10 ms·

The Politically Incorrect Guide to Ending Poverty

139 points by b-man 16y ago

thecoffman 16y ago
Very interesting article - makes you think. The Atlantic is one of the few magazines that I subscribe to in print. There's a nice blend of culture, politics, and forward thinking, and there doesn't seem to be a ton of editorial stance. You'll read one article from a liberal perspective, and then another one from a conservative one. It seems to be an all around solid publication. I don't always agree with what they publish - but its almost always thought provoking.
ddlatham 16y ago
Previous discussion at: http://news.ycombinator.com/item?id=1426429 http://news.ycombinator.com/item?id=1426429 http://news.ycombinator.com/item?id=1584200 http://news.ycombinator.com/item?id=1584200
_delirium 16y ago
Here's the project's website: http://www.chartercities.org/ http://www.chartercities.org/
mquander 16y ago
Related: http://unqualified-reservations.blogspot.com/2009/08/from-cromer-to-romer-and-back-again.html http://unqualified-reservations.blogspot.com/2009/08/from-cr... I agree with the upshot of Moldbug's argument: "Thus the practical problem with 'charter cities' is that no one wants them: not the host regime, not the international regime. For both, they simply work too well. Colonialism had to die not because it didn't work, but because it worked too well."
- jdp23 16y ago
  Umm ... colonialism doesn't actually work well for the colonized.
  - shaddi 16y ago
    Perhaps more accurately, it doesn't work well for those involved who don't have power. Puppet governments seem to do quite well for themselves, as do the colonizers.
  - mquander 16y ago
    Well, I'm not sufficiently satisfied with my historical knowledge to hang around and argue this point with you, but I would point out that Moldbug defends it vigorously. If you can't be arsed to wade through his lengthy mumblings, you can CTRL-F "The fundamental observation of colonialism is that non-European societies thrive under normal European administration, at least in comparison to their condition under native rule" in the above essay and read for a bit from there. His conclusion is that "...to assert that their average quality of government service was anything but far better than either their predecessors, or their successors, is a political distortion of history which I have no trouble at all in comparing to Holocaust denial."
    - jdp23 16y ago
      Right. It's worked out soooo well for Native Americans here in the US. Except for the whole smallpox thing. And the reservations. And the massacres. And the Interior Department.
      - fistofjohnwayne 16y ago
        Yes but now they have a better "average quality of government service."
        shaddi 16y ago
        Most folks I know living on reservations would debate that. Just saying, it's a strong claim to make.
        fistofjohnwayne 16y ago
        I was being facetious, I might have said, "sure the government service is great, if you survived."
shaddi 16y ago
I'm not going to fault this piece for being hand-wavy and poorly justified: it is that, but then again, it's a piece of popular journalism which is allowed to be. So, I'll criticize the broader idea. This article cites China as a model. Hong Kong did not pull the rest of China up as it grew. It certainly played a role, but frankly the communism that took resources from the urban coast and built roads, schools, and other infrastructure in rural areas was more likely a bigger contributor to the massive improvement in (purely economic) standard-of-living for most Chinese. It was in particular /not/ enlightened foreign rule of urban areas that did this. If we accept that all geopolitical entities respond to incentives, it is not clear that direct foreign control of areas of the developing world will produce the ideal outcome for those areas: this will only be the case when the incentives and interests of both the local population (which is not monolithic, btw, but we'll ignore that for now) and the foreigners align; long term prosperity requires that incentives align for both in the long term, which seems terribly unlikely. Moreover, the history of development is fraught with stories stories good-intentioned outsiders failing to make a beneficial impact because they poorly understood the complex local situation, and it's simply unrealistic to assume you can just start with a clean-slate-by-fiat in a "charter city" and build without considering a place's history. I think Romer has a good core idea, one that few people would argue with. Namely, development is not just a matter of fixing the "Production = F(capital & labor)" equation; good governance, good ideas, and good people all are required. While it may be surprising to some, this is an idea that is pretty well understood (at least at a high level) in the development community/industry. My beef with his idea is a flawed execution, and one that I think could be potentially damaging in the long term. These ideas need to come from local populations and make sense for their own contexts. As an analogy, you just aren't going to reproduce Silicon Valley by emulating the Bay Area's regulations and investment level: there is a whole history that made it the way it is. Attempts to do so are kind of doomed from the start, so it's better to focus on creating new centers of prosperity that make sense for the local context. I don't think foreigners are well positioned to do that. --- Another point to make, the Millennium Villages Project had a similar premise to Romer's. The idea was that solving the problems of poverty in particular villages through strong international partnerships would lead to spillover effects throughout the surrounding areas. Everything I've heard about it is that the results have been alright, but not really that great. Besides a bit more of a heavy-handed foreign-involvement approach, I'm not sure if the "charter cities" idea really is that different than MVP and hence it's not clear how it will overcome the obstacles MVP faced. Edit: William Easterly is quoted here. He has an awesome book, "The Elusive Quest for Growth", that discusses a lot of non-intuitive reasons why development efforts have historically failed. I would highly recommend it.
maxklein 16y ago
