I'm currently reading Francis Fukuyama's novel "The end of History and the Last Man." In his tome, Fukuyama ponders whether or not liberal democracy and free-market capitalism bring a close to historical progression. Fukuyama perceives that if liberal democracy and free-market capitalism are truly the final political and economic forms for the international community, then man has entered his final stage: no longer desiring. The other competing political system in the world today, market-oriented authoritarianism, helps developing nations industrialize much quicker than liberal democracy because the leader of an authoritarian regime can easily prevent strikes and neglect the working class. My question to you is, are liberal democracy and free-market capitalism the best combination for the world today? Will market-oriented authoritarianism survive in developing countries?
Update:
I have now finished Fukuyama's tome and I'd like to say that it is a very well written book. Unlike Thomas Friedman, Fukuyama actually is a scholar because his arguments are structured in a complex manner. In the end, Fukuyama states that liberal democracy is not the final form of governance. There are still inequalities in society that keep historical progression from ending, such as de-facto segregation and poverty. Instead of ameliorating the lives of the individuals in poverty and attempting to eliminate de-facto segregation, the US and its cohorts have not had the time or the money to deal with such big issues. Now, I personally believe that these issues need to be addressed soon; however, I am not going to go on an emotional rant. Furthermore, Fukuyama's discussion of the maximization of power is simply brilliant. States do not have to maximize their power as if they were an empire (through territorial and military expansion.) Instead, states can maximize their power through economic growth and the fight for the liberalization of the international community. Although Fukuyama was a neo-conservative when he wrote this book, his arguments are solid and quite impressive. It just goes to show that no matter what political party you belong to, as long as you are knowledgeable, any argument can be made and potentially won.
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What an interesting question...and I haven't read any Fukuyama, but it sounds really good. Is he a modern writer or from a while ago?
Well, I wish the answer to the question was easier. But it's not--as is apparent by how many centuries man has wrestled with this topic. Good leadership is hard to find, as well as is good financial planning and public responsibilty. Rarely are the two conjoined; thus, our dilemma.
Personally, as an economics student, I'm leaning towards the left. The ol' Laissez Faire policies are by definition inhumane. They are harsh on developing countries, small businesses, and entrepreneurs. Thus we have our situation in America (not to mention in the third world): small businesses failing left and right while good old Wal Mart and the "golden arches" prevail.
So I think that a tiny bit of government intervention in the economy is a good thing. I'm talking very small changes: discounted interest rates for small business loans, subsidies for environmentally-friendly business practices, etcetera.
After all, as Nietzsche put so poignantly, "It is by invisible hands that we are bent and tortured worst." So true--especially for the third world.
As for helping impoverished nations develop, I suggest what Nobel economist J. Sachs calls "clinical economics." It's the process of healing depressed countries from the bottom up, helping the people become entrepreneurs, etcetera. Imagine imposing a free market system somewhere like Sudan; mass famine, disease, and social instability will prevent the economy from developing from the bottom up because the people are so oppressed. After all, they're just thinking about how to survive, not how to start their own businesses. A free-market economy in that case would be, and has been, a monster-company-driven fiasco.
Market-oriented authoritarianism is a recipe for disaster. Why? Because the profit motive is NOT a good leadership quality. Leaders need to be dynamic, humane, responsive, and invested in the wellbeing of their people--not accountants who care for nothing other than money. A benign leader should be in control of the budget. But too often, the budget comes to control and corrupt the benign leader. What we end up with is countries that are not only in poverty and famine, but also have terrible leaders too. And unfortunately, there's not always a Ghandi or a Nelson Mandella to step up to the plate and "save" the nation. Famine and political crisis' blended chemical reaction became Darfur today.
In short, market-oriented authoritarianism takes the worst of leadership and the worst of financial planning and blends them...and then gives it immense power. Yeah, it sucks as much as it sounds.
Hope this helps! I am very interested in this issue so thanks for posing the question! Let me know how Fukuyama answers the question.
Allison
"Be the change you want to see in the world" ~Mahatma Gandhi
I'd agree that free-market capitalism is a good system, but I wouldn't say that liberal democracy is. Liberal democracy still installs a government which still hinders the progress of business by allowing it to thrive even if it doesn't appeal to the people's needs. Also, no matter how 'liberal' the democracy is, it still means that the voice of the few is not heard (this is referred to as "the tyrrany of the majority" by John Stuart Mills). Although the strangle hold of governments is strong as ever (and growing ever stronger as more and more legislation is passed in democratic countries), the best system we can find is an anarchy emerging from a democracy (anarchies emerging from dictatorships tend to result in chaos).
--Mike
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