NationStates Jolt Archive

I was just sitting at my desk, when I had an epiphany. I remembered that in post-World War II Germany, the economy was not free but rather under the control of the Allies. There was crippling inflation, enough to create a barter economy, and price controls that were strangling production. But then, when the Allied central planners were gone and were unable to make any kinds of edicts, Ludwig Erhard got rid of the price controls and made a new currency. After that, Germany was able to enjoy a prosperity that lasted for several decades, thanks to laissez-faire deregulation.

Well, it's not much of an epiphany if I just remembered something, right? Right. My epiphany was that I was thinking that the lessons of post-World War II Germany and Ludwig Erhard could be applied to Iraq as well. There are a great number of price controls and regulations from the Hussein era that are still in place- for example, extremely low prices for gasoline that cause inefficiency due to a high level of demand and low supply. Plus, there are serious miscalculations in infrastructure thanks to central-planning- I've heard that in Fallujah and other places, they have electricity but no clean water (Which is reminiscent of Stalin trying to electrify the Ukraine while the Ukrainians were starving, which ended up with malnourished people with lights). If we let the Iraqi people do as they wish in the economic sphere, they would have the same chance that Ludwig Erhard gave post-war Germany, and they'd be able to boost production and be able to tend to their own needs better than any central planners, Baathist or American.

But what about civil strife? Surely the Sunnis, Shiites and Kurds would still be fighting with each other. Maybe, but there's an advantage in laissez-faire that would tone down the level of violence- mutually beneficial exchange. If you depend on force, you can just take whatever you want from whomever you want- it doesn't matter what happens to the other person. But if you have to work with other people, you must worry about those other people as well- if they're not around, they can no longer supply your needs. This mutual exchange is a great advantage in toning down violence. For example, there were entrepeneurs in the post-bellum American South who, despite disliking blacks, were opposed to the Jim Crow laws because they would keep them from doing business with blacks and make money. This would have the same effect in Iraq. The Sunnis, Shiites and Kurds would be less inclined to kill each other, and be more willing to work with one another, if they had a stake in each others' outcome and production. If we were to extend this to a global perspective with trade, the Iraqis would be less willing to kill foreigners if they knew these foreigners were supplying their needs and doing business with them. The safety would increase mutually beneficial exchange, which would make the Iraqis and the rest of the world have greater ties to one another, which would increase the level of cooperation, and on and on.

I think that a free-market, with its greater production to meet the needs of the people, and the principle of mutually beneficial exchange, in which everyone has a stake in the supply of others, a social-stabilizer, is perhaps the only thing that has not been tried yet to stop the violence in Iraq, and perhaps the only way to achieve this end.

while economic strength would increase the stability and peacefulness of the region, throwing those poor bastards to the dogs of open free market economy is no way to do that.

Im about as hands off as you get but hell, even america doesnt follow the invisible hand of adam smith any more, nor should they.

Iraq's situation is pretty bleak at the moment -- a free market is just what the doctor ordered. The usual problems with such a system are poverty and a low quality of life for the poor; however, the crisis in Iraq negates these problems at the present, allowing only for improvement.

you are confusing free market with prosperity. again, im about as small government as you can get but iraq doesnt have sufficient resources infrastructure or manufacturing capacity to develop economic strength from scratch.
iraq is a one resource economy, which inevitably leads to a harsh divide between rich and poor unless there is some sort of oversight.

Well, there is a difference with Post WW2 Germany, and present day Iraq. In Iraq there is a civil war, with terrorists blowing something up every hour..You didn't see that in post war germany

exactly.

the german people wanted peace and prosperity. so they went and worked towards it.

plus they were educated

while economic strength would increase the stability and peacefulness of the region, throwing those poor bastards to the dogs of open free market economy is no way to do that.

Im about as hands off as you get but hell, even america doesnt follow the invisible hand of adam smith any more, nor should they.

I don't think any nation has ever truly followed the invisible hand of Smith. But those post-war countries that at least tried not to resist it did pretty well- Germany, Japan, Hong Kong, South Korea, etc. I think we should at least try it with Iraq as well, seeing as how we've failed to get any peace through occupation and trying to spread democracy.

Iraq's situation is pretty bleak at the moment -- a free market is just what the doctor ordered. The usual problems with such a system are poverty and a low quality of life for the poor; however, the crisis in Iraq negates these problems at the present, allowing only for improvement.

I agree, but I think that poverty in capitalistic countries is an inheritance of older days rather than a product of capitalism. For instance, the poor in America on average are about as well off as a 1970's middle class family. Poverty, I think, is ultimately relative.

you are confusing free market with prosperity. again, im about as small government as you can get but iraq doesnt have sufficient resources infrastructure or manufacturing capacity to develop economic strength from scratch.
iraq is a one resource economy, which inevitably leads to a harsh divide between rich and poor unless there is some sort of oversight.

