Venezuela y más allá

Bad news in Venezuela:

While Venezuela earns record proceeds from oil exports, consumers face
shortages of meat, flour and cooking oil. Annual inflation has risen to
16 percent, the highest in Latin America, as Chávez tripled government
spending in four years.

...

The foreign exchange regulations are part of the controls that
Chávez has created in his "march to socialism." The government sets
retail prices on hundreds of consumer products and fixes both the
maximum rate at which banks can lend and the minimum interest they can
pay depositors.

Chávez, who is seeking to end presidential term limits, has taken
$17 billion of foreign reserves from the central bank and expropriated
dozens of farms that he deemed underutilized.

And much, much more.

Free market ideas are so good, and so documented, and so developed--and still they're not accepted in most of the world. Why is this?

There must be a million reasons, but we could account for a lot of them in two ways. The first is remembering that intellectual currents don't just run wherever they like. A country heavily influenced by John Locke and later Thomas Jefferson is going to have a different cultural context for judging economic ideas than is a country whose revolutionary path was sparked by Napoleon's conquest of Spain, after years of Spanish domination. For the average American the French Revolution is a distant second to our own, while for Europeans (and those subsequently heavily influenced by European ideas) the French Revolution is the real action.

Cultures are not monolithic, and they can change, but ideas without context are harder to plant. (Likewise, the corresponding fatal conceit is thinking that anti-market cultures don't have ideas that we ought to take seriously.) The reason that Venezuelans aren't running Chavez out of town on a rail is not that they are less informed about economics than the average American is--the average American doesn't fare well in economic literacy. It's that there's a different system of judging ideas, and there are always other angles that need addressing.

The other is related: U.S. policy in Latin America has a terrible track record, and it's hard to blame Latin America for not yearning to be just like the U.S. For instance, the U.S. government has been waging undeclared war on Colombian farmers for years in the name of denying the decision-making capacity of adults up north, and for years before that was intervening any- and everywhere possible to protect Wall Street's rotten investments (both in .pdf). And then there's the School of the Americas, aka the School of Assassins. And the list goes on.

So it's no wonder that when self-righteous American hypocrites lecture their victims about freedom the victims don't embrace it whole-heartedly.

If we Americans can stop equating the American Idea of freedom, enterprise, and opportunity that drove entrepreneurs and refugees out of Europe to our shores with the actual implementation of American policies like slavery, the destruction of the indigenous inhabitants, and the rise of the empire, we'll be doing ourselves a favor, and we'll be a lot better received.

Hat tip for IHT article to Michael Moynihan at Hit and Run 

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It's mainly their problem

"U.S. policy in Latin America has a terrible track record"

Sure, but that only means that Latin Americans aren't likely to listen to Americans (or, as the beauty queen says, U.S. Americans, which while ugly does clarify). And that matters only to the extent that Latin Americans depend on Americans to do their thinking for them, be their role model, etc.

Adult Latin Americans are adults. It's not the responsibility of the United States to guide them on the path to economic success. If America's misdeeds are indeed a primary reason for the socialism of Latin Americans, then that is a contemptible fact about Latin Americans. If you believe that America's misdeeds are a primary reason for the socialism of Latin Americans, then you are being condescending towards Latin Americans. I am not accusing you of any error here. If Latin Americans really are socialist because they are reacting to the United States, then they deserve to be condescended to.

I do think that Latin Americans deserve to be condescended to, but not for that reason. I am partly of Latin America, and I am glad that I was born in the US, because I have escaped by a hair the ignorance and misinformation that I think would likely have been my lot had I been born in Uruguay.

We should not, by the way, assess a society's effective knowledge by doing a mass survey. The vast majority of Americans are indeed ignorant, but that doesn't matter all that much. What matters is not what the majority thinks, but what the mentally active think. Ninety percent (or whatever) may think that Saddam Hussein personally flew the planes into the WTC, but that doesn't matter if those ninety percent don't write articles and books about it but rather spend all their time on non-intellectual pursuits.

The problem with Latin America is not the ignorance of the masses. The problem is with the intellectual class.

