert (eds). London:
Routledge Press, pp. 27–38.
Aron, Raymond (1957) The Opium of the Intellectuals. Garden City: Doubleday
and Co.
Asbury, Herbert (1927) The Gangs of New York: An Informal History of the Under-
world. New York: Alfred A. Knopf.
Axelrod, Robert (1984) The Evolution of Cooperation. New York: Basic Books.
Ayala, Gianna and Fitzjohn, Matthew (2013) The Archaeology of the Mafia: A
Material Investigation of Extortion, Justice and Reprisal in Palermo, Siciliy
(1982–2012). World Archaeology, 45(4):816–831.
Bair, Sheila (2012) Bull by the Horns. New York: Simon and Schuster. Ibooks
edition.
Barker, Terry (2013) Neoclassical Economics as a Pseudoscience. Lecture presented
at the University of Glasgow School of Social and Political Sciences. Video link:
http://vimeo.com/65211164. Accessed 15 July 2014.

151
152 References

Barofsky, Neil (2012) Bailout: An Inside Account of How Washington Abandoned

Main Street While Rescuing Wall Street. New York: Free Press. Ibooks edition.
Barth, Frederik (1969) Introduction. In, Ethnic Groups and Boundaries: The Social
Organization of Cultural Difference, Frederik Barth (ed.). New York: Little, Brown
and Co., pp. 9–38.
Beals, Carlton (1934) The Crime of Cuba. Philadelphia: J. Lippincott.
Beetham, David (2003) Foreword. In, Organized Crime and the Challenge to
Democracy, Felia Allum and Renate Siebert (eds). London: Routledge Press,
pp. x-xii.
Bender, Jonathan and Swistak, Piotr (1992) The Emergence of Stability and Coop-
eration. Stanford, California School of Business: Research Paper Number
1182.
Bequai, A. (1979) Organized Crime. Lexington, Massachusetts: DC Heath and Co.
Berger, Peter (1974) Pyramids of Sacrifice: Political Ethics and Social Change. New
York: Basic Books.
Berger, Peter (1977) The Socialist Myth. In, Facing Up to Modernity: Excursions
in Society, Politics and Religion, Peter Berger (ed.). New York: Basic Books,
pp. 56–69.
Berger, Peter (1986) The Capitalist Revolution: Fifty Propositions about Prosperity,
Equality and Liberty. New York: Basic Books.
Berman, Harold (1963) Justice in the U.S.S.R.: An Interpretation of Soviet Law. Cam-
bridge: Harvard University Press.
Bernake, Ben (2007) The Economic Outlook. Speech before the Joint Economic
Committee, United States Congress. http://www.federalreserve.gov/newsev-
ents/testimony/bernanke20070328a.htm. Accessed 31 August 2014.
Berry, Wendell (1996) The Unsettling of America: Culture and Agriculture. New York:
Sierra Club Books.
Black, William (2012) Green Slime Drives Our Financial Crises. Blog post.
http://www.nakedcapitalism.com/2012/04/bill-black-green-slime-drives-our-
financial-crises.html. Accessed 18 January 2014.
Black, William (2005) The Best Way to Rob a Bank Is to Own One: How Corporate
Executives and Politicians Looted the S and L Industry. Austin: University of Texas
Press. Kindle edition.
Blake, Charles and Martin, Christopher (2006) The Dynamics of Political
Corruption: Re-examining the Influence of Democracy. Democratization,
13(10):1–14.
Block, Alan (1999) Bad Business: A Commentary on the Criminology of Organ-
ized Crime in the United States. In, Transnational Crime in the Americas, Tom
Farer (ed.). New York: Routledge, pp. 215–244.
Bohanan, Paul (1989) Justice and Judgement Among the Tiv. New York: Waveland
Press.
Bonsal, Stephen (1912) The American Mediterranean. New York: Moffett, Yard and
Co.
Bourgois, Phillipe (2002) In Search of Respect: Selling Crack in El Barrio. Cambridge:
Cambridge University Press.
Bourgois, Phillippe (2009) Righteous Dope Fiend. Berkeley: University of California
Press.
Brodzinsky, Sibylla and Schoening, Max, eds (2012) Throwing Stones at the Moon:
Narratives from Colombians Displaced by Violence. San Francisco: McSweeney’s.
 References 153

Brook, Yaron and Watkins, Don (2012) Free Market Revolution: How Ayn Rand’s
Ideas Can End Big Government. New York: Palgrave Macmillan. Ibooks edition.
Brown, Peter (1987) Microparasites and Macroparasites. Current Anthropology,
2(1): 155–171.
Buber, Martin (1996[1950]) Paths in Utopia. Syracuse: Syracuse University Press.
Caiden, Gerald and Alexander, Herbert (1985) Introduction: Perspectives on
Organized Crime. In, The Politics and Economics of Organized Crime, Herbert
Alexander and Gerald Caiden (eds). Lexington, Massachusetts: Lexington
Books, pp. 1–19.
Callari, Antonio, Cullenberg, Stephen and Biewener, Carole (1996) Introduction.
In, Marxism in the Postmodern Age: Confronting the New World Order, Antonio
Callari, Stephen Cullenberg and Carole Biewener (eds). New York: Guilford
Press, pp. 1–12.
Camerer, Colin (2004) Behavioral Game Theory: Predicting Human Behavior
in Strategic Situations. In, Advances in Behavioral Economics, Colin Camerer,
George Loewenstein and Matthew Rabin (eds). Princeton: Princeton University
Press, pp. 374–392.
Camerer, Colin and Loewenstein, George (2004) Behavioral Economics: Past, Pre-
sent, Future. In, Advances in Behavioral Economics, Colin Camerer, George Loewen-
stein and Matthew Rabin (eds). Princeton: Princeton University Press, pp. 3–52.
Carneiro, Robert (1970) A Theory of the State. Science, 169 (3940):733–738.
Carneiro, Robert (1988) The Circumscription Theory: Challenge and Response.
American Behavioral Scientist, 31:497.
Carneiro, Robert (2003) Evolutionism in Cultural Anthropology: A Critical History.
Boulder, Colorado: Westview Press.
Carter, Tara (2010) Rethinking Secondary State Formation in Medieval Iceland: Trade
and Social Connectivity in the Norse Economic Territory. PhD thesis. San Diego:
University of California.
Casti, John (1995) Cooperation: The Ghost in the Machinery of Evolution. In,
Cooperation and Conflict in General Evolutionary Processes, John Casti and Anders
Karlquist (eds). New York: John Wiley and Sons, pp. 63–88.
Chapman, Charles (1927) A History of the Cuban Republic. New York: Macmillan
and Co.
Chirot, Daniel (1994) Modern Tyrants: The Power and Prevalence of Evil in Our Age.
New York: The Free Press.
Cirules, Enrique (2003) Mafia in Havana. Melbourne, Australia: Ocean Press.
Claessen, Henri and Van de Velde, Pieter (1985) Social Evolution in General.
In, Development and Decline: The Evolution of Sociopolitical Organization, Henri
Claessen, Pieter Van de Velde and M. Estellie Smith (eds). Santa Barbara, CA:
Praeger, pp. 1–12.
Claessen, Henri and Van de Velde, Pieter (1987) Introduction. In, Early State
Dynamics, Henri Claessen and Pieter Van de Velde (eds). Leiden: E.J. Brill, pp.
1–23.
Clark, Kevin and Primo, David (2012) Overcoming ‘Physics Envy.’ New York
Times. http://www.nytimes.com/2012/04/01/opinion/sunday/the-social-sci-
ences-physics-envy.html?_r=0. Accessed 19 July 2014.
Clark, Walter and Gosende, Robert (2003) Somalia: Can a Collapsed State Recon-
stitute Itself? In, State Failure and State Weakness in a Time of Terror, Robert Rot-
berg (ed.). Cambridge, Massachusetts: World Peace Foundation, pp. 129–158.
154 References

Clunan, Anne (2010) Ungoverned Spaces? The Need for Reevaluation. In, Ungov-
erned Spaces: Alternatives to State Authority in an Era of Softened Sovereignty, Anne
Clunan and Harold Trinkaus (eds). Stanford: Stanford University Press, pp. 3–16.
Coghlan, Benjamin et al. (2006) Mortality in the Democratic Republic of the
Congo: A Nationwide Survey. The Lancet, 367:44–51.
Cohen, Mark Nathan (1991) Health and Rise of Civilization. New Haven, Connecti-
cut: Yale University Press.
Cohen, Ronald (1978) Introduction. In, Origins of the State: The Anthropology of
Political Evolution, Ronald Cohen and Elman Service (eds). Philadelphia: Insti-
tute for the Study of Human Issues, pp. 1–20.
Comaroff, Jean and Comaroff, John (2007) Law and Disorder in the Postcolony.
Social Anthropology (15:2): 133–152.
Coolidge, Jacqueline and Rose-Ackerman, Susan (1997) High Level Rent-Seeking
and Corruption in African Regimes: Theory and Cases. World Bank Policy Research
Working Paper 1780. Http://elibrary.worldbank.org/doi/book/10.1596/1813-
9450-1780. Accessed 21 July 2014.
Cooper, Lisa (2006) The Demise and Regeneration of Bronze Age Urban Centers
in the Euphrates Valley of Syria. In, After Collapse: The Regeneration of Complex
Societies, Glenn Schwartz and John Nichols (eds). Tucson: University of Arizona
Press, pp. 18–37.
Cooper, Neil (1999) The Arms Trade and Militarized Actors in Internal Conflict.
In, Warlords in International Relations, Paul B. Rich (ed.). London: MacMillan
Press, pp. 17–37.
Dadmer, Nasrin (2003) Tajikistan: Regionalism and Weakness. In, State Failure and
State Weakness in a Time of Terror, Robert Rotberg (ed.). Cambridge, Massachu-
setts: World Peace Foundation, pp. 245–262.
Dalrymple, Theodore (2010) Life at the Bottom. London: Monday Books. Kindle
edition.
Daniels, Anthony (1991) Utopias Elsewhere: Journeys in a Vanishing World. London:
Crown Press.
Das, Satyajit (2010) Traders, Guns and Money: Knowns and Unknowns in the Daz-
zling World of Derivatives. London: FT Press.
Das, Satyajit (2011) Extreme Money: Masters of the Universe and the Cult of Risk.
London: FT Press.
Davies, Nicholas, Krebs, John and West, Stuart (2012) An Introduction to Behavioral
Ecology, fourth edition. Hoboken, New Jersey: Wiley-Blackwell.
Davis, John (1994) Mafia Dynasty: The Rise and Fall of the Gambino Crime Family.
New York: HarperCollins.
Dawisha, Karen (2014) Putin’s Kleptocracy: Who Owns Russia?. New York: Simon
and Schuster.
Dawkins, Richard (2006[1990]) The Selfish Gene. Oxford: Oxford University Press.
Dawkins, Richard (1996) The Blind Watchmaker. New York: W.W. Norton.
de Waal, Frans (2010) The Age of Empathy. New York: Three Rivers Press.
Debo, Angie (1973) And Still the Waters Run: The Betrayal of the Five Civilized Tribes.
Princeton: Princeton University Press.
Deitche, Scott (2004) Cigar City Mafia: A Complete History of the Tampa Underworld.
Fort Lee, New Jersey: Barricade Press.
Deitche, Scott (2007) The Silent Don: The Criminal Underworld of Santo Trafficante,
Jr. Fort Lee, New Jersey: Barricade Press.
 References 155

