The Losers

Latin America

Latin America has had almost two hundred years of political independence to graduate to economic independence. It remains, however, a mixed area, wanting in local initiative, technologically patchy, entrepreneurially needy. This pattern of arrested development reflects the tenacious resistance of old ways and vested interest. In particular, the apparent rational focus on land and pastoralism …reinforced by social and political privilege, bred powerful, reactionary elites ill-suited and hostile to an industrial world. This disjuncture, when combined with social discontents – so many poor – invited antidemocratic, though populist, solutions (caudillismo), terrible when durable, destructive when fragile.  (p. 492-3) …

A more open market is a force for rationality and efficiency, a reordering of econhomic activity in the direction of comparative advantage, a constraint on corruption and favoritism. And the prospect of aid may be an an incentive to cooperation in the struggle against the drug trade – an industry whose growth can only be guessed at. No guarantees. But better a push in the right direction than a return to the status quo ante.

The Soviet Union

Among the heaviest losers in this period of record breaking economic growth and technological advance were the countries of the Communist-Socialist block: the Soviet Union at the bottom of the barrel, Romania and North Korea almost as bad, and a range of satellite victims and emulators struggling to rise above the mess…

The striking feature of these command economies was the contradiction between system and pretensions on the one hand, performance on the other. The logic was impeccable: experts would plan, zealots would compete in zeal, technology would tame nature, labor would make free, the benefits would accrue to all.  From each according to his ability, to each according to his desserts; and eventually to each according to his needs.

…These favorable predilections long concealed the weaknesses of such command economies. In fact, although the Russian state was capable of mobilizing resources for specific projects, technique was generally backward and overall performance shoddy. The impressive production data were intrinsically and deliberately exaggerated.  They should have been heavily discounted for propaganda; also for deterioration and unsold (unsalable)commodities…

The worst aspect of the system, however, was its indifference to, nay, its contempt for, good housekeeping and human decency. Prosperity forgone was bad enough. In a world that had once created and still preserved some beautiful things, the new system mass-produced ugliness: buildings and windows out of true; stained and pocket exteriors, raw cement block; equipment out of order, rusting machinery, abandoned metal corpses – in short, raging squalor

Necessarily, what the system did to things, it did to people. How to survive in a wasteland dotted with junk heaps? In a world of systematic contempt for humanity: “White coal” they called the people shipped n jammed, fetid freight cars to useless labor and oblivion in frigid wastes (The USSR anticipated here the4 death rains and marches of Nazi Germany) Some, spared or overlooked, heroically maintained oases of warmth and culture n tiny flats and rooms. Many more drowned disappointment and despair in vodka.

Still, nature’s gifts remained. The greatest asset of the revolutionary regime was the unspoiled natural treasures it inherited from a late developing economy. It ran these down with the recklessness that comes with self-proclaimed virtue.

One place and one event stand for the whole. The place is the Aral Sea, once the fourth largest body of fresh water on the face of the earth, today a dying hole – half the original surface, a third of it volume, reeking with chemicals, fish gone, air hot and poisoned. Children in the region dire young, one in ten in the first year. Decades of insolent plans, haste and waste, tons of pesticide, herbicide, and fertilizer, false economies, such as unlined irrigation trenches enabled the Soviet Union to grow lots of cotton (“white gold”, while reversing gains in life expectancy and leading the way backward.

Aral was the place. The event was the meltdown of the atomic pwower reactors at Chernobyl in the Ukraine in 1986. The first burned out of control for five days and spread fmore than 50 tons of radioactive poison across Wjhite Russia (Belarus), the Baltic staes, and aprts of Scandinavia – far more than the bombs of Hioshima and Nagasaki combined. The prevailing winds blew north-northwestward, but n one will convince those Turks who later came down with blood diseases r the thousands of pregnant women from Finland to the Adriatic who had precautionary abortions that they were not victims too. Among the unquestioned casualties were the brave men sent in to fight the fire and clean up afterwards. They were promised special compensation  and did not always get it Relief funds disappeared down the local party maw. The  workers’ exposure was systematically understated, so that they did their job at the price of a lingering death. (Could they have said no?) Withal, the task was apparently botched: the core was not completely smothered; “the situation” not stabilized.

A dozen nuclear plants on the Chernobyl model are still in operation.   “It is now clear that the political repercussions from Chernoby accelerated the collapse e of the Soviet empire.” (Sherbak, Ten Years of the Chernobyl Era)


All the ills that have hurt Latin America and the Middle East are exponentially compounded in sub-Saharan Africa: bad government, unexpected sovereignty, backward technology, inadequate education, bad climate, incompetent if not dishonest advice, poverty hunger, disease, overpopulation – a plague of plagues. Of all he so-called developing regions, Africa has done wort: gross domestic product per head increasing , maybe, by less than one percent a year, statistical tables sprinkled with minus signs; many countries with lower income today than before independence. The failure is the more poignant when one makes the comparison with other parts: in 1965, Nigeria (oil exporter) had higher GDP per capita than Indonesia (another oil exporter); twenty-five years later, Indonesia had three times the Nigerian level. ..

The governments produced by this strong-man rule have proved uniformly inept, with a partial exception for pillage. In Africa, the richest people are heads of state and their ministers. Bureaucracy has been inflated to provide jobs for henchmen; the economy, squeezed for its surplus. Much  (most?) foreign aid ends in numbered accounts abroad. These kleptocrats have much to gain by living in Switzerland, near their banks. But amybe money alone is not enough.

David S. Landers: The Wealth and Poverty of Nations, 1999, chapter on The Losers