I shall get stuck into the separation of Church and State in a while, Marco, after I have justified the rest of my bizarre claims. Here is my nomination for the #1 reason for America's success, written some time ago...
This is my thesis, not novel so far as I know: free movement of labour is just as great a factor in economic success as free movement of capital, and that the economic success of the United States of America, as well as its perceived inequality, is a result of its long reign as the world’s largest area in which free movement of labour is allowed.
In that movie with Danny De Vito and the woman that can’t act, the factory making copper wire is about to close, because it has been superseded by the fibre optic revolution; before it is rescued by the airbag Deus ex machina, the obvious moral is: “why don’t the workers up and move to Silicon Valley, where the jobs are?”
As Americans do.
As the government of France is keen to prevent people from doing; I spoke this week (actually 2000 sometime, I think) with the Scientific Attache to the French Embassy about a joint project we are starting up with a research establishment in Toulouse, and one of the good things about the industrial spin-offs anticipated are that they will keep people in the regions. An uneconomic region, to my way of thinking, should revert to nature.…
My family history is littered with abandoned regions. My roots are in soft soil; my parents were born in different towns from me, and their parents in different towns from them, and so on, back across from west to east and beyond to Europe and stasis. And Europe is still stasis, and will never seize the lead from the mobile lands. It is only India, I think, that could possibly manage to overtake the United States, barring some strange eruption of the human spirit in China. Even now, my aunts and uncles are scattered across a dozen states, and my cousins go forth themselves, moving, ever moving. I have come fourteen thousand miles, and fifteen hundred again.
The more mobile a workforce is, the more it will provide opportunity for an economy to adapt quickly; liquidity of labour is as important as liquidity of capital. A poor region saves on public expenditure by exporting people and living on remittances; new enterprises can begin where conditions are most congenial to them, and grow there as large as practicable, instead of being dispersed about the regions.
How is America less equal than Europe? Let us consider on the one hand Puerto Rico and Central Park West, and on the other Albania and Geneva; where is the greater inequality? It is only the unnatural walls against the movement of labour that prevent ten thousand Albanians forming a ghetto on the shores of Lake Leman.
Consider this: Napoleon has conquered Russia, and the serfs are free citizens of a United States of Europe. It is easy to imagine them still kept backward by their old masters under the Second Republic, until the railways come. Then they flood east, an alien deluge, a flood of cheap labour; soon there are three million of them in the centre of Paris. Europe is richer; they are richer – make them twice as rich as they would be in Putin’s Russia, and the French richer too; inequality! Poverty in the midst of a gleaming metropolis, the shame, the shame – and the citizens of a Union that stops at the Ohio might shake their fingers admonishingly, ignoring the new Haiti of the fallen Confederate States at their doorstep...
Enough already! Give Europe no barriers to the movement of men over eight million square kilometers, and give her three-thousand miles of land boundary with poorer nations; she will be better for it. A multitude of Slavs and Arabs, who will work for less than the Western man, and the tumbleweed (native of the Ukraine) rolling through the empty streets of towns better abandoned – in a generation, she will be able to rule the world...
6 comments:
Not sure there's anything much to argue about there.
Do you suppose that if Africa overcame its admittedly insurmountable governance issues and became an EU-style super-group, it would become an economic superpower on the same scale?
Your thesis asks more questions than it answers. The theme of labour moblity in America is often cited at great length in "The Economist". But these are the questions: How have they sustained labour mobility when other similar size countries didn't? How was it sustained without a constitutional edict to? The examples and history of countries' ties to various churches is well known and documented. How often are civil wars stoked by a competition between various religions for influence on the government? How negative has the suppression of various religions been in countries like USSR and China for the stability of economy and society? Why is the secular government of Turkey in charge of a "better prospects" country than the other muslim and/or arab states (and the jewish one for that matter?). My argument is that the constitution is an axiomatic description of principles which can guide a country for generations - and the relative success of various countries over the long term is determined more by their constitutions than variable details (for most countries)like labour mobility, trade policies, industrial relations laws, subsidies, taxation, privatisation, military, efficiency of the public service etc. which tend to have more transitory effects, and are somewhat dependant on the constitution for their stability.
Give Europe a constitution modeled on USA's and watch labour start to get mobilised better.
The fortunate Marco asks: "How have they sustained labour mobility when other similar size countries didn't?"
First of all, I guess there have been no similar size countries with an equivalently good transportation infrastructure.
Russia sustained its greatest rate of economic growth- a very high and sustained rate of economic growth- between the liberation of the serfs and the re-introduction of the internal passport system under the Communists. It is kind of a basket case now, after all those years of structural mismanagement, but may well come good again.
China, now that it has loosened up its internal passport system, is also experiencing incredibly rapid growth.
In India, people are moving from place to place at a great rate, and it is also doing well. In fact, a lot of those giant third world cities swollen with ex-peasants(Mexico, Sao Paulo, Djakarta, etc.) are really incredibly effective at turning really-poor peasants into not-so-poor slum dwellers, it is just that the magnitude of the economic achievement has historically been masked by the high rate of population growth.
"How was it sustained without a constitutional edict to?"
Partly, it is an example of Adam Smith's invisible hand. It is just what it is in the best interests of people to do. Any sharecropper's son in Alabama with an ounce of ambition would up and move to Chicago once the transportation infrastructure is there and he is fairly confident he won't be killed or deported when he arrives.
Partly, it is because Americans do not have the irrational connection to their particular home region as someone from say, Jaffa, or Toulouse does; their ancestors have not lived there since they first crawled out of the primeval ooze, but arrived a couple of generations ago...
I guess what the point I am trying to get to is that there are a number of other factors, such as lower international trade barriers, lack of either civil or intenational wars within its borders, common language, democracy and voting system, education etc., that interact along with labour mobility and affect each other fairly unpredictably over generations in a chicken and egg way (ie. which good thing came first and helped the other along). However, the constitution came first, and is still playing its invisible hand on everything too. Principles such as the right to bear arms, separation of Church and state, freedom of speech, separation of legal powers are not part of many other constitutions in other countries, and if one is going to buy into "nation building" for failed states or "European constitution" for Europe, a lot more weight has to be given to countries whose constitutions have worked so well, and to those principles which have provided a backbone for lawful societies. Labour mobility is but a fortunate consequence of the constitution, and the country that was there at the time.
One thing I meant to say just before (but couldn't figure out how to edit comments, maybe there is no way) is that people have to be legally and emotionally free to move. There are of course going to be other factors, such as cultural effects impacting on work ethic and respect for the rule of law, the actual legal structures, how congenial the neighbourhood is, etc., but my thesis was that labour mobility was the "#1" reason for the success of the United States.
Re your comments about a common language, surely you aren't suggesting that people in New York and Utah speak the same language? Haven't you been reading the papers? :)
[And you said there wasn't anything to argue about in this post, Dave. I think a United States of Africa would have a much better chance- one big factor in addition to labour mobility would be the reduction of all ethnic groups to minorities...]
Post a Comment