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Why can’t leading conservative magazine understand freedom?

Found this  mysterious transmission on a robot named R2D2 Twitter from  joshuafoust:National Review Online endorses authoritarian capitalism. Help us, Obi Wan @bill_easterly, you’re our only hope!”

I won’t let you down, Leia&Luke AKA @joshuafoust…  The bizarre article in question is titled China Teaches the U.S. Lessons about Economic Freedom. The argument seems roughly to be that China’s rapid growth is explained by its positive change in economic freedom after 1978. Throw in a few qualifiers, and I would agree. Then things get bizarre: the article notes that after 2003, there was negative change in Chinese economic freedom, but says it had no effect on China’s growth. Next it argues there was a negative change in freedom under Obama, which WILL have a devastating effect on the US growth rate, which for unexplained reasons responds differently than China’s. The punchline:

Where economic freedom expands, growth follows. Where economic freedom is stifled, economies stagnate. Sadly, China’s former leaders understood this better than do its current leaders, or America’s.

–or better than the author, one might add. And should we maybe give 1 or 2 Brownie points to America’s leaders for not shooting and imprisoning peaceful dissidents? And maybe America’s leaders understand better than the leading conservative magazine the indispensable link between political and economic freedom understood by Milton Friedman and F.A. Hayek (perhaps this is why the latter wrote an essay “why I am not a conservative?”).

Sorry, leading conservative magazine, as long as you are dishonest or incoherent about the f-word, you’re not making any converts in these parts.

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8 Comments

  1. William,
    I’ve read this post four times, and it’s still not very clear what you’re arguing for and against.

    I think you’re reading far too much into a what are simple, broad analogies that express a sentiment not a formula. All he’s saying is that small increases in freedom produced a great impact on china. And he’s implying that small decreases in freedom here in the USA, will have as grand a set of effects.

    I think you’re both confused and you both overrate government, overrate individuals, and underrate demographic movement.

    Growth was easy for the USA during the 1800’s: buy half a continent from Napoleon and import millions of Europeans into it. Sell them all sorts of consumer goods so that they fill up the territory, and so that you can collect profit and create capitalist barons doing so. Use the cheap land and labor to produce commodity goods and sell them to europe. Cause a price catastrophe in europe. Let them have a horrendous civil war and inherit their intellectuals and england’s naval empire.

    Now, take a country like china, forcibly held back in ignorance and poverty by Mao who decided it was better to have everyone poor and suffering than a wealthy south and a poor north and west — fragmenting the chinese empire. Now, import vast amounts of western technology, western banking and accounting technology in particular, and use your inexpensive labor to produce goods based on that technology cheaply and sell back to the westerners.

    China’s growth is largely in the form of construction: moving people from hovels in the rural areas, to apartments in urban areas. The country is vastly poor. And it’s per-capita GDP is horrid. They used totalitarianism and capitalism to manage their expansion, we used republicanism and capitalism to do the same thing. There is nothing interesting about china. Nothing. There is nothing interesting about america, either, which is why you’re both confused.

    What’s interesting is how Europe in general, and England in particular, created so much innovation, how Americans capitalized on it, and how we can use that tradition and culture of innovation to compete in a world where we are no longer the one making money from a huge demographic change.

    Once cheap labor stops, and marginal differences in knowledge are exhausted, what remains is a nation’s ability to dynamically reorganize production in real time, and to competitively innovate in real time.

    The question is, whether Americans will maintain their innovative risk taking speculative culture without the military and economic dominance they possessed in the last century, and the resulting control over the international banking and trade system.

    Posted August 17, 2010 at 9:01 pm | Permalink
  2. Harold wrote:

    This “double-morale” opinions from conservative media is not only observe in economic issues but in political issues as well.

    Yesterday, WSJ’s editorial titled “The Mosque of Misunderstanding” discussed the issue about building a mosque nearby ground zero. After constantly repeating that America is the Land of Freedom, they managed to say that there is a lack of “wisdom” by building a mosque in that area, therefore the mosque should be “build somewhere else.”

    Can someone explain this?

    Posted August 17, 2010 at 11:21 pm | Permalink
  3. sam wrote:

    Well said, Curt Doolittle. I love this blog, and agree with Mr. Easterly a vast majority of the time. But I can’t for the life of me figure out what all the fuss is about. Maybe our dear blogger simply could not turn down a challenge.

    As far as I can tell, the article is simply making a point that moving from less economic freedom to more economic freedom tends to have a positive effect on economic growth, while moving in the opposite direction tends to have the opposite effect. Is this something that Mr. Easterly would disagree with??

    The actual statement about China’s negative change in economic freedom was this: “since 2003 the Chinese leadership has restrained economic freedoms rather than expanding them, so the powers of economic freedom are facing new internal headwinds.”

