I hope Tim knew he was being absurd writing what he did, but all he wrote after the above suggested he did not. It’s unsurprising that throughout the entire left he is treated as a buffoon. Oh, a buffoon who knows economic theory quite well. But a buffoon because of his complete inability to exercise any wisdom when it comes to interpreting it, as this latest blog shows.
But if blogging about me keeps you happy Tim, keep going. It does amuse us that you waste so much time and effort getting things so spectacularly wrong time, after time, after time.
Naughty, naughty Timmy.
And the buffoonishness of my commentary is proved by my attitude towards the Washington Consensus of course.
Why? Because the reality is it’s been about destroying the state, opening up markets to unfair competition, moving to regressive indirect tax bases, denying resources to industries that need them, denying labour rights whilst enhancing capital rights, allowing the free flow of capital and denying that right to labour, undermining the property rights of onshore states and enhancing those of offshore, allowing unfettered finance rights over all else and so much more.
I suppose it\’s possible that that is indeed what it\’s about but, well, you see, proof is in the pudding. Leave aside both rhetoric and ideological positioning and ponder the important question:
Look what it’s done to Africa and you’ll know why.
So what has been happening to Africa?
The conventional wisdom that Africa is not reducing poverty is wrong. Using the
methodology of Pinkovskiy and Sala?i?Martin (2009), we estimate income distributions, poverty
rates, and inequality and welfare indices for African countries for the period 1970?2006. We
show that: (1) African poverty is falling and is falling rapidly. (2) If present trends continue, the
poverty Millennium Development Goal of halving the proportion of people with incomes less
than one dollar a day will be achieved on time. (3) The growth spurt that began in 1995
decreased African income inequality instead of increasing it. (4) African poverty reduction is
remarkably general: it cannot be explained by a large country, or even by a single set of
countries possessing some beneficial geographical or historical characteristic. All classes of
countries, including those with disadvantageous geography and history, experience reductions
in poverty. In particular, poverty fell for both landlocked as well as coastal countries; for
mineral?rich as well as mineral?poor countries; for countries with favorable or with unfavorable
agriculture; for countries regardless of colonial origin; and for countries with below? or abovemedian
slave exports per capita during the African slave trade.
Now I don\’t know about you but I regard that as very good news indeed. Hundreds of millions of our fellow humans are becoming better off. Absolute poverty is falling in Africa, just as it has fallen in Asia. And, given that we\’ve been \”imposing\” (in fact, what we\’ve been doing is saying that if you want our money we recommend that you follow some fairly basic \”good\” economic policies) the Washington Consensus in such places we should probably credit said Consensus with the results that are appearing.
Now I\’m sure that you can claim that it\’s not that Consensus which is causing that fall in poverty. But if you do then you\’ve really rather got to argue that the Consensus hasn\’t actually been imposed. In which case of course it can\’t be blamed for any of the bad things that have happened just as much as it cannot take credit for the good. But if you argue that it has indeed been imposed, if Africa is reeling under that imposition, then we need to look at what is actually happening in Africa under said imposition. And a general reduction in poverty is what is happening which, if you\’ll excuse me for saying so, is actually what we\’d rather like to be the result of a socio-economic system. Which brings me onto a further point:
Tim Worstall is a very strange man. As far as I can see he’s written 13 blogs about me – in the past fortnight. I call that an unhealthy obsession.
And despite his clearly being my biggest fan and #1 cheerleader he also gets me quite wildly wrong.
There is certainly a possibility of an obsession there I agree. But I don\’t in fact get Ritchie wrong, far from it. This is something I\’ve said many times before but people still seem to be not quite understanding it.
I\’m a lefty. No, really, I am. I\’m a liberal, a progressive and a radical. Liberals are, as the word itself suggests, concerned with liberty, as I am. Progressives are those who believe in the power of the State to make things better and I most certainly agree with that. Radicals are those who think that we cannot simply tinker at the edges, we need some fairly major changes. About the only way in which I disagree with the basic propositions as usually understood is that in terms of progressivism I think that one of the ways the State can make things better is to stop doing some of the damn fool things it\’s already doing.
So, as such a lefty, why am I so in favour of things like markets, free trade, capitalism and so on? Those things which are generally thought of as the preserve of the \”right\”? (Let us leave aside that \”the right\” ain\’t been a friend of free trade shall we?)
Because they work.
If what you want is that the poor get richer, if what you want is an improvement in general living standards, if what you want is that the absolutely poor become only the relatively poor, then capitalism, markets and free trade are the only games in town. The unique thing about this really rather strange economic system is that it is the only one which has produced a general and long lasting rise in the standard of living of the average chelovek on the Chelyabinsk omnibus.
Which is why I Rag on Ritchie quite so much. To the possible point of obsession. I do him the courtesy of assuming that he wants just what I do. A better and richer world for those currently stuck in the absolute poverty that has been humanity\’s historical lot. Certainly he works with a lot of organisations who claim that this is their aim (Action Aid, Oxfam I think, Christian Aid and so on). It\’s just that his actual suggestions of how to get from here to our jointly desired goal strike me as entirely wrong.
And as such, as suggestions which are entirely wrong, they should be critiqued in the hope that by doing so his suggestions can be improved. For we do both desire exactly the same thing. That those in Africa, indeed those anywhere, should become just as fat, rich and happy as we pinkish people who by historical happenstance were the first to leave the Malthusian world behind.
It\’s a simple and observable fact about the world around us that those places which have been roughly capitalism and market based for a century or more are places where people are rich, fat and happy. Those places which have been roughly capitalist and market based for mere decades are those places where people are becoming rich, fat and happy, in what has been generally noted as the greatest reduction in poverty in the history of our species. Those places which have only just adopted these twin capitalist and market based policies are those places where the first stirrings of becoming rich, fat and happy are starting.
Those places which have never been and are not even attempting to adopt the capitalist, market based, structure are those places where people are not and are not becoming, rich, fat and happy.
Thus, as a good little lefty, one who desires that all of humanity share our own good fortune in being rich, fat and happy, I recommend that all of humanity adopt the economic system which made us so and which is making those who do adopt it as rich, fat and happy as we are.
And the Ragging on Ritchie is that, while he claims to want the same things, his recommendations are not that those others adopt the system that worked for us and is working for those that do adopt it. That is, that his recommendations are wrong.
Which seems like something worth getting obsessed about quite frankly.