Applied Economics and Politics (TTP's)

[Dayuhan]

No dictator has ever followed such a long-winded and slow path.

Venezuela is a good example of a government using dependence-building dole-outs to achieve and sustain support. Works pretty well until the candybag runs out, or in Venezuela's case until oil production starts plunging because you're using the revenue for politics instead of putting it back into the industry that lays the golden eggs.

Wouldn't have worked nearly as well without oil in the picture, or without very high oil prices keeping the candybag full. Certainly not a very good way to build an economy, but your average populist demagogue is less interested in building an economy than in maintaining personal control.

There is no universal path to economic development. What works in one place may not work in another, and there are always tradeoffs: nothing ever works perfectly anywhere. Fundamentalism in economics - whether capitalist, socialist, or any other sort - is as dangerous as it is in politics, religion, or anywhere else.

In terms of Surferbeetle's economic systems, I'd only point out that these systems, like political systems, have to grow. They can be cultivated, but they cannot be installed. We can't bring an economy in a box, any more than we can bring a government in a box. Since people will always create an economy, it's often useful to focus on identifying and addressing obstacles to economic development, both governmental and private.

[Fuchs]

Venezuela doesn't even come close to what he wrote.


I submit that economic development is a too slow feature for a COIN strategy. Or maybe it's just me and others are fine with 10-15 year occupation campaigns?


Military leaders need to know a few simple messages about the economy in my opinion - like these:

- Don't interfere in black markets except arms markets. That's the police's job.

- Don't interrupt the flow of civilian goods, help the population to keep them flowing. Producers need to supply their markets and the demanding people depend on deliveries. Wealth depends on the access to a choice of markets.

- Listen to civilians about their economic problems. You might be able to fix some easily.

- There needs to be a functioning monetary system. It's unimportant whether that's based on national currency, foreign currency, cigarettes, chewing gums or shiny stones. It it works - don't fix it. That's a politician's job if anyone's.

- Impose restrictions (check points, limiting access to settlements with markets, blocking streets, ...) only after taking economic effects into account.

- Take into account that you might crowd out local production if foreigners flood the region with foreign goods (like food, clothes, vehicles, seeds).

...

And others. It's too late here for smart ideas, good night.

[Dayuhan]

Venezuela doesn't even come close to what he wrote.

He wrote this:

Subsidies and government-run social services develop dependency of the targeted population on the government that controls those subsidies and services, giving the government a handle with which to grasp hold of the people.

That seems a reasonable description of what poor Hugo is trying to do, the key factor of course being that in Venezuela the subsidies and social services are specifically designed to maintain dependency and control.

I would certainly agree that military leaders an organizations should minimize interference in economic matters.

[Steve the Planner]

Interesting debate on the foundations of economic growth, but, I start from a different proposition: Economics is the beginning and end, with politics as an essential complementary system that either complements, competes with, redefines or redirects economics, and security is a sub-set of politics, and/or economics.

Growth is a different variable from economic performance, and the rate of growth, and allocation of growth may be defined by free market or political systems.

Whether politics can, and does create or expand growth is as case specific as whether it stifles or suppresses it.

By the 1950's, the US was ready to break out of the concentrated port city/rail model, but to do so it needed free and fast movement of freight and people across multiple competing districts and fractious highway systems. The federal highway act not only created express routes but limited the old fashioned speed traps, and convoluted by-passes and confusing signs intended, the same as "checkpoints" to obstruct free and effective movements, and the system could not be built or function without an alternative non-local funding and management system. Once it was in place, much new growth was created and sustained.

By contrast, even before Katrina, you could drive east from New Orleans and find a huge boondoggle of a road, infrastructure, industrial park platting for miles of vacant property. Pure corruption, waste and junk. Not surprisingly, the profits for much of that city's real estate market were made through political boons of sites, development opportunities, and financing for hotels, casinos, etc... (lots of officials went to jail afterwards).

The Land Between Two Rivers will always be an unproductive dust bowl (or, on occasion, a dangerous floodplain) unless managed along its whole reach. When well managed, much prosperity is produced. If I owned a business in Venezuela, it would struggle to profit in the economic/infrastructure environment created by Hugo.

A good friend who was a network reporter during Vietnam, and based in France, always said: if it isn't about money, its about love. She has seldom been wrong. (note: Money is power; respect is love---it is not just cash and babes).

Steve

[William F. Owen]

Isn't the primary purpose of Government, the defence of the nation? Folks pledged their allegiance to Kings, because he defended them.

At the most basic level, power flows from those who can impose law, order and security, by means of force. Sorry if I am missing something, but I don't see the burning exam question here.

[Fuchs]

Isn't the primary purpose of Government, the defence of the nation? Folks pledged their allegiance to Kings, because he defended them.

Actually, people defend themselves. They also built pyramids - the Pharaoh's did likely not lift a single stone for that.

The ancient Germanic societies were said to have a very basic system of allegiance; warriors join some "noble" man of whom they expect good leadership for a skirmish or battle. The leader didn't provide "defence" - he provided leadership.

That only changed when stirrup riders with armour (both horse and body armour were pretty much privileges of the rich in Gallic and late Germanic societies) became more important and the society turned into a feudal one in which the nobles became the standing army and judges of the country, led by a king who also governed.


In regard to "primary purpose is defence"; I have a different suspicion, and that applies to NATO as well. The primary value (and thus unofficial primary purpose) of a common government is in my opinion that it keeps the people from fighting and hindering each other - not the defence against foreigners.
The first German unification was more about getting rid of all those tariffs than about defence as far as I know.

Unifications explicitly for the purpose of a common defence (Vercingetorix, Arminius) tended not to last.

[slapout9]

Governments must not only protect what is valuable but must also provide some means of producing or acquiring what is valuable. Economic instability leads to Political instability!