I'm not suggesting they do it from scratch- that would be impossible. But we could at least make it so that we can transfer capital from the rest of the world to Iraq, and that there can be some sort of intranational trade between people, like retail etc. It would be a lot better than having the US just try to centrally plan everything. Also, one-resource economies tend to be the result of intervention in the economy (like Saudi Arabia and Venezuela focusing on oil production). You can have a thriving economy even with no resources- Hong Kong, for instance, has nothing but a nice harbor, but they make a ton of money. We just have to let people try and produce to satisfy one another's and their own needs, instead of trying to tell them what they can and can't produce.

Well, there is a difference with Post WW2 Germany, and present day Iraq. In Iraq there is a civil war, with terrorists blowing something up every hour..You didn't see that in post war germany

There were the Werewolves in Germany. But still, capitalism would help social stability in that we would have Shiites buying goods from Sunnis, Kurds contracting with Shiites, and everyone trying to supply one another's needs for their own benefit. They may still very well hate each other, but there would be an incentive to do business with one another instead of absolutely shunning and hating each other.

exactly.

the german people wanted peace and prosperity. so they went and worked towards it.

plus they were educated

I think this is a bit untrue. I don't think that most Iraqi people want conflict and to be miserably poor. But they can't really do otherwise unless they're given free reign to rule their own economic lives. Also, it is not true that the Iraqis are uneducated- Saddam Hussein was praised for his efforts in educating the Iraqi populace. It may not be European level education, but there are still people with some level of knowledge, and plus, with business and demand for high-level skills that a thriving economy would create, this would spur them to become educated and improve their lives.

And here I clicked on this link expecting something along the lines of:

"Shoot Bush, restart the Soviet Union, restore Saddam Hussein to power and self-immolate with guilt over what we did to the Iraqis". But I actually found something highly intelligent, and something that I agree with. That's almost a unique occurance on the NS forums.

Wow. Greill is my hero.

Now then, this is an interesting idea. Would giving Iraq a free market opportunity help stabilize their country. As much as I would like to believe that would work, I don't think that it would. The reason for that is that these people have one or two major issues that the Geramns didn't. First of all (with no racism intended or implied) the Iraqis are much much more violent than post WWII Germans. They blow things up and don't care who they kill as long as they kill someone. the second issue is religon. Imagine trying to get a Jew and a former SS-soldier to work together based upon the goal of them both making money and I think you'll get the idea (it would end with :mp5: or :upyours: ) not a good idea. These people oftentimes genuinely hate each other. The only people who do not hate each other are the mostly secular Iraqis and those aren't the ones trying to kill each other as it stands now. Your idea about them improving their economy has merit, but needs some fine-tuning before I could see it actually working.

And here I clicked on this link expecting something along the lines of:

"Shoot Bush, restart the Soviet Union, restore Saddam Hussein to power and self-immolate with guilt over what we did to the Iraqis". But I actually found something highly intelligent, and something that I agree with. That's almost a unique occurance on the NS forums.

Wow. Greill is my hero.

Well, I'm glad that I exceeded your expectations. :D Thank you very much. ;)

Now then, this is an interesting idea. Would giving Iraq a free market opportunity help stabilize their country. As much as I would like to believe that would work, I don't think that it would. The reason for that is that these people have one or two major issues that the Geramns didn't. First of all (with no racism intended or implied) the Iraqis are much much more violent than post WWII Germans. They blow things up and don't care who they kill as long as they kill someone. the second issue is religon. Imagine trying to get a Jew and a former SS-soldier to work together based upon the goal of them both making money and I think you'll get the idea (it would end with :mp5: or :upyours: ) not a good idea. These people oftentimes genuinely hate each other. The only people who do not hate each other are the mostly secular Iraqis and those aren't the ones trying to kill each other as it stands now. Your idea about them improving their economy has merit, but needs some fine-tuning before I could see it actually working.

I know that some of them can be very violent (my dad did foreign aid in Iraq, and they'd blow up the power lines and kill the electrical engineers, utterly pointless), but is it a racial thing that they're violent, or is that a cultural thing? If it's a genetic thing, then I suppose there's really nothing that can be done about it. But I think that it is more of a cultural thing of a system that relies upon force and coercion, instead, and that it has prompted many people to act this way. If there was some way that acting upon exchange instead of force had greater incentive, then they'd be more willing to change to this more peaceful, more beneficial mode of action.

I know there is a lot of ethnic strife too, and I am not proposing that the instant a free-market economy is placed, that the Iraqis will forget all about their violent pasts and join hands and make Iraq a land of rainbows and chocolate. But, if there is some way to promote cooperation with others for the benefit of all, as mutually beneficial exchange does, then there will be greater incentive to work and do business instead of fight and kill, and those who are only mildly violent will be effectively discouraged from following their more bloodthirsty impulses. If we can start it now, there will be those young people who are not as accustomed to sectarian hatred who will be able to grow up in an environment of cooperation instead of force and resentment. We have to start somewhere, after all, and it's better we start now instead of later.

We will still have to deal with the out-and-out violent ones, but every country has to deal with violent people- that's what governments are for. But it'd be much easier to deal with a few violent people with the rest of the populace able to work and produce and cooperate and look down upon such violence as being disruptive, than a large number of violent people and the rest of the populace being more indifferent to those violent acts.