In certain societies money is not necessary or it consists of a natural resource or food item. In a more complex society that can support the infrastructure money is very important. I guess the protectorate would have to assume that responsibility.
I don't mean literally fence people off, nor do I mean cut them off from aid and interaction with the globe. I mean to protect them from overt coercive influences (internal, as well as external) while refraining from forcing western religion and politics onto them.
The U.S. did pretty well in the Middle East once we established that we wouldn't stand for getting pushed around, and we focused on commerce rather than colonialism; and accepted constraints on our missionaries as well to that of indirect influence through hospitals and schools rather than overt efforts to convert the locals. Much like China today, we did not overly constrain our commercial efforts with moral positions; nor did we overly burden our commercial efforts with the maintenance of colonial political structures and controls.
Post WWII we slid into the colonial role with its burdens, took the constraints off our religious outreach, and off of our impulse to exert moralistic pressures as well. As friction builds against that; the Chinese and others slide in underneath, much as we did, and build their own influence and economies in the process while we struggle to sustain the unsustainable, like the Euros before us.
We justified our actions in the name of the Cold War, but were encouraged by economic interests in the Oil industry, as well as religious interests in backing Israel to the degree we do. The Cold War became more a cover for action than the true driver of our policies in the region; and borne out by no perceived deviation in our policies there even though the Cold War is 20 odd years behind us. As Ike said, the real strength of the Containment strategy was how it worked to constrain ourselves. We have grown increasing unconstrained in our own behavior, but still work at least as hard as before to constrain the behavior of others. It is a trend in policy that is wearing thin with allies and opponents alike.
No, I mean more a commitment to protect. Not to protect a particular government, but rather to protect the populaces within particular regions from internal and external abuses of government without overly skewing that support by our own biases and interests. This is the future for intervention whether we like it or not. Empowered populaces and non-state actors will continue to punish states who overstep the boundaries of such relationships to exert their own will over that of the populace there.
This is new territory for the U.S.; and even though many an empire has gone down this path before us, it is in a new "globalized" environment of rapid travel and communications that we follow. History provides a general guide, but much we will need to plot out for ourselves.
Listening to the wisdom of Washington regarding foreign entanglements; and Ike regarding the importance of "self-containment" are good starts for mapping that course.
Robert C. Jones
Intellectus Supra Scientia
(Understanding is more important than Knowledge)
"The modern COIN mindset is when one arrogantly goes to some foreign land and attempts to make those who live there a lesser version of one's self. The FID mindset is when one humbly goes to some foreign land and seeks first to understand, and then to help in some small way for those who live there to be the best version of their own self." Colonel Robert C. Jones, US Army Special Forces (Retired)
In certain societies money is not necessary or it consists of a natural resource or food item. In a more complex society that can support the infrastructure money is very important. I guess the protectorate would have to assume that responsibility.
"I can change almost anything ... but I can't change human nature."
Jon Osterman/Dr. Manhattan
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Yes, barter can be prevalent but even that is a form of money because you keep accounts, checkbook money which is all it really is. But here is idea for you. I grew up in Florida while Disney World was being built and EPCOT. EPCOT stands for Experimental Prototype Community of Tomorrow. Disney solved the problem you are talking about, of course it was butchered by the shareholders and with Disney's death the original concept was lost. But the idea was to build a totally self sufficient city. It was designed to be totally self sufficient and evolving (constant process improvement through engineering) largely based upon the ideas of Buckminster Fuller, might want to try and Google that and see what you come up with. There were some fantastic stories published in the local paper at the time about what it would be like. Bur greed squashed it.Originally Posted by TheCurmudgeon
I did not literally mean fencing people off either (although the idea crossed my mind).
I think the world has changed too much, particularly communications systems. I am not sure we can do what you want. First, we would have to come to some agreement on what the basic human entitlements (rights) are since we are committing to intervening in the internal affairs of other territories and nations. Second, we would have to determine when our national (or international) interests demand intervention.
You could argue that, in certain respects, we are doing exactly this type of thing with other countries like Thailand or Indonesia. Neither have a real democracy but that does not bother us. We are committed to defend them through treaty. It works fine. But they both have functioning governments. The problem is getting to that point where all we need to have is a mutual defense treaty.
Last edited by TheCurmudgeon; 12-30-2010 at 03:41 PM.
"I can change almost anything ... but I can't change human nature."