Demetriou, Spyros (2003) Rising from the Ashes? The Difficult (Re)Birth of the
Georgian State. In, State Failure, Collapse and Reconstruction, Jennifer Milliken
(ed.). Maldin, Massachusetts: Blackwell, pp. 105–130.
Densley, James (2014) It’s a Gang Life, but Not as We Know It: The Evolution of
Gang Business. Crime and Delinquency, 60(4):517–546.
Derlugian, Georgi and Earle, Timothy (2010) Strong Chieftaincies out of
Weak  States, or Elemental Power Unbound. Comparative Social Research,
27:27–51.
Dixit, Avinash (2004) Lawlessness and Economics: Alternative Modes of Governance.
Princeton: Princeton University Press.
Doornbos, Martin (2003) State Collapse and Fresh Starts: Some Critical Reflec-
tions. In, State Failure, Collapse and Reconstruction, Jennifer Milliken (ed.). New
York: Blackwell Publishing, pp. 43–62.
Drowne, Kathleen Morgan and Huber, Patrick (2004) The 1920s: American Popular
Culture Through History. Westport, Connecticut: Greenwood Publishing.
Dumit, Myrna and Barrionuevo, Alexei (2010) Brazilian Forces Claim Victory in
Gang Haven. New York Times. http://www.nytimes.com/2010/11/29/world/
americas/29brazil.html?_r=0. Accessed 4 September 2014.
Earle, Timothy (1998) How Chiefs Come to Power: The Political Economy in Prehis-
tory. Stanford: Stanford University Press.
Earle, Timothy (2002) Bronze Age Economics: The Beginnings of Political Economies.
Boulder, CO: Westview Press.
Earley, Pete (1993) The Hot House: Life Inside Leavenworth Prison. New York: Ban-
tam Books.
Easterly, William (2006) The White Man’s Burden: Why the West’s Efforts to Aid the
Rest Have Done So Much Ill and So Little Good. New York: Penguin Books.
Eckstein, Susan (1993) Back from the Future: Cuba under Castro. Princeton: Prince-
ton University Press.
Eddy, Paul, Saboga, Hugo and Walden, Sara (1988) The Cocaine Wars. New York:
W.W. Norton and Company.
Edwards, Adam and Gill, Peter, eds (2003) Transnational Organized Crime: Perspec-
tives on Global Security. London and New York: Routledge Press.
Edwards, Jorge (1993) Persona Non Grata. New York: Paragon House.
Eisenstadt, S.N. (1992) The Breakdown of Communist Regimes and the Vicissi-
tudes of Modernity. Daedelus, 121:21–42.
Ekblom, Paul (2003) Organized Crime and the Conjunction of Criminal
Opportunity Framework. In, Transnational Organized Crime: Perspectives on
Global Security, Adam Edwards and Peter Gill (eds). London: Routledge Press,
pp. 241–263.
Ellis, Eric (2008) Farewell to Asia’s Greatest Kleptocrat. The Spectator, 32, Febru-
ary 2. http://www.spectator.co.uk/columnists/any-other-business/477511/fare-
well-to-asiaandx2019s-greatest-kleptocrat/. Accessed 30 July 2014.
Ellroy, James (1998) The Big Nowhere. New York: Mysterious Press.
Engvall, Johan (2006) The State under Siege: The Drug Trade and Organized
Crime in Tajikistan. Europe-Asia Studies, 58(6):827–854.
Evans-Pritchard, E.E. (1976) Witchcraft, Oracles and Magic among the Azande.
Oxford: Oxford University Press.
Ezrow, Natasha and Frantz, Erica (2013) Failed States and Institutional Decay: Under-
standing Poverty in the Developing World. London: Bloomsbury. Kindle edition.
156 References

Federal Bureau of Investigation (1958) Mafia Monograph. http://vault.fbi.gov/

Mafia20Monograph. Accessed 30 August 2014.
Fehr, Ernst and Schmidt, Klaus (2004) A Theory of Fairness, Competition, and
Cooperation. In, Advances in Behavioral Economics, Colin Camerer, George
Lowenstein and Matthew Rabin (eds). Princeton: Princeton University Press,
pp. 271–297.
Feinstein, Andrew (2011) The Shadow World: Inside the Global Arms Trade. New
York: Farrar, Straus and Giroux.
Ferrell, Jeff (2002) Tearing Down the Streets: Adventures in Urban Anarchy. New York:
Palgrave Macmillan.
Ferrell, Jeff, Hayward, Keith and Young, Jock (2008) Cultural Criminology: An Invi-
tation. New York: Sage Publications.
Ferrell, Jeff and Hamm, Mark, eds (1998) Ethnography at the Edge: Crime, Deviance
and Field Research. Boston: Northeastern University Press.
Feshbach, Murray and Friendly, Alfred (1992) Ecocide in the USSR: Health and
Nature under Siege. New York: Basic Books.
Fiorentini, Gianluca and Peltzman, Sam (1995) Introduction. In, The Economics
of Organized Crime, Gianluca Fiorentini and Sam Peltzman (eds). Cambridge:
Cambridge University Press, pp. 1–30.
Fituni, Leonid (1995) The Collapse of the Socialist State: Angola and the Soviet
Union. In, Collapsed States: The Disintegration and Restoration of Legitimate
Authority, William Zartman (ed.). Boulder: Lynne Reinner, pp. 143–156.
Foucault, Michel (1977) Discipline and Punish: The Birth of the Prison. New York:
Vintage Books.
French, Howard (1996) Zaire Splits, History Repeats Itself. New York Times, 11
November. http://www.nytimes.com/1996/11/11/world/as-zaire-splits-history-
repeats-itself.html. Accessed 23 July 2014.
French, Howard (1997a) Zaire’s Collapse. New York Times 20 March. http://www.
nytimes.com/1997/03/20/world/zaire-s-collapse.html. Accessed 23 July 2014.
French, Howard (1997b) The Great Gold Rush in Zaire. New York Times 18 April.
http://www.nytimes.com/1997/04/18/world/the-great-gold-rush-in-zaire.
html. Accessed 23 July 2014.
Friedman, Milton (2002 [1982]) Capitalism and Freedom. Chicago: University of
Chicago Press.
Frimpong-Ansah, Jonathan (1992) The Vampire State in Africa: The Political Econ-
omy of Decline in Ghana. Trenton: Africa World Press.
Frye, Timothy and Shleifer, Andrei (1997) The Invisible Hand and the Grabbing
Hand. American Economic Review, 87(2):354–358.
Fukuyama, Francis (2004) State-Building: Governance and World Order in the 21st
Century. Ithaca, New York: Cornell University Press.
Fukuyama, Francis (2006) The End of History and the Last Man. New York: Free
Press.
Fukuyama, Francis (2012) The Origins of Political Order: From Prehuman Times to the
French Revolution. New York: Farrar, Straus and Giroux. Ibooks edition.
Galbraith, James K. (2008) The Predator State: How Conservatives Abandoned the Free
Market and Why Liberals Should Too. New York: Free Press.
Galeotti, Mark (2001) Underworld and Upperworld: Transnational Organized
Crime and Global Society. In, Non-State Actors in World Politics, Daphné Josselin
and William Wallace (eds). New York: Palgrave Macmillan, pp. 203–217.
 References 157

