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How a small, poor country became the top economy in Latin America

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One way to learn about whether specific economic policies work or not is to look at different countries that have tried them. Believe it or not, patterns do emerge about what works and what doesn’t work, as you look across different times and places. I’ve been reading a book called “Money, Greed and God” with my friend Carla, which talks about what has worked to reduce poverty.

The author basically outlined two approaches. In the first approach, the government 1) confiscates the wealth of the most productive workers, 2) nationalizes (takes control of) the businesses of the most successful entrepreneurs, 3) restricts trading between citizens and with other countries, with minimum wage, price controls and tariffs. In the second approach, the government does the opposite: 1) lowers taxes on the most productive workers, and 2) lets entrepreneurs compete to provide goods and services to consumers, and 3) lowers restrictions on internal trading and trading with other countries, e.g. – eliminating minimum wage, tariffs and price controls.

Let’s take a look at two Latin American countries that went in opposite directions. Venezuela and Chile. Then we can finally find out which policies actually achieve results for the people.

Here is how Chile started out in 1973.

PROBLEM: Price controls and tariffs:

Prices for the majority of basic goods were fixed by the government in 1973. Even though Chile was and still is a small economy, the level of protection­ism was high. By the end of 1973, the nominal average tariff for imports was 105 percent, with a maximum of 750 percent. Non-tariff barriers also impeded the import of more than 3,000 out of 5,125 registered goods. Just as economic theory predicts, large queues in front of stores were usual in Santiago and other cities in Chile as a result of the scarcity caused by price controls.

PROBLEM: Government taking over private businesses:

The decline in GDP during 1973 reflected a shrinking productive sector in which the main assets were gradually falling under government control or ownership through expropriations and other government interventions in the economy.

PROBLEM: Deficit spending and government printing money:

The fiscal situation was chaotic. The deficit reached 55 percent of expenditures and 20 percent of GDP and was the main cause of inflation because the Central Bank was issuing money to finance the government deficit.

SOLUTION: lower or eliminate restrictions on trade:

The most important economic reform in Chile was to open trade, primarily through a flat, low tar­iff on imports. Much of the credit for Chilean eco­nomic reforms in the following 30 years should be given to the decision to open our economy to the rest of the world. The strength of Chilean firms, productive sectors, and institutions grew up thanks to that fundamental change.

SOLUTION: let competing entrepreneurs in the private sector provide goods and services to consumers:

A second fundamental reform was to allow the private sector to recover, adding dynamism to the economy. In fact, important sectors such as elec­tricity generation and distribution and telecommu­nications were still managed by state companies. After we implemented a massive privatization plan that included more than 50,000 new direct share­holders and several million indirect (through pen­sion funds) shareholders, these companies were managed by private entrepreneurs that carried out important expansion plans.

SOLUTION: let people take responsibility for their own lives instead of depending on government:

The 1981 reform of the Chilean pension fund system deserves special mention. Under the leader­ship of Minister José Piñera, an individual capitali­zation account program was designed with specific contributions, administered by private institutions selected by the workers. The Chilean Administra­doras de Fondos de Pension (Pension Fund Administrators or AFP) has been replicated in more than 20 countries, and more than 100 million workers in different parts of the world use these accounts to save for retirement.

SOLUTION: allow parents to choose the school that fits their needs from competing education providers, and push school administration down from the federal government to the municipal level, where it would be more responsive to voter’s needs:

In 1981, Chile introduced a universal educational voucher system for students in both its elementary and secondary schools. At the same time, the central government transferred the administration of public schools to municipal governments…  The financial value of the voucher did not depend on family income.

RESULTS: And I was able to find a nice short, description of how all that worked out for them on the far-left Wikipedia, of all places:

The economy of Chile is a high-income economy as ranked by the World Bank, and is considered one of South America’s most stable and prosperous nations, leading Latin American nations in competitiveness, income per capita, globalization, economic freedom, and low perception of corruption.

In 2006, Chile became the country with the highest nominal GDP per capita in Latin America. In May 2010 Chile became the first South American country to join the OECD. Tax revenues, all together 20.2% of GDP in 2013, were the second lowest among the 34 OECD countries, and the lowest in 2010. In 2017, only 0.7% of the population lived on less than US$1.90 a day.

