Blog goddess Natalie Solent has written two posts that Iíd like to bring to your attention, but Iím only going to discuss them in one. (What a bargain! And we pass the savings on to you!)
The first post is a fisking of a British textbook used in a Religious Studies course. Natalie tears into the material with gusto, since the author of the textbook blames the inequality of living standards between developing nations and industrialized countries on world trade and a lack of foreign aid. NATO also adds to the problem by acting as the worldís police force.
Got that? World trade creates poverty. Mean nations who happen to be rich wonít give their wealth away to those who deserve it. And NATO screws everyone over by trying to keep genocide and regional conflicts from flaring up.
If this is what theyíre teaching the youth in the UK then I weep for the Commonwealth. I’m also wondering why some Socialists are writing a textbook on religion, since I thought they hated that sort of thing.
Click on the link and read the post. Itís very good, and Natalie does a very good job of pointing out the absurdity of it all. But thatís not whatís really puzzling me.
Natalie follows up her fisking with a post about interest rates charged on loans to developing countries. Two of her readers, both admitting that high interest rates hinder needed growth in the Third World, take mutually supporting positions as to the cause and utility of those rates.
One claims that itís pretty much a natural law for high rates to be charged where the risk is high, and so itís natural that money for needed growth will be scarce. If developing nations want to actually, you know, develop, then they have to clean up their own back yard first. Reduce corruption, develop and stick to sound economic policy, support the rule of law.
The other reader seems to think that every problem is the fault of poor government and rich people. People get rich in developing nations by loaning money to the guys in power, and so the only thing theyíre interested in is propping up the government in order to guard their cash flow. The poor are helpless, marginalized, and just donít matter.
I donít make any bones about how my areas of interest are law enforcement, self defense and military history. Iíve never even read Adam Smith, which is as close to an admission of blasphemy as youíll find here at The Chicago Boyz. Thatís why Iím not going to even try to take a position when it comes to economic theory.
Thatís what my readers are for.
The question to springs to mind is what would happen if interest rates were reduced for selected developing countries? Would it make a difference, or would it just be more money down a rat hole? And, if itís almost certainly going to be a waste of resources and time, why in the world does anyone support organizations like the World Bank?
It could just be that Iím missing something here. There might be an alternative to loans that I just donít see. If so, Iím sure that someone will point it out.