Gambetta, Diego (1993) The Sicilian Mafia: The Business of Private Protection. Cam-
bridge, MA: Harvard University Press.
Garrett, Laurie (2001) Betrayal of Trust: The Collapse of Global Public Health. New
York: Hyperion.
Garrett, Laurie (2014) Why an Ebola Epidemic Is Spinning Out of Control.
http://www.cnn.com/2014/07/24/opinion/garrett-ebola/. Accessed 20 August
2014.
Geddes, Barbara and Neto, Artur Ribeiro (1992) Institutional Sources of Corrup-
tion in Brazil. Third World Quarterly, 13(4):641–661.
Gerth, H.H. and Mills, C. Wright (1958) From Max Weber: Essays in Sociology. New
York: Galaxy Books.
Geyer, Georgie Anne (1993) Guerrilla Prince: The Untold Story of Fidel Castro. New
York: Little, Brown and Company.
Giancana, Sam and Giancana, Chuck (1992) Double Cross. New York: Time
Warner Books.
Gilman, Antonio (1981) The Development of Social Stratification in Bronze Age
Europe. Current Anthropology, 22:1–24.
Gleason, Abbott (1997) Totalitarianism: The Inner History of the Cold War. New
York: Oxford University Press.
Glenny, Misha (2008) McMafia: A Journey through the Global Criminal Underworld.
New York: Alfred Knopf.
Gloster-Coates, Patricia and Quest, Linda (2005) Kleptocracy: The Curse of Devel-
opment. International Social Science Review, 80(1–2):3–19.
Goff, Fred and Locker, Michael (1969) The Violence of Domination: U.S. Power
and the Dominican Republic. In, Latin American Radicalism, Irving Louis
Horowitz, et al. (eds). New York: Random House, pp. 249–291.
González, Edelmira (1935) La Revolución en Cuba: Memorias del Coronel Rosendo
Collazo. La Habana: Editorial Hermes.
Gosch, Richard and Martin, A. (1975) The Last Testament of Lucky Luciano. New
York: Little Brown.
Gould, Stephen J. (1996) Full House: The Spread of Excellence from Plato to Darwin.
New York: Harmony.
Greitens, Sheena (2012) A North Korean Corleone. New York Times, 3 March.
http://www.nytimes.com/2012/03/04/opinion/sunday/a-north-korean-corle-
one.html?pagewanted=all&_r=0. Accessed 30 August 2014.
Gros, Jean-Germain (1996) Towards a Taxonomy of Failed States in the New
World Order: Decaying Somalia, Liberia, Rwanda and Haiti. Third World Quar-
terly, 17(3):455–471.
Grossman, Herschel (1999) Kleptocracy and Revolutions. Oxford Economic Papers,
51(2):267–283.
Grossman, Herschel (1995) Rival Kleptocrats: The Mafia versus the State: Organ-
ized Crime and Governments. In, The Economics of Organized Crime, Gianluca
Fiorentini and Sam Peltzman (eds). Cambridge: Cambridge University Press,
pp. 143–160.
Gruening, Ernest (1931) Cuba under the Machado Regime. Current History,
34:214–219.
Guggenheim, Harry (1934) The United States and Cuba. New York: Macmillan.
Gurian, Waldemar (1964) Totalitarianism as Political Religion. In, Totalitarianism,
Carl J. Friedrich (ed.). New York: Grosset and Dunlap, pp. 119–137.
158 References

Haller, Mark (1992) The Changing Structure of American Gambling in the Twen-
tieth Century. In, Prostitution, Drugs, Gambling and Organized Crime, Eric Monk-
konen (ed.). Munich: K.G. Saur, pp. 313–340.
Harding, Luke (2010) WikiLeaks Cables Condemn Russia as ‘Mafia State.’ The
Guardian. http://www.theguardian.com/world/2010/dec/01/wikileaks-cables-
russia-mafia-kleptocracy. Accessed 31 August 2013.
Handelman, Stephen (1995) Comrade Criminal: Russia’s New Mafiya. New Haven:
Yale University Press.
Harris, Marvin (2001) The Rise of Anthropological Theory: A History of Theories of
Culture. New York: Alta Mira Press.
Havel, Vaclav (1991) The End of the Modern Era. New York Times, 1 March.
http://www.nytimes.com/1992/03/01/opinion/the-end-of-the-modern-era.
html. Accessed 30 August 2014.
Hayek, Friedrich (1944) The Road to Serfdom. Chicago: University of Chicago Press.
Hayek, Friedrich (1988) The Fatal Conceit: The Errors of Socialism. In, The Col-
lected Works of Friedrich Hayek, W.W. Bartley (ed.). London: Routledge Press.
Hedges, Chris (1999) Leaders in Bosnia Are Said to Steal up to $1 Billion. New
York Times 17 August. http://www.nytimes.com/1999/08/17/world/leaders-in-
bosnia-are-said-to-steal-up-to-1-billion.html?module=Search&mabReward=rel
bias%3Ar%2C%7B%222%22%3A%22RI%3A17%22%7D. Accessed 10 August
2014.
Henken, Ted (2006) Entrepreneurship, Informality and the Second Economy:
Cuba’s Underground Economy in Comparative Perspective. Cuba in Transition,
15: 360–375.
Heuss, Ernst (1990) Evolution and Stagnation of Economic Systems. In, The Evo-
lution of Economic Systems: Essays in Honor of Ota Sik, Kurt Dopfer and Karl Rai-
ble (eds). New York: St. Martin’s Press, pp. 141–174.
Hicks, Albert (1946) Blood in the Streets: The Life and Rule of Trujillo. New York:
Creative Age Press.
Hirschfeld, Katherine (2007) Health, Politics and Revolution in Cuba since 1898.
New Brunswick: Transaction Press.
Hirsh, Michael (2010) Our Best Minds Are Failing Us. Newsweek 16 September.
http://www.newsweek.com/2010/09/16/our-best-economic-minds-are-failing-
us.html. Accessed 30 August 2014.
Hirshleifer, Jack (2001) The Dark Side of the Force: Economic Foundations of Conflict
Theory. Cambridge: Cambridge University Press.
Hollander, Paul (1983) The Many Faces of Socialism. New Brunswick: Transaction
Books.
Hollander, Paul (1998[1981]) Political Pilgrims: Western Intellectuals in Search of the
Good Society. New Brunswick: Transaction Press.
Holmes, Charles (1998) Ex-KGB Agents Cashing in as Private Spies. Atlanta Jour-
nal Constitution. 1 February 1998.
Horowitz, Irving (1993) The Decomposition of Sociology. New York: Oxford Univer-
sity Press.
Horowitz, Irving Louis (1999) Behemoth: Main Currents in the History and Theory of
Political Sociology. New Brunswick: Transaction Publishers.
International Rescue Committee (2007) Mortality in the Democratic Republic of the
Congo: An Ongoing Crisis. https://www.rescue.org/sites/default/files/migrated/
 References 159

where/g_belgium/2006-7_congomortalitysurvey_a4.pdf. Accessed 15 August

2014.
Jackson, Robert (1987) Quasi-States, Dual Regimes and Neoclassical Theory:
International Jurisprudence and the Third World. International Organization,
41(4):519–549.
James, George (1994) 4 Are Charged after Drug Raid on Queens ‘Stash House.’ New
York Times, 28 November. http://www.nytimes.com/1994/11/28/nyregion/4-
are-charged-after-drug-raid-on-queens-stash-house.html. Accessed 20 August
2014.
Jenks, Lelend (1928) Our Cuban Colony. New York: Vanguard Press.
Johnson, Dirk (1997) Jailed Chicago Gang Leader Charged as a Drug Criminal.
New York Times, 21 September. http://www.nytimes.com/1997/09/21/us/a-
jailed-chicago-gang-leader-is-charged-as-a-drug-criminal.html. Accessed 30
August 2014.
Johnson, Simon (2012) Predators and Professors. http://www.project-syndicate.
org/commentary/predators-and-professors. Accessed 1 August 2014.
Johnson, Simon and Kwak, James (2010) Thirteen Bankers: The Wall Street Takeover
and the Next Financial Meltdown. New York: Pantheon Books.
Johnson, Steven (2006) The Ghost Map: The Story of London’s Most Terrifying
­Epidemic—and How It Changed Science, Cities, and the Modern World. New York:
Penguin Books.
Johnson, Allen and Earle, Timothy (1987) The Evolution of Human Societies: From
Foraging Group to Agrarian State. Stanford: Stanford University Press.
Jones, Christine, Lindauer, David and Roemer, Michael (1991) Parallel, Frag-
mented and Black: A Taxonomy. In, Markets in Developing Countries: Parallel,
Fragmented and Black, Michael Roemer and Christine Jones (eds). San Francisco:
ICS Press, pp. 3–12.
Jones, Gregory (2008) Heterogeneity of Degree and the Emergence of Coop-
eration in Complex Social Networks. Emergence: Complexity and Organization,
10(4):46–54.
Josselin, Daphne and Wallace, William (2001) Non-State Actors in World Politics:
The Lessons. In, Non-State Actors in World Politics, Daphne Josselin and William
Wallace (eds). New York: Palgrave Macmillan, pp. 251–260.
Kaplan, Robert (1994) The Coming Anarchy. Atlantic Magazine. http://www.theat-
lantic.com/magazine/archive/1994/02/the-coming-anarchy/304670/?single_
page=true. Accessed 1 August 2014.
Kara, Siddharth (2009) Sex Trafficking: Inside the Business of Modern Slavery. New
York: Colombia University Press.
Kellner, Douglas (1996) The End of Orthodox Marxism. In, Marxism in the Post-
modern Age: Confronting the New World Order, Antonio Callari, Stephen Cullen-
berg and Carole Biewener (eds). New York: Guilford Press, pp. 33–41.
Kelly, Robert and Schatzberg, Rufus (2003) ‘Once Upon a Time in America’:
Organized Crime and Civil Society. In, Organized Crime and the Challenge to
Democracy, Felia Allum and Renate Siebert (eds). London and New York: Rout-
ledge Press, pp. 129–146.
Kempe, Frederick (1990) Divorcing the Dictator: America’s Bungled Affair with
Noriega. New York: Putnam and Sons.
Kennedy, Robert (1960) The Enemy Within. New York: Harper and Brothers.
160 References

