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« Education and the World's Poor -- Entrepreneurship Not Aid is the Solution | Main | The Political Economy of Forgiveness »


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Rodrik wrote, "What enabled reform was not a reconfiguration of political power, but the emergence of new strategies. Economic change often happens not when vested interests are defeated, but when different strategies are used to pursue those interests."at

But what caused the Chinese communists to choose freer markets? After all, the idea had been around for a while. The crisis of the 1960's persuaded Deng and a few other leaders of the Communist party to consider an alternative that might keep so many people from starving to death.

The same goes for the USSR. See Yegor Gaidar's book on the collapse of the USSR.

There are no new ideas. The debate about freedom vs state control is at least as old as Plato (communist) and Aristotle (free market).

Actually, it goes back to Moses (free market) vs pharaoh (state control).

Yet the most robust form of government today and in the history of mankind has been the pharaoh/Plato government controlled economy. Free market economies have been rare and short-lived. Freedom in the US lasted only until about WWI, and didn't exist for Blacks until the 1960's.

Crisis often forces a switch to the idea that is not in power at the time of a crisis, the dominant idea being seen as the cause of the crisis.

But I think the best explanation of which of the old ideas wins at a particular time is found in human nature, especially Schoeck's depiction of human envy (Envy: a Theory of Social Behavior). The elite has always used envy to control the masses.

And as Schoeck points out the West developed because Christianity found a way to subdue envy. Socialism (Plato) elevates envy to a virtue and appeals to most people, even many ignorant Christians.

Most political/economic theories can be classified as 1) appeasing/promoting envy and tending toward state control or 2) subduing envy and leading to freedom.

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