It's not just politically incorrect, it's also incorrect. Hong Kong was not setup as a place for the british to run, the british came in and controlled it. There's a difference - because the british were absolute law and order. There were not two voices. A more apt comparison would be suzhou. Areas of it were developed under singaporean authority. The singaporeans ended there with huge losses, and I don't think they are interested in doing such anymore. And singapore and china are relatively close culturally - if for example china were to setup cities in Africa, diaster would occur. You can see the same happening with current chinese ventures there: they are run and managed solely by chinese and employ chinese. I was watching a BBc documentary the other day about some chinese companies in Angola, and an Angolan man complained: "Why do they need to bring people from China here to drive trucks?" The answer is simple - if you have people from two different countries and two different cultures where one is driving a truck and the other is managing his work, then productivity will sink massively. A country administering a town in another country will be constantly beset by these cross-cultural problems. There will be conflicting interests, conflicting cultures and conflicting work attitudes. One side will resent the other, and instead of new booming towns, there will be wastage and empty buildings. The current system is better, where a country simply sends its people to build infrastructure and then walks away. Perhaps even build the entire physical infrstructure and buildings of a city, but the actual management has to be separate, I'd think.
- tokenadult 16y ago
  Thanks for mentioning the example of the Singapore zone in Suzhou. I had not previously heard of that, and its apparent initial failure is instructive. http://www.singapore-window.org/suzhou.htm http://www.singapore-window.org/suzhou.htm Some more recent sources suggest that the relationship slogs on. http://www.singapore-window.org/suzhou.htm http://www.singapore-window.org/suzhou.htm
  - mickt 16y ago
    I find it interesting that the Wiki page on Suzhou make little mention of this: http://en.wikipedia.org/wiki/Suzhou#Industry http://en.wikipedia.org/wiki/Suzhou#Industry The whole page almost seems like a piece of PR.
kragen 16y ago
Honduras recently amended its constitution to permit the creation of Regiones Especiales de Desarrollo, following Romer's ideas: http://www.congreso.gob.hn/contenido/1640-cronologia-del-nacimiento-de-una-ciudad-modelo-en-honduras http://www.congreso.gob.hn/contenido/1640-cronologia-del-nac...
- iwwr 16y ago
  Special economic zones are a convenient way for host nations to introduce reforms gradually and in constrained areas. The flow of kickbacks and bribery can continue in the mainland, while new laws and rules are developed in the SEZ islands. Even better, the political oligarchy can receive rents from these new areas if they become successful.
  - kragen 16y ago
    That's a very positive way to look at it. But bribery is not the only aspect of normal politics you can leave behind in your special economic zone; you can also abridge, for example, import tariffs, labor laws, accountability for political corruption, and environmental regulations.
jcampbell1 16y ago
not hacker news.
hristov 16y ago
This article pops on hn periodically, so I do not have time to refute it in detail yet again, but should point out quickly that this is just a plan to create private paid for dictatorships. It is very unlikely to result in reduction of poverty as this rarely happens in dictatorships. What will most likely happen is some type of slave camp deal as it is already happening in Dubai. Now you will say, "but the people have a right to vote with their feet, i.e. to leave if they do not like the place." Technically yes, but in reality no. The poor foreign workers that are being held in Dubai also theoretically have a right to leave, but they cannot because the Dubai police will simply club them on their heads if they even mention leaving before finishing their job. If you do not have an overall legal framework that protects individual rights, if the people do not have the right to elect their own leaders and/or police chiefs, then it is very unlikely the police will protect the people's rights.
- izendejas 16y ago
  I'm not sure that the situation in Dubai is one that Romer would envision. You're attacking a straw man. Having said that, I won't argue either way. The devil is in the execution no doubt. But in trying out his idea, I would hope that there's something we can learn from it besides the would-be automatic response of "that doesn't work." What we're currently trying is clearly not working all that well, so we'd be insane not to try something different and I'd hope that Romer can get two parallel "experiments"--for concisenss--in two different countries to see which conditions, if any, are better suited for his model.
thisrod 16y ago
The most interesting part of this is the irrational thinking it exposes in the developed world. What's the difference between extending Canada to include a bit of Africa, and letting more Africans move to the existing Canada? I think it's pretty minor. Then why would Canadians bother with Romer's plan, when they could simply relax their immigration laws?
- izendejas 16y ago
  That's a valid observation. Surely, immigration is good for the home country of the emigrants economically speaking (think remittances, entrepreneurs going back, etc). This, I'd argue, is indeed better than foreign aid. But what Romer is arguing is that his model is meant to change the rules and bring the ideas to the country. As an immigrant, what would be the point of moving to Canada and learning new models/ideas if when you go back, you won't have the power to change them and expose others to them under the same circumstances?
wladimir 16y ago
When I read "Politically incorrect", I was thinking of Jonathan Swifts' "A modest proposal" (http://art-bin.com/art/omodest.html http://art-bin.com/art/omodest.html)
emit_time_n3rgy 16y ago
This reminds me of this Journeyman documentary subject on the plans of Chinese business-persons to develop a Swedish town into a large commercially thriving community - http://www.journeyman.tv/61449/documentaries/chinatown.html http://www.journeyman.tv/61449/documentaries/chinatown.html Not poverty-reduction-related but does relate to the subject in a different way..