Kenney, Dennis and Finckenhauer, James (1995) Organized Crime in America. Bel-
mont: Wadsworth.
Khadiagla, Gilbert (1995) State Collapse and Reconstruction in Uganda. In, Col-
lapsed States: The Disintegration and Restoration of Legitimate Authority, William
Zartman (ed.). Boulder: Lynne Reinner, pp. 33–47.
Khedery, Ali (2014) Iraq’s Last Chance. New York Times. http://www.nytimes.
com/2014/08/17/opinion/sunday/iraqs-last-chance.html?_r=0. Accessed 4 Sep-
tember 2014.
Kirkpatrick, Jeanne (1982) Dictatorships and Double Standards. New York: Ameri-
can Enterprise Institute.
Klerks, Peter (2003) The Network Paradigm Applied to Criminal Organizations:
Theoretical Nitpicking or a Relevant Doctrine for Investigators? Recent Devel-
opments in the Netherlands. In, Transnational Organized Crime: Perspectives on
Global Security, Adam Edwards and Peter Gill (eds). London: Routledge Press,
pp. 97–113.
Klitgaard, Robert (1990) Tropical Gangsters: One Man’s Experience with Development
and Decadence in Deepest Africa. New York: Basic Books.
Kolata, Alan (2006) Before and after Collapse: Reflections on the Regeneration
of Social Complexity. In, After Collapse: The Regeneration of Complex Societies,
Glenn Schwartz and John Nichols (eds). Tucson: University of Arizona Press,
pp. 208–221.
Kolakowski, Leszek (1977) Introduction: Need of Utopia, Fear of Utopia. In, Radi-
calism in the Contemporary Age, Volume 2: Radical Visions of the Future, Seweryn
Bialer and Sophia Sluzar (eds.). Boulder: Westview Press.
Kolakowski, Leszek (1978) Main Currents of Marxism. Oxford: Oxford University
Press.
Kolakowski, Leszek (1992) Amidst Moving Ruins. Daedelus, 191:43–56.
Konanykhine, Alexandre and Gratcheva, Elena (no date) Mafiacracy in Russia.
Unpublished manuscript.
Krasna, Joshua (1996) Narcotics and the National Security of Producer States.
Texas Law Review, 16(2):1–24.
Kregel, J.A. (1990) Plan, Market and Banking. In, The Evolution of Economic Sys-
tems: Essays in Honor of Ota Sik, Kurt Dropfer and Karl F. Raible (eds). New York:
St. Martin’s Press, pp. 133–139.
Kreye, Andrian (1994) Mafia Capitalism in Moscow. http://www.andriankreye.
com/Moscow.html. Accessed 10 August 2014.
Krugman, Paul (2013) http://www.pointofinquiry.org/paul_krugman_science_
and_pseudoscience_in_economics/. Podcast. Accessed 1 August 2014.
Kshetri, Nir (2013) Cybercrime and Cybersecurity in the Global South. New York:
Palgrave Macmillan.
Kupatadze, Alexander (2012) Organized Crime, Political Transitions and State For-
mation in Post-Soviet Eurasia. New York: Palgrave Macmillan.
Kuttner, Robert (1996) Everything for Sale: The Virtues and Limits of Markets. Chi-
cago: University of Chicago Press.
Kvint, Vladimir (2004[1999]) The Global Emerging Market in Transition. New York:
Fordham University Press.
Lacey, Robert (1991) Little Man: Meyer Lansky and the Gangster Life. New York: Lit-
tle, Brown and Company.
Lamar-Schweyer, Alberto (1938) How President Machado Fell: A Dark Page in North
American Diplomacy. Habana: La Casa Montalvo Cardenas.
 References 161

Leach, Edmund (1967) The Political Systems of Highland Burma. London: Beacon
Press.
LeDuff, Charlie (2000) The Exchange Rate Behind Bars. New York Times Magazine.
http://www.nytimes.com/2000/10/15/magazine/the-exchange-rate-behind-
bars.html. Accessed 31 August 2014.
Lee, Rensselaer (1999) Transnational Organized Crime: An Overview. In, Trans-
national Crime in the Americas, Tom Farer (ed.). New York: Routledge, pp. 1–38.
Ledneva, Alena (1998) Russia’s Economy of Favors: Blat, Networking and Informal
Exchange. Cambridge: Cambridge University Press.
Lemarchand, René (2003) The Democratic Republic of the Congo: From Failure
to Potential Reconstruction. In, State Failure and State Weakness in a Time of Ter-
ror, Robert Rotberg (ed.). Cambridge Massachusetts: World Peace Foundation,
pp. 29–70.
Lenches, Elisabeth Tamedly (1993) The Legacy of Communism: Poisoned Minds
and Souls. International Journal of Social Economics, 20(5,6,7):14–34.
Leone, Richard (1997) Forward. In, Everything for Sale: The Virtues and Limits of
Markets, Robert Kuttner. Chicago: University of Chicago Press.
Levine, Michael (1990a) Deep Cover. New York: Dell Books.
Levine, Michael (1990b) The Big White Lie. New York: Thunder’s Mouth Press.
Lewellen, Ted (1992) Political Anthropology: An Introduction. New York: Bergin and
Garvey.
Lewis, Michael (2010) The Big Short: Inside the Doomsday Machine. New York: W.W.
Norton and Company.
Lindsey, Forbes (1911) Cuba and Her People of Today. Boston: L.L. Page and Co.
Lifton, Robert J. (1961) Thought Reform and the Psychology of Totalism. New York:
W.W. Norton and Co.
Llovio-Menendez, José (1988) Insider: My Hidden Life as a Revolutionary in Cuba.
New York: Bantam Books.
Louw, Stephen (1997) Unity and Development: Social Homogeneity, the Totali-
tarian Imaginary and the Classical Marxist Tradition. Philosophy of the Social
Sciences, 27(2):180–205.
Lowenstein, Roger (2001) When Genius Failed: The Rise and Fall of Long Term Capi-
tal Management. New York: Random House.
Lowenstein, Roger (2010) The End of Wall Street. New York: Penguin Books.
Luke, Thomas and Rodrigue, J.P. (2008) Protecting Public Health and Global
Freight Transportation Systems During an Influenza Pandemic. Disaster Medi-
cine, 3(2):99–107.
Lumen, Enrique (1935) La Revolucion Cubana. Mexico City: Ediciones Botas.
Maher, Lisa, Swift, Wendy and Dawson, Michael (2001) Heroin Purity and Com-
position in Sydney, Australia. Drug and Alcohol Review, 20:439–448.
Mahmutcehajic, Rusmir (2003) Sarajevo Essays: Politics, Ideology, and Tradition.
Albany, New York: State University of New York Press.
Maingot, Anthony (1999) The Decentralization Imperative and Caribbean Crimi-
nal Enterprises. In, Transnational Crime in the Americas, Tom Farer (ed.). New
York: Routledge, pp. 143–170.
Makinda, Samuel (1999) Clan Conflict and Factionalism in Somalia. In, Warlords
in International Relations, Paul B. Rich (ed.). New York: St. Martin’s Press, pp.
120–139.
Malia, Martin (1994) The Soviet Tragedy: A History of Socialism in Russia, 1917–
1991. New York: The Free Press.
162 References

Malone, David and Tanner, Mark (2012) Debt Generation. York, England: York
Publishing.
Maltz, Michael (1985) Toward Defining Organized Crime. In, The Politics and Eco-
nomics of Organized Crime, Herbert Alexander and Gerald Caiden (eds). Lexing-
ton, Mass.: Lexington Books, pp. 21–35.
Mandel, Robert (2011) Dark Logic: Transnational Criminal Tactics and Global Secu-
rity. Stanford, CA: Stanford University Press.
Manuel, Frank (1997) A Requiem for Karl Marx. Cambridge, Massachusetts: Har-
vard University Press.
Marchese, Joseph (2009) Managing Gangs in a Correctional Facility: What War-
dens and Superintendents Need to Know. Corrections Today, February 1.
Marcouiller, Douglas and Young, Leslie (1995) The Black Hole of Graft: The Preda-
tory State and the Informal Economy. American Economic Review, 85(3):630–646.
Markowitz, Lawrence (2013) Unlootable Resources and Unruly Elites in Central Asia.
Ithaca: Cornell University Press. Kindle edition.
Marten, Kimberly (2012) Warlords: Strong-Arm Brokers in Weak States. Ithaca: Cor-
nell University Press. Kindle edition.
Massari, Monica (2003) Transnational Organized Crime between Myth and Real-
ity: The Social Construction of a Threat. In, Organized Crime: A Threat to Democ-
racy? Felia Allum and Renate Siebert (eds). London: Routledge Press, pp. 55–70.
Matthews, Herbert (1953) Republic with No Citizens. New York Times Magazine,
18 May, p. 12.
Matthews, Herbert (1956) Cuba’s Violence Found Normal. New York Times. 4
November.
Matthews, Owen (2008) Stalin’s Children: Three Generations of Love, War and Sur-
vival. New York: Walker and Company.
McAnany, Patricia and Yoffee, Norman, eds (2009) Questioning Collapse: Human
Resilience, Ecological Vulnerability and the Aftermath of Empire. Cambridge: Cam-
bridge University Press.
McCoy, Alfred (2010) Can Anyone Pacify the World’s Number One Narco-State?
http://www.huffingtonpost.com/alfred-w-mccoy/can-anyone-pacify-the-
wor_b_519216.html. Accessed 30 August 2014.
McEwan, Gordon (2006) Inca State Origins: Collapse and Regeneration in the
Southern Peruvian Andes. In, After Collapse: The Regeneration of Complex Soci-
eties, Glenn Schwartz and John Nichols (eds). Tucson: University of Arizona
Press, pp. 85–98.
McGlen, Frank and Tuden, Arthur (1991) Anthropological Approaches to Political
Behavior. Pittsburgh: University of Pittsburgh Press.
McKenna, Maryn (2013) CDC Threat Report: ‘We Will Soon Be in a Post-Anti-
biotic Era.’ Wired Magazine. http://www.wired.com/2013/09/cdc-amr-rpt1/.
Accessed 1 August 2014.
McNeil, W.H. (1976) Plagues and Peoples. Garden City: Doubleday.
McNulty, Mel (1999) The Militarization of Ethnicity and the Emergence of War-
lordism in Rwanda, 1990–1994. In, Warlords in International Relations, Paul B.
Rich (ed.). London: MacMillan Press, pp. 81–102.
Messick, Hank (1971) Lansky. New York: Berkley Books.
Midlarsky, Manus (1999) The Evolution of Inequality: War, State Survival and Democ-
racy in Comparative Perspective. Stanford: Stanford University Press.
 References 163

