Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: frankw1900 who wrote (59644)	12/3/2002 2:52:00 AM
From: FaultLine	Respond to of 281500

The economic "distress" Russia has seen the last ten years is the continuation of the economic distress it had the previous 70 years... nice post Frank, thanks. --ken

To: frankw1900 who wrote (59644)	12/3/2002 11:02:21 AM
From: JohnM	Read Replies (1) \| Respond to of 281500

Just an excellent post, frank. Thanks. I don't know where to start to respond; there's both too much and not enough. Let me take a couple of quotes and spin off a thought or two. The economic "distress" Russia has seen the last ten years is the continuation of the economic distress it had the previous 70 years, isn't it? I don't think so, though I'm hardly an authority. It's my impression, as strange as it may sound, that things economic got much worse after Yeltsin rather than Gorbachev came to power. An economy which was clearly not functioning as one but still provided survival benefits for pensioners, health care for most, however meager the care was, and some form of housing. That state sponsored economy was, apparently, simply replaced by "free market" incentives. Best I can tell the folk simply hanging on for dear life, fell over the edge into despair. The question here is whether a gradual change such as Gorbachev argued for, into a Scandinavian style social democracy would have been an easier move than into the "free market." I put free market in quotes because most of my reading says it was actually not that. Only a ruthless grab bag in which higher level bureaucrats grabbed as much of the best stuff as they could, and be damned with the rest. You are talking long run; I am talking short run; and everytime I type those words, I'm reminded of the quote often attributed to Keynes, that in the long term we are all dead. The second comment you offer about which I can say something is I'm not exactly sure what you mean by "destroying people". Some things can be done which don't cause harm. If folk are absolutely near the bottom in terms of standard living as in truly undeveloped countries then any increase in economic activity in their neighbourhood is a Good Thing. So get rid of the tariffs and subsidies. Life, as we both know, routinely "destroys people" so I'm obviously not talking about that. And any economic system produces winners and losers, so I'm talking less about that. I have in mind transition issues in which well meaning folk, in the 90s they were from the IMF or Chicago type economists, who arrived in country with the notion that taking the state out of as much economic activity as possible would produce both long term and short term benefits for folk. In the Russian case, and no doubt there are others--Stiglitz discusses several, the short term was brutal. And, if I understand Stiglitz correctly (a point also made a bit less effectively by the NYU Russian expert Stephen Cohen) there were better paths to take, ones which would have hurt fewer people. As for your point that at the kinds of minimal economic activity you find in someplaces, any sort of economic activity is better than none. At that level of statement, I certainly can't argue. I would have to go back to Stiglitz and check for specific country issues. And I'm not terribly eager to do that. And if I wound up getting the info from my economist brother, I wouldn't be able to fill in the blanks for you. So I best skip that route as well. Finally, frank, what struck me about the WSJ article was only that the issue of globalization and economic transition was very much in play, that it is producing very interesting intellectual ferment at top economics graduate departments in which the bulk of students are from outside the US. Made me think I should climb over the hill, scoot across the Hudson, and take an economic course or two at Columbia. John