Great post from Steve on Africa

POST: Africa and Science

Great Steve blog that really got me thinking, given my recent African sojourn and watching "Blood Diamond" (Leo WAS amazing) last night with Vonne in the home theater.

You see the whole "conflict diamonds" scheme and you can't help but be for it, but then there's the bit when the local villager, whose entire community is in flames, opines, "I hope they never find oil here, then things will really go bad" (or words to that effect).

And you wonder: is it the stuff they've got in Africa (raw materials they inevitably fight over) or the options they lack (everyone in the movie wants the pink diamond so they can escape in wealth)?

Create wealth and the options multiply. Fight over fixed resources and it'll always be zero sum

All rule of law gets you is confidence that, if you try and actually create new wealth, you can keep it. All markets get you is the chance to securitize that effort by being able to sell what you create. And all S&T is about is that search for what's useful and sell-able next.

So yeah, the Economist makes perfect sense to me.

But I always remind: security is 100 percent of your problem until you get it. Then it's only 10 percent of your exit strategy solution.

Comments

[Mark in Texas]

When you have valuable resources in fairly compact form like diamonds or oil, life is always going to get worse for everybody except the politically connected and the thugs that they hire in a place with poor rule sets.

That is one of the nice things about ethanol fuel made from sugar cane. It can be produced cheaper than the current world wholesale price for gasoline, but only if you have a rule set that ensures enough stability for farmers to plant and tend their fields long enough to harvest the cane and an infrastructure that allows you to transport the cane to a processing plant and a legal and financial rule set that encourages investment in capital equipment to turn sugar cane into ethanol.

If you have those rule sets, the elite can make a lot of money from their cut while the stability and infrastructure will allow all kinds of positive things to happen.

Applying science and technology can turn up the dial and get even more eggs out of the golden goose, but the first step is to get the rule sets in place to allow peoples' natural ambitions to create those golden eggs.

I wonder if rather than trying to eliminate corruption in Gap countries it might be more effective to heed the words of Frank Hague, Mayor of Jersey City and political boss of Hudson County, New Jersey, "I do not believe that 3% off the top is excessive for an efficient and well run government." It would certainly be an improvement over kleptocracies that take everything so that nobody tries to improve anything.

[Jimmy J]

The question is......how do we bring a country like Kenya or Tanzania into the globalization movement?

They both have representative governments, they don't start wars with their neighbors, and they have lots of talented, hard-working people. But their elected governments are kleptocracies that will not back ownership of private property and operate on the principle of a zero sum society. So many Third World countries like that. Mired in poverty and backwardness because they won't allow capitalism to take root.