Miliband, Ralph (1996) Reclaiming the Alternative. In, Marxism in the Postmodern
Age: Confronting the New World Order, Antonio Callari, Stephen Cullenberg and
Carole Biewener (eds). New York: Guilford Press, pp. 218–224.
Milliken, Jennifer and Krause, Keith (2003) State Failure, State Collapse and State
Reconstruction: Concepts, Lessons and Strategies. In, State Failure, Collapse and
Reconstruction, Jennifer Milliken (ed.). New York: Blackwell Publishing, pp. 1–24.
Mills, Greg, Pham, Peter and Kilcullen, David (2013) Somalia: Fixing Africa’s Most
Failed State. Talfenberg Ebook. Kindle edition.
Morgenson, Gretchen and Rosner, Joshua (2011) Reckless Endangerment: How Out-
sized Ambition, Greed and Corruption Led to Economic Armageddon. New York:
Times Books. Ibooks edition.
Morris, Ellen (2006) “Lo, Nobles Lament, the Poor Rejoice.” In, After Collapse:
The Regeneration of Complex Societies, Glenn Schwartz and John Nichols (eds).
Tucson: University of Arizona Press, pp. 58–71.
Mungiu, Alina (2006) Corruption: Diagnosis and Treatment. Journal of Democracy,
17(3):86–99.
Ng’ethe Njuguna (1995) Strongmen, State Formation, Collapse and Reconstruc-
tion in Africa. In, Collapsed States: The Disintegration and Restoration of Legitimate
Authority, William Zartman, (ed.). Boulder: Lynne Reinner, pp. 251–264.
Naím, Moisés (2005) Illicit: How Smugglers, Traffickers and Copycats Are Hijacking
the Global Economy. New York: Doubleday.
Nations, Marilyn (1986) Epidemiological Research on Infectious Disease: Quanti-
tative Rigor or Rigor Mortis? Insights from Ethnomedicine. Culture, Illness and
Healing, 9:97–103.
Naylor, R.T. (2003) Predators, Parasites or Free-Market Pioneers: Reflections on
the Nature and Analysis of Profit-Driven Crime. In, Critical Reflections on Trans-
national Organized Crime, Money Laundering, and Corruption, Margaret Beare
(ed.). Toronto: University of Toronto Press, pp. 35–54.
Naylor, R.T. (2002) Wages of Crime: Black Markets, Illegal Finance and the Under-
world Economy. Ithaca: Cornell University Press.
Nelson, Robert (2002) Economics as Religion: From Samuelson to Chicago and Beyond.
State College, Pennsylvania: Pennsylvania State University Press.
Newhouse, Ken (2009) Defining, Identify and Tracking Security Threat Groups.
Corrections Today, February 1.
Nicaso, Antonio and Lamothe, Lee (1995) Global Mafia: The New World Order of
Organized Crime. Toronto: Macmillan.
Nocera, Joe (2013) The New Russian Mob. New York Times. http://www.nytimes.
com/2013/03/28/opinion/nocera-the-new-russian-mob.html?_r=0. Accessed
28 March 2013.
Nordland, Rod (2014) Warlords with Dark Pasts Battle in Afghan Election. New
York Times, 26 February. http://www.nytimes.com/2014/02/27/world/asia/
warlords-with-dark-pasts-battle-in-afghan-election.html?module=Search&m
abReward=relbias%3Ar%2C%7B%222%22%3A%22RI%3A17%22%7D&_r=0.
Accessed 20 August 2014.
Nordstrom, Carolyn (2007) Global Outlaws: Crime, Money and Power in the Contem-
porary World. Berkeley: University of California Press.
Norton, Henry Kittredge (1926) Self-Determination in the West-Indies. World’s
Work, 51:76–84; 210–218; 321–328.
164 References

O’Regan, Davin (2012) Narco-States: Africa’s Next Menace. New York Times,
March 12.
Oppenheimer, Andres (1993) Castro’s Final Hour. New York: Touchstone Press.
Ostfeld, Richard, Keesing, Felicia and Eviner, Valerie (2008) Infectious Disease
Ecology: Effects of Ecosystems of Disease and of Disease on Ecosystems. Princeton:
Princeton University Press.
Pacheco, Ferdie (1994) Ybor City Chronicles: A Memoir. Gainesville, Florida: Uni-
versity of Florida Press.
Padilla, Heberto (1984) Heroes Are Grazing in My Garden. New York: Farrar, Straus
and Giroux.
Paoli, Letizia, Rabkov, Irina, Greenfield, Victoria and Reuter, Peter (2007) Tajik-
istan: The Rise of a Narco-State. Journal of Drug Issues, 22:951–980.
Parkinson, William and Galaty, Michael (2007) Secondary States in Perspective:
An Integrated Approach to State Formation in the Prehistoric Aegean. American
Anthropologist, 109(1):113–129.
Parsons, Michelle (2014) Dying Unneeded: The Cultural Context of the Russian Mor-
tality Crisis. Nashville: Vanderbilt University Press.
Partnoy, Frank (2009[1997]) F.I.A.S.C.O.: Blood in the Water on Wall Street. New
York: W.W. Norton and Company. Ibooks edition.
Partnoy, Frank (2009) Infectious Greed: How Deceit and Risk Corrupted the Financial
Markets. New York: Public Affairs.
Patrick, Stewart (2011) Weak Links: Fragile States, Global Threats and International
Security. Oxford: Oxford University Press.
Paz, Octavio (1990) The Other Voice: Essays of Modern Poetry. San Diego: Harcourt
Brace.
Peel, J.D.Y. (1971) Herbert Spencer: The Evolution of a Sociologist. New York: Basic
Books.
Pengalse, Ben, Kane, Stephanie and Parnell, Phillip (2008) Interview: The New
Anthropology of Crime. Political and Legal Anthropology Review, 32(1):105–123.
Perez, Louis (1978) Intervention, Revolution and Politics in Cuba, 1913–1921. Pitts-
burgh: University of Pittsburgh Press.
Perez, Louis (1986) Cuba under the Platt Amendment, 1902–1934. Pittsburgh: Uni-
versity of Pittsburgh Press.
Pérez-López, Jorge (1995) Cuba’s Second Economy. From Behind the Scenes to Center
Stage. New Brunswick: Transaction Press.
Phillips, Ruby Hart (1935) Cuban Sideshow. Havana: Cuba Press.
Phillips, Ruby Hart (1949) Cuba Plans to End Rebellious Gangs. New York Times,
9 October.
Phillips, Ruby Hart (1959) Cuba: Island of Paradox. New York: McDowell Obolensky.
Pinker, Steven (2002) The Blank Slate: The Modern Denial of Human Nature. New
York: Penguin Books.
Piot, Charles (2010) Nostalgia for the Future: West Africa after the Cold War. Chi-
cago: University of Chicago Press. Kindle edition.
Pizzo, Stephen, Fricker, Mary and Muolo, Paul (1989) Inside Job: The Looting of
America’s Savings and Loans. New York: McGraw Hill.
Plenkhanov, Sergei (2003) Organized Crime, Business and the State in Post-
Communist Russia. In, Organized Crime and the Challenge to Democracy, Felia
Allum and Renate Siebert (eds). London: Routledge Press, pp. 73–92.
Porta, Donatella Della (2004) Political Parties and Corruption: Ten Hypotheses on
Five Vicious Circles. Crime, Law and Social Change, 42:35–60.
 References 165

Prewitt, Patricia (2006) Contraband. http://www.pen.org/viewmedia.php/prm-

MID/683/prmID/1327. Accessed 27 August 2012.
Price, Peter (1980) The Evolutionary Biology of Parasites. Princeton: Princeton Uni-
versity Press.
Prunier, Gérard and Gisselquist, Rachel (2003) The Sudan: A Successfully Failed
State. In, State Failure and State Weakness in a Time of Terror, Robert Rotberg (ed.).
New York: Fordham University Press, pp. 101–127.
Rankin, Daniel and Taborsky, Michael (2009) Assortment and the Evolution of
Generalized Reciprocity. Evolution, 63(7):1913–1922.
Rasanayagam, Johan (2011) Informal Economy, Informal State: The Case of
Uzbekistan. International Journal of Sociology and Social Policy (11–12):681–696.
Rawlinson, Paddy (2003) Bad Boys in the Baltics. In, Transnational Organized
Crime: Perspectives on Global Security, Adam Edwards and Peter Gill (eds). Lon-
don and New York: Routledge Press.
Reid, Ed and Demaris, Ovid (1964) The Green Felt Jungle. New York: Pocket Books.
Reno, William (1999) Warlord Politics and African States. New York: Lynne Rienner.
Reno, William (2003) Sierra Leone: Warfare in a Post-State Society. In, State Failure
and State Weakness in a Time of Terror, Robert Rotberg (ed.). New York: Fordham
University Press, pp. 71–100.
Resnick, Stephen and Wolff, Richard (1996) The End of the USSR: A Marxian
Class Analysis. In, Marxism in the Postmodern Age: Confronting the New World
Order, Antonio Callari, Stephen Cullenberg and Carole Biewener (eds). New
York: Guilford Press, pp. 323–332.
Reuter, Peter (1985) The Organization of Illegal Markets: An Economic Analysis.
Washington, DC: United States Department of Justice.
Reuter, Peter (1995) Racketeers as Cartel Organizers. In, The Politics and Econom-
ics of Organized Crime, Herbert Alexander and Gerald Caiden (eds). Lexington,
Mass.: Lexington Books, pp. 49–65.
Rich, Paul (1999) The Emergence and Significance of Warlordism in International
Politics. In, Warlords in International Relations, Paul Rich (ed.). New York: St.
Martin’s Press, pp. 1–16.
Richburg, Keith (1992) This Is Liberia: Or Is It “Taylorland”? Seattle Times, Novem-
ber 21. http://community.seattletimes.nwsource.com/archive/?date=19921121
&slug=1525818. Accessed 13 August 2014.
Ridley, Mark (1995) Animal Behavior [Second Edition]. Oxford: Blackwell
Publishing.
Rieff, David (1995) Slaughterhouse: Bosnia and the Failure of the West. New York:
Simon and Schuster.
Ritter, Archibald (2005) Survival Strategies and Economic Illegalities in Cuba.
Cuba in Transition, 15:342–359.
Rose-Ackerman, Susan (1978) Corruption: A Study in Political Economy. New York:
Academic Press.
Rosenberg, Charles (1987) The Cholera Years. Chicago: University of Chicago
Press.
Rosenberg, Tina (1995) The Haunted Land: Facing Europe’s Ghosts after Commu-
nism. New York: Random House.
Rotberg, Robert, ed. (2003) State Failure and State Weakness in a Time of Terror.
Washington, DC: Brookings Institute Press.
Rubin, Barry (1988) Modern Dictators: Third World Coup Makers, Strongmen, and
Populist Tyrants. New York: McGraw-Hill.
166 References

