In TCS Daily, Max Borders wites an interesting post on PNM Theory entitled: A Blueprint for Inaction? He states:

And it is in Barnett's recommended process of transforming Gap states into Core states that we see the age-old tension between theory and practice start to emerge. Before attempting to expose this tension, we should note that Barnett's Blueprint for Action is a worthwhile effort. Still, it falls short — not due to the Wherefores carefully elaborated the first book, but due to some of the Hows elaborated in the sequel. The shortcomings of the second stage of Barnett's grand strategy — implementation — are, in some respects, due to what Friedrich Hayek called "the fatal conceit." In other words, Barnett focuses too much on nation-building and not enough on institution-building.

He goes on to discuss why various nation-building efforts and proposals have not or do not work to well. He then states:

The most important aspect of any SysAdmin effort should be institution-building, not just nation-building. This is where the UN and the quasi-governmental behemoths have failed so utterly in just about everything they've done. To build a nation without transfusing vital institutions is to build a house of cards ready to collapse. To wit: India and China are in no position to contribute to institution-building, as they're still grappling with the internal transformation of their own institutions. The most successful Core states are the states that look the most like the US in their institutions. So while you might want Britain or Australia to contribute to institution-building, you're not likely to want Russia or Brazil to do so.

He concludes:

So at the same time SysAdmin is putting down insurgencies, restoring basic infrastructure, and protecting civil order, it should also be establishing the essentials for prosperous and highly organized complex order: the Rule of Law; an independent judiciary; transparency and accountability mechanisms; a separation of powers; popular sovereignty (constrained by the rule of law); and fixed, enforced property rights. Without these essentials, a nation is doomed. But with them, the nation has a chance to grow and order itself spontaneously — no central planners or behemoths necessary.

This is pretty interesting stuff. Along time ago (pre-blogging days) I was having discussion with friends on what to with Iraq (this was pre-invasion) after the take-down. Most of my thoughts were bottom-up: local public utility maintenance, local credit unions and micro loans, pre-canned legal-system, etc. Many of my ideas were influenced and cribbed from Hernando de Soto and his book the Mystery of Capital.

My thought was the General Franks or somebody would rule Iraq as the US Ambassador-General. Meanwhile at the smallest most local level, institution-building and Iraqi governing would begin. Over time, the Iraqi would move up the food chain ending with a a national advisory congress, followed by a national congress with partial powers, followed by an a national federal systems with Iraqis in full power and the US Ambassador-General replaced with a US Ambassador. Well, the US went the opposite way in Iraq top-down, not bottom-up. This might have been necessitated by the defeatist attitudes of the western media and fear of a loss interest and commitment by the US public.

This is a very important article I think. I would like to see the thoughts and comments of those exploring PNM Theory and what they think of nation-building vs. institution-building.

Update: Discussions on Barnett's website, Phatic Communion, and Zenpundit