Top 10 Posts of Understand Globalization

Putin, Russia, Ukraine, and the Globalized World

When ordering the Russian Army to take control of key points of Ukraine’s Crimean Peninsula on the first weekend of March, it is highly unlikely that Vladimir Putin had appropriately contemplated the full financial and economic implications of such a decision. Read More

Globalization and The Olympics (Part I)

Every four years, during two weeks and a half, the entire world –figuratively speaking– takes a breather to see and learn about high-performance athletes competing with the best-of-the best, in search of  new olympic –and world– records setting and all sort of sports feats. Read More

From Hydra to Phoenix. The Transformation of Developing Nations

Indeed, occasionally it is both amazing and truly ironic how the global socio-economic cycle evolves. Not so many years ago, during the late 80s and early 90s, most of the underdeveloped world was in shambles, overburdened with debt, high levels of inflation, and frequent recessions and currency crises. Developing nations were, at that time, a basket-case. Read More

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Globalization and Capitalism

Both, capitalism and globalization have often been vilified –sometimes even paired up as a super villain duo. They have been charged with pretty much everything going wrong in our lives. Granted, sometimes, poorly implemented versions of both phenomena are to be blamed (The Cyprus debacle being one of the most recent manifestations). However, a careful and more detailed analysis will reveal that things are not as simple as they are often believed to be. In other words, let’s not shoot the messenger. Read More

Outsourcing: Opportunities, Myths and Realities

Outsourcing is a very widespread practice, with unknown boundaries.  In that respect, the US is a leading nation, as in many other areas. A constructive and realistic way to visualize jobs displacement by outsourcing is as an opportunity to upgrade skills and remuneration. History and experience unmistakably show that, in the long run, excessive emotional attachment to personal working habits does not pay well. An open, flexible mind, with a strong desire to learn new skills, is the best preparation of them all, for the hyper-competitive global economy. Read More.

Adam Smith: The Wealth of Nations and Globalization

An Inquiry into the Nature and Causes of the Wealth of Nations (1776) was the original title of the seminal book that lay down the conceptual framework for modern Economics. The book is commonly known as The Wealth of Nations; it was written by the Scottish Adam Smith (1723–1790). The impact of his brilliant work in the following generations has been such that Adam Smith is indisputably considered the father of economics. Read More.

David Ricardo: Comparative Advantages and Globalization

In the previous post we boarded a similar line of thought, regarding Adam Smith and The Wealth of Nations. It is only natural, almost a reflex, to do the same thing with another pillar of economics, the  British, David Ricardo (1772-1823). Read More.

Five Positive Effects of Globalization You Might Have Missed

There’s much that’s happening around the world and in your own backyard as world leaders, academics and everyday people like you and me push toward a more unified global existence. These people are asking and finding answers to some of the toughest questions we face. These are five really good articles we found that you might like. Read More. 

Joseph Schumpeter and Creative Destruction

The original concept of creative destruction was introduced by the German economist and sociologist Werner Sombart (1863–1941) and developed and popularized by the brilliant Austrian-American economist Joseph Schumpeter (1883–1950) in his book Capitalism, Socialism and Democracy (1942). Read More.

The New World Order: G7 and E7 Nations

There has been a profound change in the world’s progress as we have known it up to recently; capitalism’s geography is changing. In recent years, the average economic growth rates gap between the big emerging countries versus the big developed ones has been both substantial and consistent; that has already been going on for a considerable number of years, overwhelmingly favoring the largest emerging nations. The relative economic and political weight of the E7 economies has been the net result, said weight has been progressively increasing compared to the G7 countries’ weight. Read More.

The Former Soviet Republics: A Recapitulation (Part Two)

 

One of the many fascinating subjects of analysis in globalization is how the former Soviet republics have evolved after the 1991 implosion of the USSR to this date.

Continued from Part One of this series, the table below summarizes some key information, an indispensable element in order to make an objective assessment based on the most relevant hard data available.

Former USSR Countries 2

 

Out of the 27 countries on the table, 7 have been highlighted in italics; they are the countries that were part of Yugoslavia. Two of these countries have already surpassed Russia in their GDP per capita, Slovenia and Croatia. From the remaining 20 non-Yugoslav nations, 7 of them already  have reached output per capita levels higher than those of Russia’s: Czech Republic, Slovakia, Estonia, Poland, Lithuania, Hungary, and Latvia.

What is the lesson to be learned from this most welcome development?

