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A Libertarian Island Dream in Honduras Is Now an $11B Nightmare

52 points by impish9208 2y ago

impish9208 2y ago
https://archive.is/ZQI1U https://archive.is/ZQI1U
- everybodyknows 2y ago
  Direct link to CSIS's report: https://www.csis.org/analysis/engines-prosperity-promise-zones-employment-and-economic-development-zedes-honduras https://www.csis.org/analysis/engines-prosperity-promise-zon... "Engines of Prosperity: The Promise of the Zones for Employment and Economic Development (ZEDEs) in Honduras"
ceejayoz 2y ago
Reminds me of how the "Free State Project" ran into "people feed bears and it sucks for everyone". https://www.vox.com/policy-and-politics/21534416/free-state-project-new-hampshire-libertarians-matthew-hongoltz-hetling https://www.vox.com/policy-and-politics/21534416/free-state-...
- someone7x 2y ago
  As a libertarian skeptic, this was a delightful tale.
smackeyacky 2y ago
Huh. Prospera smells a lot more like re-colonisation efforts instead of any kind of libertarian paradise. I especially like how the founders just assumed they'd have access to the groundwater without paying for it. I imagine one of their requirements to set something like that up is for the local government to be terminally corrupt. At least the sea steading initiative didn't rely on the local government and people being exploited. You had to volunteer to be exploited there.
- gunian 2y ago
  the water wars of the 2020s are by far the highlights of contemporary history
renewiltord 2y ago
This is fairly typical of third-world countries. Your business only lasts as long as your patron survives politically. The mayor complains that the city-state of Prospera buys power from the local power company. Of course they do. That's the point usually of SEZs: that they bring local industry and they pay for local services. He complains that the revenue from the apartment tower would have paid for a lot if they paid normal fees and were subject to normal permitting but if they were they wouldn't have built there. These are all fairly typical to any place and mostly intended outcomes. The SEZ approach is usually a mechanism to promote industry in a place that usually won't see it. But local governments are corrupt. About the one reason you can be sure that Prospera isn't malevolent is that they didn't spend some fraction of those billions of dollars in rigging the election so that their guy would continue to be in power.
daveguy 2y ago
> His plan called for “Prosperity Zones” where laws and regulations would be “reset” and governmental powers like taxation, eminent domain, and policing would fall to a private corporation that ran the zone. It's like they read Neuromancer and thought it was an aspirational goal.
- ceejayoz 2y ago
  Pretty common. See Musk’s love for Iain Banks’ Culture novels.
  - jkmcf 2y ago
    Musk didn't read very carefully.
    - BobaFloutist 2y ago
      So weird to be a fan of The Culture and also be anti-trans.
      - deleted 2y ago
        [deleted]
  - mdhen 2y ago
    The culture is not libertarian. Anarcho socialism is the closest thing, but post scarcity, so not really applicable to anything in the present
    - ceejayoz 2y ago
      Not really the point. Musk names his ships after the Culture, but the author was an avowed left-wing socialist who'd probably see Musk as our version of Veppers. He was... not a huge fan of billionaire oligarchs.
      - mdhen 2y ago
tomrod 2y ago
The failure of Yarvin's Dark Enlightenment and Network States. Neofeudalism doesn't work.
- gunian 2y ago
  what does neofeudal mean in this context?
  - pram 2y ago
    It's how Urbit was designed, for example. The gentry owns all the primary namespaces, and the peasants pay rent to use their lairds fief.
    - jazzyjackson 2y ago
      Is it all that different than DNS, in that top level domains are owned by a certain 'gentry' and everyone else pays rent? You don't have to pay for namespace in urbit btw only if you want a permanent handle (and when you buy a planet or whatever its yours, you don't pay monthly for it, but yes you buy it from someone who was granted ownership by king curtis)
      - pram 2y ago
        Certainly not different in practice, and it’s also bad. Yet ARPANET wasn’t originally designed to have a bunch of parasitic registrars collecting rent, so thats something worth considering.
- dyauspitr 2y ago
  It’s nothing new. Just monarchy with peasants and slaves.
- binary132 2y ago
  Oddly enough, it seems that every time a self-selecting population of lunatics and sociopaths attempts to bootstrap a New Society, it proves their theoretical framework wrong. How curious… well, maybe next time!
andriesm 2y ago
I assume Honduras was a country desperate to attract foreign investment? Special Economic Zones worked very well in many other countries. It's not hard to understand why - give long term regulatory certainty, with strong protections for the the wannabe capitalists who want to bring things there and promise them stable very low taxes, and they will eventually flock to the place, bring a ton of money and build a lot of things there if you let them, creating a ton of economic activity in the process, minus the huge tax contributions, but still a net economic benefit because of all the surrounding economic activity and employment etc. But then a place like Honduras reneges on their ZEDE promise, so now you can basically never trust their promises again? At any moment in future they could make hard turns towards socialism and confiscate, tax away, and regulate to death - anything that you invest there. So I guess Honduras will have to grow without huge influxes of new FDI or the stimulus effects one can sometimes get from lower regulations and taxes. Honduras doesn't strike me as the type of place where people with money are excited to invest? I wonder how this will affect it's future attractiveness?
- caspper69 2y ago
  Yeah, when you set up shop on someone else's sovereign territory, one day, at some point, you're going to have a bad time. The state's monopoly on violence is the ultimate tiebreaker, although as noted, there are many other ways these governments can extract concessions (banking, utilities, telecom, egress (!!)). That's why Uncle Sam is nice to have on your side. A libertarian utopia or corporate controlled trading zone doesn't stand a chance without the backing of a sovereign with a military.
  - tjalfi 2y ago
    > That's why Uncle Sam is nice to have on your side. A libertarian utopia or corporate controlled trading zone doesn't stand a chance without the backing of a sovereign with a military. The Republic of Minerva[0] is a good example of this. Some libertarians built an artificial island on a reef and the neighboring country of Tonga annexed it. [0] https://en.wikipedia.org/wiki/Republic_of_Minerva https://en.wikipedia.org/wiki/Republic_of_Minerva
up2isomorphism 2y ago
I just don’t feel it is right to call everything that not socialism “libertarian”. .
owenfi 2y ago
Haven’t listened to much of this yet, but like the podcast a lot in general: https://podcast.clearerthinking.org/episode/248/erick-brimen-creating-a-new-city-from-scratch/ https://podcast.clearerthinking.org/episode/248/erick-brimen...
jazzyjackson 2y ago
I was let down by the article, there's very little narrative that I would describe as "nightmarish" (unless you consider longevity/crypto bros hosting a beach party outside their coworking space a nightmare). More just legal and political posturing and dunking on the feasibility of network states. I did enjoy the irony of a libertarian sect going straight to Washington DC to try and push around their host country. Like, yes, there is a reason it's nice to be a citizen of a global hegemon, why are you trying to do your own thing again?
- vitehozonage 2y ago
  I found the article to be very long and uninteresting and also never found the "nightmare" part, maybe i missed it