139 points by b-man 16y ago

Very interesting article - makes you think. The Atlantic is one of the few magazines that I subscribe to in print. There's a nice blend of culture, politics, and forward thinking, and there doesn't seem to be a ton of editorial stance. You'll read one article from a liberal perspective, and then another one from a conservative one. It seems to be an all around solid publication. I don't always agree with what they publish - but its almost always thought provoking.

ddlatham 16y ago

Previous discussion at: http://news.ycombinator.com/item?id=1426429 http://news.ycombinator.com/item?id=1426429 http://news.ycombinator.com/item?id=1584200 http://news.ycombinator.com/item?id=1584200

_delirium 16y ago

Here's the project's website: http://www.chartercities.org/ http://www.chartercities.org/

mquander 16y ago

Related: http://unqualified-reservations.blogspot.com/2009/08/from-cromer-to-romer-and-back-again.html http://unqualified-reservations.blogspot.com/2009/08/from-cr... I agree with the upshot of Moldbug's argument: "Thus the practical problem with 'charter cities' is that no one wants them: not the host regime, not the international regime. For both, they simply work too well. Colonialism had to die not because it didn't work, but because it worked too well."

jdp23 16y ago
Umm ... colonialism doesn't actually work well for the colonized.
- shaddi 16y ago
  Perhaps more accurately, it doesn't work well for those involved who don't have power. Puppet governments seem to do quite well for themselves, as do the colonizers.
- mquander 16y ago
  Well, I'm not sufficiently satisfied with my historical knowledge to hang around and argue this point with you, but I would point out that Moldbug defends it vigorously. If you can't be arsed to wade through his lengthy mumblings, you can CTRL-F "The fundamental observation of colonialism is that non-European societies thrive under normal European administration, at least in comparison to their condition under native rule" in the above essay and read for a bit from there. His conclusion is that "...to assert that their average quality of government service was anything but far better than either their predecessors, or their successors, is a political distortion of history which I have no trouble at all in comparing to Holocaust denial."
  - jdp23 16y ago
    Right. It's worked out soooo well for Native Americans here in the US. Except for the whole smallpox thing. And the reservations. And the massacres. And the Interior Department.
    - fistofjohnwayne 16y ago
      Yes but now they have a better "average quality of government service."
      - shaddi 16y ago
        Most folks I know living on reservations would debate that. Just saying, it's a strong claim to make.
        fistofjohnwayne 16y ago
        I was being facetious, I might have said, "sure the government service is great, if you survived."