From my standpoint, the lesson to be learned is a simple one: Any nation, regardless of its size and natural resources, can accelerate its rate of economic growth while simultaneously enhancing its social fabric. This is particularly more so if the nation in question is far behind in economic development from the first tier countries (developed countries). There are only two indispensable prerequisites:

  • A genuine desire to fast-track the country’s development.
  • That desire has to be transformed into intensive work and order, of a creative and constructive nature, making the most of the country’s comparative advantages.

All former Soviet nations reconstructed their societies and economies essentially from scratch, once the USSR collapsed. They had plenty of headwinds working against them: they were financially broke, with negligible monetary reserves, and they had no capitalist nor democratic system in place. Their economies were mostly in shambles—or not far from it—after over four decades of being satellites of the Soviet Union. In some respects, they were in a worse shape than if they had just emerged from a military war.

If those 7 nations have been able to transit from such a deplorable socio-economic system as the Soviet one to a relatively high level of social and economic well-being in around 20 years, any other underdeveloped nation has no valid reason for not doing so.

During 2013, Russia’s output per capita ($17,920) was #77 in the world, just a notch below Argentina’s ($18,600, #75).

The merit behind those 7 nations cannot be overstated. Having been a part of the Soviet system and being able to surpass its former ruler was no easy task.

As for the rest of the former Soviet republics that are at the bottom of the table, the conclusion is the same as before: their economic output per capita is a fair reflection of the day to day capabilities each one of them has—or lack thereof—to properly organize themselves, implementing constructive structural reforms within a progressively decreasing corrupt sociopolitical system.

That simple, irrefutable truth is not fully understood; otherwise, constructive change would be at work at turbo speed everywhere.

That is the great challenge, yet the greatest opportunity of our generation, to implement the required structural reforms, creating the right incentives for  new jobs and wealth generation, to close the huge gap that separates all underdeveloped nations from the developed world. That challenge is worth several trillion dollars of wasted opportunities, as it is clearly explained in my book GLOBALIZATION.

The closer the political subjugation of any former soviet republic is to Russia, the poorer it is. In other words, the most independent, free-minded former soviet republics are, not coincidentally, the most affluent.

Is Panama Taking Off for Good?

Panama-City-SkylinePanama was formed as an independent nation in 1903, by a separation from Colombia. Since then until 2009 Panama had been a typical underdeveloped nation, basically characterized by mediocre government management.

On July 1st of 2009, Ricardo Martinelli was sworn in as Panama’s president; his term expires shortly, next June 30.

The transformations that president Martinelli made to the Panamanian society during the past five years as head of that Central American nation converted it from a sleep economy, into a roaring one.

Taking the Panama Canal’s expansion program as the initial platform, Panama has been able to successfully transit an important part of its economy to banking, services, medical tourism, and rising commerce. Panama has also increasingly become a very attractive country to set-up regional offices of large multinational companies.

Panama has a population of 3.6 million (90th in the world), a total area of 75,420 sq. km. (118th in the world), a total GDP of  US $61.5 billion (90th in the world), and a GDP per capita of US $16,500 (81st in the world).

Panama is an excellent example of a relatively tiny nation that has been recently moving smartly along the lines of its basic competitive advantages.

Irrespective of its tiny size, Panama’s average growth rate during the past three calendar years was a whopping 9.66% (10.8%, 10.7%, and 7.5%, for 2011, 2012 and 2013, respectively).

Within Latin America, Panama’s $16,500 GDP per capita (2013) places it 14% below Chile’s and a notch below Uruguay’s; looking in the opposite direction, Panama’s per capita GDP is a notch above Puerto Rico’s and 6% above Mexico’s. So, the way things stand today, if current trends were extrapolated forward, the first two Latin American nations to achieve full developed status in the years ahead would be Chile and Panama.

During the five years of Martinelli’s administration Panama’s extreme poverty levels were reduced from 38% to 29%. Still very high, albeit a remarkable improvement in such a relatively short period, five years.

In Panama, the demand for workers is so high that even a relatively large dislocation of workers —just a few weeks ago, around 9,000 workers were fired from the Panama Canal’s expansion project—  did not destabilize the economy because they were quickly absorbed and placed in other jobs. The firing of those workers was brought about by a controversy between the subcontractors; currently the case is being disputed in court. Thankfully, the expansion works have already resumed, one month after being suspended.

Hence, time and time again history has proved that although a substantial critical mass can be an advantage for an accelerated pace of development (China’s case), the lack of it is a factor that, with the right government policies and initiatives, can be easily overcome.

