Applied Economics and Politics (TTP's)

[Surferbeetle]

War is a conflict between various parties who employ a wide variety of warfare methods in order to impose their will upon their opponents. I understand War best as a system which is comprised of various sub-systems. Security, Economics, and Politics are inter-related subsystems which can be used to describe a larger conflict system. As with any model of reality it's best to keep in mind the heuristic all models are wrong but some are useful.

IMHO we as an institution display a good understanding of Security as a standalone system, however, we are just now beginning to realize that Economic and Political systems can significantly impact the Security system. This statement is evidenced by the reocurring need for one-off designs which have been constructed by various actors. This appears to be the result of our (the institution that is the USG, or at least, all of the elements fielded to address the 'problem' found in Iraq and Afghanistan) working without the benefit of a shared understanding of the underlying principles, definitions, roles, responsibilities, and requirements which comprise Economic and Political systems.

In line with the above observations it has been my experience that open source FMs are very, very thin on Economics and Politics TTP's for USG units which work within the Operating Environment found in Full-Spectrum Operations. Since I can't find what I need in the open source FM's of which I am aware of I have expanded the scope of my search. My search for a deeper understanding has included completing a graduate degree, participating in the Socratian experience that is SWJ over the last few years, and practicing what I learn in my small sphere of influence.

Upon further reflection, it's a long-winded way of stating the purpose of the thread.

Topic Area: Agriculture
Geographic Area: Zambia
Focal Question: Has Zambia's Farming Systems Research and Extension (FSR/E) approach to agricultural expansion facilitated sustainable development?
Sources:
(1) Bezuneh, M., Ames, G.C.W., and Mabbs-Zeno, C., 1995. "Sustainable agricultural development using a farming systems approach in Zambia". Ecological Economics, vol. 15, no. 2, pp. 149-156.
(2) World Bank, 1980-1994. World Bank Development Report. New York, NY: Oxford University Press.
Reviewer: Marc Small, Colby College '96

According to the World Bank, over the last twenty years agricultural production in Zambia has accounted for, on average, only fourteen percent of total GDP. In comparison, industrial production and manufacturing, combined, have made up approximately eighty three percent of total GDP over the last twenty years. Clearly, the agricultural industry is not one of the most economically powerful industries in Zambia. Consequently, the Zambian government has neglected the agricultural industry in order to pay more attention to the politically and economically influential industries such as manufacturing and industrial production.

Since the 1970's, Zambia has relied on simple, relatively inexpensive agricultural research programs to enhance agricultural productivity. In the early stages of the research programs, research was conducted in order to develop productivity enhancing technologies (i.e. fertilizers, pesticides and capital intensive crops). During this period, research took place on research stations, which did not imitate the typical conditions of a Zambian farmer's fields. In general, the research programs were designed by wealthy bureaucrats, who were only interested in fast results, and short term productivity gains.

By the late 1970's, the Zambian Ministry of Agriculture and Water Development recognized that the needs of small scale and traditional farmers were not being appropriately addressed by the previously implemented research programs. In 1978, with the help of CGIAR (The Consultative Group on International Agricultural Research), the Zambian government implemented the Farming Systems Research and Extension (FSR/E) approach to agricultural development.

The FSR/E approach to agricultural development involves development and implementation of production technologies for the traditional and small scale farming sectors. The FSR/E methodology relies on provincial Adaptive Research Planning Teams (ARPT) to carry out the appropriate farming system research. Each provincial ARPT has at least one agronomist, one economist, and one research extension liaison officer, who acts as the middleman between the farmer and the ARPT. In addition, each team is supported by a national ARPT rural sociologist and nutritionist (Bezuneh et al. 151).

Although the Zambian FSR/E approach to agricultural development has achieved some success, there is little indication that the FSR/E program promotes sustainable agriculture. The FSR/E program, like Zambia's original research programs, has continued to emphasize fast results and the meeting of farmers short term needs. Productivity gains have often come through the expansion of cultivated land. Far too often, this expansion has been into marginally productive areas that are susceptible to soil erosion. Also, the Adaptive Research Planning Teams have placed too much emphasis on developing environmentally harmful, capital intensive technologies such as toxic fertilizers and pesticides. According to the World Bank, fertilizer consumption in Zambia more than doubled between 1970 and 1987. Not enough emphasis has been placed on developing "farming systems that are compatible with the particular environmental attributes constraining small scale producers" (Bezuneh et al. 153).

[Wargames Mark]

I recommend looking at Hong Kong's development and the policies of John Cowperthwaite.

Economic growth occurs most efficiently when individuals pursue their own aims through voluntary exchange. The role of government is to provide rule of law and security. Rule of law and security protect investment and provide an environment in which individuals are willing to go out and build stuff or go out and provide services to each other.

