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>"Bryant Garth, a law professor who wrote the standard history book on arbitration, told me that the P.&I.D. process showed the danger of the arbitration system
by nickff 3y ago
>"Bryant Garth, a law professor who wrote the standard history book on arbitration, told me that the P.&I.D. process showed the danger of the arbitration system’s being manipulated by a greedy actor. “It treats the state as if it’s just another business,” he said, “rather than the representative of the people.”"
Calling a series of rapaciously corrupt administrations which often engage in electoral fraud[1] 'representative of the people' seems laughably charitable. I'm also unsure of why anyone would engage in business with a state if the latter were permitted to do whatever it wanted, whenever it wanted, without regard to its own commitments, simply by invoking its 'representation'.
[1] https://en.wikipedia.org/wiki/Federal_government_of_Nigeria https://en.wikipedia.org/wiki/Federal_government_of_Nigeria
- alephnerd 3y ago> why anyone would engage in business with a state if the latter were permitted to do whatever it wanted High risk, high reward. Also the state isn't permitted to do whatever it wants if it wishes to remain a part of the global financial system.
- nickff 3y ago>"Also the state isn't permitted to do whatever it wants if it wishes to remain a part of the global financial system. " International arbitration is supposed to enforce this, and is exactly what the quote is against.
- NoboruWataya 3y ago> Also the state isn't permitted to do whatever it wants if it wishes to remain a part of the global financial system. Interestingly, the article also paints this fact in a fairly cynical light. > A country that doesn’t pay its arbitration bills can wind up blackballed by foreign investors. “Rather than hopelessly resist,” Born told me, “the overwhelming majority of parties voluntarily comply.” Those damned foreign investors, not wanting to do business with corrupt governments that screw them.
- gwern 3y ago> High risk, high reward. Which usually means no trade because for many transactions, the required sufficiently high reward would outweigh the intended gains. So you get deadweight loss. Think of a lemon market for used cars. Yes, there will still be some transactions for cars which look like a sufficiently astounding bargain, but overall, both buyers and sellers are much worse off.
- alephnerd 3y agoThe world isn't as rational as your blog tries to make it. Some people (not me) are fine with taking the risk, or have additional aces up their sleeves. Corruption works thanks to information asymmetry. In other cases, this is (sadly) just standard operating procedure.
- gwern 3y agoTell me that when Nigeria gets as rich per capita as countries which do have good rule of law. (I'll wait.)
- cherryteastain 3y ago> Also the state isn't permitted to do whatever it wants if it wishes to remain a part of the global financial system. Unless the state in question is USA. USA can do whatever it wants.
- pcrh 3y agoThe "capitalists" in this story don't come out smelling of roses either.