It is almost a certainty that, among others, Martinelli was inspired for the design and execution of his strategy by the Four Asian Tigers’ near miraculous turnarounds from rags to riches in less than three decades by the end of last century.

How did Martinelli achieve such a dramatic injection of vitality and growth in Panama?

With the classical recipe, a-la-Singapore: mainly through heavy investment in public infrastructure, opening-up the economy, and removing the major obstacles that hamper growth.

Martinelli lacked previous government experience. He did have though, a good trajectory as a businessman; as a supermarket tycoon, with around 10,0000 employees under his umbrella. In no way am I suggesting that this is a guaranteed recipe for success. It is not. The are innumerable examples of former businessmen and/or corporate officers who have failed miserably when being elected Presidents or Prime Ministers, like president Vicente Fox (2000-2006) in Mexico. Thus, although Martinelli’s experience in business surely was of great help, to be able to achieve such dramatic results in a relatively short time requires many additional attributes which, unfortunately, are in short supply.

Behind major success, as has been Panama’s economic case under Martinelli, there is a state of mind, a different mind frame than the one prevailing for decades (generations, in most cases). It is about leadership, statesmanship, about wise, well implemented profound structural change that unleashes the creative potential and productivity of a lagging society.

A break with the past in many aspects is a must. Martinelli has recently stated “We Panamanians are the Phoenicians, the new Phoenicians of the modern world”.

Martinelli has proved to be a master student of history and of the true foundations of sound economics.

In Panama’s case —like practically everywhere else that this has happened— such a great break with the past is essentially the work, vision, and determination of a single person, the outgoing president Martinelli. Hence, it can be done. Moreover, such a constructive break with a mediocre past should be done everywhere, most particularly starting with the poorest nations on earth.

In the political front, Martinelli has been a vocal, unwavering critic of the many atrocities and extremely poor government policies pursued by Venezuela, Ecuador, and Argentina. That did not gain him many friends, particularly among the abundant populist media in Latin America.

Not all of Martinelli’s efforts were addressed in the right direction. After all, he is only human.

  • Martinelli unsuccessfully tried to change the constitution to extend his stay in office.
  • Likewise, he was also behind his wife’s candidacy for Vice President of Panama, which  surprisingly resulted in a losing ticket.

By itself, the first point did not necessarily entail poor judgement. However, when combined with his wife running for the Vice Presidency —fortunately in a failed ticket—, the mere appearance of nepotism is utterly unacceptable, suggesting Martinelli’s obsessive attachment to power, with all the vicious consequences inherent to it.

In the economic front though, the cause/effect relationship in Panama’s case (like in all other virtuous transformations) is so evident that it can almost be touched.

Life is an open book, an encyclopedia. Thus, we have to learn to learn from it. That’s wisdom. Most fortunately, as Panama’s example proves it, this critical learning process is alive and well, albeit far from running at full steam. Read more on Why are most of the world’s nations socially and economically underdeveloped?.

Aside from Martinelli’s notorious attachment to political power, it is very encouraging and gratifying to witness the work, vision and execution of a government leader like him, injecting such a powerful dynamism into an otherwise rather ordinary country.

There is no substitute for good (preferably great) management.

Juan Carlos Varela, the winning candidate in the recent presidential elections, is programmed to take office next July 1st, for a five-year term. Varela has been part of Martinelli’s administration during most of it. First as the Foreign Secretary, and later on as Vice President. To Varela’s credit, he turned sour on Martinelli when the later intentions to place his wife in his protege’s ticket to the presidency transpired.

Infrastructure investment in Panama has not kept pace with economic growth: electricity and water are rationed in the tallest buildings; the sewage system easily overflows when raining, among other pending tasks. As a result, there is a fair risk the economy can overheat, if it has not already done so.

Assuming the previous aspects are appropriately dealt with, and if Varela sticks to the essence of Martinelli’s economic agenda, in addition to adding his personal touch for improving it (for instance by demonstrating to be an effective fighter against corruption —the backbone of his presidential campaign), Panama could become a bright star in the world.

Panama is not that far from becoming another role model country, a living example of what really works in economics and society.

The key behind this turbocharged growth possibility for decades to come lies in consolidating the good work, and strengthening institutions, transforming it into state policy. Varela has the great opportunity to do so.