    The article does not seem to deny or confirm the link between political and economic freedom. As conservatives, I’m sure they practically obsess over the link. You adopt a much more sweeping interpretation of the article than is probably fair – I do not see an article primarily about freedom, but about the effects of economic freedom on economic growth.

    I’m sure most of us accept their premise to be true. Political freedoms surely have a negative effect on growth. But political freedom held constant, surely we expect – and find! – differing economic outcomes from differing levels of economic freedoms.

    As a case study, one need not look any further than a simple comparison between authoritarian regimes of Hugo Chavez and Paul Kagame.

    Posted August 17, 2010 at 11:52 pm | Permalink
  4. William Easterly wrote:

    Curt and Sam, thanks for your comment. I was making a simple point: the article had a double standard for the Negative Changes in Economic Freedom in China and the US.

    And, 2nd, in giving so much general credit to Deng Xiao Ping vs. America’s leaders, it ignored Deng’s despicable actions aginst individual freedom in Tien An Men Square, and continued violence against and imprisonment of dissidents in China.

    Posted August 18, 2010 at 1:21 pm | Permalink
  5. sam wrote:

    William – thanks for replying! I’m a big fan of your work.

    On this point, I still just don’t see it. I’m really not sure what you disagree with here. It does not appear that you disagree that “the empowering forces of even modest amounts of economic freedom” in China was a major contributor to their economic growth. And they seem to think that the more recent negative change in economic freedoms are causing their markets to face “new internal headwinds”.

    Perhaps you are right that Deng deserves no praise that is not qualified with his atrocious restrictions on civil and political freedoms, and perhaps National Review is slightly remiss in not expanding more on China’s “enduring lack of political freedom”. But for an article themed solely on the effects of economic freedom on economic growth, I’m not sure we can consider that a requisite. Nor am I convinced that noting the relative “freeing” of their markets under Deng makes them “fellow travelers with chinese communists”.

    Forgive me for asking: do you have an axe to grind with these guys?

    Posted August 18, 2010 at 2:26 pm | Permalink
  6. Harold wrote:

    Sam,
    The contradiction is simple and I can explain it as follows:

    According to the article, there is a positive relationship between freedom an economic growth and that explains the rapid growth in China.
    However, the relationship does not hold for China since 2003: “since 2003 the Chinese leadership has restrained economic freedoms rather than expanding them.” But China is still Growing!

    So, why if the relationship hold for the 1980-2003 period, and then it breaks for 2003-2010 period, why he suggest that the reduction in freedom in the USA–due to the government actions from this administration–will harm the USA economy??

    Posted August 18, 2010 at 7:42 pm | Permalink
  7. Joseph Sunde wrote:

    I was dreading reading the NRO post, but when I actually read read it, I was slightly under-agitated (as were Curt and Sam). After reading Mr. Easterly’s reply the disagreement makes sense, but I think it’s a little overhyped to start nit-picking about this leader and that leader. From reading the post in full, it seems like a very broad, generalized argument from 1978 onward (in China) and the U.S.’s recent actions. The argument seems simply about plain direction, rather than actual scope. I don’t think it implies China is MORE free than the U.S. and it seems to be speaking merely of economic issues.

    That being said. What was the most silly to me about all of this was the attack on National Review for some small post in The Corner (not in the magazine, just on their blog). For anyone who reads The Corner (I read it daily), there is constant disagreement on any number of issues and there are numerous writers who do not write for the actual magazine (I personally have never seen Foster appear in the magazine).

    My point is simply that it seems a bit hysterical to characterize the entire magazine for one little post, as over-generalized and problematic as you may think it is. Actual NR (magazine) heavyweights constantly ridicule the romanticization of China. Jonah Goldberg, for instance, who is the EDITOR of NRO, has made sort of a game out of poking fun of Tom Friedman’s ravings about the authoritarian capitalism of China.

    A small point, but an important one. One thing I like about The Corner is the diversity of views, even if some are silly or ill written.

    Posted August 19, 2010 at 12:12 am | Permalink
  8. sam wrote:

    As if to make your point Joseph, a new National Review article by editor Jonah Goldberg on China today: http://www.nationalreview.com/articles/244273/china-wealthy-s-rich-jonah-goldberg

    Posted August 20, 2010 at 12:17 pm | Permalink

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    The Aid Watch blog is a project of New York University's Development Research Institute (DRI). This blog is principally written by William Easterly, author of "The Elusive Quest for Growth: Economists' Adventures and Misadventures in the Tropics" and "The White Man's Burden: Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good," and Professor of Economics at NYU. It is co-written by Laura Freschi and by occasional guest bloggers. Our work is based on the idea that more aid will reach the poor the more people are watching aid.

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