According to the Heritage Foundation, Chile is ranked as the 18th freest economy in the world. The World Bank ranked Chile as the 50th highest GDP per capita for 2018, just below Hungary and above Poland.

Now, you can contrast those results with Venezuela. I have been blogging about Venezuela for years on this blog, and documenting how they raised taxes, banned guns, nationalized private sector companies, raised tariffs, and increased regulations. They are now ranked JUST ABOVE NORTH KOREA for economic freedom – #179 out of 180 countries measured. Basically, they did the opposite of everything that Chile did – transferring power away from parents, workers, business owners, churches and municipal governments to the powerful centralized federal government.

Wikipedia explains how Hugo Chavez took over in 1999 and enacted a communist revolution.

More:

Since the Bolivarian Revolution half-dismantled its PDVSA oil giant corporation in 2002 by firing most of its 20,000-strong dissident professional human capital and imposed stringent currency controls in 2003 in an attempt to prevent capital flight, there has been a steady decline in oil production and exports. Further yet, price controls, expropriation of numerous farmlands and various industries, among other government authoritarian policies… have resulted in severe shortages in Venezuela and steep price rises of all common goods, including food, water, household products, spare parts, tools and medical supplies; forcing many manufacturers to either cut production or close down, with many ultimately abandoning the country as has been the case with several technological firms and most automobile makers.

They confiscated private property, took over private sector businesses, implemented tariffs and price controls, redistributed wealth via massive welfare programs, and pushed all decision-making out of families and municipal governments up to the federal government. By depriving the producers of their earnings, the country caused massive shortages of goods and services, to the point where people are fleeing the country, consuming zoo animals, and selling their bodies as prostitutes in order to get food and water.

Application

In the next election, we are not picking a tribe because of how they make us feel about ourselves. We are not choosing in order to see ourselves as “nice” and “not nice”. We need to look at specific policies being proposed, and see what works and what doesn’t work. The examples of Chile (rags-to-riches) and Venezuela (riches-to-rags) are helpful for voters who want to get RESULTS instead of FEELINGS.

I’ll leave you with a list of links from previous posts so you can see how communism worked out for Venezuela.

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Can feminism be defended with reason and evidence? Jordan Peterson vs Cathy Newman

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Can radical feminism be defended rationally and evidentially?
Can radical feminism be defended rationally and evidentially?

There was a short discussion recently on UK Channel 4 between Canadian university professor named Jordan Peterson, and a radical feminist with an undergraduate degree in English named Cathy Newman. While you watch, imagine that she is teaching some non-STEM course that you’ve enrolled in. Would you dare to disagree with her?

First, the video, which has over 33 million views:

And here is an article from the UK Spectator: (paywalled)

Whatever else anybody might think of him, Professor Peterson is a man of remarkable learning and experience, and does not appear to have arrived at any of his views by the now common means of ‘I reckon’. Yet Newman, who approaches the interview with the trademark sourness she employs for everyone she expects to disagree with, treats this is just another chance to burnish her own social justice credentials and expose her guest as a bigot. Big mistake.

Storming straight in with the differences between the sexes, in the opening minutes it is clear that Professor Peterson is willing to back up all his views with references, data and calm analysis. 

By 11 minutes in she is saying ‘I think I take issue with (that)’, before demonstrating that she can’t. Soon she is reduced to dropping the bombshell observation that ‘all women are different’. By 16.45 there is a palpable win, as Peterson points out that Newman has exactly the disagreeable and aggressive qualities that allow certain types of people to succeed. By 19.30 she is having to throw out things to him that he hasn’t even said, such as ‘You’re saying women aren’t intelligent enough to run top companies’. A minute later and she is reduced to countering empirical evidence with anecdote. Peterson presents the data about men in general and Newman responds with the ‘I know plenty of men who aren’t (like that)’ card. Shortly after that (at 22.25) Newman is reduced to spluttering and then silence. She tries to pull herself together. But she can think of nothing to say.