Russo, Gus (2001) The Outfit: The Role of Chicago’s Underworld in the Shaping of
Modern America. New York: Bloomsbury.
Sachs, Jessica (2008) Good Germs, Bad Germs: Health and Survival in a Bacterial
World. New York: Hill and Wang.
Sahlins, Marshall (1974) Stone Age Economics. New Brunswick: Aldine Transaction.
Salvadori, Massimo (1968) Introduction. In, Modern Socialism, Massimo Salvadori
(ed.). London: Macmillan, pp. 1–38.
Sanderson, Stephen (1990) Social Evolutionism: A Critical History. Cambridge: Basil
Blackwell.
Sante, Luc (1991) Lowlife: Lures and Snares of Old New York. New York: Farrar,
Straus and Giroux.
Satter, David (2003) Darkness at Dawn: The Rise of the Russian Criminal State. New
Haven: Yale University Press.
Saviano, Robert (2006) Gomorrah: A Personal Journey into the Violent International
Empire of Naples’ Organized Crime System. New York: Farrar, Straus and Giroux.
Scientific Station for Pure Products (1916) Notes Relating to the Brewing Industry.
Pure Products, 12(11):554.
Schneider, Jane and Schneider, Peter (2008) The Anthropology of Crime and
Criminalization. Annual Review of Anthropology, 37:351–373.
Schoen, Johanna (2005) Choice and Coercion: Birth Control, Sterilization and Abor-
tion in Public Health and Welfare. Chapel Hill: University of North Carolina Press.
Schutz, Barry (1995) The Heritage of Revolution and the Struggle for Govern-
mental Legitimacy in Mozambique. In, Collapsed States: The Disintegration and
Restoration of Legitimate Authority, William Zartman (ed.). Boulder: Lynne Rein-
ner, pp. 109–124.
Schwartz, Glen (2006) From Collapse to Regeneration. In, After Collapse: The
Regeneration of Complex Societies, Glenn Schwartz and John Nichols (eds). Tuc-
son: University of Arizona Press, pp. 3–17.
Schwartz, Rosalie (1989) Lawless Liberators: Political Banditry and Cuban Independ-
ence. Durham, North Carolina: Duke University Press.
Schwartz, Timothy (2012) Travesty in Haiti: A True Account of Christian Missions,
Orphanages, Fraud, Food Aid and Drug Trafficking. Smashwords. Ebook.
Scott, James (1972) Comparative Political Corruption. Englewood Cliffs, New Jersey:
Prentice-Hall.
Segell, Glen (1999) Warlordism and Drug Trafficking: From Southeast Asia to Sub-
Saharan Africa. In, Warlords in International Relations, Paul Rich (ed.). New York:
St. Martin’s Press, pp. 38–51.
Service, Elman (1968) Primitive Social Organization: An Evolutionary Perspective.
New York: Random House.
Service, Elman (1978) Classical and Modern Theories of the Origins of Govern-
ment. In, Origins of the State: The Anthropology of Political Evolution, Ronald
Cohen and Elman Service (eds). Philadelphia: Institute for the Study of Human
Issues, pp. 21–34.
Shlapentokh, Vladimir (2007) Contemporary Russia as a Feudal Society: A New Per-
spective on the Post-Soviet Era. New York: Palgrave Macmillan.
Shifferd, Patricia (1987) Aztecs and Africans: Political Processes in Twenty-Two
Early States. In, Early State Dynamics, Henri Claessen and Pieter Van de Velde
(eds). Leiden: E.J. Brill, pp. 39–53.
 References 167

Sholchet, Katherine (2013) Grisly Crime Surges into Spotlight as Mexico Shifts
Drug War Strategy. http://www.cnn.com/2013/03/27/world/americas/mexico-
violence/index.html?hpt=hp_t5. Accessed 4 September 2014.
Short, Martin (1984) Crime, Inc. The Story of Organized Crime. London: Thames
Methuen.
Sicker, Martin (1991) The Genesis of the State. New York: Praeger.
Siebert, Renate (2003) Mafia and Anti-Mafia. In, Organized Crime and the Challenge
to Democracy, Felia Allum and Renate Siebert (eds). London: Routledge Press,
pp. 39–54.
Sims, Kenny (2006) After State Collapse: How Tumilaca Communities Developed
in the Upper Moquegua Valley, Peru. In, After Collapse: The Regeneration of Com-
plex Societies, Glenn Schwartz and John Nichols (eds). Tucson: University of
Arizona Press, pp. 114–136.
Skaperdas, Stergios and Syropoulos, Constantinos (1995) Gangs as Primitive
States. In, The Economics of Organized Crime, Gianluca Fiorentini and Sam Peltz-
man (eds). Cambridge: Cambridge University Press, pp. 61–83.
Spiegel (2013) Promising but Perilous: German Firms Put Off by Russian Corrup-
tion. 3 April http://www.spiegel.de/international/europe/german-investors-dis-
couraged-by-corruption-in-russia-a-892043.html. Accessed 1 September 2014.
Smith, Ivan (2012) Mad Dog Killers: The Story of a Congo Mercenary. West Midlands,
England: Helion and Co.
Smith, John Maynard (1982) Evolution and the Theory of Games. Cambridge: Cam-
bridge University Press.
Smith, Yves (2010) Econned: How Unenlightened Self-Interest Undermined Democracy
and Corrupted Capitalism. New York: Palgrave Macmillan. Ibooks edition.
Solzhenitsyn, Aleksandr (1973) The Gulag Archipelago. New York: Harper and Row.
Spinden, Herbert (1920) Shall the United States Intervene in Cuba? World’s Work,
41:465–483.
Stanley, William (1996) The Protection Racket State: Elite Politics, Military Extortion,
and Civil War in El Salvador. Philadelphia: Temple University Press.
Stark, Miriam (2006) From Funan to Angkor: Collapse and Regeneration in
Ancient Cambodia. In, After Collapse: The Regeneration of Complex Societies,
Glenn Schwartz and John Nichols (eds). Tucson: University of Arizona Press,
pp. 144–167.
Stephens, Philip (2012) Do Not Put Your Faith in the False Deities of Economists.
Financial Times, June 18. http://www.ft.com/cms/s/0/291908a0-b577-11e1-
ab92-00144feabdc0.html#axzz3BvDjRImv. Accessed 30 August 2014.
Stephenson, Neil (1992) Snow Crash. New York: Bantam Books.
Sterling, Claire (1990) Octopus: The Long Reach of the International Sicilian Mafia.
New York: W.W. Norton and Company.
Stern, Steven, ed. (1998) Shining and Other Paths: War and Society in Peru, 1980-
1995. Durham, North Carolina: Duke University Press.
Stiglitz, Joseph (2002) Globalization and Its Discontents. New York: W.W. Norton
and Company.
Stiglitz, Joseph (2010) Freefall: America, Free Markets and the Sinking of the World
Economy. New York: W.W. Norton and Company.
Stucker, David and Basu, Sanjay (2013) The Body Economic: Why Austerity Kills.
New York: Basic Books.
168 References

Suchlicki, Jaime (1969) University Students and Revolution in Cuba, 1920–1968.

