More Thatcherite theology from Heath. Syria needs liberal capitalism, apparently, as if the latest global crisis of liberal capitalism didn't play any part in triggering the Arab Spring in the first place.
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The best explanation of what is going wrong in Syria and why the Arab Spring has turned into a bloody winter of discontent can be found in Why Nations Fail: the Origins of Power, Prosperity and Poverty, a fascinating tome by two US economists, Daron Acemoglu and James A Robinson, which ought to be on everybody’s reading list at the Foreign Office. The book, one of the best written on economics in recent years, has a thesis that is as simple as it is powerful. Countries can be divided into two broad groups, it argues, depending on economic and political structures.
The first, small but fortunate group of countries includes Britain, other Western economies and countries such as Australia, New Zealand, Singapore, South Korea, Japan and Botswana. These nations have in common something that is far more important than their differences: inclusive economic institutions that encourage and incentivise the vast majority to take part in freely chosen economic activities that make the best use of their talents, skills and interests.
Such benign economic institutions include secure and well-respected property rights; a good, reliable and trusted system of law and order, upholding the sanctity of contracts; a decent infrastructure; a sound and supportive regulatory framework for markets; low barriers to entry that allow individuals and firms to enter new markets and compete with incumbents; and access to education and economic opportunity for the great majority of the public.
I'd be fascinated to learn more about these 'inclusive economic institutions' which apparently played such a crucial and 'benign' role in the rise of British capitalism. Also, it's pretty baffling that the state-led conservative corporatism of Japan, South Korea and Singapore is lumped together with the British/Australian/NZ model as if they're one and the same (even though modern-day liberal capitalist countries have historically been happy to resort to protectionism when it suited).
This, however, is actually quite an accurate description of actually-existing capitalism as most people around the world experience it:
By contrast, the second group of countries, which include Syria, Egypt and all of the other failed states globally, have been saddled with what Acemoglu and Robinson describe as extractive political institutions. These are deliberately designed to grab the incomes and wealth generated by the economy for the benefit a small elite and are buttressed by equally extractive political institutions which have handed all the power to these same few, with limited or no checks and balances and no rule of law. In these countries, the best and often only way to get rich is to have good connections and to exploit the power of the state to crush competitors.
Supposedly private firms don’t stay ahead because they provide the best products but because they have friends in high places, are able to ensure that laws and red tape keep out competitors and pay bribes to grab all the best contracts.
Change does not roll in on the wheels of inevitability, but comes through continuous struggle.
- By MisterMuncher
- By Boiler