Governance and Growth

Harvard development economist Dani Rodrik has some interesting things to say about governance and economic development - two topics of great interest to counterinsurgents. From his remarks from an April 15 World Bank panel:

A deep insight that has emerged out of the disappointments of the Washington Consensus is that successful policy reform is at its core governance reform. Reforms in the areas of, say, trade or fiscal policy require much more than just cuts in tariffs and a balancing of the budget. If you want to achieve lasting change and have a real impact on the behavior of those agents that determine the success of reform, you must change the “rules of the game”—the manner in which trade policy is made or fiscal policy is conducted. This insight, assisted and reinforced by the academic literature on institutions and growth, has in turn produced a new development agenda focusing on a broad list of governance reforms.

Dr. Rodrik goes on to distinguish between “politics-as-an-end” and “politics-as-a-means.” The former is “transparency, effectiveness, rule of law, lack of corruption, voice and participation… at their core social, political, and legal arrangements which markets-and economic analysis-typically presuppose… deeply embedded in the history, traditions, and politics of a society.”

The latter is the value that good governance creates by providing “producers and households with greater clarity on the rules of the game and investors with greater assurance that they can appropriate the returns to their efforts.” Good governance may or may not be necessary for growth - growth is achieved by removing the most binding constraints, and in some countries governance is not most binding.

Economists and development professionals (says Dr. Rodrik) can give useful advice on governance-as-a-means but not necessarily governance-as-an-end. What’s more, the path to pursue one might not be congruent with the path to pursue the other - there may be tradeoffs.

For most countries the “good governance” and the “governance for growth” agendas are likely to differ substantially. Economists have precious little to say about how to achieve the first of these, but plenty to contribute to the second. From a growth standpoint, the risk is that the governance agenda takes an independent life of its own, and that it becomes divorced from the particular governance challenges that are most closely linked to stimulating and sustaining economic growth.

In Iraq, of course, the Coalition is pursuing “governance-as-an-end” - democratization. At the same time, economic development is seen as important for the later phases of counterinsurgency. It demonstrates the government’s capabilities, reduces grievances (as Austin Bay would say) and absorbs accelerants (military-aged men). Therefore, our Provincial Reconstruction Teams have both political and economics sections.

Here are the comments from the full panel (pdf) via Tyler Cowen. Includes Daron Acemolgu and Francis Fukuyama, but I haven’t had time to go through them.

Dust

Today (April 17) I left my trailer expecting the usual roasting sun and temps - we had a steady climb into the 90s last week. Instead, I found this:

The temperature must have fallen 20 or 25 degrees overnight. It is quite pleasant.

The dust has an odor that’s not completely an odor: it’s like walking into a woodworking shop where someone is using a very fine grit power sander. In the late afternoon, the air takes on a golden color that deepens until the sun sets. You have to see it to believe it. At night, the dust in the lights oddly reminds me of a hard snowstorm on a very cold night, with fine flakes.

Rain

We had some unseasonal rain this afternoon (Friday). Even a quick cloudburst knocks the dust down and cools the air. The leafy trees and even the palms show themselves surprisingly lush. The rain unlocks the strong odor of clay. A few trees are flowering, and the flocks of tiny chirping birds are back.

But Weather Underground says 95 degrees by Tuesday.

Switzerland

Just back from leave, I was going to write this post, but John Fund beat me to it in The American.

[T]he Swiss have produced a remarkable success story that goes far beyond the signature tourist products they are known for: chocolates, watches, and knives. They have one of the world’s most stable economies, a skilled workforce, internationally recognized export companies, a sound currency, and renowned banking and financial services. All this is combined with remarkable social harmony, given that Switzerland has four national languages and great religious diversity.

Read the whole thing.

Major Andrew Olmsted

This post is unforgivably late, due to technical problems, but no less important.

Major Andrew Olmsted, the blogger and columnist, was killed in action January 3 in As Sadiyah (via Marginal Revolution). Maj. Olmsted, 37, was from Colorado Springs, Colorado. Captain Thomas J. Casey, 32, of Albuquerque, New Mexico, was killed in the same engagement. Both were assigned to the Military Transition Team, 1st Brigade, 1st Infantry Division, Fort Riley, Kansas.

Here is the Army’s announcement (via Bill Roggio). Here is Maj. Olmsted’s blog. Here is his final post, published by his co-blogger hilzoy at Obsidian Wings. He also wrote at Winds of Change and the Rocky Mountain News; here are his columns. Here is a story introducing him to the paper’s readers before he deployed.

Sunset

The sun sets in a clear sky over the Green Zone.

Splashup Review: Not Quite There

Zeal and Activity now sports a new header image that reflects my new scenery. This was a very simple image to create: I took a snapshot, cropped it in Picasa, and used photo editing software to insert the floating text.

When I made the original header, I used Adobe’s popular Photoshop software ($649) at a university computer lab. This time, I used a pathbreaking online service called Splashup (formerly Fauxto). Like Google Docs and email sites like Hotmail and Yahoo Mail, Splashup aims to perform the same functions as desktop software within a browser window.

This could be useful to bloggers, travelers, and members of the military, so I thought I would write up my impressions. Splashup will be best for users who want more than cropping and rotation, but who don’t use the advanced features of Photoshop or edit images every day. I think this is a pretty big and completely unserved market.

MNF-I Report on the Surge

Multinational Forces Iraq (MNF-I) has released a report on the effects of the surge to date. The Long War Journal has highlights. But I can’t find a link to the original report - zealandactivity at yahoo.com if you see it. Thanks!

Sandbags

Iraqi TV

The other day, I was waiting for a meeting, and the antechamber had a new television tuned to Iraqi broadcast TV. The program was a sort of man-on-the-street travelogue. The Iraqi camera crew wandered through a busy commercial riverfront section of Baghdad, in and out of shops, popping a microphone in the face of anyone who would stop for a 10-second interview. The streets were crowded with colorfully-dressed pedestrians, almost elbow to elbow, and the shops were full of merchandise. An Iraqi explained that this is a wholesale apparel district. People are shopping for Eid. This station tries to show how security is improving, she said. The footage, which ran unedited, was a rerun; it first aired the day before our meeting.