The Former Soviet Republics: A Recapitulation (Part One)

Communism Schmommunism

Not all former Soviet countries were created equal. In fact, some of those nations experienced their own post-Soviet versions of communism, which later on, after getting rid of the humiliating subjugation they suffered under the communist regime, once that deplorable government system collapsed at the beginning of the 90s, it allowed them to flourish and prosper with relative ease, sprinting themselves above and beyond their former subjugators, in the social and economic sense.

When analyzing how the former communist countries have been performing in recent years –including Russia–, after the collapse of the USSR, there are some remarkable stories of countries that went through a relatively quick and successful adaptation to a market economy and to a democratic system. Granted, none of those countries have done a complete conversion yet, it is a work in progress. Judging by the results, however, some of those successful countries are much closer to their destination point (becoming a fully developed nation), than to their parting point (the big mess from which they started when abandoning the state-controlled economic model).

As we can see in the table below, the most outstanding performance cases, in descending order, are: Slovenia, the Czech Republic, Slovakia, Estonia, Poland, Lithuania, Hungary, Croatia, and Latvia. The first six of these countries already enjoy a significantly higher output per capita than Russia’s, their former ruler, double digits superiority (Slovenia has a whopping 58% advantage, while Poland has a 18% favorable difference). It is important to keep in mind that Russia has an output per capita of a mediumlydeveloped nation, like Argentina, Chile, and Malaysia.

Former USSR Countries

To simplify and make more sense of the comparative analysis, let’s group the nine mentioned countries in four subgroups:

  • Subgroup One, Slovenia and Croatia. These countries (along with five more) were part of the former Yugoslavia, which was dissolved starting in June 25, 1991 and ending in 1998 —when the last Serb-held enclave in eastern Slovenia was returned to Croatia, under UN supervision..
  • Subgroup Two, the Czech Republic and Slovakia. Both republics were part of Czechoslovakia, before a peaceful, negotiated dissolution of that former nation in January 1, 1993.
  • Subgroup Three, the three Baltic Republics: Lithuania, Estonia, and Latvia.
  • Subgroup Four, the two remaining nations: Poland and Hungary.

There rarely are any accidents in social sciences. The relative overperformance of the nine countries of the four subgroups clearly adheres to a most rigorous cause/effect analysis. Let’s see why.

As previously stated, Slovenia, along with six more nations (Croatia, Montenegro, Serbia, Macedonia, Bosnia and Herzegovina and Kosovo –in descending order of  current economic output per inhabitant) were part of Yugoslavia. Yugoslavia is a fascinating subject for study.

In a nutshell, Yugoslavia, having been occupied by the Axis forces, emerged from WWII with Marshall Tito’s (Josip Broz) ruling, under the USSR’s umbrella.  Thus, Yugoslavia was initially part of the Soviet system at the end of WWII, even being considered very loyal to the Soviets the first few years after the war. However, Tito had a very clear spirit of independence, never showing any real submission to the Kremlin, just the standard respect and cooperation attitude as equals, and a little bit of deference to a larger, presumably more consolidated nation. That spirit of independence proved to be unbearable to Stalin, who as history clearly shows, preferred to view the satellite Soviet republics as subjects, not equals. Tito was the only government leader within the USSR to successfully challenge Stalin, getting away with it. On June 28, 1948, Yugoslavia was formally expelled from the Communist Information Bureau (Kominform), a de facto official withdrawal from the Soviet sphere.

Hence, thanks to Tito’s stern spirit of independence, all present republics that were part of Yugoslavia had a significantly better head-start when the USSR collapsed and Eastern Europe began to re-encounter the path of free markets and democracy.

Upon Tito’s death in 1980, and with the fall of communism throughout eastern Europe, the Yugoslav federation began to unravel, once the demands for independence among the different ethnic groups intensified.

On June 25th, 1991, Slovenia declared its independence from Yugoslavia, based on a landslide –88% of the vote– referendum for independence held on December 23, the prior year. Unlike Croatia, Serbia, and Bosnia and Herzegovina, Slovenia was able to secede from Yugoslavia with relatively little violence. For the rest of the republics, seceding from Yugoslavia and becoming independent turned out to be a bloody and long civil war. That explains most of the lagardness of those republics; of course, there are also other factors that explain why they are currently so behind the rest of the pack.