That's a decent objection,

That's a decent objection, but consider the way the smarter people in the Republican Party look at French culture now. The French masses were vocally antiwar, and the result is crap like changing the name of french fries, which doesn't even refer to the country in question. That doesn't mean that we shouldn't watch their movies, but I suspect that a great many people would be instinctively turned off by a French movie.
It's not just what the "mentally active" think that matters, either. The totally mediocre student in a university can still write an article in a shitty free magazine that gets read by more people than you'd think can still help shape opinion. Add up all that type across different age groups (people who could now feasibly be ministers, politicians, teachers, or what have you) and you start getting a lot of people mobilized behind certain ideas. People don't only listen to professors and Nobel Prize winners.
¿Y sos casi de la Republica Oriental?

Depends

¿Y sos casi de la Republica Oriental?

Mom's family was living there at the time, Mom and Dad married there. Staying in Uruguay was never in the plan but it could have been.

I suspect that a great many people would be instinctively turned off by a French movie.

I'm not sure what point you're making here. But I'll hazard an answer: I'm not blaming Latin Americans for being hostile to American cultural and culinary exports because of American foreign policy. Refusing to drink Coca Cola would be trivial stuff and mostly a symbolic gesture, with little economic impact (except perhaps to Coca Cola). I'm (hypothetically*) blaming them for seriously shooting themselves in the foot, specifically for adopting insane economic policies just because of American foreign policy.

Similarly, I simply see nothing serious in Republican renaming of fries and avoiding the rare French movie that makes it over here (assuming they do avoid it - that's your conjecture). What would be serious would be Republicans nationalizing agriculture in response to France's perceived perfidy, since France does not have nationalized agriculture and we want to do the opposite to show how angry we are. That would be seriously shooting ourselves in the foot. That would be incredibly stupid. That would signal a degree of stupidity that would be essentially beyond help and up to us Americans to get over, and not up to the French to help us with by apologizing or whatever. It would not be France's fault that we perversely chose to nationalize our agriculture in response to alleged French perfidy on the matter of Iraq. That is essentially what you're saying Latin Americans are doing - screwing up their economies in a major way simply because they don't like American foreign policy.

* I say "hypothetically" because I'm not sure that really is a large factor in their decision to embrace socialism. After all, the USSR and China also adopted insane economic policies, and as far as I know hostility to America had very little to do with it. There is much that is intrinsically appealing in socialism, to the mind that has not been immunized. The thing is, by now much of the intellectual class should have been immunize, simply by having observed recent events. In the twenties and thirties, many first class intellectuals fell for socialism and even totalitarianism hook, line, and sinker. And in a sense they can't be blamed for it. But if anyone is falling for it today then they're essentially an intellectual basket case.

It's not just what the "mentally active" think that matters, either. The totally mediocre student in a university can still write an article in a shitty free magazine

Then he is mentally active in the relevant sense, and so confirms my point rather than providing a counterexample. He's taking part in the national discourse. The vast majority of Americans simply do not. They sit on the sidelines, doing other things entirely (e.g., playing sports or going to the mall or chatting for hours about people they know or listening to music). A lot of them simply ignore the issues, or spend their time on different issues (e.g., scientific discovery).

At any given time, then, only a small part of the population is actively thinking and talking about an issue. I suspect that what happens is that the more a person thinks and talks about an issue, the better informed he gets, at least, the better informed he gets of what the crowd believes. He is introduced to the popular views - popular, not among the entire population, but among the thinker/talkers.

For this reason, it doesn't matter all that much whether the vast majority of the population is ignorant of X. If someone is not thinking about X, then it makes very little difference whether he does or does not know about X. It's only when he starts thinking that it starts to matter. So what matters is, what is the viewpoint on X among the thinking/talking crowd, among the chattering class. Whenever someone starts chattering, thereby joining the chattering class, he is generally introduced to one or another viewpoint on X popular among some segment of the chattering class. Because of this, it doesn't really matter that he was previously ignorant of X.

What matters, then, is the ideas that live among the chattering class. What matters is whether the chattering class is, or is not, ignorant of good economic ideas (for example).

The policymakers are generally picked from the thinking class. A carpenter is unlikely to be picked to decide American industrial policy. A Harvard graduate, possibly a lawyer, possibly a professor from a college, is more likely to be picked. It matters what they think, and so it matters what viewpoints are popular among the intellectual class.

