Saturday, November 23, 2013

Ridley on Economic Freedom and Political Authoritarianism

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from the article:

Yet this is precisely the wrong lesson to draw from China (and Singapore). It’s not because it’s unfree at the top that China is growing fast, but because, at least in some respects, it is very free at the bottom. The extraordinary fact is that — economically — the average Chinese person is more free from government interference than the average Westerner. As Niall Ferguson has documented, general government total expenditure is twice as high in the United States and Europe as it is in China as a per cent of GDP. China ranks higher than America on the ethics of politicians. It takes far less time and trouble to build a house or a nuclear power station in China than it does in Britain.

So long as you don’t cross the Communist Party, China is laissez-faire on a scale that would make Hayek blush. That’s what happens when you liberalise a totalitarian regime: if the party was previously taking all the decisions, then once it steps back there’s very little else in the way of state bureaucracy.

Source: Matt Ridley, "When Political Tyranny Allows Economic Freedom," therationaloptimist.com, November 13, 2013

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