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

To: JohnM who wrote (59668)	12/3/2002 9:44:59 PM
From: frankw1900	Respond to of 281500

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. The problem was difficult wasn't it? The event of Soviet collapse was unplanned. Moving from top down directed economic activity to market directed economic activity wasn't something they could get to easily even if there had been total goodwill throughout the country, which there was not. The grab was unsurprising. I'm actually surprised it wasn't worse. I was a bit too elliptical in that post but I guess it can be summarized in the axiom I pushed: Nature doesn't cause famine (or other such like disasters), it is caused by war or other political activity. The poverty found in the 3rd world is illustrative. It's bad but is made worse by some of the things we do here with subsidies and tariffs - the result of political activity. What could the rest of the world have done for (eg) the Russians? It was a new situation - transition from communism to market orientation and also from tyranny to democracy (however imperfect). We hadn't seen this before. The reaction wasn't perfect, that's for sure, but it wasn't that bad, either - there was some financial aid, (some of it worthwhile, some not) there was well meant advice, (some of it useful, some not). But basically it was up to the Russians, I think, to get the job done. What we could do and for the most part, we're doing it, is make sure they have access to world markets and invest - they need all sorts of investment. But that's predicated on reliable commercial law and that's something they have to establish themselves. We show them ours and how it works, and they are making some progress to towards enforcement. Could they have done a better job if they'd written the laws before stepping into the free market world? Perhaps, but there's no way of knowing. The situation was unprecedented. Also, it should not be equated with the difficulties a country like (eg) Peru faces. They have the legal forms but can't get them to work very well. If that's the case, then it isn't too helpful telling them to open their markets to (eg) the US, since that's not going to be helpful dealing with some of the particular problems inhibiting Peru's business formation. (I just wrote a note to Paul Philip about that Message 18297306 Although opening US markets to (eg) Peruvians would be helpful to them, it would be of limited scope because those who could take greatest advantage of that would be folk who are already well set up, monyed, and have unambiguous title to their property. There would be growth but rather limited - the least well off would see some improvement in their situation but not all that could be possible and slow growth of a middle class. Yes, I was intrigued by all these young foreigners getting the new economic word. I hope it's a more practical message than some of the messages such folk were getting 30 years ago.