Thursday, July 21, 2016

Mises Essay On Decentralization
& Economic Success Factors
An interview with Hans-Herman Hoppe in the Polish weekly Najwyższy Czas! .. emphasizes a more free-market based approach to the economy .. away from punishing productive citizens & rewarding unproductive citizens .. "The economic success of a country depends on three interrelated factors: the security of private property and property rights, the freedom of contract and trade, and the freedom of association and disassociation — and, of course, the diligence, intelligence, and ingenuity of its people. Each and every State, insofar as it relies on taxation for its own funding, acts in violation of these requirements. But these violations can be less extensive and far-reaching, or more so, explaining the relative success of some countries and the failure of others. The internal organization of the State, whether it is a one-party dictatorship or a multi-party democracy, is essentially irrelevant in this. Indeed, as the present example of Venezuela vividly demonstrates, democracy and democratic elections can well lead to the almost complete abolition of private property rights and the freedom of contract and trade, and result in spectacular economic collapse .. As well, the comparison of the economic performance of India vs. China is instructive in this regard. While modern India, for almost seven decades now, has been ruled by democratic governments, modern China has been ruled throughout by a communist party dictatorship, roughly half of the time, during the Mao-era, by an orthodox all-out-communist party leadership, and the second half by a regime of 'liberal' reform-communists. The result? Both countries are still desperately poor as measured by Western standards, indicating that both governments showed little if any respect for private property rights. But: While the economic situation was about equally desperate in both countries until the early 1980s, since then, with the onset of the 'reform communism' in China, the Chinese GDP per capita has well surpassed and risen significantly above that of India, indicating a comparatively greater scope of economic freedom in China and/or an on average brighter and more diligent Chinese population .. in conclusion, then: Don’t put your trust in democracy, but neither should you trust in a dictatorship. Rather, put your hope into radical political decentralization, not just in India and China, but everywhere."
LINK HERE to the essay

No comments: