Inequality, migration and economists

It strikes me that the nation state is a right unit for analysis, if only one of several.

However, if one does question the validity of the nation state as a unit of analysis, one should certainly question the use of income translated into US dollars to measure prosperity, irrespective if the purchasing power of this income. At various times in my life I have been in countries where people had very low income by this standard, but still had enough for the necessities of life. They could not of course afford imported goods, but could survive without them.

An extreme example of what I mean is the case, during the chaotic aftermath of the Yeltsin years, when doctors in a Russian city were paid in manure. Naturally they weren’t pleased, but manure did have an economic value in the local economy, even if it wasn’t convertible to the dollar.

I am certainly not advocating “shit pay” as a general principle, but on a hypothetical isolated island, iron would be valuable, and so would manure, but gold – or dollars – would not help feed or clothe anyone!

http://news.bbc.co.uk/1/hi/world/europe/1331944.stm

To endorse what you’re saying, while my wife was still in the Philippines, I was paying her rent. She had a nice 3 bedroom apartment… $80 a month rent. Cost of living is typically very low in the poorer countries. But only for some things. Other things, that have to be imported, can be even more expensive. For instance, I could mail her a DVD player, express, as a Christmas gift, cheaper than one could be purchased locally.

But most of the poor in poor countries will live lives much better than any hunter-gatherer society ever produced, even if they’re not lives somebody in a first world society would aspire to. Because that pittance goes a long way if everybody around you is poor, too.

Here’s the thing, though. It’s not so much that this country is wealthy, and that country is poor, by luck of the draw. Countries represent experiments with culture and legal systems, as much as they do places on the globe. And some cultures and legal systems just work better than others.

It isn’t that North Korea has had a run of bad luck relative to South Korea. It’s that it has been badly run. The US didn’t get wealthy just because we were lucky to have good natural resources; There are poor countries with good natural resources. We got wealthy because our culture and legal system permitted them to be exploited effectively, and built upon. It didn’t discourage productivity, and encourage theft. (Legal or otherwise.)

Note the past tense. I think we’re living on our seed corn now, to some extent.

So, sucks to be poor, in a poor nation, but it’s not an offense against Man and God that people who are doing things right do better than people who are doing things wrong. It’s an offense that we pretend the problem is in the country doing things right, not the ones doing things wrong.

The really serious problem, IMO, is that what works for creating wealth in a society is not necessarily what is going to be popular, or looks “just” to somebody who already has the benefit of that wealth, and is more concerned about it’s distribution than it’s creation.

You can kill the golden goose if you get too concerned about who gets the eggs, rather than that they get laid. And refuse to connect the neighbor’s goose dinner last month to their present shortage of golden eggs.

“You can kill the golden goose if you get too concerned about who gets the eggs, rather than that they get laid. And refuse to connect the neighbor’s goose dinner last month to their present shortage of golden eggs.”

Ah, yes, what the elites and their servants have been saying for the past few decades in the US, decades of slow growth. It’s straight-up projection, of course – they worry 100% about who gets things, and want it all for themselves, and resent the peasants getting anything.

Back on topic: has Milanovic ever done this with some metric other than money (capabilities, happiness, etc) as the basis for his comparison? Presumably that would bring the within-state variation closer to the fore?

I think he was saying it was not theft.
If one were to suggest to a neoliberal that the business plan of the extraction industry was to steal from the commons and sell it back to the people, they would have an apoplectic seizure. Never mind suggesting that all real property was at some time, likely in the remote past, stolen from the commons.

Even most of the upper class kids im studying with that will certainly make a lot more than that in 10 years think 1000 Euro a month is a fortune right now. Dadys new Porsche is often more important than giving the kids some money. To make things worse, they see all those status goods at home and so just keep buying them anyway for themself even if their parents try to experiment with tough love for no reason. Then they get jeaulous at me because i dont have to work 20 hours during the term. But my comp is 250€ theirs 1500, my phone 80, theirs 600, my cloth 10 year old from Aldi, theirs from the newest Prada collection. Thing is, not joining that status good competition does have negative consequences for me that a person who does not buy them somewhere in Africa does not face.

I am not sure where to enter the argument. The question is not so much that there is inequality, but how widespread it is and how wide are the gaps. I don’t even think the questions is so much about the causes of inequality. A certain amount of inequality may be inevitable. Even the apologists of Capitalism admit it as a “side effect” while minimizing it.
However, I think there is a substantial subset of Capitalists and apologists who see inequality as a feature, not a bug.

Can’t read Harford’s piece, but Bertram’s point is well-taken. Of course it is not only the poor in the poor nations who suffer relatively; and it is not only the poor in the rich nations who do the excluding. Those opposed to immigration may not be the upper-class in the rich countries; though they may prefer anti-immigrant populist sentiment to other forms of political expression, e.g. higher inheritance taxes.

On Milanovic’s data, we could use box plots. So using Milanovic’s data, if we take 13 countries and put them side by side on the horizontal axis and we take world income distribution on the vertical axis we see that the box plots for each country were much closer to each other in 1850 than they are in 1990. What this shows graphically is that even if we were to equalize income within countries today, at least half of global inequality would remain because much of one’s position is determined today by the global position of the nation in which one is born rather than where in the income distribution one lands in the country into which s/he is born. Milanovic refers to this as a non-Marxist world

An old CT post where Chris makes similar point to the one I was trying to make above ‘Position in local rather than global hierarchies is what matters for health outcomes and self-esteem.’

https://crookedtimber.org/2006/11/13/relativities-local-and-global/

The premise that intra-country inequality in First-World countries pales when considering how “good” even the poor in the rich countries have it compared to the poorest globally is such an old chestnut. It’s transparent apologetics.

I’m just reading Matt Taibbi’s The Divide: American Injustice in the Age of the Wealth Gap. The US is not a First-World country. A large part of its population are reduced to Third-World status. The “feudal privilege” that affluent Americans think comes naturally with US status doesn’t in fact extend to the poor and the world highest incarceration rate is powerful proof of this fact.

“Historically, the nation-state seemed like a political framework to address these dilemmas, to promote fairness as justice, to counter-balance private power with public interest.”

To others, the nation-state seems like a good way to exploit the masses, while pretending to promote fairness. These others are the people who actually run the government.

Seriously, Presidents live like kings, and retire to lives of wealth. People get elected to Congress, and, magically, their net worth skyrockets. Even the bureaucracy, which formerly traded security for wealth, now get both. The median federal salary is close to $80K, meaning that the MEDIAN federal employee earns at the 90th percentile for US wages.

It’s a scam: Tell the poor they need the government to fight the rich, and the government becomes the rich. The wealthiest communities in the US? They’re clustered around D.C., populated by government employees and those who cater to them.

When people advocate government as a solution to income equality, the term that comes to mind is “useful idiot”. You’re being used.

“The median income in America, up a bit since the crash, is still lower than pre-crash. The average family is making do with less than before GW Bush took power”

It’s worse than that. Real median worker earnings have all but stagnated for the last forty (40) years), during which GDP has of course increased substantially. Check out the Census tables, especially P43, at https://www.census.gov/hhes/www/income/data/historical/people/. American workers haven’t got a real raise in 40 years (the average increase, according to the trend line, has been less than $100 real dollars a year), yet they are undoubtedly buying more stuff – much of it on credit.

Household income increased a bit more substantially up to the late 1990s, then declined quite steeply. Most of the increase, while it lasted, was due to the expansion of the workforce. Likewise, the decrease reflects the shrinking of the workforce and this started way before the Great Recession. 2013 median household income was on a par with 1988 in real terms.

“Nevertheless, income is production; to produce high incomes requires that a society be organized to be highly productive.”

The organization itself doesn’t have to be productive. In fact, it doesn’t pay to be productive (as you yourself hinted), or it does only at the beginning. An effective organization is one organized to rob other people. First inside their own society, then outside, mostly outside.

Ze Kraggash: An effective organization is one organized to rob other people. First inside their own society, then outside, mostly outside.

Organizations can be very effective at robbery, though robbery does not produce goods and discourages the production of goods.

Brett Bellmore @ 20

He, who makes the rules, gets the gold, proving that he, who has the gold, makes the rules.

No rules, bad rules, or fair rules — the hardest political choice to make is the last.

Brett Bellmore #20. Accepting your assumptions about the state, what is the alternative?
Assuming that you are the propertarian style libertarian you appear to be, then is government’s only function is to protect your property? Apparently, you think you would always be the one with property and the state always your client, or perhaps, you are so
competent and skillful that you will always be able to obtain that property?
The basic fallacy of libertarianism is that its proponents never consider the possibility that they could be on the low end of power discrepancies, without wealth, power, or status.

“The premise that intra-country inequality in First-World countries pales when considering how “good” even the poor in the rich countries have it compared to the poorest globally is such an old chestnut. It’s transparent apologetics. ”

There’s a next step in the argument, which makes it less transparently silly. The neoliberals will say their preferred policies help reduce the large (global) inequality while raising the small one. And surely the Piketty style leap, to the thought that rising inequality within states warrants a global wealth tax, deserves to be harried by people who say that globally this is about as good as it’s ever gotten. Also glad to echo the point above from Milanovic about it being a very non-Marxist situation.

34: PPP is for many reasons very unreliable. It is based on comparing the price of a basket of goods between countries but the fundamental problem is that consumption in different societies is structured differently, and perhaps more to the point it is structured differently depending on socio-economic status even within a society. The price of food affects poor people far more than it does rich people. In poor countries, personal services are comparative cheap because wages are low. When a typical Western middle class basket of goods is used as the basis of calculating PPP of a poor developing country, the results are close to meaningless. These problems are of course well known to technical experts (they are not idiots) and they are fundamentally impossible to solve. The PPP estimates we have may still be better than nothing but they must be taken with more than a grain of salt. The idea that we can with any reliability distinguish whether a poor Bangaldeshi’s real income is below or above “1 dollar a day” is ludicrous.

[Was posted long ago, caught in moderation]
19: “The median income in America, up a bit since the crash, is still lower than pre-crash. The average family is making do with less than before GW Bush took power”

It’s worse than that. Real median worker earnings have all but stagnated for the last forty (40) years), during which GDP has of course increased substantially. Check out the Census historical income tables, especially P43. American workers haven’t got a real raise in 40 years (the average increase, according to the trend line, has been less than $100 real dollars a year), yet they are undoubtedly buying more stuff – much of it on credit.

Household income increased a bit more substantially up to the late 1990s, then declined quite steeply. Most of the increase, while it lasted, was due to the expansion of the workforce. Likewise, the decrease reflects the shrinking of the workforce and this started way before the Great Recession. 2013 median household income was on a par with 1988 in real terms.

Not sure about Milanovich. Usually when economists refer to “per capita income” they mean per capita GDP. There are of course those who track the number of people making $1 per day. There are serious methodological problems with that (see 35). Generally speaking, it isn’t at all obvious how best to measure global inequality. If we look at the global top 1% compared to the global bottom 1% or even 10%, I doubt the gap is getting smaller.

Anyway, you must be living in a different modern industrial society. I’m certainly no lonely.

You may find this objectionable, but based on my experience debating with you (and it goes back a pretty long way, Balkinization included) I wouldn’t trust your descriptions of your emotions. Not dishonesty, only lack of awareness is indicated.

But if you care to why not tell us why you like to post here? (Or perhaps you don’t like to post here, but do it anyway!)

TM,
I don’t know of adjustments to PPP numbers that would undermine Milanovic’s broad conclusions. So, as summarized by Sarah Dykstra, “the new PPP numbers [from the ICP project], do suggest a lot of poor countries are richer than we thought. For example, The Economist now estimates that China’s economy will be bigger than the US economy by year’s end. (This much to the delight of Eclipse author and colleague Arvind Subramanian, whose forecasts now look better than anyone else’s.) But it isn’t just China. India’s 2011 current GDP PPP per capita from the World Bank World Development Indicators is $3,677. The new ICP number: $4,735. Bangladesh’s 2011 GDP PPP per capita according to the WDI is $1,733; the ICP suggests that number should be $2,800. Nigeria goes from $2,485 to $3,146.”
How did the ICP deal with the problem that since different goods are being consumed in different countries no meaningful comparison is possible. As I understand it, they deny that there is no substantial overlap in goods consumed; and then take steps to weigh goods for countries in terms of how widely consumed they are.
Against the concern that PPP adjustments still result in exaggerated sense of global inequality, I think the opposite could be true if we pay attention to differences in qualities in services and goods and greater substitution possibilities in the first world.

Using mathematics to take the politics or economics out of the analysis of income inequality is an interesting parlour trick, and one that seems to serve.

Whether we think of wealth as a good and necessary thing qua capital, to be invested and accumulated in order to enable higher production and incomes, or wealth as bad thing, the tool of extractive rent-seeking or financialization, would still seem to matter. Shall we inquire into whether the 1st worlder reduced from 100 to 80 lost his union job? Shall we wonder whether the 3rd worlder leaping to 30 did so by forcing his less fortunate brethren to earn that 10 in a sweatshop, working 70 hours a week while living in a favela without public services?

the Guardian: North Koreans working as ‘state-sponsored slaves’ in Qatar

http://www.theguardian.com/global-development/2014/nov/07/north-koreans-working-state-sponsored-slaves-qatar

But, of course, mathematics could never be the basis for a “disingenuous argument” and World Bank economist Branko Milanović just wants us to know how slippery a concept inequality really is.

“I wouldn’t trust your descriptions of your emotions. Not dishonesty, only lack of awareness is indicated.”

Not so much lack of awareness, I just rate fairly high on the Asperger scale. Not everybody is all touchy feely, you know; That diversity liberals claim to believe in doesn’t stop at the skin.

I’ve been lonely enough of my life to know that I’m not lonely now. The contrast IS rather stark.

As for why I post here, I like arguing, and I like domestic tranquility. This mandates that I find somebody outside my family to argue with. Going out of my way to find people I disagree with facilitates this, as I’m not much for arguing points I don’t believe in.

“working as ‘state-sponsored slaves’ in Qatar”

Yes, and wasn’t it a common (of the compassionate kind) justification for slavery that they were better off picking cotton on a plantation than surviving in a jungle? Though of course the sweatshop has the important ideological advantage of being (technically speaking) chosen voluntarily.

Poor Milanovic, he wants higher immigration, and not in the rights denying middle eastern way. I say _even that_ isn’t obviously worse for the people who become economic migrants, and yes, you can’t entirely wish away the voluntary nature of people from Kerala going to the Gulf as nurses or brick layers. They’d very much rather come to Boston instead, but at least Dubai lets them in.

Or as Weyl and Posner put it – “We citizens of OECD countries take pride in our political and civil rights, and our generous welfare systems. Yet we maintain our high standard of living by giving no rights and trivial money to people who live outside our arbitrary borders. While we fuss over whether we should raise or lower our marginal tax rates, we ignore the plight of the most desperate people in the world. And yet we are surprised that leaders of China and the GCC accuse us of hypocrisy when we criticize their records on human rights.”.

And now poor Milanovic is an apologist for slavery because he wants the US and Europe to let in more immigrants. Yes, that’ll work…

As for why I post here, I like arguing

Why thank you for the frank response, Brett! And thanks for sharing re Aspergers. That helps me with interpreting your comments, I think.

I do think it’s useful to take some time out from our ‘normal’ everyday mindset to ask “why do I like such and such?” I mean, when I ask myself why I like arguing–which clearly I do–I feel the answer is a mixture of trying to get clear as to what I believe, trying to get through vague and muddled ideas to something better, but also enjoying the heat of competition and (unfortunately?) releasing aggression. And it’s the aggression component which, from my perspective, is the animating spirit of much of your commentary. So, I wonder to what extent you agree with that assessment? And I wonder how you regard your own aggressive impulses?

That diversity liberals claim to believe in doesn’t stop at the skin.

Fair enough. And…

Is it that you don’t think liberals actually believe in diversity (although it would be nice if they did)? Or, perhaps that you, as a non-liberal, don’t believe in diversity and don’t think anyone else needs to either?

While it’s correct that global mobility is the preserve of a small share of the population, there’s a lot of welfare improvement to be had from more internal mobility in developing countries. We’re probably all based in countries where we take it for granted that we can move around within the jurisdiction as much as we please, but for many people that’s just not true. And it’s not just a china issue. Egypt has massive differences in welfare between upper and Nile delta and it suits a lot of people in the latter to keep it that way. Both formal and informal restrictions are used to keep the rural population out of the big cities. International migration has to be placed in the context of domestic mobility restrictions.

Off-topic, and fairly deeply so, but following Engels link in 17 t0 a now about 8 year old post by Chris, and from there to one from a year earlier by Maria, I’m really struck by how the population of commenters has changed. Engels was there, and a few others (me, I guess), some now under different names from that time show up from time to time, but the “regular” crowd from that point is probably 70% different from the “regular” crowd now. (I’m not even sure if I’m part of the “regular” crowd anymore. I think that’s mostly due to being very busy these days, but it’s hard to say for sure.)

“Is it that you don’t think liberals actually believe in diversity (although it would be nice if they did)? Or, perhaps that you, as a non-liberal, don’t believe in diversity and don’t think anyone else needs to either?”

It is my experience that liberals certainly believe in cosmetic diversity, that people don’t all look alike. But their belief in diversity *inside* the skin is very limited. Liberals will routinely assert, for instance, that no woman would seek a purely elective late term abortion. Or advance arguments based on the premise that their adversaries actually agree with them, and are just being contrary for some reason, usually despicable.

I’m told that everybody is actually, when pressed, some kind of utilitarian. That all women feel oppressed by traditional sex roles. That conservatives actually think liberal programs are good for minorities, and oppose them out of racism.

Nobody believes this, nobody does that. If liberals believe in diversity, it’s an awfully superficial sort of diversity.

Now, I believe in diversity. The range of human opinion and thought processes is essentially unbounded, it ranges into extremes that are madness and/or evil. Which is to say that diversity is real, very real, but that doesn’t imply that it ought always be respected or even tolerated.

I believe that some expressions of human diversity are pathology. Belief in diversity doesn’t imply approval. Not for individuals, or for cultures. Some modes of thought work. Some don’t.

But, diversity? Very, very real, even when liberals don’t want to acknowledge it.

Brett: “So, sucks to be poor, in a poor nation, but it’s not an offense against Man and God that people who are doing things right do better than people who are doing things wrong. It’s an offense that we pretend the problem is in the country doing things right, not the ones doing things wrong.”

But it is an offense if the people doing better are doing so partly because they act (and have long acted) in ways that support those in power doing things wrong. In buying resources from corrupt and undemocratic regimes who suppress and exploit their people, e.g., we both enable them to maintain power and incentivize the development of such regimes and attendant civil wars in resource-rich places that don’t yet have them.

Good to see you, Matt. I think my commenting tapered off a little in recent years too but I see Brett Bellmore is still his irrepressible self.

“That provokes an ancillary question: would you agree that liberals tend to be a kinder, gentler, more-pleasant-to-be-around sort than conservatives?”

Not in my experience, no. As you might expect, given that I come here for *conflict*. For instance, can we agree that this is not about a *conservative* professor? That SEIU is not a notably conservative organization?

In my experience liberals aren’t that bad to be around so long as you don’t disagree with them. But their worldview is manichean enough that a whiff of disagreement can make them turn very nasty indeed.

If I may, Brett is saying that everybody in America enjoys wealth (compared to most people on the planet); and the bad attitude is among those Americans who enjoy less-of-the-American-wealth, and want to redistribute it, killing the system which made them wealthy (compared to most people on the planet) in the first place. Those people should instead celebrate the system which makes them poor Americans because it makes them better off than most non-Americans. Or so I think.

Here’s an hypothesis:

Maybe… Liberals have sharper tongues than conservative because it’s understood that we’re not as prone to going postal.

!

The function of inequality of incomes, and the relationship of income to wealth, lies behind our interpretation of the fact of both economic inequality within and the fact of inequality among countries and individuals (or families). The kind of simple dichotomies that may divide the worldviews of libertarians from socialists or conservatives from liberals figure in how people construct an interpretations.

Branko Milanovic adopts the polar dichotomy of the capitalist as innovator/saver and the capitalist as rentier to explain how he views (the views of others about) the relationship of inequality to efficiency and growth:

How does inequality affect economic efficiency? We care about inequality, or perhaps we care mostly about inequality, because we believe that it affects some important economic phenomena—notably, economic growth: Do more unequal countries grow faster or slower? Historically, the pendulum has swung from a rather unambiguous answer that inequality is good for growth to a much more nuanced view that favors the opposite conclusion.

Why has this been the case? To understand it, look at inequality, as far as economic efficiency is concerned, as cholesterol: There is “good” and “bad” inequality, just as there is good and bad cholesterol. “Good” inequality is needed to create incentives for people to study, work hard, or start risky entrepreneurial projects. . . . The benevolent view of economic inequality—that it provides incentives for individuals to excel—dominated when economists believed that only the very rich save and that without them, there would be no investments and no wealth creation. Workers (or the poor) were thought apt to spend everything they earned. If everybody then had the same (relatively) low income, there would be no saving, no investment, and no economic growth. . . . But the world was also full of another type of capitalist rentiers who would do very little but sit back, relax, and let money “do the work” for them. . . . From this perspective, the rich looked less indispensable as “receptacles” for savings and as possible investors; they appeared much more like parasites living well while clipping coupons and doing little else.

From this caricature of what I think he sees as 19th century or early 20th century views of the dichotomy, Milanovic sees a different view developing in the late 20th century. (This is where, imho, we can see Milanovic go spinning off into neoliberal fairy tale land.)(emphasis added)

Yet the view of inequality as harmful, which began to dominate in the past couple of decades, did not develop from that ethical perspective [rich capitalist as rentier drone]. Curiously, it shares the same starting point with the view of inequality as a benevolent force—namely, that there should be people who are willing to invest—yet it reaches very different conclusions.

Here’s how the argument flows: People (rich, middle class, and poor) vote for how high they want their taxes to be, taking into account that the advantages from government spending (funded from taxes) accrue mostly to the poor. Very unequal societies will tend to vote for high taxation simply because there are a lot of people who benefit from government transfers, pay nothing or little in taxes, and would always outvote the few rich. Now, such high taxation reduces the incentives to invest and to work hard, and this lowers the rate of economic growth. The mechanism is similar to the nineteenth-century fear that people without property, if given half a chance to vote, would expropriate the wealthy. Here the same thing happens except that the expropriation is a bit gentler: It operates not through outright nationalization but through taxation. In both cases—the benign and the malevolent views of economic inequality—the important thing is to have people who are willing to invest. But in the first case, rich investors require high inequality. In the second case, the introduction of political democracy is the monkey wrench that makes high inequality politically unsustainable. Even if the rich could somehow promise the poor that they would not consume but invest surplus income, and that the rich are thus indispensable for economic growth, there is no way that this promise could be enforced. It will not be credible, either. Consequently, the capitalist system must generate on its own a pre-tax income distribution that is sustainable and will not encourage people to choose extortionary tax rates. For this to happen, assets among people need to be distributed relatively evenly. We cannot, over the short or medium term, affect the distribution of financial assets much, but we can affect the distribution of education (what economists call “human capital”)—hence the emphasis on better access to education for everybody. This is not only because education may be thought desirable in itself, not even because higher education may be directly helpful for economic growth, but also because wider distribution of that asset would equalize distribution of pre-tax income and make even those relatively poor think twice before deciding to vote for high taxes.

What probably seems like a rather odd (and thoroughly unrealistic) theory of politics is Milanovic’s version of the median voter hypothesis. He handles the rather obvious counter scenario of a corrupt democracy where the rich lobby to protect themselves in a footnote.

It could even happen that there is no real redistribution but that the effects on growth still remain negative. For example, in order to prevent the political takeover by the poor, the rich can combine and through lobbying buy votes and legislation, thus preventing the redistribution. But this effort at lobbying, a non-productive activity par excellence (because it is a zero-sum game, concerned only with redistribution and not creation of new wealth), will be a sheer waste from the point of view of economic growth, and a slower growth will ensue again.

I apologize for the long quotations, but I don’t think I can make my point about Milanovic’s views without them. Milanovic summarizes his view (following the above quotations, but before launching into discussion of justice issues) with a rather cliched and anodyne dichotomy:

. . . in some places and times, inequality may hamper economic growth (through its monopoly element) and in others help it (through its incentive element). Suffice it to say that our view regarding the positive versus negative effects of inequality on economic efficiency will always depend on how much weight we put on one or the other element in the essential dilemma: social monopoly versus incentives. . . . in those cases where we think that the leveling of incomes—the absence both of the carrot of success and of the stick of failure—has gone so far that people will not try harder unless allowed to keep the fruits of their labor or investment more fully, we should, as odd as it may seem, opt out and call forth greater inequality.

The deeper quotation exposes some things the anodyne summary does not make so clear. The most alarming, it seems to me, are the apparent absence from Milanovic’s economics of either private predation or public goods. One can excuse this as a simplification, but, if so, it’s a dangerous over-simplification, imho. From such simplifications and elisions, neoliberalism draws its power as mind-numbing propaganda.

Milanovic, Branko (2010). The Haves and the Have-Nots: A Brief and Idiosyncratic History of Global Inequality. Basic Books.

“It could even happen that there is no real redistribution but that the effects on growth still remain negative. For example, in order to prevent the political takeover by the poor, the rich can combine and through lobbying buy votes and legislation, thus preventing the redistribution”

BREAKING: The wealthy might choose to use their power to stymie democratic attempts at redistribution. It could even happen here people!

You heard it here first people. Glad we have the World Bank to keep us informed about economics and politics and stuff.

Oh goodness gracious, I wonder if this is going to come to pass. I hope not, sounds pretty undesirable. Maybe if we could politely inform these wealthy oligarchs of the inefficiencies associated with this strategy they will politely assent and choose instead to re-invest their fortunes into new production lines.

“the important thing is to have people who are willing to invest”

High inequality is necessary for investment people! I mean, just look at the US today – inequality has gone through the roof and business investment has never been higher! Watch out, all you leftists and redistributionistas – you are killing our pro-investment moment! Who wants to invest in productive capacities when people at the middle and bottom of the economic distribution actually have the disposable income to buy your crap? Where is the fun in that?

“We cannot, over the short or medium term, affect the distribution of financial assets much, but we can affect the distribution of education (what economists call “human capital”)—hence the emphasis on better access to education for everybody.”

Education (human capital) is super exceptional people – it doesn’t even follow the laws of supply and demand! Lets get everyone a degree so everyone can get paid the premium for having a degree! Luckily there are no distinctions of prestige between different degrees from different institutions that might work to reproduce these same inequalities among the nominally educated. #solutionsforourtime

“As well as cacao small farmers and labourers not eating chocolate,”

I find it somewhat hilarious that, whenever my wife puts together a box of stuff to send to her family, she always makes a point of including a lot of chocolate bars, because they really do enjoy eating chocolate. Love the stuff.

Hilarious because they’ve got a cacao tree. But understandable because there’s a lot of work between the fruit of the cacao, and anything a westerner would recognize as “chocolate”.

Bruce Wilder –
Not much to say by way of reaction, but I do want to note that I appreciate you going through his work here as it is quite interesting . doubt I am the only one thinking such, so no need to apologize for all the block quotes above, etc.

mattski @ 5:34 “But that doesn’t mean respecting all differences, since you’re obviously right that some differences are pathological. And at the same time, is it unreasonable to say that, for example, everybody wants to be happy? Is it unreasonable to say that everybody needs food & shelter or everybody wants to feel loved?”

Um, no. There is a fairly substantial number of people in the United States who believe that the purpose of life is discipline under an authoritarian leader plus heaps of suffering for those who follow the leader and suffering + severe punishment for those who step outside the boundaries. And also punishment plus the “consequences” of starvation and death by lack of medical care for those who ‘fail’, which is to say those who for any reason whatsoever are unable to earn a minimum salary working for wages under one of the elite. Happiness ain’t got nuttin to do with it.

Economists, and most of the rest of us, think of equality in terms of consumption. Which is fair enough, because that’s the end game. But there is no consumption without production, and production is not, as is often pretended, a matter of specialised exchange but of cooperation necessarily involving hierarchies. So inequality is baked in. What’s not baked in is how much and who. I’m not a big fan of models, but perhaps a story one makes the point:

The standard Econ 101 pictures a fishing village as populated by fisherfolk who each go out and catch fish (presumably in coracles). Each is rewarded for his/her luck, skill and diligence with some quantity to trade in the market for apples or whatever. There is some inequality resulting from natural factors (these figure large in modern libertarian discourse). If you think about this, there’s no room for investment: what would you invest in in such an economy? More coracles? In return for what?

But in fact our fishing village gets its fish with 12 person schooners. The schooner and crew as a unit, not any individual, pulls the fish in. One captain, two mates, two four-man watches and a cook. Who is the least dispensable member of the crew? The cook. Will they be paid more than the captain? No, not even if captains line the strand and ships lie idle for want of cooks. Pay and privileges will reflect the working hierarchy that keeps the schooner functioning. But the differential between captains and seamen will reflect the outcome of political bargaining, not individual merit. It could, as on whalers and pirate ships, be as low as 4 or 5 to one, or it could be much higher. Unions, access to external sources of power, the demands of solidarity and much else will all go into the ongoing wrestle. In such an economy there is not only room for investment but for rent-seeking, wealth-extraction, cost-shifting and much else. All the games we play.

In cooperative production, inequality is a social given, but the level and type is not. That’s our dilemma, even as we have gone beyond schooners to the 50,000 people or more who make a car factory run. If you want to see how thin the story about individual effort and reward is, read Mark Twain’s account of the Mississippi pilot’s union and ask – who was harmed when they raised their share of the collective output?

> Watch out, all you leftists and redistributionistas – you are killing our pro-investment moment!

You can’t lend people money if they have enough money.

Brett Dunbar,

My understanding is that MASH misrepresents the sort of warfare the U.S. engaged in against North Korea. As China supported North Korea the U.S. realised it could not defeat them with conventional ground warfare and used bombing and chemical and perhaps biological weaponry against North Korea .

This was very unequal as North Korea was very behind in technology and did not have a similar technological capacity, and nor did China at the time.

i think it quite likely a big reason the North became the paranoid isolated country with an oversized military is in part due to this egregious use of modern weapons against it. The South Korean regime at the time if the North’s invasion/attempt at reunification was if I remember correctly led by Japanese collaborators, and even Soth Koreans disliked them.
It was quite unfair to divide Korea up into North and South.

“Twenty years later I was about to cross the Yalu River on a Chinese train. At Sinuiju, I was welcomed onto the sacred soil of the DPRK with a bunch of flowers. Standing in front of a life-size statue of Kim Il-sung, my host told me that he was a bit disturbed by the scale of the personality cult in China. In Pyongyang a Young Pioneer gave me another bouquet of flowers. I was shocked at what I saw as we drove through the city: we could have been in Eastern Europe after the Second World War. Then I remembered that what General Curtis LeMay had threatened to do to North Vietnam had already been done to North Korea: it had been bombed into the Stone Age. There were no protests in the West against the heavy bombing of Pyongyang at only 15 minutes’ notice: 697 tons of bombs were dropped on the city, 10,000 litres of napalm; 62,000 rounds were used for ‘strafing at low level’.

Three years earlier in Phnom Penh the Australian journalist Wilfred Burchett had told me that what I had seen in Vietnam was ‘nothing compared to what they did to Korea. I was there. There were only two buildings left standing in Pyongyang.’ It was alleged that the US had used germ warfare, and although the US dismissed these claims as ‘outrageous’, on 9 August 1970 the New York Times reported that chemical weapons had been considered after ‘American ground forces in Korea were overwhelmed by Chinese Communist human wave attacks near the Yalu River’. Pentagon policymakers wanted to ‘find a way to stop mass infantry attacks’, so ‘the army dug into captured Nazi chemical warfare documents describing sarin, a nerve gas so lethal that a few pounds could kill thousands of people in minutes if the deadly material were disbursed effectively.’ Was it used in Korea? Probably not, though germ warfare tests were conducted in US cities. In one test ‘harmless’ bacteria were introduced into the Pentagon’s air-conditioning system.”
http://www.lrb.co.uk/v34/n02/tariq-ali/diary

I’m fairly sure I’ve never seen an episode of MASH. I have read some histories of the war.

While the use of nuclear weapons was considered, MacArthur was in favour. Non conventional weapons weren’t actually used, weapons that aren’t used cause no damage. After the large scale mobile warfare of the first year was over, in which the south suffered more than the north. The front was static for the rest of the war. While the UN had an advantage in the air it wasn’t especially large and as they were not seriously attempting to win they didn’t subject the north to heavy bombing, all the serious effort was in the first year, which had fairly comprehensively devastated both.

The two parts of Korea ended the war in roughly equal positions, the north possibly slightly better off as less of the large scale ground warfare took place there. And that does much more damage than conventional bombing could. The economic performance post war was initially similar only diverging rather later, the GDPs remained roughly equal until about 1973, during the early 1970s the North’s was, if anything, higher. The divergence occured more than twenty years after the war, so blaming it seems rather perverse.

85

OK, my friend. I still don’t know what you’re talking about, and don’t know what your claims have to do with my remarks. But if your goal is to enlighten then why not provide some specific information, links, etc.

Yeah Brett Dunbar, big *citation needed* at the end of your posts there, at least if you want to argue with ZM who is clearly providing what seem to be fine sources.

Branko Milanovic on migration

In a recent World Bank study, people from seven countries were asked whether they would move to another country (permanently, temporarily, or “just to try it out”) if it were legally possible.3 A whopping 62 percent of Albanians expressed interest in moving permanently or temporarily out of their country; for Romanians, the percentages were 79 percent for males and 69 percent for females; for Bangladeshi, 73 percent for males and 47 percent for females. In this small sample, we see that countries that have done economically poorly would, if free migration were allowed, remain perhaps without half or more of their populations. With fully open borders, we would witness enormous migration flows that would almost empty out some parts of the globe. There is little doubt that a large share of the African population, particularly the youth, would inundate West Europe, the part of the world that is colloquially known in some Congolese languages as “the heaven.” . . .

Whether it is under the pressure of domestic labor or out of fear of cultural heterogeneity, the rich world has begun a process of walling itself in, creating de facto gated communities at the world level. The most infamous of them is the U.S.-Mexican border fence that is supposed to run for seven hundred miles. It is, at times, a twenty-foot cement wall, reinforced by barbed-wire obstacles and equipped with numerous cameras and sensors. The Mexican Wall should, when fully constructed, be seven times as long as the Berlin Wall and twice as high. Nevertheless, it is estimated that more than 200,000 Mexicans enter the United States illegally every year,4 and that at least 400-500 die trying to cross the border. . . .

These people who try to leave their countries of birth for the uncertain pleasures of Europe are not only poor; they do not see any future, any place for themselves, in their own societies. Their desperate bids to reach Europe are silent accusations leveled against the governments that are unable to provide any social and economic perspective to the growing multitudes of the young. They are also an indictment of the economic failure of Arab and sub-Saharan Africa, a testimony to the increasing income gap between the two shores of the Mediterranean. In reality, as Ali Bensaad, a Franco-Algerian sociologist, says, “one should salute the tenacity and courage of the harraga. Lacking any channels of political … expression, those are the youth who react with the elements they have constructed from a devastated cultural and political space, emptied of all meaning by their governments.”

@97

I live in Maryland (which has one of the highest — if not the highest — median household incomes in the USA) and a poll that was getting a lot of play before the recent election said that 47% of us would move if we could.

Brett Dunbar,

I cannot believe you are arguing that the Korean War (which has resulted in a still ongoing antagonism between the U.S. and North Korea) has no bearing on the North Korean economy?!?!

“There was discussion of using chemical and nuclear weapons, they weren’t used so obviously did no damage.”

Napalm is a chemical weapon and was used by the U.S. on North Korea extensively. I at no point claimed the U.S. did use the atomic bomb on North Korea, despite threatening to do so.

” In any event bombing entirely ceased in 1953 when the war ended. ”

Despite the Armistice Agreement there is a permanent presence by the US Army on North Korea’s border, and there are sanctions and threats made against the country too.

“As Cumings [the author of the article I quoted above] elaborates, “The U.S. long ago put North Korea under siege (embargoing its economy since 1950, running huge war games near its borders, observing it by any and all means)”. Nicholas Eberstadt describes North Korea’s economic crisis thusly: “Today, North Korea has the awful distinction of being the only literate and urbanized society in human history to suffer mass famine in peace time”.

However, the North has never truly been at peace since its establishment.

Furthermore, the US maintained nuclear weapons in South Korea until 1991. Even after their withdrawal, North Korea has no assurance that the US will never threaten it with nuclear weapons again. In 2010 when the North shelled South’s island, Yeonpyeong Island, in protest against joint South Korea-US military drills, the US immediately dispatched the nuclear-powered aircraft carrier USS George Washington to the Yellow Sea…. Cumings argues “leaders in Seoul repeatedly sought assurances from Washington that the North would not be attacked over Seoul’s veto. It is my understanding that they never received those assurances”.

he Vietnam War demonstrated that neither China nor the Soviet Union would guarantee North Korean security in case of another war in the Korean Peninsula.35 Nevertheless, the existence of socialist allies was a vital counterbalance to the US-led alliance in East Asia. In this sense, the normal- isation of diplomatic relations between China and the United States in the 1970s and between China and South Korea in the early 1990s along with the collapse of the socialist bloc in Eastern Europe and the Soviet Union, isolated North Korea in its foreign relations and dramatically undermined its security…”

“ZMs claims are almost totally irrelevant given that the economic performance of the two parts of Korea were hardly distinguishable until twenty year after the war”

The experiences of the Korean War were different in North and South, and the international and geopolitical consequences were completely different as well. North Korea is hardly treated by other countries the same as they treat South Korea – and this is to do with the Korean War and the Cold War.

Twenty years after the war, when you not a decline in North Korea’s economy, was, ironically enough, when it started experimenting with global capitalist finance:

“Despite its strong commitment to sovereignty and territorial integrity, North Korea has gradually and carefully promoted some attempts to build up connections with the capitalist world since the early 1970s.
…
Between 1971 and 1975, North Korea acquired loans from Western countries equivalent to US$1.2 billion. However, like many energy-dependent developing economies, the two oil shocks and the global economic downturn unfavourably affected North Korea’s outward expansion and finally brought about a declaration of debt defaults. North Korea has been avoided by Western capital and financial institutions ever since.”

“Basically the timing doesn’t work for it being due to the war, the North’s economy stopped growing in about 1973 and then contracted dramatically in the early 1990s.”

So, what was happening globally that might have affected North Korea’s economy in the 1990s I wonder?

“The disintegration of the Cold War system not only damaged North Korean security but also its economy. North Korea urgently needed to find a substitute for the socialist world market and aid. A Guidebook on Chosun [North Korea] Investment Laws explains the background for the establish- ment of the special economic zones as follows:

“Since the Soviet Union and Eastern European socialist countries that had been our major trading part- ners collapsed, our country creates the special economic zones to actively promote trade relations with the capitalist countries and to achieve national interests”.”

In the mid-1990s North Korea suffered flooding that resulted in crop failures and famines, while “the collapse of the Soviet Bloc and China’s intensification of reforms in the early 1990s not only led to the disintegration of the socialist market and created a critical shortage of fuels and resources but also radically undermined North Korea’s secu- rity environment”. Additionally, the U.S. increased beligerent threatening of North Korea as “America’s greatest security threat” following the first Gulf War, and Kim Il Sung had died in 1994.

Altogether these events led to North Korea prioritising national security ahead of the economy. North Korea, understandably, sees this as part of its long battle with the U.S. and allies.

“An editorial in the Global Times, which is widely known to speak for official Chinese for- eign policies, also recognised North Korea’s dilemma:

“North Korea has no choice but to secure state power instead of seeking economic development. Having been secluded and antagonized by the international community for many years, North Korea wavers frequently between military expansion and economic development”.

In short, North Korea attempted an economic opening of territory with the establishment of the Rason Economic Zone, going beyond its abiding representation of territory only as a shelter or fortress. Yet, crises during the 1990s forced it to re-strengthen geopolitical territorial practices and discourses with a new political system of military- first.”

George W. Bush called North Korea part of the “axis of evil” and in 2002 U.S. Assistant Secretary of State reported North Korea had admitted to him they were starting a uranium enrichment programme for nuclear weapons, also in 2002 the U.S. government released its new National Security Strategy declaring the U.S.’s right to act preemptively against whoever it decides are its adversaries.

All this intensified the ongoing conflict since the Korean War between the U.S. and North Korea.

It is either wilfully stupid or rhetorically crafty of you to pretend the Korean War and ongoing conflict has no bearing on North Korea’s economy :/

South Korea had made a great effort with its Sunshine Policy to try to normalise relations between the two Koreas, but any good will was spoiled by U.S. war mongering efforts throughout the 2000s and 2010s.

North Korea stated “In the current era with impending invasion schemes by imperialists and reactionaries, we cannot develop the socialist economy comprehensively without reinforcement of military power and develop- ment of the defense industry”.

And it was thought North Korea could become the U.S.’s next target after Iraq (which is now ongoing again). “One North Korean scholar explains the legitimacy of militarisation in the 2000s: “[The] American unilateral invasion into Iraq clearly shows that it is only with strong military deterrent that we can prevent a war and protect security of our country and nation. For this reason, our Republic has no choice but to strengthen military deterrent, fully mobilizing our country’s potential”.”

Apparently now that North Korea (very unfortunately in my view) has progressed with its nuclear program, it has decided it is in a position to concentrate on developing its economy again:

“The success of the nuclear test made North Korean leaders feel safe enough to shift their focus to building the country,” says Zhang Yushan, researcher at the Jilin Academy of Social Sciences. Regarding North Korea’s increasing zeal for economic recon- struction, Delury and Moon term it as “the transition from security-first to security-plus-prosperity””

Bruce Wilder @ 96, 97 — Chris Bertram @ 98

Yes, to the limited extent that I’m familiar with Milanovic’s views, mostly from a few short Internet essays and his participation with other economists in a panel discussion about Piketty’s book, I think it’s fair to call him humane. But while it’s tempting, in investigating the economics of inequality, to focus almost exclusively on the historical mechanisms that express en masse individual reactions to particular life experiences, it can also be misleading.

What can be understood by such analyses is important — that there are multiple determining factors in any large scale social phenomenon, such as mass Mexican emigration to the U.S. and the political reactions to it, or the credit cards and liars-loan mortgages that make it easier for corporations to manage their profit margins, not to mention the expectations of their shareholders — it overlooks, in a way that even the crudest of Marxists would not, the extent to which such imbalances are designed and intentionally implemented, and more importantly, by whom, and for whose benefit. What’s missing from Milanovic’s impressively subtle analysis is the role of power, its motivations and the arc of its influence, and how those differ from what society actually requires from it.

Even if I hadn’t said so many times before in these threads, it’s no doubt obvious to any economist that I’m not one of their number, so it doesn’t embarrass me much to ask them dumb questions. In the present context I’d ask this: if in a mature capitalist economy, secular stagnation — a crisis of production and consumption, as I understand it — threatens the yields on the investments of our rentiers, what do they do about it? Product differentiation and demand management via advertising have a limited reach. (Do we really need 57 brands of toothpaste on our supermarket shelves, or organic lettuce right next to the pesticide-laden kind?) The effect of overturning the post-war consensus and letting women into the workforce has long since petered out, and cheap credit for the masses has apparently bitten our financial innovators in the ass much earlier than any economist had expected. What is to be done?

As a non-economist, I’d say that there are still plenty of things to invest in — social goods of all kinds have been going begging some some little while, no? — but not if chasing higher yields for the parasitic rentiers at the top of our collective food chain is still considered a sine-qua-non. If that’s indeed the case, even at this late date, then government-guaranteed casino capitalism is probably the best we can do. Since the 99% can still afford to make payments on a car, if not on a house, how ’bout we invent CDOs for used cars? That’s the trick, surely. And when Carl Icahn’s done blackmailing Apple, maybe he can start thinking about opportunities in renminbi-denominated assets.

ZM – your argument is basically to concede that the economic circumstance of North and South Korea today are not a result of the war but instead the political circumstances each found themselves in afterwards. Why not be more explicit about it? It is clear that you have no basis to argue that the economic consequences of the relative destruction in the North was worse than for the South unless you have some evidence to dispute the relatively similar economic performance of the two states for the subsequent 20 years.

It looks to me like ZM says the different development of North Korea versus South Korea developed from the war, but not from the immediate direct destruction of the war.

I could imagine it either way. Oversimplified, imagine the development of both economies as logistic functions. If one of them is knocked back farther, then it will take longer for them to reach the point that the exponential growth is highly visible. But if one grows at a higher exponential rate, it can overcome the destruction easier. Then when the growth slows, one might approach a higher stable plateau than the other.

But they aren’t just functions. If one gets a big glob of outside investment early, that actually does pay off, that can advance them quickly. South Korea did, and North Korea didn’t. That is an indirect effect of the war, but not from the immediate destruction from the war.

Rakesh 43, the GDP per capita numbers you are citing don’t tell us anything about global inequality in terms of the gap between the top and the bottom. I don’t think there is any evidence that globally, the difference in income (let alone wealth) between the top 1%, or 0.1% or 0.01%, and the bottom 10, 20, even 50% of the population is closing. To the contrary, I would wager and I doubt anybody around here would disagree that that gap is increasing globally, just as it is increasing within the US and China and many other countries individually.

It might be that when you compare the middle of the American and the Chinese distributions, the difference is getting smaller. It matters quite a bit how much we trust the PPP adjustments but at least in the case of China, there is little doubt that real improvements in the material living standard of the general population have been achieved (at the cost of considerable social and environmental damage certainly but nevertheless). That still doesn’t answer the question of global inequality.

mpowell,

“ZM – your argument is basically to concede that the economic circumstance of North and South Korea today are not a result of the war but instead the political circumstances each found themselves in afterwards. Why not be more explicit about it? It is clear that you have no basis to argue that the economic consequences of the relative destruction in the North was worse than for the South unless you have some evidence to dispute the relatively similar economic performance of the two states for the subsequent 20 years.”

You appear not to have followed the argument :/

The argument I made was not about the development of North Korea versus South Korea, but North Korea versus the U.S.A.

Brett Bellmore suggested the divergency between the fates of North Korea and the United States of America was based on the good management of the United States which encouraged productivity and did not encourage theft.

I made a short comment that Brett Bellmore seemed not to have factored in that the U.S. had destroyed North Korea as part of its varied international acts of war after WW2 – and perhaps this U.S. war making had something to do with the economic development of both North Korea and the U.S.

[N.B. I did forget to point out that the U.S. has been colonised by England starting from the late 16th C, whereas the European incursion into East Asia was later and they did not set up colonies in the same way. Brett Bellmore did not note at what historical point we should think of the U.S. and North Korea being at a similar “starting point” , and I doubt he could find a historical point of such similitide]

Entrance: Brett Dunbar

Brett Dunbar argued that the Korean War was fought as a conventional war, with normal weaponary and North and South Korea suffered equally.

I point our with reputable sources that the Korean War is not like MASH suggests, and that the U.S. used extensive aerial bombing including Napalm, which I do not consider as conventional warfare. I also point out it is said North Korea was more extensively destroyed, people relegated to living underground, thanks to U.S. aerial bombing attacking civilian and agricultural infrastructure.

Brett Dunbar argues that the Korean War had no affect on North KOrean economic development, since North Korea and South Korea developed at a simialr rate until the 1970s, and 1990s.

I point out with source that the U.S. and other international actors have treated North Korea as an enemy since the Korean War, and this has had repercussions on North Korean economic development – and detail factors in the 1970s , 1990s, and 2000s.

And bringing South Korea into it is irrelevant.

As I was never arguing about NOrth Korean development versus South Korean development, but about U.S. development versus North Korean development – I still hold my original point to Brett Bellmore that the U.S. attacks on North Korea during the KOrean War and subsequent U.S. treatment of North Korea as an enemy have been a major (if not the major) causal factor in North Korean economic developemnt since the Korean War. And, moreover, that U.S. military interventions in North Korea and elsewhere since WW2 have been a defining element in U.S. economic development in the same period.

What exactly are your points countering these points I am making ?

Rakesh 112:
“I would not say that those numbers say nothing. I am not quite sure what implication you are drawing from Chinese growth, but Milanovic already has the top ventile in China above, I think, the bottom two ventiles in the US in terms of global income distribution.”

These numbers are probably not meaningless but whatever they say, they don’t imply a reduction in global inequality.

Brett Dunbar,

“Napalm is a conventional weapon”
I disagree that Napalm was a conventional weapon at the time of the Korean War, since it was only developed in 1942 and first used in war only in 1944. It is only conventional now since horrible people used it so much since 1942, which they should not have.

“”Napalm is the most terrible pain you can imagine,” said Kim Phúc, a napalm bombing survivor known from a famous Vietnam War photograph. “Water boils at 100 degrees Celsius (212°F). Napalm generates temperatures of 800 to 1,200 degrees Celsius (1,500-2,200°F).”[22]”

Anyway, it is very wrong and is now illegal under International law to use Napalm on civilian populations as the US did so often in the Korean War.

“I do note that you seem to have tried to imply that the USA was responsible for the Korean war when as a matter of historical fact the North engaged in an unprovoked invasion of the South.”

Should I suppose you are of the mistaken belief that North Korea and South Korea pleasantly discussed and decided by themselves to divide the country up into North and South following WW2 ?

Wikipedia : “The United States and the Soviet Union agreed to temporarily occupy the country as a trusteeship with the zone of control along the 38th parallel….An initiative to hold general and free elections in the entire Korea came up in the United Nations in the fall of 1947. However this initiative did not materialize because of disagreement between the United States and the Soviet Union…”

It isn’t that North Korea has had a run of bad luck relative to South Korea. It’s that it has been badly run. The US didn’t get wealthy just because we were lucky to have good natural resources; There are poor countries with good natural resources. We got wealthy because our culture and legal system permitted them to be exploited effectively, and built upon. It didn’t discourage productivity, and encourage theft. (Legal or otherwise.)

“The USA had no great regard for Rhee ”

Rhee was chosen because of his anti-Communism and connections to the US, despite his corruption and abuse of power.

“Brett Bellmore compared North and South Korean economic policies and then made a related comment about the USAs success was linked to American governance. He wasn’t comparing North Korea to the USA he was arguing that the reason the South is a success while the North is an abject failure was due to the different politics in each.”

To which I pointed out that the U.S. attacks on North Korea and subsequent treatment of North Korea as a mortal enemy for over half a century has had a great effect on the North Korean economy.

As well as pointing out that the U.S. attacking various countries, like Vietnam that you mention, has had a strong effect on the U.S. economy since WW2.

I am not interested in the different national economic policies in South Korea from North Korea, so I wonder that you think I will be interested in you now bringing Vietnam up.

Are you denying that the U.S. with its attacks on North Korea in the Korean War and subsequent treatment of North Korea as an enemy has affected North Korean economic development?

If so – can you provide any evidence of North Korea not being affected by U.S. actions towards it?

@ZM:

Oh, FFS. Take a few deep breaths.

What about now?

Do you even care?

Your self-righteous BS is tiresome.

Korea, Vietnam, etc., are ancient history. Most of us here know that shit.

The question is: What is to be done?

You seem to be inspired.

We need you.

We are lost.

Tell us.

@ZM:

I am honestly sorry.

I am sick to death by the election results the other day.

Forgive me, please.

If I can be given the leeway to take this part out of context, I can agree with both
Brett Bellmore @3, 11.08.14 at 12:36 pm
and
ZM @117, 11.13.14 at 4:29 am:

There are poor countries with good natural resources. We got wealthy because our culture and legal system permitted them to be exploited effectively, and built upon. It didn’t discourage productivity…

…but not this part:

…and encourage theft. (Legal or otherwise.)