Building on a growing body of scholarship that analyses state institutional development, Rachel A. Schwartz has written a bold and ambitious book that is both theoretically distinctive and empirically rich. Like many analysts working in Central America, she documents wide performance gaps in crime control, regulatory oversight and service provision, and draws attention to state practices that contribute to those outcomes. Unlike those who call for relatively simple fixes to correct state institutional weakness (more funding, training, transparency), Schwartz recognises the way disruptive state behaviours may respond to deeply entrenched, parallel rules, which serve as powerful impediments to change. Highlighting what she calls ‘undermining rules’ that structure persistent deviations from formal protocols, she challenges the notion that the gaps between publicly declared (official) practices and the actual (unofficial) ones reflect a lack of governance capacity. Instead, she finds these subterranean practices are better understood as well-defined, rigorously enforced, and predictably patterned behaviours that reflect the political, economic and social priorities of the ‘dominant coalition’. The framework she develops goes a long way toward explaining why reform efforts fail to correct these practices and frequently serve as a catalyst for their adaptive persistence.
Schwartz anchors her analysis in the context of civil war, a setting, she notes, that tends to narrow the network of regime decision makers and privilege the voices of counter-insurgency and national security forces. As intelligence agencies, the military high command and the police become increasingly centralised and hived off from public scrutiny, they can devise a parallel set of rules that undermine the exercise of critical state responsibilities, including the protection of human rights, collection of tax revenue and provision of basic services. Extending their influence over the judicial branch and putative state monitors, counter-insurgency elites can act with impunity as they engage in extrajudicial killings, redirect and appropriate the flow of state resources, and shape service delivery practices that extend their power. Once established, these alternative institutional logics become difficult to dismantle. Dominant actors find new ways to persevere, even in the face of extended peace negotiations, substantial postwar international assistance and a citizen-based push for formal reform.
Unspooling her argument, Schwartz uses rigorous process tracing to map state institutional development in Guatemala and Nicaragua, two of the Central American countries that have experienced recent civil war conflicts. She digs into the archival record, making extensive references to unearthed documents and eye-witness accounts compiled over several decades in collections dispersed across Guatemala, Nicaragua, the United States and online. (See her appendix listing archival sources for details, pp. 266–9.) To this documentary base, she adds 83 targeted and anonymised elite interviews and a growing secondary literature detailing informal institutional practices.
Schwartz's analysis traces the development and operation of informal rules across two analytically distinct periods: the initial conflict phase, in which subterranean mechanisms are constructed, and the postwar context, in which they are adapted in response to exposure and pressure. Schwartz finds that postwar adjustments require the dominant coalition to expand and incorporate new allies, such as organised crime networks and emerging economic elites, who likewise benefit from the informal controls and resource flows that characterise the unofficial order. When the dominant coalition succeeds in making these adaptations, its parallel rules may be able to survive indefinitely, well beyond the period in which this alternative system was constructed. Even when the dominant coalition is disrupted and an alternative network assumes control over the state, vestiges and variants of the old order may remain, giving rise to institutional volatility and instability.
Three case studies put flesh on these arguments, two of them drawing on institutional development in Guatemala and one focusing on property rights in Nicaragua. The first involves a fine-grained examination of the mechanisms of customs fraud orchestrated by high-level Guatemalan military officials, some of whom continued as non-state actors following public exposure and formal dismissal. Schwartz spells out how the process operated and was adapted, bracketed between the 1996 Moreno network scandal and the 2015 ‘La Línea’ exposé that brought down the Otto Pérez Molina administration. Her second case takes up the practices of extrajudicial killing, particularly at the hands of the Guatemalan police, and reviews repeated acts of ‘social cleansing’ by state security forces. She traces the interactions of police, including ‘demoted agents’ (rebajados), and death squads; the periodic suspension of habeas corpus protections; and the well-documented pattern of impunity for state actors involved in multiple acts of violence. These informal norms and practices persisted over decades in Guatemala, in spite of the formal expulsions of implicated state personnel, the privatisation of state resources, the creation of new tax and customs institutions, and an assortment of police reforms.
Schwartz's take on the underlying state institutional arrangement and its persistence in Guatemala answers many questions about the durability of high-level corruption, state criminality and the entrenched pattern of human and social rights abuses. Her work helps to explain the intensity of the domestic elite mobilisation against the International Commission against Impunity (CICIG), the UN-sponsored anti-corruption mechanism that was closed down in 2019, and the resistance by the dominant elite network (colloquially called ‘el pacto de corruptos’) to anti-corruption crusader Bernardo Arévalo's presidential election in 2023. For its scope, rigor and extensive documentation, this book places Schwartz among the leading interpreters of contemporary Guatemalan politics.
The argument is more compelling in the Guatemala analysis than in the discussion of land reform in Nicaragua. This variation is not surprising given the better fit of her model as an explanation for continuity than for discontinuity and the uneven allocation of her research time. As she notes in her methodology description, most of her field work was carried out in Guatemala, with research in Nicaragua being confined to a single, relatively brief stint (see fn. 110, p. 29; p. 31). The truncated nature of her Nicaragua coverage almost certainly comes at an analytical cost. Schwartz may, for example, overstate the extent to which the Sandinista National Directorate functioned as a coherent entity and exercised meaningful control over the rural areas during the latter part of the 1980s contra war, when inflation roared and the economy collapsed amid soaring poverty and a rollback of early reforms.
Schwartz is on more solid ground in her claims about the Sandinista regime's redirection of land distribution policies toward individual plots in an attempt to win rural support and deter contra recruitment. Although her claim about the positive outcomes of community policing in Nicaragua (pp. 250–2) appears to need a time stamp, given the sharp deterioration of policing practices in recent years, her meticulous review of negotiations over property rights across time captures the on-going rules volatility found in Nicaragua, where regulatory instability and targeted confiscation persist to the present.
In the final chapter, Schwartz broadens her analytical framework and considers the possibility that undermining rules might emerge in response to different kinds of threats, not just in the context of civil war. This addition expands the potential application of her framework to novel settings, as scholars continue to explore the co-existence of parallel and conflicting rules governing state institutions. Her concluding call for the international community to assist with the ‘deconstruction’ of shadow power coalitions may make too many assumptions about the political capacity of external actors and under-examine the problematic dimensions of hybrid governance. Overall, however, this study does a monumental job explaining how informal institutional practices develop and persist in diverse postwar contexts, and the challenges associated with bringing about change.