shaddi 16y ago

I'm not going to fault this piece for being hand-wavy and poorly justified: it is that, but then again, it's a piece of popular journalism which is allowed to be. So, I'll criticize the broader idea. This article cites China as a model. Hong Kong did not pull the rest of China up as it grew. It certainly played a role, but frankly the communism that took resources from the urban coast and built roads, schools, and other infrastructure in rural areas was more likely a bigger contributor to the massive improvement in (purely economic) standard-of-living for most Chinese. It was in particular /not/ enlightened foreign rule of urban areas that did this. If we accept that all geopolitical entities respond to incentives, it is not clear that direct foreign control of areas of the developing world will produce the ideal outcome for those areas: this will only be the case when the incentives and interests of both the local population (which is not monolithic, btw, but we'll ignore that for now) and the foreigners align; long term prosperity requires that incentives align for both in the long term, which seems terribly unlikely. Moreover, the history of development is fraught with stories stories good-intentioned outsiders failing to make a beneficial impact because they poorly understood the complex local situation, and it's simply unrealistic to assume you can just start with a clean-slate-by-fiat in a "charter city" and build without considering a place's history. I think Romer has a good core idea, one that few people would argue with. Namely, development is not just a matter of fixing the "Production = F(capital & labor)" equation; good governance, good ideas, and good people all are required. While it may be surprising to some, this is an idea that is pretty well understood (at least at a high level) in the development community/industry. My beef with his idea is a flawed execution, and one that I think could be potentially damaging in the long term. These ideas need to come from local populations and make sense for their own contexts. As an analogy, you just aren't going to reproduce Silicon Valley by emulating the Bay Area's regulations and investment level: there is a whole history that made it the way it is. Attempts to do so are kind of doomed from the start, so it's better to focus on creating new centers of prosperity that make sense for the local context. I don't think foreigners are well positioned to do that. --- Another point to make, the Millennium Villages Project had a similar premise to Romer's. The idea was that solving the problems of poverty in particular villages through strong international partnerships would lead to spillover effects throughout the surrounding areas. Everything I've heard about it is that the results have been alright, but not really that great. Besides a bit more of a heavy-handed foreign-involvement approach, I'm not sure if the "charter cities" idea really is that different than MVP and hence it's not clear how it will overcome the obstacles MVP faced. Edit: William Easterly is quoted here. He has an awesome book, "The Elusive Quest for Growth", that discusses a lot of non-intuitive reasons why development efforts have historically failed. I would highly recommend it.

maxklein 16y ago

It's not just politically incorrect, it's also incorrect. Hong Kong was not setup as a place for the british to run, the british came in and controlled it. There's a difference - because the british were absolute law and order. There were not two voices. A more apt comparison would be suzhou. Areas of it were developed under singaporean authority. The singaporeans ended there with huge losses, and I don't think they are interested in doing such anymore. And singapore and china are relatively close culturally - if for example china were to setup cities in Africa, diaster would occur. You can see the same happening with current chinese ventures there: they are run and managed solely by chinese and employ chinese. I was watching a BBc documentary the other day about some chinese companies in Angola, and an Angolan man complained: "Why do they need to bring people from China here to drive trucks?" The answer is simple - if you have people from two different countries and two different cultures where one is driving a truck and the other is managing his work, then productivity will sink massively. A country administering a town in another country will be constantly beset by these cross-cultural problems. There will be conflicting interests, conflicting cultures and conflicting work attitudes. One side will resent the other, and instead of new booming towns, there will be wastage and empty buildings. The current system is better, where a country simply sends its people to build infrastructure and then walks away. Perhaps even build the entire physical infrstructure and buildings of a city, but the actual management has to be separate, I'd think.