Jon Osterman/Dr. Manhattan
---
Don't fence it off....Dome it offI did not literally mean fencing people off either (although the idea crossed my mind
For the best or the worst, such societies do not exist anymore. What ever you say, even in the most remote places everything is valued on a money base. It can even become silly but the concept of money is everywhere.
It's for example on of the biggest problematic of youth integration into post conflict South Sudan.
Also, the function of central state to edit money is tricky. In many places, populations will use a foreign currency to trade. You actually can govern without using national currency.
I don't disagree that money is everywhere, I just don't believe that you have to have it.
However, your second solution is much more elegant. Simply use US currency. As I understand it, it is currently one of the benchmark currencies used in the world (at least until it becomes the Chinese yuan).
Heck, we were using it to bribe everyone in northern Iraq prior to the invasion. Although another currency that is not as easy to counterfeit might be better. Maybe the Australian dollar.
Actually, the more I think about the problem the more I think an external currency would be best. The reason I preferred not having money is because non-specie backed money (paper currency not tied directly to the value of gold or silver) the value of the money is largely dependent on the trust in the value of the government. Where there is a weak government you tend to have high inflation. So if you have no government the natural response is to have no money. However, as you have pointed out, that idea is antiquated. It would be smarter to us an external benchmark currency until the territory had a stable government.
Last edited by TheCurmudgeon; 12-30-2010 at 07:42 PM.
"I can change almost anything ... but I can't change human nature."
Jon Osterman/Dr. Manhattan
---
Buckminster Fuller on money
At present 99 percent of humanity is misinformed in believing in the Malthusian concept of the fundamental inadequacy of life support, and so they have misused their minds to develop only personal and partisan advantages, intellectual cunning, and selfishness. Intellectual cunning has concentrated on how to divorce money from true life-support wealth; second, cunning has learned how to make money with money by making it scarce. As of the 1970s muscle, guns, and intellectual cunning are ruling world affairs and keeping them competitive by continuing the false premise of universal inadequacy of life support. If mind comes into supreme power within a decade, humanity will exercise its option of a design revolution and will enter a new and-lasting epoch of physical success for all. If not, it will be curtains for all humanity within this century.
Highlights are mine and this goes to the central problem.
That's been the gold standard since the 70s and even today both in Africa and on this end of the world. Even as much as the dollar fluctuates most prefer to deal in USD. The Euro is not as trusted and not sure it's any harder to counterfeit based on stats in Europe.
Excellent point ! In fact most were discerned in early 84 when half of Zaire switched to the USD for trading. They even named the trading street "Wall Street" situated on the curb across from our embassy
It wouldn't be long before few performed any transactions in local currency other than the government and military. That led to a whole new set of problems though.
If you want to blend in, take the bus
Our counterfeiters are better than yours!
Excellent, you just exposed the Gold and Silver fallacy. How do you determine what gold or silver is worth....a government sets a "Price" on what it is worth and that "Price" becomes Money kept in a bank account which is why using a gold or silver standard has never worked and certainly will never work in any type of modern economy. I agree with you, you would probably be best using a foreign currency at least to start with. But debt can be crushing to developing countries.
I think the debt would be less crushing if the people lending the money did not demand a complete governmental bureaucracy. That is the whole point behind doing it as a minimalist operation - let the society develop at its own level and not demand it to be something it cannot afford to be. Of course, the expense of administering the country would fall on whomever is acting as the protector, and a cost/benefit analysis would need to be made as to whether it is worth doing in the first place. But assuming that the analysis indicates that intervention is necessary and cost-effective, then the protectorate seems to be the logical choice.
"I can change almost anything ... but I can't change human nature."
Jon Osterman/Dr. Manhattan
---
I've seen this allegation before, but I've yet to see it substantiated in any way. Have our interventions actually increased since the end of the cold war? I think not.
Are we really overstepping those boundaries? Our post-9/11 extravagances in Iraq and Afghanistan certainly did, but as a general rule our attitude toward "failed states" has been to deter, contain, and ignore. There's very little to suggest any appetite for repeating the experience of Iraq and Afghanistan: if politicians haven't learned a lesson the populace has, and on the basis of political will alone regime change is, at least until memory fades, as dead as the dodo bird.
