Thursday, 10 January 2019

All Countries are Developing Countries - Part 2 - the Libertarian View

(In haste as I have to do some work...)

N.B. All states start from homesteading and then warlording etc. It’s how they get past the war-lording that matters.

1.       Make sure you can defend your external borders aka Defence of the realm  (Ukraine messed up badly there a few years ago, they were so busy bickering over who should be in charge that the Russians just marched in and occupied the eastern half – (the truth about that is more nuanced.  A lot of that instability was down to US/EU interference and Russian reaction).

2. Eliminate corruption and have stable financial and legal systems, meaning private/contract law as well as public order aka Rule of Law (defence against internal enemies and protection of minorities (automatic under the Rule of Law), fire brigade (No. Not fire brigade – that’s a form of insurance – which I agree may be better organised by local authorities – despite their woeful inefficiencies - and funded from LVT). Separation of religion and state (OK, that's most of the Middle East buggered). (Not exactly.  The Rule of Law in the UK stems from Judeo Christian philosophy.  What you might mean is the tolerance of those who wish to practice other Faiths.  As to stable money values, it is government central banks that have been at the very root of the destruction of that. Money is a market invention and until it became generally nationalised and then fiat worked very well.  Just look at the private money in the Great Britain between about 1750 and 1820.)

3. Try and instil a sense of democracy, which only works if there is some sort of single national identity (See EU democratic failure) - democracy doesn't work if a country is divided on tribal lines (you only have to look as far as Northern Ireland to see that, let alone the third world). Which is why the Japanese took to democracy like a duck to water after 1945. (True. But in ‘developing nations’ democracy develops as the middle class get richer and then the lower classes get richer and all demand a say in how the government operates.)

4. Get the infrastructure (roads, railways, airports, telephones, electricity and water supply) up and running. (Not exactly.  Infrastructure development follows economic growth – it generally relieves bottlenecks – see the Causey Arch.  In the UK – one of the most successful ‘developing nations’ - all of the things you list were first developed by private capital.  This ‘build infrastructure and they will come fallacy’ is the one that has been practiced by the likes of the UN to help ‘developing nations’, well develop, and has been so successful, not.  As without stable institutions that develop through time – secure property rights, Rule of Law, individual liberty etc. – the infrastructure spend is invariably wasted).

5. Universal education up to a certain age, making sure that girls get equal treatment. (Yes, of course this is a ‘Good Idea’. However evidence from ‘developing nations’ is that centrally funded education run by government is less effective than private education.  Often that is because the State educators seek to indoctrinate. As far as I can tell, private school education for children in England blossomed as worker productivity increased over the industrial revolution. That is there was the wealth to support education as it was no longer necessary for family survival for children to work.)

6. Public health - immunisation programmes, clean water and functioning sewage/refuse collection, pregnancy and natal care, free condoms. Cap prices that doctors and drugs companies can charge patients (it's largely rent).  (Public health starts with clean water in and foul water out.  The first water supplies in in the UK were private companies.  Foul water out – famously Bazelgette (my hero) London sewerage system was a state program – London local authorities.  But elsewhere private business developed ways of handling sewerage, Pepys talks about ‘shit shovellers’ who came round in carts and took away the poo from each house.  In truth this is more of a city problem than a national problem. For example today, now, I am not on mains sewers. I have my own mini sewerage treatment works in my rural garden.  Turning to health care, pretty well all of that was available, in what was by 1945 the UK, from private institutions. Even immunisation was provided by private doctors. As to capping prices, really?  Pre NHS famously doctors were always moaning about low pay. And how did Bevin get the doctors to play along with nationalisation?  By ‘stuffing their mouths with gold’).

7. Make country open for foreign investment and trade but DO NOT let multinational corporations come in and rape the place. Tariffs and protectionism where absolutely necessary but they are to be phased out ASAP. (Yes, and No.  MNC’s can only ‘rape the place’ if they are given special privileges.  The best at this is the EU, a crony corporatist construct par excellance.  Also, the preceding conditions of the Rule of Law strong property rights, individual liberty etc. mitigate against MNC’s raping anything.  Especially if money is not nationalised and fiat and paper based as the ‘specie flow mechanism’ automatically stops over-consumption. Tariffs and protectionism are never necessary.)

8. Decent housing for the poorest - meaning slum clearances and building state-owned affordable housing with electricity and running water etc. (Yes, and no. ‘We’ all know what stops Rachmanism -. LVT. Funnily enough the slum clearances in London had some considerable negative effects by breaking up communities.  And the appalling vandalism by Prescott and his cronies in clearing ‘sub-standard housing’ has not been successful. Overall better to apply a sort of reverse Pigouvianism to landlords to drive standards up by fostering competition on quality by removing the unearned land value gains.  Plus, I do agree that LA housing has a valuable role to play in that competition noting that LVT neutralises the land price issue.  As to leccie and H2O, yes, that goes without saying).

9. Don't let income inequality get out of hand. A stable society won't thrive if a small business and political 'elite' are multi millionaires and the masses are struggling by on a dollar a day. Earned income is always the best kind of income, but having universal welfare/a basic income to patch up the survivors has always worked far better than expected. (Yes. But. Competitive capitalism automatically engenders more equality. OTH crony corporatism as we have now (with banksters say) does the opposite.  Today the Big Problems for the average bloke are rents and taxes – the same thing. And just look at the state of our current political elite and Brexit. How corrupt are they and how relatively rich?)

10. As far as possible, fund government out of taxes on land values, natural resources and other monopolies. Whenever and wherever it's been tried it has doubled the rate of progress. (Of course)


Rich Tee said...

I don't think the importance of (2) can be overstated.

Developed countries have a third party that is perceived, as much as possible, as being neutral and fair. In its most pure form it is a court with a judge and jury.

The most war torn nations do not seem to have this - or it exists but is seen as partisan and corrupt by one or both sides - so you just get two sides constantly trying to impose themselves on each other, often violently.

Lola said...

RT. Correct. The Rule of Law. Habeous Corpus. Strong private property rights and an independent judiciary who are also subject to the law are critical for a successful society. We have that rooted in the Common Law and Magna Carta. The Common Law applies to everyone, including the Crown. And the Law exists naturally, all we have to do is find out what it is - judge made (discovered) law in the UK.

Mark Wadsworth said...

RT, it's something development experts always put near the top of the list.


1. Let's not drag too much nuance into this - the counter example is Israel, they had their defences up and ready on the day of independence.

2. Fire brigade could go under 2, 4 or 6, to be honest. And I do mean separation of church and state. Even in a mono-religious country, it is very important. Tolerance of other 'faiths' is nice to have but not that important - see Japan.

3. Yes, EU is too many self-interested countries to have any proper democratic cohesion/popular support. Theresa May might be a shit Prime Minister, but she is MY Prime Minister. As you say, it's a very gradual thing, can take decades to bed in.

4. Chicken and egg.

8. Prescott et al completely messed up, probably deliberately. That's not say that it can't be done well. The UK did it well in the past, lots of countries still do it well now. And lots do it very badly.

9. Agreed to all that.