What Is Kleptocracy? Definition and Examples

Is This what the USA has become? Does any of this sound familiar?

 By Robert Longley

Published on February 09, 2021

Kleptocracy is a form of government in which the leaders, known as kleptocrats, use their political positions of power to gain or increase their personal wealth by stealing money and valuable resources from the countries they rule. While both forms of government imply a degree of corruption, kleptocracy differs from plutocracy—government by the wealthy, for the wealthy.

Key Takeaways: Kleptocracy

• A kleptocracy is a form of government in which the rulers use the power of their   positions to steal from the people.
• Kleptocracy tends to occur in poor countries under authoritarian forms of government where the people lack the political power and financial resources to prevent it.
• In contrast to plutocracy—government by the wealthy—the leaders of kleptocracies enrich themselves after taking power.
• Recent examples of confirmed kleptocracies include Congo under Joseph Mobutu; Haiti under “Baby Doc” Duvalier; Nicaragua under Anastasio Somoza; the Philippines under Ferdinand Marcos; and Nigeria under Sani Abacha.

Kleptocracy Definition

Coming from the Ancient Greek word “klepto” meaning “theft” and “cracy” meaning “rule,” kleptocracy means “rule by thieves,” and is used to describe governments whose leaders misuse their power to steal from their people. Through acts of embezzlement, bribery, or outright misappropriation of public funds, kleptocrats enrich themselves and their families at the expense of the general population. 

Often associated with dictatorships, oligarchies, or similar forms of autocratic and totalitarian governments, kleptocracies tend to develop in poorer countries in which the people lack the resources to prevent it. Kleptocrats typically drain the economies of the countries they rule by raising taxes on production and then using the tax revenue, rents from natural resources, and foreign aid contributions to increase their own wealth. 

In anticipation of losing their power, kleptocrats typically devise intricate illegal international money laundering networks to protect their stolen assets by hiding them in secret foreign bank accounts. Increasingly, the processes of globalization are blamed for helping kleptocrats protect their finances and polish their reputations. Both illegal schemes like fake foreign “shell corporations” and legal international investments, such as luxury real-estate purchases, help kleptocracies launder their ill-gotten gains while extricating them from their country of origin.

Only recently did wealthy countries begin taking legal steps to stop the flow of this dirty money. Launched in 2010, for example, the United States Kleptocracy Asset Recovery Initiative empowers the Department of Justice to seize the ill-gotten funds of corrupt foreign leaders and return them to their country of origin. On a multi-national level, the United Nations Convention Against Corruption supports the prevention and punishment of kleptocracy and kleptocrats worldwide.

One unique characteristic of contemporary kleptocracies is their visibility. Unlike traditional international criminals, who strive to hide in the shadows, kleptocrats often maintain a high-profile status, publicly flaunting their wealth to convince the people of their economic wisdom and ability to lead the country.

A relatively new variation of kleptocracy, “narcokleptocracy” describes a society in which the government leaders are unduly influenced or controlled by criminals involved in the international trade of illegal drugs. For instance, the term was used in a 1988 report of the U.S. Senate Committee on Foreign Relations to describe the regime of Panamanian dictator Manuel Noriega in relationship to the Iran-Contra scandal.

Kleptocracy vs. Plutocracy

In contrast to a kleptocracy, a society governed by corrupt individuals who become rich and powerful by stealing from the people, a plutocracy is ruled either directly or indirectly by people who are already extremely wealthy when they come to power. 

Unlike kleptocrats who commit actual crimes to enrich themselves individually by stealing from the people, plutocrats typically enact government policies intended to benefit the society’s entire wealthy class, often at the expense of the lower economic classes. While kleptocrats are always government officials who directly control the people, plutocrats may be extremely affluent private citizens who use their wealth to influence elected government officials, often through bribery.

While kleptocracies are typically found in authoritarian forms of governments, such as dictatorships, plutocracies are less likely to develop in democratic countries where the people have the power to vote the plutocrats out of office.