tokenadult 16y ago
Thanks for mentioning the example of the Singapore zone in Suzhou. I had not previously heard of that, and its apparent initial failure is instructive. http://www.singapore-window.org/suzhou.htm http://www.singapore-window.org/suzhou.htm Some more recent sources suggest that the relationship slogs on. http://www.singapore-window.org/suzhou.htm http://www.singapore-window.org/suzhou.htm
- mickt 16y ago
  I find it interesting that the Wiki page on Suzhou make little mention of this: http://en.wikipedia.org/wiki/Suzhou#Industry http://en.wikipedia.org/wiki/Suzhou#Industry The whole page almost seems like a piece of PR.

kragen 16y ago

Honduras recently amended its constitution to permit the creation of Regiones Especiales de Desarrollo, following Romer's ideas: http://www.congreso.gob.hn/contenido/1640-cronologia-del-nacimiento-de-una-ciudad-modelo-en-honduras http://www.congreso.gob.hn/contenido/1640-cronologia-del-nac...

iwwr 16y ago
Special economic zones are a convenient way for host nations to introduce reforms gradually and in constrained areas. The flow of kickbacks and bribery can continue in the mainland, while new laws and rules are developed in the SEZ islands. Even better, the political oligarchy can receive rents from these new areas if they become successful.
- kragen 16y ago
  That's a very positive way to look at it. But bribery is not the only aspect of normal politics you can leave behind in your special economic zone; you can also abridge, for example, import tariffs, labor laws, accountability for political corruption, and environmental regulations.

jcampbell1 16y ago

not hacker news.

hristov 16y ago

This article pops on hn periodically, so I do not have time to refute it in detail yet again, but should point out quickly that this is just a plan to create private paid for dictatorships. It is very unlikely to result in reduction of poverty as this rarely happens in dictatorships. What will most likely happen is some type of slave camp deal as it is already happening in Dubai. Now you will say, "but the people have a right to vote with their feet, i.e. to leave if they do not like the place." Technically yes, but in reality no. The poor foreign workers that are being held in Dubai also theoretically have a right to leave, but they cannot because the Dubai police will simply club them on their heads if they even mention leaving before finishing their job. If you do not have an overall legal framework that protects individual rights, if the people do not have the right to elect their own leaders and/or police chiefs, then it is very unlikely the police will protect the people's rights.

izendejas 16y ago
I'm not sure that the situation in Dubai is one that Romer would envision. You're attacking a straw man. Having said that, I won't argue either way. The devil is in the execution no doubt. But in trying out his idea, I would hope that there's something we can learn from it besides the would-be automatic response of "that doesn't work." What we're currently trying is clearly not working all that well, so we'd be insane not to try something different and I'd hope that Romer can get two parallel "experiments"--for concisenss--in two different countries to see which conditions, if any, are better suited for his model.

thisrod 16y ago

The most interesting part of this is the irrational thinking it exposes in the developed world. What's the difference between extending Canada to include a bit of Africa, and letting more Africans move to the existing Canada? I think it's pretty minor. Then why would Canadians bother with Romer's plan, when they could simply relax their immigration laws?

izendejas 16y ago
That's a valid observation. Surely, immigration is good for the home country of the emigrants economically speaking (think remittances, entrepreneurs going back, etc). This, I'd argue, is indeed better than foreign aid. But what Romer is arguing is that his model is meant to change the rules and bring the ideas to the country. As an immigrant, what would be the point of moving to Canada and learning new models/ideas if when you go back, you won't have the power to change them and expose others to them under the same circumstances?

wladimir 16y ago

When I read "Politically incorrect", I was thinking of Jonathan Swifts' "A modest proposal" (http://art-bin.com/art/omodest.html http://art-bin.com/art/omodest.html)

emit_time_n3rgy 16y ago

This reminds me of this Journeyman documentary subject on the plans of Chinese business-persons to develop a Swedish town into a large commercially thriving community - http://www.journeyman.tv/61449/documentaries/chinatown.html http://www.journeyman.tv/61449/documentaries/chinatown.html Not poverty-reduction-related but does relate to the subject in a different way..