52 points by impish9208 2y ago

impish9208 2y ago

https://archive.is/ZQI1U https://archive.is/ZQI1U

everybodyknows 2y ago
Direct link to CSIS's report: https://www.csis.org/analysis/engines-prosperity-promise-zones-employment-and-economic-development-zedes-honduras https://www.csis.org/analysis/engines-prosperity-promise-zon... "Engines of Prosperity: The Promise of the Zones for Employment and Economic Development (ZEDEs) in Honduras"

ceejayoz 2y ago

Reminds me of how the "Free State Project" ran into "people feed bears and it sucks for everyone". https://www.vox.com/policy-and-politics/21534416/free-state-project-new-hampshire-libertarians-matthew-hongoltz-hetling https://www.vox.com/policy-and-politics/21534416/free-state-...

someone7x 2y ago
As a libertarian skeptic, this was a delightful tale.

smackeyacky 2y ago

Huh. Prospera smells a lot more like re-colonisation efforts instead of any kind of libertarian paradise. I especially like how the founders just assumed they'd have access to the groundwater without paying for it. I imagine one of their requirements to set something like that up is for the local government to be terminally corrupt. At least the sea steading initiative didn't rely on the local government and people being exploited. You had to volunteer to be exploited there.

gunian 2y ago
the water wars of the 2020s are by far the highlights of contemporary history

renewiltord 2y ago

This is fairly typical of third-world countries. Your business only lasts as long as your patron survives politically. The mayor complains that the city-state of Prospera buys power from the local power company. Of course they do. That's the point usually of SEZs: that they bring local industry and they pay for local services. He complains that the revenue from the apartment tower would have paid for a lot if they paid normal fees and were subject to normal permitting but if they were they wouldn't have built there. These are all fairly typical to any place and mostly intended outcomes. The SEZ approach is usually a mechanism to promote industry in a place that usually won't see it. But local governments are corrupt. About the one reason you can be sure that Prospera isn't malevolent is that they didn't spend some fraction of those billions of dollars in rigging the election so that their guy would continue to be in power.

daveguy 2y ago

> His plan called for “Prosperity Zones” where laws and regulations would be “reset” and governmental powers like taxation, eminent domain, and policing would fall to a private corporation that ran the zone. It's like they read Neuromancer and thought it was an aspirational goal.