Miami: University of Miami Press.
Summers, Lawrence (1994) Testimony before the Committee on Banking, Hous-
ing and Urban Affairs of the United States Senate. Washington, DC: United
States Government Printing Office.
Taibbi, Matt (2010) Griftopia: Bubble Machines, Vampire Squids, and the Long Con
That Is Breaking America. New York: Spiegel and Grau.
Tainter, Joseph (1988) The Collapse of Complex Societies. Cambridge: Cambridge
University Press.
Taleb, Nassim Nicholas (2008) The Black Swan: The Impact of the Highly Improbable.
New York: Random House.
Talmon, J.L. (1960) Political Messianism: The Romantic Phase. London: Seeker and
Warburg.
Tanzi, Vito (1995) Corruption: Arm’s Length Relationships and Markets. In, The
Economics of Organized Crime, Gianluca Fiorentini and Sam Peltzman (eds).
Cambridge: Cambridge University Press, pp. 161–180.
Tattlin, Isadora (2002) Cuba Diaries: An American Housewife in Havana. New York:
Algonquin Press.
Taylor, Rob (2012) Military Comeback a Distant Dream for Afghan Taliban. Reu-
ters. 5 February. http://www.reuters.com/article/2012/02/05/us-afganistan-tali-
ban-military-idUSTRE81404K20120205. Accessed 15 August 2014.
Thaler, Richard (2004) Mental Accounting Matters. In, Advances in Behavioral Eco-
nomics, Colin Camerer, George Loewenstein and Matthew Rabin (eds). New
York: Princeton University Press, pp. 75–103.
Thomas, Hugh (1998) Cuba: The Pursuit of Freedom. New York: Da Capo Press.
Thorne, Tanis (2003) The World’s Richest Indian: The Scandal over Jackson Barnett’s
Oil Fortune. Oxford: Oxford University Press.
Tilly, Charles (1985) War Making and State Making as Organized Crime. In, Bring-
ing the State Back In, Peter Evans, Dietrich Ruschemeyer and Theda Skocpol
(eds). New York: Cambridge University Press, pp. 169–191.
Tilly, Charles (1992) Coercion, Capital and European States, AD 990-1992. Cam-
bridge, Mass.: Wiley-Blackwell.
Trigger, Bruce (1998) Sociocultural Evolution: Calculation and Contingency. Oxford:
Wiley-Blackwell Publishers.
Tripodi, Paulo (1999) The Collapse of Albania and a Different Type of Warlord:
Criminal Gangs. In, Warlords in International Relations, Paul B. Rich (ed.). New
York: St. Martin’s Press, pp. 103–119.
Trouillot, Michel-Rolph (2000) Haiti: State against Nation. New York: Monthly
Review Press.
Turkus, Burton and Feder, Sid (1992[1951]) Murder, Inc. The Story of the Syndicate.
New York: Capo Press.
Tyler, Gus (1962) Organized Crime in America: A Book of Readings. Ann Arbor: Uni-
versity of Michigan Press.
Ulam, Adam (1966) Socialism and Utopia. In, Utopias and Utopian Thought, Frank
Manuel (ed.). New York: Houghton Mifflin, pp. 116–134.
United States General Accounting Office (2000) Testimony before the Committee
on International Relations, House of Representatives. Washington, DC: United
States Government Printing Office.
Valdez, Alfonso (2009) Prison Gangs 101. Corrections Today, February 1.
 References 169

Van Duyne, Petrus (2003) Medieval Thinking and Organized Crime Economy. In,
Transnational Organized Crime, Myth, Power and Profit, Emilio Viano, Jose Magal-
lanes and Laurent Bridel (eds). Durham, North Carolina: Carolina Academic
Press, pp. 23–44.
Velie, Lester (1953) Suckers in Paradise. Saturday Evening Post, 225(39):32–183.
Verdery, Katherine (1996) What Was Socialism and What Comes Next? Princeton:
Princeton University Press.
Vilensky, Simeon (1999) Till My Tale Is Told: Women’s Memoirs from the Gulag.
Bloomington, Indiana: Indiana University Press.
Viola, Lynne (2007) The Unknown Gulag: The Lost World of Stalin’s Special Settle-
ments. Oxford: Oxford University Press.
Volkov, Vadim (2000) The Political Economy of Protection Rackets in the Past
and Present. Social Research, 67(3):709–744.
Volkov, Vadim (2002) Violent Entrepreneurs: The Use of Force in the Making of Rus-
sian Capitalism. Ithaca: Cornell University Press.
Waller, J. Michael and Yasmann, Victor (1995) Russia’s Great Criminal Revolution:
The Role of the Security Services. Journal of Contemporary Criminal Justice, 11(4).
Walzer, Craig (2008) Out of Exile: Narratives from the Abducted and Displaced People
of Sudan. San Francisco: McSweeney’s.
Weatherford, Jack (2004) Genghis Khan and the Making of the Modern World. New
York: Random House. Kindle edition.
Wiarda, Howard (1968) Dictatorship and Development: The Methods of Control in
Trujllo’s Dominican Republic. Gainesville, Florida: Center for Latin American
Studies.
Wiegand, Timothy (2010) Adulterated Cocaine and Lessons Learned from the
Jake Walk Blues. Journal of Medical Toxicology, 6(1):63–66.
Wilson, Nigel (2014) ISIS Smuggling $50m of Oil Monthly to Fund Medieval Cali-
phate in Iraq and Syria. International Business Times. 23 July 2014. http://www.
ibtimes.co.uk/isis-smuggling-50m-oil-monthly-fund-medieval-caliphate-iraq-
syria-1457941. Accessed 16 August 2014.
Wolf, Eric and Hansen, Edward (1966) Caudillo Politics, A Structural Analysis.
Comparative Studies in Society and History, 9:168–179.
Wolf, Eric and Hansen, Edward (1972) The Human Condition in Latin America. New
York: Oxford University Press.
Woodfill, D.S. (2012) Arpaio Jail Sweep Yields Weapons, Contraband. Arizona
Central.com. http://www.azcentral.com/news/articles/2012/08/18/201208
18PNI0818-met-arizona-arpaio-jail-sweep-contraband-weapons-brk.html).
Accessed 31 August 2014.
Woodiwiss, Michael (2003) Transnational Organized Crime: The Global Reach of
an American Concept. In, Transnational Organized Crime: Perspectives on Global
Security, Adam Edwards and Peter Gill (eds). London: Routledge Press, pp. 13–27.
Wraith, Ronald and Simkins, Edgar (1963) Corruption in Developing Countries. New
York: Norton and Co.
Wright, Irene (1910) Cuba. New York: MacMillan.
Wright, Henry (2006) Early State Dynamics as Political Experiment. Journal of
Anthropological Research, 62(3):305–319.
Yamamoto, Shinya (2009) How Did Altruism and Reciprocity Evolve in Humans?:
Perspectives from Experiments on Chimpanzees (Pan troglogyes). Interaction
Studies, 10(2):150–182.
170 References

Yannis, Alexandros (2003) State Collapse and Its Implications for Peace-Building
and Reconstruction. In, State Failure, Collapse and Regeneration, Jennifer Millikin
(ed.). New York: Blackwell Publishing, pp. 63–80.
Zack-Williams, A.B. (1990) Sierra Leone: Crisis and Despair. Review of African Polit-
ical Economy, 49:22–33.
Zartman, William (1995a) Introduction. In, Collapsed States: The Disintegration
and Restoration of Legitimate Authority, William Zartman (ed.). Boulder: Lynne
Reinner, pp. 1–14.
Zartman, William (1995b) Putting Things Back Together. In, Collapsed States: The
Disintegration and Restoration of Legitimate Authority, William Zartman (ed.).
Boulder: Lynne Reinner, pp. 267–271.
Zartman, William (1997) Testimony before the Subcommittee on Africa, Committee on
International Relations, One Hundred Fifth Congress 8 April. Washington, DC:
United States Government Printing Office.
Zeigler, John Vincent (1977) Arms Smuggling to Cuba, 1952–1958. Coral Gables:
MA Thesis University of Miami.
Index
American exceptionalism, 101–3
anecdotal terminology for organized
crime, 16
antiracketeering statutes, 36
armed forces, politicization of in
Cuba, 86–7
bailouts, 103
Batista regime, 91–2, 136n6,
142n11
behavioral ecology, Darwinian
political economy, 125–26
behavioral economics vs. behavioral
ecology, 49–52
frequency-dependent selection, 51
rational economic man assumption,
51, 62
variation in populations, 51
Berger, Peter, 145n3
Big Nowhere, The (Ellroy), 1–3, 13
black market prices, 119–20
Brazil, kleptocracy in, 82
Camorra vignette, 27–8
capitalism, 41
Castro regime, 136n6, 141–2n8,
143n13
cheating and systemic complexity,
54–7
cleaner fish analogy, 55–6
Darwinian political economy, 123
differential reproduction, 55
differential survival, 55
in economic exchange, 138–9n2
increased fitness, 56
natural selection, 56
variation, 55
chieftaincies, 111–12
cleaner fish analogy, 54–5
coercive resource extraction, 17
collaborative relationships with
organized crime in Cuba, 91–2
171
Columbia
gray zones, 116
violence, 142n9
competition for resources, 53
computer simulations, 54
conflicts in gray zones, 114
Congo, gray zones, 116–17
contaminated markets, 38–9
corporate racketeering, 102–3
corruption, 15–16
creation of underdevelopment, 108
Cuba, 30–1, 34, 36, 83–92
armed forces, politicization
of, 86–7
Batista regime, 91–2, 136n6, 142n11
Castro regime, 136n6, 141–2n8,
143n13
collaborative relationships with
organized crime, 91–2
corruption, 87–9
extractive qualities of government,
86
gambling, 136n9
Gómez, General José Miguel, 85–6
graft, 92
ideological conflicts, 84–5
informal economy, 84
invisible forces, 88–9
looting, 90
organized crime, 149n3
monopolies, 84
personalistic armies, 89
politics as spoils system, 88
post-USSR collapse, 137n6
racketeering politicians, 125
smuggling, 87–8, 134–5n4
violence, 89–90
voting fraud, 142n10
culture of dependency and corruption
in Haiti, 97–8
cyclical model of political evolution,
111–12
172 Index
Darwinian model, 110
Darwinian political economy, 19–22,
122–8
behavioral ecology, 125–6
in Cuba, racketeering politicians,
125
cyclical vs. linear model of political
economy, 126–127
evolutionary stable strategies, 123–6
gangster state failure and
reemergence, 126
gray zones, 124
methods of research, 122
racketeering, 125
security force formation, 123–4
in Soviet Union collapse, 127
vulnerability vs. increasing
complexity and advance, 128
warlord-controlled mini-states, 124
democracy, gangsterization of, 80–3
in Brazil, 82
informal economy, 80–1
invisible proto-states, 80
in Latin America, 82–3
law enforcement, weakening of, 81
deregulation, 101–2
differential reproduction, 55
differential survival, 55
Doctrine of Progress, 105–6
Duvalier, Jean-Claude, 95–8
early European gangster-states, 75–6
economics, 38–48
assumptions about, 39
capitalism, 41
collapse and regeneration model,
108
contaminated markets, 38–9
free markets, 39, 45–6
Friedmanistan, 42–6
invisible hand, 46–8
Marxists, 40–2
Marxitopia, 42–4
regulated vs. free markets, 38–9
Soviet bureaucracy, 40
USSR collapse, 40
utopian thinking, 20th century, 43
Ellroy, James, 1–3, 13
Enlightenment philosophy, 104–6,
108
epidemics, 149n2
equilibrium, 61
ESS. See evolutionary stable strategies
ethnic boundary formation, 147–8n12
ethnic vs. economic definitions of
organized crime, 4, 23–4, 129n1
evolutionary stable strategies (ESS),
51, 57
competition for resources, 52
computer simulations, 54
Darwinian political economy, 123–6
farming and raiding, 58–62
in gangs, 13
Hawks and Doves game, 52–3
racketeering as, 7, 14, 57
extortion, 32–3
extractive qualities of government
in Cuba, 86
Extremism, 62–3
failed states concept, 107–8
farming and raiding, 58–62
financial crisis of 2008, 101
formal vs. informal economies,
24–5, 102
free markets, 7, 39, 45–6, 103
frequency-dependent selection, 51, 61
Friedmanistan, 42–6
Friedman, Milton, 42
Fukuyama, Francis, 145–6n5
Full House (Gould), 132n10
gambling
in Cuba, 136n9
rackets, 33–34
gangs as primitive states, 12–17
evolutionary stable strategies, 13
gangster-state collapse and
regeneration, 18–19
secondary state formation, 111
territorial dynamics, 13
gangster-states
chieftaincies, 111–12
collapse and regeneration, 117–20
defined, 68
failure and reemergence, 126
 Index 173