To be honest, Cathy Newman is nothing like the women I’m friends with. All of my closest friends are Christian women. All of them are anti-feminist to some degree, with the most successful one professionally (Dina) being the wisest and most anti-feminist of all. When I think of my panel of wise Christian women advisors – each with one or more STEM degrees – I don’t recognize Cathy Newman in them. But Cathy Newman does remind me of the radical feminists I encountered when I was doing my BS and MS degrees in computer science at the university.

In my experience, radical feminists debate using six tactics:

  1. Deny facts or evidence because men were involved in researching them or discovering them
  2. Countering empirical data with anecdotes and personal experiences
  3. Taking arguments and evidence as if they are personal attacks
  4. Becoming hysterical and crying
  5. Claiming that disagreement with feminism will produce violence against women and women committing suicide, etc.
  6. Trying to get you expelled, fired or silenced – often by making false accusations or faking hate crimes against themselves

It’s important for everyone to understand the views of others in order to know how defensible our own views are. In order to get the best scholarly case for radical feminism, I like to read feminist academics like Christina Hoff Sommers, Camille Paglia, Jennifer Roback Morse, etc. who evaluate and critique radical feminist scholarship. That’s how I encounter the ideas of those I disagree with (as well as listening to and watching debates).

Here’s a short Factual Feminist video:

I understand the claims that are made by radical feminists, but I am also aware of what the evidence says. I don’t try to stop feminists from making claims, I just study how to refute their claims.

But what about the radical feminists? Do they do a good job of understanding those who disagree with them? Let’s take a look at an example which I think is representative of feminist tolerance and open-mindedness.

The Toronto Sun reports on a sociology professor who gave her students an assignment – an assignment with some very peculiar constraints.

Excerpt:

A Ryerson University student who wanted to write a paper on the “myth” of the male-female wage gap was told by her prof that not only was she wrong, she should only rely on feminist journals for her assignment instead of business sources which “blame women,” her sister says.

Josephine Mathias, 21, a fourth-year political science student at University of Toronto, took to YouTube Wednesday to criticize the assignment given her twin Jane for a sociology class.

[…]After Jane sent an email describing her intention to write about the wag gap, her instructor replied that her premise was wrong, Josephine said.

Here’s what the professor said:

“Perhaps you want to write your paper on the glass ceiling. You need to look at feminist sources on this issue…Do NOT use business sources. They blame women. The reality is patriarchy,” says the instructor’s email, posted online.

In a copy of the assignment provided to the Toronto Sun by Josephine, the instructor also notes that Ontario and Canada government websites and Statistics Canada will not be considered scholarly sources.

“Government websites state government policy that is devoid of analysis, and usually reproduces mainstream stereotypes, assumptions and misconceptions,” the assignment says.

What is interesting is that the professor makes about $167,000 a year – higher than the average professor’s salary. And she’s not teaching computer science or petroleum engineering. I find it interesting that another Canadian university reprimanded a grad student for showing a debate clip that offered both sides of the transgenderism debate. Leftist tolerance. Leftist open-mindedness.

Once you’ve paid your tuition, and the leftist has the grading pen, you lose every argument. Either you get an F, or you get expelled. If you’re in the workplace, you get fired. False charges are often made. Hate crimes are faked. Anything to play the victim, rather than address the arguments and evidence. This is how people on the left “debate”.

As I wrote previously, the more women embrace radical feminism, the more toxic they become to men. Not just in the classroom or the workplace, but in relationships. Who wants to marry someone whose only response to reason is fury? Men might be OK with temporary arrangements with abusive women. At least while those women have youth and beauty. But men don’t marry abusive women. At least, not if they have any wisdom.

(Image source: Independent Man)

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Joe Biden claims that he and his son Hunter aren’t corrupt – is he lying?

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Is Joe Biden "The Manchurian Candidate" for president?
Is Joe Biden “The Manchurian Candidate” for president?

There was a neat story that broke late on Thursday night by Kimberly Strassel, writing for the Wall Street Journal. It’s covers additional information about the Hunter Biden – China scandal. The latest story is that an investor involved in the deal between the Biden family and EFC China Energy, a Shanghai-based conglomerate, has decided to come forward and speak out.