As for the second subgroup, the Czech Republic and Slovakia, there are three major positive factors that have greatly contributed towards their relative outperformance in relation to the former USSR countries:

a) Czechoslovakia was the industrial bastion of the Habsburg Empire in the XIX century. Hence, there was sort of like a historic memory imbued in society’s subconsciousness, in such a way that when circumstances required it, in the new found independence, it was relatively less difficult for them to make a successful transition towards a market economy and a democratic system.

b) Both, the Czech Republic and Slovakia have always considered themselves to be fully Europeans. Geography, in turn, also has heavily contributed in that direction, given their proximity to Austria, Germany, and Poland.

c) Although not necessarily at the same level than Yugoslavia’s, the spirit of independence of Czechoslovakian society has also been very marked. During the spring of 1968, Alexander Dubcek, the then newly appointed head of the communist party, initiated a liberation movement, the Prague Spring, which adopted the motto “socialism with a human face”, for their cause. Undoubtedly, in no small measure, Dubcek’s attempt to liberalize Czechoslovakian society was inspired and encouraged by Yugoslavia’s example. Although Dubcek affirmed his loyalty to communism and the Warsaw Pact, that proved too hard to stomach for the USSR, who seven months later, on August 21, ended that experiment by sending Warsaw Pact troops to Czechoslovakia and removing Dubcek from his post, sending him to an obscure forest supervising position in a remote area in his native Slovakia, where he was not allowed to talk to anyone besides his family.

The third subgroup’s history is a truly fascinating and encouraging one. These three relatively tiny nations have been invaded and submitted time and time again throughout history, mainly by the Russian Empire.

The way the Baltic republics have taken advantage of their relatively new independence has been remarkable, a genuine role model for the rest of mankind.

Despite lacking critical mass given their relatively small population size (only in that respect), they have shown the whole world what a determined society eager to improve their standard of living can accomplish in just a couple of decades, and counting.

The great success of the Baltic states must be particularly painful to digest for an autocrat like Putin. It is very interesting to observe how the income gap between these tiny nations and their former ruler is getting bigger by the day. An unquestionable testimony of the evident superiority of the Baltic Republics’ socio-economic system versus Russia’s.

Finally, the fourth subgroup is also very interesting: Poland and Hungary. Both nations are medium sized, both in population and in territorial extension. Poland is in a class by itself, since its break with the forced communist past has been wholeheartedly, very frank, open and consistent. Hungary’s conversion to a market economy and a free democratic system has been a very hesitant process, particularly under the present government. Even so, the initial impetus Hungary received in foreign investment and technology transfer was sufficient to achieve its current level of development, despite its many drawbacks, challenges and threats.

This brief recount of historic events clearly explains a great deal about the relative performance of most of the overachievers among the former Soviet republics; the cause/effect relationship is quite evident. There is no price too high to pay for a free, orderly society, under the rule of law. The results speak for themselves.

Continue reading in the next post of this two-part series.

Viktor Orban, Hungary, and the World

Last weekend’s victory of Viktor Orban’s Fidesz (Fiatal Demokraták Szövetsége- Alliance of Young Democrats) party in Hungary’s elections casts a long and ominous shadow on European, and even in the world’s, liberal democratic tradition and practice. Orban won his re-election at the polls for a second four-year term as Prime Minister. He had already been PM from 1998 to 2002.

How can anyone be so sure that Orban’s current policies and political practices are doomed to failure?

The cause/effect relationships between good governance, effective government policies  (cause), and population prosperity (effect), do not have a substitute. The world has repeatedly witnessed this through history, but more particularly during recent decades. Nations of all sizes, and most corners on Earth that have truly embraced higher standards of governance have prospered; countries that have done otherwise have failed. There are numerous examples of both cases (more detail on this in my book, Globalization).

To provide an objective perspective to this line of reasoning, let’s take a look at the table below, where relevant comparative economic data related to Hungary, Poland and the Czech Republic is contrasted.

Czech Republic, Poland, and Hungary

As it can be seen, there is a remarkable similarity between Hungary and the Czech Republic, sizewise. Both nations have a population size that is fairly alike, the Czech Republic surpassing Hungary’s by only 7% in this indicator. In territorial extension Hungary has the upper hand, with an 18% superiority. By combining both previous elements, if anything, at first sight Hungary seems to have a marginal comparative advantage, by having a less densely populated country than the Czech  Republic.

Very significantly though, Czech Republic’s GDP per capita is substantially higher than Hungary’s, almost by a third (US $26,300 Vs $19,800). Unsurprisingly, exports per capita in the Czech Republic are higher (by a whooping 62%) than in Hungary (US $15,187 Vs $9,373), a testimony of the more viable and hospitable environment for foreign investments in the Czech Republic in comparison to Hungary. Poland is also lagging in this last economic indicator, although its general status is more favorable than Hungary’s, with a GDP per capita slightly superior, 6.5% (US $21,100 Vs $19,800).