If the goal is economic development and prosperity, then reducing the fiscal burden of government, reducing regulation, and ensuring effective rule of law and security will set the conditions for such development to occur. Nobody tells the individuals that make up the population what to do, they just go out and do it, in pursuit of their own interests. The result is high efficiency growth.

If the goal is control of the population, and you are willing to sacrifice a (potentially big) degree of economic development and prosperity in order to achieve that control, then government intervention is the way to go. 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. If people are dependent upon the government for food distribution, then the government could hardly have a more tight rein on the population. Control of housing, healthcare, and employment would help also. (Again, we're talking about a goal of increasing central government control of the population, rather than economic growth.)

If rule of law and security are lacking, then regardless of the other policies in place (laissez faire or interventionist), there will be minimal economic development, at least of a productive type from the perspective of a developed country. Without rule of law and security, resources are distributed by banditry and allocated by the whim of thugs and thieves. No sane person invests capital or personal effort in such a place.

[Fuchs]

That was a nice recap of capitalist ideology.
At the same time, it's hopelessly over-optimistic. I think it's appropriate to call it naive, too.

I can consider your take on the role of government-run social services only as typical "American". You'd be laughed at the average German forum for such a text due to its typical American social=socialist=fear!!! slant.
No dictator has ever followed such a long-winded and slow path. They simply set up a domestic intelligence service, round up potential opposition and then they have control. No major economic changes are necessary.

Without rule of law and security, resources are distributed by banditry and allocated by the whim of thugs and thieves. No sane person invests capital or personal effort in such a place.

Except those who recall that you can hire guns, of course.
Actually, Europe lacked the rule of law until a few decades, up to about a century ago.
The pre-19th century systems didn't even come close to today's understanding of "rule of law" and the 19th century systems badly discriminated in favour of the establishment (thus providing no universal rule of law either). Much of Western Europe was under authoritarian or outright dictatorial control will the fourties, Spain even till the death of Franco.
How did we get to this point without ever investing till the 20th century?
We didn't - people don't consume everything just because investments are risky. They still save much, and savings~investments in macroeconomics.
Such a new thing as "rule of law" can hardly have been a condition for more than "minimal economic development".

- - - - -

Many conditions need to be met for a rapid economic growth or industrialisation along the market economy model. Few countries meet these and many of those who once met them don't meet them any more for perfectly normal reasons.
Planned economy coupled with central dictatorial authority proved able to lead to rapid economic growth, even with little (yet crucial) outside help.

In either case you get the most growth if the country has a much higher potential than actual economy. A well-educated, experienced, healthy population with a minimum of security & stability and a useful monetary system can produce extreme growth.
See Solow and Ramsey growth models: http://en.wikipedia.org/wiki/Ramsey_growth_model http://en.wikipedia.org/wiki/Solow_growth_model
Examples are post-WW2 Italy, Germany and Japan as well as developing countries that industrialised based on a sound education & health basis - Taiwan, South Korea, PR China post-'80.
The planned economy approach on the other hand managed to pull off strong growth and rapid initial industrialisation even without meeting all those conditions - examples are the inter-war Soviet Union (especially during the 30's) and PR China (pre-'80). Nevertheless, it requires some conditions be met; see the failure in Tanzania and many other small developing countries.

Cuba with its health and education system is an economy miracle in the waiting queue. It lacks the resources and export markets for a planned economy economic growth, but it has the right ingredients for a market economy growth (less the entrepreneurship middle class).

- - - - -

"Efficiency" is a poor metric in regard to economic growth. You cannot measure it. You can measure rapidity, though - and the rapidity of growth depends more on the variables than on the system.

- - - - -

Just in case someone thinks that I'm a covert commie from Eastern Germany; I was born in Western Germany and did my economics degree at a Western German University.

[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!

[Steve the Planner]

Wilf:

I thought the point was that since the (1) invention and wide distribution of the effective handgun, (2) the emergence of middle classes and non-royal wealth, and (3) tactics where scruffy insurgent militias could defeat the greatest army in the world, ended the tyranny of kings and laid the foundation for our modern world?

Now, the king works to keep our "rice bowls" full, or, ultimately, we say: The king is dead, long live the (next) king.

It's been shown to be rather a good concept.

[Surferbeetle]

How about some Econ TTP's from USAID which could be applied at a local level:

GATE'S METHODOLOGY
GATE uses mixed-methods, which rely on primary data collection through surveys, secondary analysis of household survey and national accounts data, and qualitative analysis using key informant interviews and focus groups. Integral to GATE's gender and pro-poor analysis are the following components:

Distributional analysis: explores the value added generated along the chain and examines the returns to labor and capital and to the different actors that participate in the chain.

