As the Zimbabwean electoral soap opera continues to unfurl, I am led more and more to wonder why "we" (Western governments and IFIs) don't simply buy out corrupt dictators? The World Bank has loaned a lot of money to Zimbabwe, all of it seemingly wasted judging by current conditions there. From the Bank's Zimbabwe page:
Between 1980, when Zimbabwe joined the Bretton Woods Institutions, and 2000 when the country fell behind in its payments on World Bank loans, the Bank funded a total of 33 projects worth US$1.6 billion. Bank support concentrated on infrastructure, agriculture, health support, and community and local government programs, financed from both International Development Association (IDA) Credits (42%) available to low-income countries, and International Bank for Reconstruction and Development (IBRD) loans (58%) available to middle-income countries. Zimbabwe’s arrears to the World Bank were estimated at US$521 million as of September 13, 2007. The arrears to the IMF stood at US$134 million at end-July 2007 and to the AfdB at US$359 million as of end-April 2007.
So why not "buy the rascals out"? Go to Mugabe in 2002 and offer him $500 million cash to go live in Canada. Is it that his expected profits from being in power are too large for us to afford the buyout? Is it because of moral hazard? Is it because of the moral outrage such a scheme would create?
Or is it because if the institutions of the country don't change, the new president will simply become the next Mugabe?