Saturday, August 30, 2008
Bad Samaritans is perhaps not quite as radical as the subtitle might lead one to believe, but it is a rare critique of globalization from the perspective of an economist trained and vested in the globalist circles. It's a bit of a light read at 200 pages, but an interesting look at a topic usually approached from a humanist and emotional perspective.
P. 15-16 "The Korean economic miracle was the result of a clever and pragmatic mixture of market incentives and state direction. The Korean government did not vanquish the market as the communist states did. However, it did not have blind faith in the free market either. While it took the markets seriously, it often recognized that they needed to be corrected through policy intervention ... Now, if it was only Korea that became rich through such 'heretical' policies, the free-market gurus might be able to dismiss it as merely the exception that proves the rule ... however ... practically all of today's developed countries, including Britain and the U.S., the supposed homes of the free market and free trade, have become rich on the basis of policy recipes that go against the orthodoxy of neo-liberal economics."
P. 104 - "Few would now dispute that communism failed as an economic system. But it is a huge leap of logic to go from that conclusion to the proposition that state-owned enterprises do not work ... For a while, it was as if the whole ex-communist world was hypnotized by the mantra, 'private good, public bad', reminiscent of ... Animal Farm. Privatization of SOEs has also been a centrepiece of the neo-liberal agenda that the Bad Samaritans have imposed on most developing countries in the past quarter of a century."
P. 158 - "Gore Vidal, the American writer, once described the American economic system as 'free enterprise for the poor and socialism for the rich'. Macroeconomic policy on the global scale is a bit like that. It is Keynesianism for the rich countries and monetarism for the poor."
P. 180 - "Having once dismissed political factors as minor details that should not get in the way of good economics, neo-liberals have recently become very interested in them. The reason is obvious - their economic programme for developing countries as implemented by the Unholy Trinity of the IMF, World Bank and WTO has had spectacular failures (just think of Argentina in the 1990s) and very few successes. Because it is unthinkable to the Bad Samaritans that free trade, privatization and the rest of their policies could be wrong, the 'explanation' for policy failure is increasingly found in non-policy factors, such as politics and culture."