Last week Americans all over the country, some dressed in 18th century costume, staged re-enactments of the Boston Tea Party, the 1773 tax revolt that was a key event leading up to the 1776 Declaration of Independence and subsequent war for independence from Britain.
The angry rebels, some wearing knee breeches and others sweat pants, and egged on by rabid radio and TV talk show hosts, seem to think that President Obama’s spending plans amount to taxation without representation. This is nonsense. I recall voting in last November’s election, and although not all of my preferred candidates won, I am hardly unrepresented. If I don’t like paying the taxes I do I can always vote in the next election for candidates who share my views. That is what we call democracy. [click to continue…]
I attended a book launch recently for a new volume published by the Center for Global Development here in Washington: “Africa’s Private Sector: What’s Wrong with the Business Environment and What to Do About It.” I found the slim volume to be a thought-provoking read – it’s packed with data and practical policy options. However, at the launch event, one of the authors mentioned a piece of information so startling that I found it hard to concentrate on the panel discussion of the book. During her research, which included interviewing numerous private business people in Africa, one construction company mentioned that the continent’s road infrastructure was in such poor shape that on more than one occasion the company had airlifted cement across countries.
The company used helicopters to airlift cement. [click to continue…]
Milton Friedman is routinely blamed for most of the ills of modern society, often by people who show little sign of ever having read or understood his work. Naomi Klein wrote an entire book – The Shock Doctrine - in which she accuses Friedman and his disciples not only of exploiting disasters to undertake sweeping economic reforms but of conspiring to produce them to create more opportunities to impose his “fundamentalist form of capitalism [that] has always needed disasters to advance.” Klein accuses Dr. Friedman, the architect of free market reforms in Augusto Pinochet’s Chile, of conniving in the dictator’s human rights abuses, and she goes on to say that “for [Friedman's] vision to be implemented in its complete form, authoritarian or quasi-authoritarian conditions are required.” This comes as a surprise to those of us who consider Milton Friedman one of the most vigorous and reasoned defenders of liberty since John Stuart Mill. It is also a surprise if you consider that Chile, largely as a result of Friedman’s influence, is today one of the most prosperous, free, democratic, and stable societies going. [click to continue…]
The other day I went down to the basement – I have nothing as grand as a wine cellar – to select a few bottles to bring to a weekend family gathering. At first I passed over the wines I have been saving for a special occasion, looking for something cheaper, and then reconsidered. What could be more special than getting together with family and close friends?
In these gloomy economic times our instinct is to cut back, look inwards, and slip into survival mode: a kind of economic and social hibernation. But it is precisely in such times that we need more than ever to do something to make ourselves and others feel good. It doesn’t have to involve great expenditure – in my case both the cheap and the expensive wines were sunk costs – but it does require generosity towards others and to oneself. Blaming others for our misfortunes is not healthy. All of us, not just the bankers and fraudsters, played a part in the financial collapse, and we should own up to it. But blaming oneself for everything is equally wrong. It actually is NOT all about me. Nor you. It seems to me that life is equal parts intent and randomness, and that a healthy person and a healthy society need to recognize both.
Now is an especially good time to remember and appreciate the good things we still have, and to share what we can with others. Drinking the good wine now implies some faith in the future, a belief that there will again be good wine to drink and good times to enjoy. A little optimism on that score will do us all some good.
It is rare, though in recent months it has become much more common, for a bit of economic data to make you weep, but here is one that may. In 1993, when I was in Madagascar to review progress on the privatization of state enterprises, I came across a report stating that if the current set of reforms (privatization, trade liberalization, public sector reform) worked as hoped the country by 2010 would get back to the same level of per capita GDP it had in 1970. In the event, that optimistic scenario failed to materialize. According to the World Bank, Madagascar’s per capita GDP in 1970 was $473. In 2007 it was $320. That’s 40 lost years, a period in which two generations have been born and grown to adulthood in a shrinking economy that offers them almost no hope. [click to continue…]