formation, 110 early European gangster-states,

as parallel institution, 79 75–76
as territorial exaptations of gangster-state as parallel institution,
racketeering, 110 79
gangster-warlords, 124, 132n9 gangster-states defined, 68
garment industry, 33 in Haiti, 95–8
geography of protection, 65 in Hispañola, 93–5
Gómez, General José Miguel, 85–6 Mafia branding, 76–7
Gould, Steven J., 132n10 in New York, 92–3
governing roles within territories, 71 in post-Soviet gangster states,
graft in Cuba, 92 99–101
gray zones and demapping, 113–17 prehistoric gangster-states, 73–5
in Africa, 147n10 primary gangster state formation,
conflicts, 114 68–9
Darwinian political economy, 124 retreat of formal institutions, 79
emergence, 114 territoriality, 69–73
epidemics, 149n2 underworld as prehistory, 69
human rights, 114 in Zaire, 98–9
non-combatant populations, kleptocratic gangster-states, 15, 21
114–15
Greenspan, Alan, 45 labor rackets, 31–3
extortion, 32–3
Haiti film projectionists’ union, 33
cholera in, 150n4 garment industry, 33
kleptocracy in, 95–8 labor unions, 32–3
Hawks and Doves game, 52–3 violence, 31–2
Hispañola, kleptocracy in, 93–5 labor unions, 32–3
Hobbesian political theory, 146n7 Latin America, kleptocracy in, 82–3
H1N1 pandemic, 63–4 law enforcement, weakening of, 81
human rights in gray zones, 114 looting, 96–7
looting in Cuba, 90
increased fitness, 56
informal economy, 80–1, 120, 130n3 macroparasitism, 60–1
informal economy in Cuba, 84 mafia
invisible forces in Cuba, 88–9 branding, 76–7
invisible hand, 46–8 bust-out, 97
regulatory agents, 47–8 capitalism, 12
schoolyard bully analogy, 47–8 vs. racket, 4
self-interest, 47 systems, 134n2
invisible proto-states, 80 Marxists, 40–2
Marxist theory, 137n5, 145n3
Keynesian political economy, 42 Marx, Karl, 42
Khan, Genghis, 65–7 Mediocristan, 63
kickbacks, 96 modernization theory, 106–7
kleptocracy, 68–103 Moldova and Transnistria, 120–1
American exceptionalism, 101–3 racketeer-army, 119
in Cuba, 83–92 violence in territorial
democracy, gangsterization of, 80–3 reconfiguration, 121
174 Index
monopolies in Cuba, 84
monopoly control, 17, 26, 35
Morgan, Lewis Henry, 144n1
natural selection, 55–6
New York, kleptocracy in, 92–3
non-combatant populations in gray
zones, 114–15
organized crime, 23–37
academic research on, 130–1n4
anecdotal terminology, 16
attributes, 28
Camorra vignette, 27–8
criminological approach, 6
Cuba, 30–1, 34, 36, 149n3
Darwinian models, 5, 6–7
definition, 3–7, 28–9
ethnic vs. economic definitions, 4,
23–4, 129n1
formal vs. informal economies, 24–5
free markets, 7
gambling rackets, 33–34
illegality, 24–5
labor rackets, 31–3
organization, 25, 28–9
in prison economies, 29–30
prohibition, 35–7
racketeering, 26–7
racket vs. mafia, 4
in stateless campus economy, 30–1
parasitism, 59–60
personalistic armies in Cuba, 89
police, role in racketeering, 36
political decline and collapse,
104–21
collapse and regeneration, 112–13
creation of underdevelopment, 108
cyclical model of political
evolution, 111–12
Darwinian model, 110
Doctrine of Progress, 105–6
economics perspective, 108
Enlightenment philosophy,
104–6, 108
failed states concept, 107–8
gray zones and demapping,
113–17
modernization theory, 106–7
political economy, 111
post-Soviet transition problems,
107–8
secondary gangster state formation,
111
sociopolitical complexity, 104–6
spatial vs. functional definition, 113
state as exaptation, 109–11
warfare-driven political-economic
complexity, 112
warlords, 113
political economy, 111
politics as spoils system in Cuba, 88
post-Soviet Russia, 10–12
gangster states, kleptocracy
in, 99–101
human costs, 11
instability, 11
mafia capitalism, 12
organized crime in, 10
thirdworldization, 11
transition problems, 107–8
violence, 140n5
prehistoric gangster-states, 73–5
pricing mechanisms, 60
primary gangster state formation,
68–9
prison economies, 29–30
prohibition, 35–7
protection, formalization of, 59–60,
61, 62
prototypical feudal society, 67
racketeer-army, 119
racketeering
antiracketeering statutes, 36
criminology studies, 39
Darwinian political economy, 125
definition, 123
external pressures, 124
evolutionary stable strategies, 7,
9, 14
gambling, 33–4
monopoly control, 26, 35
and organized crime, 26–7
police, role in, 36, 124
and primitive states, 15
in prison economies, 29–30

revenues, 37
violence, 8
racketeering, evolution of, 49–67
behavioral economics vs. behavioral
ecology, 49–52
cheating and systemic complexity,
54–57
equilibrium, 61
evolutionary stable strategies (ESS),
51–4, 57
farming and raiding, 58–62
frequency-dependent selection,
51, 61
geography of protection, 65
macroparasitism, 60–1
parasitism, 59–60
pricing mechanisms, 60
protection, formalization of, 59–60,
61, 62
prototypical feudal society, 67
raiding and trading on the steppes
vignette, 65–7
rational economic man assumption,
51, 63
stabilization, 8, 62
supply and demand, 62–5
variation in populations, 51
racket vs. mafia, 4
raiding and trading on the steppes
vignette, 65–7
rational economic man assumption,
51, 62
regional fiefdoms, 19
regulated vs. free markets, 38–9, 103
regulatory agents, 47–8
retreat of formal institutions, 79
revenues from racketeering, 37
Rothstein, Arnold, 58
Russian Real Estate scam, 96–7
schoolyard bully analogy, 47–8
secondary gangster state
formation, 111
security force formation, Darwinian
political economy, 123–4
self-interest, 47
Sicilian Mafiosi, 71–2
Smith, John Maynard, 7
smuggling in Cuba, 87–8, 134–5n4
Index 175
Snow Crash (Stephenson), 133
sociopolitical complexity, 104–6
Somalia, gray zones, 115–16
Soviet bureaucracy, 40
Soviet Union collapse, Darwinian
political economy, 127
spatial vs. functional definition,
state, 113
stabilization, 61
stable democratic states, 15
stateless campus economy and
racketeering, 30–1
stateless realms, 130n3, 131n6
state
as exaptation, 109–11
spatial vs. functional
definition, 113
Stephenson, Neil, 133
supply and demand, 62–5
Extremism, 62–3
H1N1 pandemic, 63–4
with kleptocracy, 72–3
Mediocristan, 63
transformative threshold, 62–3
territorial conquests, 18
territorial exaptations of racketeering,
110
territoriality, 69–73
governing roles within territories,
71
supply and demand, 72–3
violence, strategic use of, 72
Thailand, extortion, 143–4n14
theology and innovation,
132–3n11
thirdworldization of post-Soviet
Russia, 11
transformative threshold, 62–3
Trujillo, Rafael, 93–5
under the cartels vignette, 77–9
underworld as prehistory, 69
US-Mexican borderlands, 73
USSR collapse, 40
utopian thinking, 20th century, 43
variation, 55
variation in populations, 51
176 Index
violence
in Cuba, 89–90
ethnic, 94, 118, 147–8n12
in labor rackets, 31–2
in Moldova’s territorial
reconfiguration, 121
and monopolies, 17
in post-Soviet period, 140
psychological stress,
132–3n11
public displays of, 76–7
in racketeering, 8
strategic use of, 72
and territorial conquests, 18
voting fraud in Cuba,
142n10
vulnerability vs. increasing
complexity and advance, 128
warfare-driven political-economic
complexity, 112
warlords, 70–1, 113, 124
Yugoslavia/Bosnia, 117–20
black market prices, 119–20
ethnic violence, 118
informal economy, 120
Zaire
gangster state, 15
gray zones, 113, 115
kleptocracy in, 98–9