Doubtless a lot of economic policy is what we might call corruption - i.e., the stuff that James Buchanan was talking about. For example, earmarks for a congressman's own constituents to ensure re-election. That is almost pure corruption, with no intellectual component other than transparent rationalization. However, many big policies like the income tax, social security, the decision to go to war, the war on drugs - many of these big policies do not originate (I think) purely in the kind of corruption that produces pork, but in ideas. They may be sustained by the interest groups that develop around the new ideas, the parasites, such as the police that benefit from the drug war by their greatly expanded power of confiscation of private property, or the teacher's union that benefits from governmental education policy, or the social security recipients that benefit (in the short term - which is the only term left to them) from social security. But I think that the big ideas that balloon into the great big black holes that they eventually become generally originate in the ideas of the intellectual class.

An extreme example of this is any communist takeover of a country. The policies of Stalin and Mao were products of ideas that had a powerful grip on the imagination of virtually the whole intellectual class of the early 20th century, not products of everyday government corruption.

What I meant by my mediocre

What I meant by my mediocre student example is that here is someone who could plausibly become an "intellectual" in Hayek's sense who could easily express knee-jerk reactions without really considering the arguments, and who could influence opinion. Then when enough of the mentally inactive believe something, it's dangerous even for politicians who know better to counteract it. See: natural selection vs. creation myth.

It seems like Hayek's intellectuals are missing from your responses, and they are critical in this analysis, at least according to him and me.

I don't mean that Latin Americans reject sounder economic policies out of knee-jerk hate for everything U.S. I just mean that whatever influence the U.S. can have is typically negative. We're making our own job harder, as they'd say inside the Beltway.

Them too

Then when enough of the mentally inactive believe something, it's
dangerous even for politicians who know better to counteract it. See:
natural selection vs. creation myth.

But religion is propagated mainly by a sector of the chattering classes. Religious leaders chatter quite a lot. So that's no counterexample either. Religion is a primordial intellectual pursuit. If you want to find the intellectuals of ancient Babylon, you probably need to look in the places of worship. Religion, actually, I like to think, is mainly the fossilized product of the intellectuals of bygone times, it is a consolation created by philosophers of long ago, a set of comforting thoughts created, at some time, by intellectuals. The people who today interpret the teachings of the ancient philosophers are sometimes called priests, sometimes called academics. There's a difference of course, in that the priests make extreme claims as to the inerrancy of their material. But even here they are not so different from many academics.

It seems like Hayek's intellectuals are missing from your responses

I am not familiar with the concept of Hayek's intellectuals.

I just mean that whatever influence the U.S. can have is typically
negative. We're making our own job harder, as they'd say inside the
Beltway.

I dispute the characterization of it as "our own job". It's just that sort of thinking - the sort of thinking represented, perhaps inadvertently, by the phrase "our own job" - which gets us a bad reputation in the first place (well, not entirely - see below). "Is it our own job to save Latin America from communism? Well, we have a strong military. Let us use our strength to help us do our own job."

The Latin Americans have dug themselves into a hole and only they can dig themselves out. The habit of blaming America for their problems is itself part of their problem - their own problem, not ours. Cuba, for example, scapegoats the US for its economic woes. But who is the victim? Me? No, I'm doing fine. The victim is the people of Cuba. This is their problem. They are the ones being deluded, and they are the ones suffering from that delusion.

The habit of blaming outsiders is universal, it is a temptation, a vice, that people are prone to everywhere. In Germany the outsider was the Jew. In the time of the witch trials the outsider was the witch. I hear that in Japan crime is blamed on foreigners. In the US as well we see nativists continually linking crime to immigration. This is not really the fault of the scapegoat. The scapegoat is, of course, to blame, in the sense that everybody is to blame, everybody is at fault to some degree, everybody contributes to the problem to some degree. Nobody is perfect, so there is always plenty of cherry-picked and exaggerated material on which to build a theory that scapegoats someone. There is always some Jew somewhere who did something bad to somebody. There is always some Mexican illegal somewhere who did something wrong. On the basis of these scraps a worldview can be built.

 

Unfortunately, the French

Unfortunately, the French anti-war sentiment, (not unlike most French policies since World War II I would dare to say) was largely fuelled by blunt anti-americanism, not genuine non-interventionism.

Third World Economic Ignorance

The reason that Venezuelans aren't running Chavez out of town on a rail is not that they are less informed about economics than the average American is--the average American doesn't fare well in economic literacy.
Americans are ignorant in absolute terms, but in relative terms it is likely they are less so than less educated and more anti-capitalist places. See Caplan's point here.