A commitment to protect is a nice idea, but it's not likely to be the future of intervention, for the US at least. Sustained deployment of US forces is simply too expensive to be justified in the absence of any direct threat or interest. Americans may feel sorry for the people of Zimbabwe or Myanmar, Somalia or the DRC, but shelling out a few hundred billions from our pockets is a bit more sympathy than we're prepared to express.
Actually it's not that simple. Zimbabwe as Tito's Yugoslavia show that under strong (rigid) government you have a crazy inflation.Where there is a weak government you tend to have high inflation. So if you have no government the natural response is to have no money.
The value of national currency is based on the international perception but also (mainly) on national perception of its value compare to external currency for non international exchange market currencies.
The natural response in a non state/government environment is, as Stan just pointed it, to go for the most stabe foreign currency.
By the way, dollars is the most appreciated curency and its easiness to counterfake is part of its popularity.
Case in point, 84 to 94 in Zaire, then although a total cleptocracy was relatively stable, millions in foreign aid, and a very strong government/rule. The official ROE was 50 Makutas (one half of a Zaire, or 50 cents if you will) to one USD, and the black market rate (directly in front of the US Embassy) was 28 Zaires to one USD. When I departed in late 94 the rates were more than 5 million Zaires to one USD.
At restaurants most of us paid in USD or held a credit account til the end of each month. Grocery stores did not post prices on the shelves. The value of your purchase was calculated during the arduous process of ringing up your total.
If you want to blend in, take the bus
Admittedly, my knowledge of economic theory is not that great. I would guess it is a question of perception, both internal and external. Do the people in the country have faith in the currency; will the people outside of the country accept it in exchange for goods. How "good" the government is at governing may or may not necessarily matter.
That being said, I think we have a consensus that using an external currency until a self-sustaining government can be formed is the best option.
"I can change almost anything ... but I can't change human nature."
Jon Osterman/Dr. Manhattan
---
Money can very in its buying power a bit for a host of reasons, but there's one influence factor that can be manipulated quite easily:
The amount of cash.
Paper and coin money don't increase in quantity by much unless the government and/or central bank allow it.
Bank deposits (the other part of M3) can be regulated with rules for banking.
In short: There's no hyper-inflation with trillion dollar bills unless you print trillion dollar bills. You can refuse to print them, this creates a scarcity of paper money and increasingly scarce objects with a use tend to gain in value ceteris paribus.
Inflation beyond about 8% is really about government trying to finance itself (or get rid of its domestic currency non-indexed debt) with the printing press, not about other economic factors.
The use of foreign cash has advantages and disadvantages; a widespread use of foreign money essentially fixed he exchange rate to 1, it's like in a monetary union. This may be a huge problem for a trading country if its economy develops differently than the primary economy of the foreign cash.
Btw, I have a blog post under preparation about the new state/cash issue. Check my blog in a week if it's relevant to your interests.
Last edited by Fuchs; 12-31-2010 at 04:27 PM. Reason: btw
You may not be an expert in economics, but you're dead on the money !
We don't have the unfortunate experience of going to the airport or train station and attempt to exchange our currency for the destination's, only to discover "your money's no good here".
When the dictator ships in boats loads of freshly printed 5 million notes -- coincidentally with the national military's payday -- and not a soul at the local market or store will accept that currency as payment, things get sticky.
Most were carrying grenades and weapons back in 91 and most didn't make it out of the market that day.
BTW, Happy New Year to you and yours !
Regards, Stan
If you want to blend in, take the bus
Traditional fiat money (legal tender) has a forcing provision that maintains that it is the only method of payment accepted for your taxes, if that provision is not in there, then there is know reason to hold the currency (circulate it). A foreign currency with that stipulation will probably do everything you need it to do at least at the start. I think this would allow you to focus on the main problem which is going to be the "real" physical economy that actually produces the things that people need in order to survive and prosper.Admittedly, my knowledge of economic theory is not that great
That being said, I think we have a consensus that using an external currency until a self-sustaining government can be formed is the best option.
To infuse foreign money in large quantities is actually dead-on wrong.
This should be obvious by now.
Foreign cash leads to corruption and the corrupt people in whatever power position send a large share of their booty to other countries to secure their wealth.
Foreign cash can furthermore establish itself firmly and the abundance (the infusion is often disproportionate to the countries' economy) of it leads to inflation (wages rise - measures in foreign cash).
This all makes it extremely difficult for the addict after withdrawal.
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