Peace, Prosperity, and Politics
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Times News Platforms. Facebook Twitter Show more sharing options Share Close extra sharing options. Palestinians in Gaza City hold banners on June 25, , denouncing the U. June 25, Nabih Bulos. Follow Us. More From the Los Angeles Times. Puerto Rico braces for flooding and landslides from Karen. Fortunately, however, the democratization of Taiwan has already refuted the idea that Confucian or Sinic civilization is incompatible with democracy. If the Chinese economy prospers, if China outgrows poverty, then mainland China may become a democracy in two or three decades.
Some promising developments are already observable. Villages elections have been held for about a decade Rowen Some cadres already have been voted out of office. Moreover, China trains more lawyers than before, and the Chinese are beginning to perceive the economic benefits of the rule of law Pei By contrast, post-Soviet Russia provides a vivid illustration of the limited value of electoral democracy without the rule of law.
Moreover, the democratic-peace component of the capitalist peace is constrained by the geopolitical need to avoid leapfrogging in the extension of democracy or tiger-coat patterns of democracy and autocracy. It seems to be a rare case of a desirable end that is attainable by a desirable means. By contrast, protectionism engenders less wealth and more war. Although one might argue that globalization or the resulting inequality destabilizes democracies and promotes internal conflict and violence, there is little empirical evidence to support this view de Soysa ; Fearon and Laitin ; Hegre, Gissinger, and Gleditsch ; Weede ; World Bank Because the empirical studies discussed earlier have demonstrated some fairly strong effects of democracy on the avoidance of war between democracies, and because the pacifying effects of democracy on rebellion and civil war within states can also be documented Muller and Weede ; Hegre et al.
According to Lipset or Boix and Stokes , the viability of democratic regimes and the likelihood of transitions to democracy depend on the level of economic development. The more prosperous a country is, the more likely it is to become and to remain a democracy.
No Economic Peace for Palestinians
Because this proposition has been supported strongly by cross-national studies, much better than any other conceivable determinant or prerequisite of democracy, we may argue that the promotion of democracy necessitates providing a helping hand to poor countries. This help can be provided in different ways. First, prosperous countries influence the legal foundations for capitalism or economic policies elsewhere. How much this influence matters was demonstrated during the Cold War by the divided nations, where one part was influenced by the Soviet Union and the other part by the United States.
Economies benefiting from U. After China began to abandon socialist practices and converted to creeping capitalism in the late s, it quadrupled its income per capita in two decades and almost closed a sixteen-to-one gap in income per capita with Russia Weede The idea of advice should not be conceived too narrowly.
By providing a model for emulation, successful countries implicitly provide advice to others. Second, prosperous and democratic countries may provide open markets for exports from poor countries. Without a fairly open U. South Korea and Taiwan might still be poor and ruled by autocrats instead of being fairly prosperous and democratic. Third, rich and democratic countries may provide FDI to poor countries.
Moreover, FDI not only promotes growth and prosperity, but also directly contributes to democratization de Soysa and Oneal ; Burkhart and de Soysa ; de Soysa Fourth, rich and democratic countries may provide economic aid. By and large, big economies, such as the United States or Japan, provide relatively much less aid than small Scandinavian economies, such as Norway or Sweden.
But barriers to imports from poor countries are the lowest in the United States and the highest in Norway. Whereas European assistance to poor countries is provided by governments for the most part, U. Rich-country subsidies to agricultural producers, which harm poor countries, are much greater than development aid. The theoretical case for aid, however, has always been weak Bauer Aid may strengthen governments and undermine free markets.
This risk is much greater with government-to-government aid than with private giving, which rarely selects the state as recipient. Certainly, foreign aid does not promote democracy Knack Econometric studies have not demonstrated that aid generally increases growth rates. In recent studies, one finds either a curvilinear relationship between aid and growth Hansen and Tarp , which suggests that some aid may be useful but too much of it may be harmful, or a conditional effect, which suggests that positive aid effects depend on a proper policy environment in the recipient nation and that otherwise aid is simply wasted Burnside and Dollar Or one finds that the effectiveness of aid depends on its bilateral rather than multilateral character Ram Both the ambivalent findings about the effectiveness of aid and the poor record of official aid giving from the biggest Western economies underline that economic development depends above all on domestic efforts, institutions, and policies.
Still, there is some room for beneficial outside influences. The mere existence of prosperous and developed countries generates advantages of backwardness and opportunities for faster growth of less-developed countries Barro and Sala-i-Martin ; Olson ; Bleany and Nishiyama They can borrow technology from the more developed countries and thereby grow faster than the Western pioneers of economic development grew. Japan until the s and the East Asian tiger economies thereafter used these advantages of backwardness effectively. Currently, China, India, and parts of Southeast Asia do so.