The previous analysis is not necessarily conclusive, yet it provides a strong support to our line of reasoning. A more conclusive evidence will be at hand 2 or 3 years down the road, if comparative economic policies in the three mentioned nations prevail.     

What has Hungary’s government done differently than Poland and the Czech Republic? The three of them being former communist countries under the USSR’s umbrella (until the beginning of the 90s).

To put it in simple and direct terms, Orban’s government has characterized itself with increasing and excessive centralized power, with multiple manifestations of authoritarianism which, inevitably, have been undermining freedom and democratic standards, not to mention investments and economic well-being among the Hungarian population. On top of that, Orban’s government has provided abundant manifestations of xenophobia.

The apparent transformation of Viktor Orban from a relatively staunch anti-Communist and free liberal—during a great deal of his first term in office; now the sincerity of his former political posture seems doubtful—to an aspiring dictator has been a rather recurring phenomena in the worldwide political arena throughout mankind’s history. Hopefully, this occurrence in Hungary  could be one of the last episodes of such an outrageous behavior within the EU.

How can this happen? It seems to me that there are three factors at play here:

  • Very weak political structures, where appropriate checks and balances are insufficient or non existent. In Hungary’s case, for example, Orban’s government has implemented constitutional changes debilitating—and eliminating whenever possible—the checks and balances established by the legislative power to supervise the executive branch. Previously, the government had nationalized the private pension plan system.

  • Greedy personalities at work, with very low moral standards (Orban’s case).

  • History provides numerous examples of this ruinous behavior. Unfortunately, those shameful examples aren’t always repudiated, but replicated, as is currently the case in Hungary.

Cronyism, corruption, and an excessive presence of the state in all social spheres is the common denominator in these cases. The corresponding pattern of behavior is well established: once power is seized (nowadays mostly through conventional elections), the leader in command rapidly begins to implement electoral and political changes (like tight controls of the media, with repressive and oppressive harsh policies towards opponents) aimed at debilitating to the extreme any organized opposition. The offending government leader (and his/her party) will resort to any conceivable trick to enhance their political control, aiming to perpetuate themselves at the top spot while alive, extending their costly way of thinking forward through their political parties.

Orban is the near-perfect personification of an anachronic expansionist ethnic nationalist, very similar to Putin’s. Thus, Orban’s sympathy for Putin and their relative closeness.

For a few years during the late 90s and early in the last decade, Hungary was one of the most promising former communist nations. A significant amount of foreign investment was pouring in. Most regrettably, nowadays Hungary has been increasingly becoming one of the best examples of how-not-to-do-things, for the reasons previously cited.

Although Hungary lacks the critical mass —economically, territorially, and population wise—  to become a more onerous problem for Europe and for the world, nonetheless it has both, a significant historical importance (particularly by having been a part of the then powerful Austro-Hungarian Empire, from 1867 to 1918) and a rather relevant strategic location not far from the heart of Europe. Moreover, Hungary is a formal member of the EU, and of the Euro system, and part of NATO, which it joined in 1999 along with Poland and the Czech Republic.

As the evidence stubbornly shows, contemporary political systems are a relatively easy prey for populist characters which, in a relatively short period can take almost any country in a downward spiral (see Contemporary Political Systems and their Multiple Limitations).

To different degrees, what is happening in Hungary is not radically different to the nightmarish situation in Argentina and Venezuela. It is the same malaisse, in different degrees, and with only negligible differences: nations in a clear pathway to deterioration, quite often at an accelerated pace. In many respects, even Italy (under prior PM Berlusconi) elicited a great resemblance to Argentina and Venezuela nowadays (see Venezuela and Italy: A Tale of  Two Horrors).

Even in the most developed nations, like Switzerland, occasionally there are rare instances where harmful results materialize at the polls (see The Limitations of Democracy). More so, in aspiring democracies like Turkey, where PM Recep Tayyip Erdogan has recently resorted to absurd and self-inflicting harmful policies and measures, like (unsuccessfully) trying to block Twitter in Turkey, as a presumable way to stop or mitigate the great political damage brought about by a corruption scandal among his family, where personal economic benefit was allegedly achieved at the expense of government finances.

The rather frequent dysfunctionalities of contemporary political systems should be a cause for a profound rethinking (and redesign, where applicable) in how to truly improve effective governance in our world. It’s the only way to achieve consistent, self-sustainable, long-term prosperity, in harmony and peace.

 

 

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