Friday, 18 February 2011

Once Again the Spin Doctors Try to Equate Political Freedom with the Free Market: The Egyptian Case

Interesting story in The New York Times this morning about the Egyptian military and its economic power. The claim is that about a third of the economy is run by the military in its various forms, and that in the past it has resisted "liberalization" of the economy.

One should read "free market" or "Chicago school" for "liberalization," it seems. The story says: "The military has used its leverage in times of crises to thwart free market reforms before, most notably during the 1977 bread riots set off after President Anwar el-Sadat cut subsidies for food prices to move toward a free market. The military agreed to quell the unrest only after extracting a promise from Mr. Sadat that he would reinstate the subsidies, said Michael Wahid Hanna, who studies Egypt’s military at the Century Foundation in Washington."

The story adds: " And the idea of liberalizing the economy was thrown into disrepute because of the corrupt way that the Mubarak government carried out privatization, bestowing fortunes on a small circle around the ruling party while leaving most Egyptians struggling against grinding poverty and rampant inflation." (My italics)

Whether real political reforms will come under the military rule remains to be seen: as noted earlier, the track record of military regimes isn't all that good, although there are notable exceptions like Portugal. But a planned economy is not a bad economy, ipso facto.

And, hey, has the track record been all that good for the "free market" lately? Aren't we all still suffering from that economic meltdown it engendered a couple of years ago?

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