European and Japanese agricultural markets and Western textile and garment markets demonstrate the most persistent unwillingness of rich countries to provide a helping hand to poor countries. As important as the provision of models for emulation is the avoidance of pressure from rich countries on poor countries to commit themselves to bad policies. Global labor standards are an important example of such pressure. Concerning the minimum-wage component of labor standards, the World Bank recognized this effect years ago:.
Those affected by minimum wage provisions in low- and middle-income countries are rarely the most needy. Most of the real poor operate in rural and informal markets in such countries and are not protected by minimum wages. The workers whom minimum wage legislation tries to protect- urban formal workers-already earn much more than the less favored majority. And inasmuch as minimum wage and other regulations discourage formal employment by increasing wage and nonwage costs, they hurt the poor who aspire to formal employment.
World Bank , It has been estimated Mitra , 6 that in India less than 10 percent of the workforce is employed in the formal and privileged sector of the economy. More than 90 percent of the workforce stand no chance of benefiting from minimum wages or other labor standards. A country achieves prosperity by economic growth. FDI is one helpful background condition for growth that also seems to promote democratization Burkhart and de Soysa Export orientation, active foreign trade, FDI inflows, and economic openness are other useful determinants of economic growth Dollar ; Edwards ; de Soysa and Oneal ; Bleany and Nishiyama As argued earlier, international trade by itself reduces the risk of war between trading nations.
Thus, a beneficial means namely, free trade directly and indirectly via prosperity and democracy contributes to a desirable end: the avoidance of war between nations. Moreover, economic openness also reduces the risk of civil violence de Soysa and of genocides or other political mass murders Harff , and the intervening variable of prosperity-in-between trade and war avoidance-also happens to reduce the risk of domestic instability and violence Henderson and Singer ; World Bank The policy implications of the capitalist-peace strategy are simple: promote economic freedom and globalization.
If the policy succeeds, one gets more prosperity, more democracy, less civil war, and less interstate war. Ultimately, the capitalist-peace strategy rests on a policy of depoliticization.
Under capitalism, material well-being depends less on political affiliations and more on market success. The capitalist peace depends on a universalistic ethic and its acceptance Giersch Free trade and the principle of nondiscrimination between peoples or races and between domestic and foreign producers guide consumers to buy from the best and cheapest producers. Often, the cheapest producers in poor countries need their customers more than richer producers in rich countries, who can fall back on either capital income or social-security transfer payments, need theirs.
In applying the capitalist-peace strategy to contemporary problems, three conditions must be recognized. First, a capitalist-peace strategy presupposes a minimal degree of state effectiveness. Moreover, the democratization component of the capitalist-peace strategy requires overcoming arbitrary and autocratic rule.
This statement obviously points to another difficulty. Overcoming chaos, warlords, and state failure appears to be a prerequisite for the applicability of the capitalist-peace strategy.
There's nothing inevitable about the rise of violence and rancor, in the United States and abroad.
Analyzing how this prerequisite might be established is beyond the scope of this article. Second, we have few reasons for optimism about the applicability of the capitalist-peace strategy to the Muslim world. My pessimism about the Muslim world derives from two sources. Muslim civilization so far has resisted democratization more consistently and persistently than other non-Western civilizations. Turkey is still the best example of a Muslim democracy, but Turkish democracy is strongly guided by the secularist armed forces, which makes the democratic character of the regime dubious.
Besides, some Muslim countries are rich in oil or other natural resources. Superficially, natural wealth might seem to facilitate the achievement of prosperity and growth, but it does not do so in these cases. Perhaps rich resource endowments reinforce elite predatory behavior and rent seeking and thereby make institutional and economic development more difficult. In any event, the capitalist-peace strategy seems least likely to prevent violence and war within the Islamic civilization or between it and the rest of the world. Still, it might work elsewhere, in particular Asia.
As Bhalla has argued in more detail and more convincingly than anybody else, inequality among human beings has probably fallen since the s. More important, global poverty has been reduced, too.
At the turn of the millennium the percentage was This progress has been spread unevenly across the globe. Africa has done the worst. Asia was involved most in globalization and therefore has done best. Within Asia, the demographic giants China and India, where nearly 40 percent of humankind live, have been most important.
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As they opened up, they grew much faster than in previous decades. Only 6 percent of it was Asian. At the turn of the millennium, 52 percent of the global middle class was Asian, and its share is still growing. The crucial question for the applicability of the capitalist peace is China.