ceejayoz 2y ago
Pretty common. See Musk’s love for Iain Banks’ Culture novels.
- jkmcf 2y ago
  Musk didn't read very carefully.
  - BobaFloutist 2y ago
    So weird to be a fan of The Culture and also be anti-trans.
    - deleted 2y ago
      [deleted]
- mdhen 2y ago
  The culture is not libertarian. Anarcho socialism is the closest thing, but post scarcity, so not really applicable to anything in the present
  - ceejayoz 2y ago
    Not really the point. Musk names his ships after the Culture, but the author was an avowed left-wing socialist who'd probably see Musk as our version of Veppers. He was... not a huge fan of billionaire oligarchs.
    - mdhen 2y ago

tomrod 2y ago

The failure of Yarvin's Dark Enlightenment and Network States. Neofeudalism doesn't work.

gunian 2y ago
what does neofeudal mean in this context?
- pram 2y ago
  It's how Urbit was designed, for example. The gentry owns all the primary namespaces, and the peasants pay rent to use their lairds fief.
  - jazzyjackson 2y ago
    Is it all that different than DNS, in that top level domains are owned by a certain 'gentry' and everyone else pays rent? You don't have to pay for namespace in urbit btw only if you want a permanent handle (and when you buy a planet or whatever its yours, you don't pay monthly for it, but yes you buy it from someone who was granted ownership by king curtis)
    - pram 2y ago
      Certainly not different in practice, and it’s also bad. Yet ARPANET wasn’t originally designed to have a bunch of parasitic registrars collecting rent, so thats something worth considering.
dyauspitr 2y ago
It’s nothing new. Just monarchy with peasants and slaves.
binary132 2y ago
Oddly enough, it seems that every time a self-selecting population of lunatics and sociopaths attempts to bootstrap a New Society, it proves their theoretical framework wrong. How curious… well, maybe next time!

andriesm 2y ago

I assume Honduras was a country desperate to attract foreign investment? Special Economic Zones worked very well in many other countries. It's not hard to understand why - give long term regulatory certainty, with strong protections for the the wannabe capitalists who want to bring things there and promise them stable very low taxes, and they will eventually flock to the place, bring a ton of money and build a lot of things there if you let them, creating a ton of economic activity in the process, minus the huge tax contributions, but still a net economic benefit because of all the surrounding economic activity and employment etc. But then a place like Honduras reneges on their ZEDE promise, so now you can basically never trust their promises again? At any moment in future they could make hard turns towards socialism and confiscate, tax away, and regulate to death - anything that you invest there. So I guess Honduras will have to grow without huge influxes of new FDI or the stimulus effects one can sometimes get from lower regulations and taxes. Honduras doesn't strike me as the type of place where people with money are excited to invest? I wonder how this will affect it's future attractiveness?

caspper69 2y ago
Yeah, when you set up shop on someone else's sovereign territory, one day, at some point, you're going to have a bad time. The state's monopoly on violence is the ultimate tiebreaker, although as noted, there are many other ways these governments can extract concessions (banking, utilities, telecom, egress (!!)). That's why Uncle Sam is nice to have on your side. A libertarian utopia or corporate controlled trading zone doesn't stand a chance without the backing of a sovereign with a military.
- tjalfi 2y ago
  > That's why Uncle Sam is nice to have on your side. A libertarian utopia or corporate controlled trading zone doesn't stand a chance without the backing of a sovereign with a military. The Republic of Minerva[0] is a good example of this. Some libertarians built an artificial island on a reef and the neighboring country of Tonga annexed it. [0] https://en.wikipedia.org/wiki/Republic_of_Minerva https://en.wikipedia.org/wiki/Republic_of_Minerva

up2isomorphism 2y ago

I just don’t feel it is right to call everything that not socialism “libertarian”. .

owenfi 2y ago

Haven’t listened to much of this yet, but like the podcast a lot in general: https://podcast.clearerthinking.org/episode/248/erick-brimen-creating-a-new-city-from-scratch/ https://podcast.clearerthinking.org/episode/248/erick-brimen...

jazzyjackson 2y ago

I was let down by the article, there's very little narrative that I would describe as "nightmarish" (unless you consider longevity/crypto bros hosting a beach party outside their coworking space a nightmare). More just legal and political posturing and dunking on the feasibility of network states. I did enjoy the irony of a libertarian sect going straight to Washington DC to try and push around their host country. Like, yes, there is a reason it's nice to be a citizen of a global hegemon, why are you trying to do your own thing again?

vitehozonage 2y ago
I found the article to be very long and uninteresting and also never found the "nightmare" part, maybe i missed it