Segmentation analysis: assesses how the labor market is segmented by sex throughout the value chain;

Analysis of power and governance within the chain: investigates power within production and exchange relationships across the value chain, including the power to set market prices and bargain as well as indebtedness and sub-optimal contracting; and,

Entitlements and capabilities analysis: considers factors and characteristics that mediate men's and women's entitlements to productive resources, and their capabilities to deploy these resources. Where possible, GATE also examines the poverty rates and livelihood strategies of different actors in the chain.

Survey from Wikipedia

Statistical surveys are used to collect quantitative information about items in a population. Surveys of human populations and institutions are common in political polling and government, health, social science and marketing research. A survey may focus on opinions or factual information depending on its purpose, and many surveys involve administering questions to individuals. When the questions are administered by a researcher, the survey is called a structured interview or a researcher-administered survey. When the questions are administered by the respondent, the survey is referred to as a questionnaire or a self-administered survey.

Market Segmentation from Wikipedia

Market segmentation is a concept in economics and marketing. A market segment is a sub-set of a market made up of people or organizations sharing one or more characteristics that cause them to demand similar product and/or services based on qualities of those products such as price or function. A true market segment meets all of the following criteria: it is distinct from other segments (different segments have different needs), it is homogeneous within the segment (exhibits common needs); it responds similarly to a market stimulus, and it can be reached by a market intervention. The term is also used when consumers with identical product and/or service needs are divided up into groups so they can be charged different amounts. These can broadly be viewed as 'positive' and 'negative' applications of the same idea, splitting up the market into smaller groups.

Value Chain Analysis by Wikipedia

A value chain is a chain of activities for a firm operating in a specific industry. The business unit is the appropriate level for construction of a value chain, not the divisional level or corporate level. Products pass through all activities of the chain in order, and at each activity the product gains some value. The chain of activities gives the products more added value than the sum of added values of all activities. It is important not to mix the concept of the value chain with the costs occurring throughout the activities. A diamond cutter can be used as an example of the difference. The cutting activity may have a low cost, but the activity adds much of the value to the end product, since a rough diamond is significantly less valuable than a cut diamond. Typically, the described value chain and the documentation of processes, assessment and auditing of adherence to the process routines are at the core of the quality certification of the business, e.g. ISO 9001.

Supply chain analysis from Wikipedia

A supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer. Supply chain activities transform natural resources, raw materials and components into a finished product that is delivered to the end customer. In sophisticated supply chain systems, used products may re-enter the supply chain at any point where residual value is recyclable. Supply chains link value chains.[2]

SWOT analysis by Wikipedia

SWOT analysis is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieve that objective. The technique is credited to Albert Humphrey, who led a convention at Stanford University in the 1960s and 1970s using data from Fortune 500 companies.

Stakeholder analysis by Wikipedia

Stakeholder analysis is a term used in conflict resolution, project management, and business administration to describe a process where all the individuals or groups that are likely to be affected by a proposed action are identified and then sorted according to how much they can affect the action and how much the action can affect them. This information is used to assess how the interests of those stakeholders should be addressed in a project plan, policy, program, or other action. Stakeholder analysis is a key part of Stakeholder management.

[Steve the Planner]

Beetle:

Problem with all those great power points in GIGO.

You can download the USAID "master plans" for Iraq, as an example, and track them across the years. I summarize all below:

2004: We have analyzed the economic problems in Iraq and find that they all derive from agricultural inadequacies, all traceable to the lack of american made tractors. In 2004, we addressed the problem by providing 5,000 tractors.

2005: We have analyzed the economic problems in Irq and find that, despite tractors, agricultural inadequacies are all traceable to the lack of american made center pivot irrigation systems. In 2005, we addressed the problem by providing 5,000 systems.

And so on and so on.

USAID looks good on paper, but, at present, has no effective teeth. Fix that, and, in theory, we would not have many of the COIN confusion the military is now struggling with.

[Surferbeetle]

Vetted digital copies of 'local' case studies and simulations could be used to gain and check subject comprehension and be maintained upon a share portal.

Two examples:

• Harvard Business School sells digital copies of case studies and simulations.

• IBS/CDC out of India sells case studies

[Steve the Planner]

Problem is we go to war with the aid system we have.

State's Ambassador Herbst has, over and again, sought money to staff up SCRS. Whether this would work or not, no funding ever materialized, and, at best, he can field a handful of 90-day inter-agency assignees for piecemeal "master planning."

Personally, I have a great deal of respect and faith in the new USAID administrator, and believe that, one day, he will be able to transform USAID, if, like Herbst, enough time, money, and staffing is provided.

