Sunday, December 1, 2013

China? Seriously Dambisa?

I suppose intellectual vacillation is inevitable – perhaps even desirable.  And even changing one’s mind is ok – following a process of inquiry, introspection, examination, reflection, alteration, adaptation, as the case might require.  The fact is that for most people such rethinking of one’s position, when it does happen, typically comes about slowly and with deliberation.  And when it arrives – well, we respect and commend the process of inquiry and discovery.
It’s the radical about-faces that are puzzling and perplexing.  Alan Greenspan’s post-fallout and much ballyhooed  I've found the flaw" volte-face comes to mind.
How can he have been so wrong? – We inevitably ask of the flip-floppers.  We question their motives, their interests, their original understanding, and even their intellectual capabilities – hell, even their sanity. 
But as much as we lament Greenspan uncharacteristic outburst – he seems to be well on his way to being exonerated and vindicated. I dunno about Dambisa Moyo. It’s frankly a little sad to see her turnabout.
Many of you may recall Dambisa Moyo – who burst into prominence in 2009 with her seemingly startling claim that aid (as in foreign) was keeping Africa poor.  This was the theme of her book: Dead Aid.  But it was her eloquence, and passion – and the fact that she was Zambian- that really propelled the message - MEMO TO THE WEST: we don't need your frickin' aid!  Speaking for Africans – especially sub-saharan Africa, her message was simple, straightforward, and appealing:  stop the aid, its curtailing our entrepreneurship, our initiative our ability to pick ourselves up by our bootstraps!
It wasn’t the first time we heard that provocative message. And Dambisa Moyo wasn’t the first African either.  There was not too long ago George Ayittey - drawing from in his aptly named 2005 book Africa Unchained - angrily railing that the “externalist orthodoxy … which portrays Africa as a “victim” and suggests that the solutions to Africa’s problems must come from external sources.” We applauded his vision and his choosing to cast his lot with the “cheetah generation” the new breed of Africans taking their future into their own hands.  Other, less familiar but equally articulate coreligionists are Andrew Mwenda and Ngozi Okonjo-Iweala and my personal favorite Eleni Gabre-Madhin.  The view is also very much present in the West; William Easterly, for instance – whose subtitle on his take on the matter says it all: The White Man’s Burden: Why theWest’s Effort s to Aid the Rest Have Done So Much Ill and So Little Good.
Critics of aid have been around for awhile.  The great P.T.Bauer whose Dissent on Development  published in 1972 – outed conventional development theory, and was shunned for it. As an important aside, once an intellectual outcast, Bauer is now celebrated – see the laudatory tome by Dorn, Hanke and Walters – The Revolution in Development Economics.
But this compelling counterfactual was not enough for Ms. Moyo – she opted out of the cheetah generation.  She has become enamored of China’s economic success – and is now peddling its development model to the rest of the world; she gushes over and talks-up China’s ability to pull up millions of its citizens out of a once dismal poverty and conveniently dismisses and overlooks the accompanying atrophied political environment and social unrest.   In a bizarre Ted Talk, and warming up to the task in a NY Times editorial last year, – Ms. Moyo presumes to take down the West and (what she considers) its fetish with democracy and political rights – she manages to argue, after rhetorically asking “Is China the New Idol for Emerging Economies?” that the choice before third world developing economies is either economic security or market democracy – full stop.  And thus, in one fell swoop Ms. Moyo conveniently forgets how it was market capitalism that enabled the infrastructure, the trading spaces, the open markets, student-exchanges, the free-flow of ideas, in which China has prospered.  It is because of the wide-expanse of markets that now traverse the world that allows firms to distribute costs across considerably larger domains and the reduced restriction to the free flow of capital facilitate investments across the world.  Clearly China has benefited.  Is China growth limitless?  Doubtful.  We’ve seen this before. Here is Josef Joffe in a comment from a brilliant essay in the Wall Street Journal (10.25.13):

The rise-of-the-rest school assumes that tomorrow will be a remake of yesterday—that it is up, up, and away for China. Yet history bids us to be wary. Rapid growth characterized every "economic miracle" in the past. It started with Britain, the U.S. and Germany in the 19th century, and it continued with Japan, Taiwan, Korea and West Germany after World War II. But none of them managed to sustain the wondrous pace of the early decades, and all of them eventually slowed down. They all declined to a "normal" rate as youthful exuberance gave way to maturity. 

China? Seriously Dambisa?  How about a tonic? And then you can reconnect with the Dambisa who deserved that Hayekaward.  Here’s a dabble of Alex Tabarrok to remind you of how the entire world benefits from the global free market umbrella created by supporters of free trade since the end of the second world war.  And here’s touch of William Bernstein on how TRADE (and free markets) shaped the world.  And last, a little helping of Douglass North – to remind you that the fundamental “sauce” responsible for sustainable benefits from market capitalism are the formal and informal institutions associated with democratic capitalism; you can’t just pluck one and not the other - and expect it to work. 


1 comment:

  1. I love A Splendid Exchange! Explains some of the reasons the world developed the way it did.

    -Scott Lane