The article says:

[A] former business partner of Hunter Biden’s has come forward to provide the ugly details of the “family brand.” Tony Bobulinski, a Navy veteran and institutional investor, has provided the Journal emails and text messages associated with his time as CEO of Sinohawk Holdings, a venture between the Bidens and CEFC China Energy, a Shanghai-based conglomerate. That correspondence corroborates and expands on emails recently published by the New York Post, which says they come from a Hunter laptop.

In a statement, Mr. Bobulinski said he went public because he wants to clear his name, which was contained in those published emails, and because accusations that the information is fake or “Russian disinformation” are “offensive.” He attests that all the correspondence he provided is genuine, including documents that suggest Hunter was cashing in on the Biden name and that Joe Biden was involved.

There are indicators that Joe Biden was not only invovled, but stood to gain financially from the deail:

Hunter, in his own angry texts, makes clear that his contribution is his name. He rails at Mr. Bobulinski that the CEFC heads are “coming to be MY partner to be partners with the Bidens.” He reminds him “that in this instance only one player holds the trump card and that’s me. May not be fair but it’s the reality because I’m the only one putting an entire family legacy on the line.” Mr. Gilliar privately tells Mr. Bobulinski to show flexibility, since “I know why [CEFC Chairman Ye Jianming] wants the deal and what makes it enormous, It’s the family name.”

CEFC was closely entwined with the Chinese government and military until it went bankrupt, following U.S. charges of money laundering. There is no question CEFC was buying Hunter for influence.

Joe Biden claims he has never discussed his son’s business. Yet a May 2017 “expectations” document shows Hunter receiving 20% of the equity in the venture and holding another 10% for “the big guy”—who Mr. Bobulinski attests is Joe Biden.

In one text, Hunter says that “my Chairman gave an emphatic NO” to a version of the deal. Mr. Walker, Hunter’s partner, explains in a text to Mr. Bobulinski that when Hunter “said his chairman he was talking about his dad.”

Mr. Bobulinski’s texts show he even met with Joe Biden. Mr. Gilliar reminds him in May 2017: “Don’t mention Joe being involved, it’s only when u are face to face, I know u know that but they are paranoid.” Mr. Biden had left office by then, though CEFC was always a suspicious company with ties to a rival government. It would have a been risky for any public figure to deal with it, much less a potential presidential candidate.

WSJ using paywalls their articles after a few hours, so you can read the full text of the article here.

In the Thursday night debate, Joe Biden said that the e-mails and the laptop were “Russian disinformation”. Unfortunately for him, he couldn’t point to the names of anyone. On the other hand, there are specific people who contradict what he said, specifically, the Director of National Intelligence.

The Daily Wire reported:

John Ratcliffe, Director of National Intelligence, told Fox Business on Monday morning that Hunter Biden’s laptop was not part of a Russian disinformation campaign despite the media’s attempts to claim otherwise.

Fox Business host Maria Bartiromo pressed Ratcliffe about claims from House Intelligence Committee Chairman Adam Schiff, who made repeated false claims during the Russia investigation, that the news surrounding the laptop was Russian disinformation.

“Is this Russian disinformation, director?” Bartiromo asked.

Ratcliffe responded, “So, Maria it’s funny that some of the people that complained the most about intelligence being politicized are the ones politicizing intelligence and unfortunately in this case, it is Adam Schiff, the chairman of the House Intelligence Committee, who as you pointed out on Friday said that the intelligence community believes that Hunter Biden’s laptop and e-mails on it are part of some Russian disinformation campaign.”

“Let me be clear, the intelligence community doesn’t believe that because there is no intelligence that supports that and we shared no intelligence with chairman Schiff or any other member of Congress that Hunter Biden’s laptop is part of some Russian disinformation campaign,” he continued. “It’s simply not true.”

So it’s pretty clear that Biden lied about the laptop and the emails that implicate Hunter Biden in a scheme to purchase access and possibly influence with foreign dollars. Hunter was cashing in on his father’s position, and the evidence suggests that Joe Biden was at least aware of what was going on, and might even have been getting a cut of this foreign money.

By the way, the image is from one of my favorite anti-communist movies: “The Manchurian Candidate”, 1962. Do NOT see the re-make. If you haven’t seen it, I highly recommend it.