From: steinly@topaz.ucsc.edu (Steinn Sigurdsson)
Newsgroups: sci.environment
Subject: Re: Development policies
Date: 21 Dec 92 22:58:34 GMT
	<1992Dec15.155026.11786@vexcel.com> <1992Dec15.155957.12052@vexcel.com>
	<1992Dec18.164247.17939@ke4zv.uucp>
	<STEINLY.92Dec18154507@topaz.ucsc.edu>
	<1992Dec21.162017.9194@ke4zv.uucp>
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In-reply-to: gary@ke4zv.uucp's message of 21 Dec 92 16:20:17 GMT

In article <1992Dec21.162017.9194@ke4zv.uucp> gary@ke4zv.uucp (Gary Coffman) writes:

   In article <STEINLY.92Dec18154507@topaz.ucsc.edu> steinly@topaz.ucsc.edu (Steinn Sigurdsson) writes:
   >In article <1992Dec18.164247.17939@ke4zv.uucp> gary@ke4zv.uucp (Gary Coffman) writes:
   >
   >  The alternative, of course, is for countries to make themselves attractive
   >  for private foreign investment and development. This brings new jobs and
   >  income to workers, tax revenue to the government, and a climate of prosperity
   >  that fosters other investors, domestic and foreign, to start more businesses
   >  catering to the new found flows of wealth.

   >Ack. This is a gross oversimplification Gary. In the medium term
   >indiscriminate foreign private investment can be disasterous
   >because the optimum strategy for the foreign investors may be
   >to force asset stripping of the local economy to maintain the
   >investment which is then abandoned. Now, you may argue that
   >in the long run that doesn't matter as long as the capital
   >flows in (although I'd argue that it is not always the case),
   >but it is irrelevant anyway, as the locals will _percieve_
   >an injustice and rebel. Then you either have to abandon your
   >investment or back it by force - whether by landing US Marines
   >or bribing locals.  This is why people are willing to accept
   >less than optimum gross gains in the long term in exchange for
   >the inefficiencies of managed economies, the short term pain
   >and income discrepancies of pure capitalism have too often been
   >too much to tolerate.

   It's certainly true that the transistion to a capitalist economy
   is a painful one for nations that have been dwelling in a fantasy
   world of socialist economics. But like the Arkansas Legislators
   who passed a law saying pi=3.0 to make the math easier, bandaids
   won't stop internal cancer in an economy. Serious diseases like 
   communism and other forms of managed economy require strong medicine.
   That medicine is often painful and sometimes nearly fatal in the
   short term. But it's the only long term path to healthy development.

I agree that communism and its derivatives have failed, but
I think you overlook what is often referred to as the "middle way",
which is limited government intervention and protectionism for
some industries while an industrial base is established. I'd argue
that for example the post-war Japanese economy and many of the smaller
European countries used this to build their economies at a decent
rate without going through the agonies a full implementation of 
laissez-faire capitlism would bring.  - Hell, pre world war II
USA was a partially protected economy.
	This is very difficult to do though, it can easily lead to
corruption and/or tyranny, but it is less likely to lead to the
extreme social conditions that might forment popular revolt.

   Sending in the Marines, or bribing local officials, is no solution.

Nope, it isn't. It's done all the time though.

   The people of the country must be convinced that the short term pain
   is worth the long term gain, or the development effort will fail. It
   must have grassroots support, the healing must begin from within. Using

Yup, but another problem is that the ones who profit first
in privatised economies too often try to change the rules at
that point to hold on to their newfound privilege thereby 
terminating most "trickle down" - another recipe for revolution...

   foreign military force is just another form of command economy, this
   time with the commands coming from without the borders of the country
   involved. Like all command economies, it will ultimately fail.

Yeah, but it is often in the interest of the few too perpetuate it,
and the promise they'll fail in the long run means little to those
who suffer in the short run...

   Bread and circuses have a strong mass appeal that is difficult to 
   overcome. But the only path that works in the long term lies in
   rejecting them. People must learn that their well being is in 
   their own productive hands and not in what they can beg or steal 
   from another. Parasites die without a host, and the World Bank is 
   serving as a convienent host who is prolonging the agony of these
   countries.

Yeah, but they must also believe that they personally (or their
immediate descendants) can succeed and that rules won't be changed
on them in mid-stream... 

This is getting way off sci.env, probably time to stop...

|  Steinn Sigurdsson	|I saw two shooting stars last night		|
|  Lick Observatory	|I wished on them but they were only satellites	|
| steinly@lick.ucsc.edu |Is it wrong to wish on space hardware?		|
| "standard disclaimer"	|I wish, I wish, I wish you'd care - B.B. 1983	|