Notwithstanding, the White House, Senate, NSC, State and USAID have been deeply immersed for the last six months in a policy/organizational structure debate about the above: Who is going to lead and implement an effective US stability & reconstruction program if and when we choose to create one?

Until that core debate is concluded, and the organization is (or is not) created, the US military is left to muddle in active wars without the key entity needed for resolution.

They are doing the best they can, without adequate resources, framework, training or capability. God bless them.

[Dayuhan]

AID, like so many other aid agencies, often tries to use money and technical assistance to promote development in environments where the primary constraints on development are not financial or technical, but political. Given the complications and potential for unintended consequences that go along with political engagement this is understandable, but it often produces very unsatisfactory returns on aid investment.

[Steve the Planner]

Dahayun:

i.e., Massive corruption comes from massive unconstrained US spending.

How do we cure corruption?????

[Dayuhan]

Massive corruption comes from massive unconstrained US spending.

I wouldn't say that corruption is a consequence of US spending, though large amounts of externally sourced money do increase the opportunities for corruption.

I was thinking more of the reality that economic development requires change, and change often threatens the position, prosperity, and even the survival of local and national elites. These elites may not openly oppose development efforts, especially if they have uses for the incoming funds, but they are likely to actively manipulate the process to ensure that their interests are not compromised, which often also ensures that the aims of the funding agency are not met. We need to be able to recognize divergent goals, and in cases where the interests of the local elite are completely incompatible with development goals it may be better to simply put the money somewhere else, where it might have some chance of accomplishing something.

Unfortunately it's often more important to be able to say we sent x hundred million to a certain utterly miserable place than to be able to point out what that money actually accomplished.

How do we cure corruption?????

We don't, unless it's our own corruption. We can't cure anyone else's.

[Surferbeetle]

STP and Dayuhan; define corruption. Different cultures have different definitions as we all know.

Dayuhan, I am still reflecting upon the Philippine Politics and the Rule of Law paper (perhaps you could provide a link in this thread as well) which you shared the other day; here is a political analysis (TTP's) paper which you might find to be of interest:

Reidar Visser's Iran's Role in Post Occupation Iraq Enemy, Good Neighbor, or Overlord?

The subject of Iran’s role in Iraq—what it is, and what it should be—is a hotly contested one. Some analysts stress the role of Shiite identity and religion as a unifying bond between Iran’s approximately 60 million Shiites and the 15 million strong Shiite majority in Iraq, mostly concentrated in Baghdad and areas south. A few suggest the existence of even vaster schemes of cooperation, with Shiite solidarity extending from Iran via Iraq to the Alawite minority that rules Syria and into the south of Lebanon, which is also dominated by Shiites—a “Shiite crescent” that seems ideally positioned to dominate the entire Middle East through its hold on strategic territory and with its control of combined oil resources that rival those of Saudi Arabia. At the same time, other scholars reject the idea of any particular closeness between the Shiites of Iran and those of Iraq. These analysts tend to stress the Arabness of the Shiites of Iraq—who in many cases descend from recently settled nomadic tribes whose conversion to Shiism took place within the past couple of centuries—and point to historical facts such as the loyal Shiite participation on the Iraqi side in the eight-year war against Iran in the 1980s as proof of the Iraqiness of the Shiites and as a formative experience in its own right. Often, this kind of perspective goes hand in hand with a view that Iraqi Shiites are actively hostile to the model of government instituted in Iran after the 1979 revolution, and that they in particular despise the idea of clerics holding political office. It has even been suggested that the current government of Nuri al-Maliki, after its turn against certain internal Shiite contenders, constitutes a contemporary example of what this attitude to Iran means in practice.

In this report, a synthesis of these two positions is offered. On the one hand, the Iraqi identity of the Shiites living in the country seems firmly established at the popular level. Historically, the Shiites of Iraq have always shied away from all kinds of schemes that would create a sectarian enclave south of Baghdad or unite the Shiite portions of the country with Iran, and the spectacular failure of the scheme to create a federal Shiite entity in post-2003 Iraq (which was tentatively launched in the summer of 2005) seems to attest to the endurance of an “Iraq first” attitude among the Shiite population. However, on the other hand, the U.S. invasion of Iraq in 2003 set in motion a formidable process of upheaval and such tremendous pressures from the outside that internal Shiite elite politics in Iraq changed beyond recognition and shifted away from its historical trajectory.

[Dayuhan]

define corruption.

Two definitions:

1. The use of institutional resources for individual advantage.

2. The other guy's hustle.

I personally think that what we think of as "traditional corruption"... bribes, kickbacks, etc is often less damaging to an economy than the use of State power, including coercive force, to maintain elite control of the means of production. They often go together, of course, and it's a fairly poisonous combination.

I don't think the full text of the Philippine paper is available online...