Sunday, March 06, 2011

Two unconventional ideas in breaking with bad governance

Jumpstart a city

Cities are the heart of civilisation and growth. A well functioning city is a great opportunity to obtain economic growth and social change. The best thing that we can hope for, in thinking about the lives of poor people or those facing discrimination in rural India, is for them to escape to a city. We in India don't have a single well functioning city. As an example, governance in Bombay is deeply broken.

How could a poor country kick start the emergence of one or more good cities? Paul Romer has an idea : To walk down the Hong Kong route, to create `charter cities'. See Two paths to good cities. Writing on CFR.org, Sebastian Mallaby reports some big events. Last year, Madagascar came close to signing onto a charter city, but it did not work out. And last month, Honduras approved a Constitutional Amendment which will make this possible. So Paul Romer's three-year crusade appears to be going from a wild idea to the zone of possibility. If it works, it'll score bigger impact than Romer, 1986, which is in Nobel Prize range.

I personally think it would be a much better use for aid money, to go down this route, instead of the conventional development economics that aid agencies emphasise. I feel these existing strategies range from useless to counterproductive. In contrast, it seems that under the right conditions, a charter city could work, and if it works, the upside is phenomenal. So even if 10 charter cities are attempted and one works, it'd be a huge contribution.

On a related theme, you might like to see: What if India had a Hong Kong?

Elect a foreigner

Raghuram Rajan has been talking about another line of attack. He has a recent paper titled Failed States, Vicious Cycles and a Proposal. The blurb reads:

...examines the problems of failed states, including the repeated return to power of former warlords, which he argues causes institutions to become weaker and people to get poorer. He notes that economic power through property holdings or human capital gives people the means to hold their leaders accountable. In the absence of such distributed power, dictators reign.

Rajan argues that in failed states, economic growth leading to empowered citizenry is more likely if a neutral party presides. He proposes a unique solution to allow the electorate to choose a foreigner, who would govern for a fixed term. Candidates could be proposed by the UN or retired leaders from other countries; they would campaign on a platform to build the basic foundations of government and create a sustainable distribution of power.

Rajan emphasizes that this is not a return to the colonial mode: the external candidate (like all the others) would be on a ballot and the electorate would choose whether he or she was their best chance to escape fragility.

Each country is unique and we have to ask ourselves what might work where. In India? Bangladesh? Sri Lanka? Pakistan? Afghanistan? Libya?

3 comments:

  1. Some of the key figures in Media and different fields of life are deliberately declaring the government as corrupt and inept. They are only trying to betray the people of Pakistan. I Just want to ask such elements why the positive steps taken by the government are not discussed, but the loopholes are always presented as the worst case scenario. Such media personnel are the worst enemy of this nation as they are just chaos merchant and putting their entire weight to spread pandemonium among masses. I wonder why they are hesitant to discuss, BISP program, Employee stock scheme, Aghaz-e-Haqooq-e-Balochistan package , war on terror and a lot others. It is clear they are monger lovers and presenting wrong side of picture for their vested interests. Furthermore there was no word of appreciation for Government’s resolve to end corruption and steps taken by the interior minister Rehman Malik. Is it not the duplicity of media? We must give credit to government where it is due.

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  2. This is a sneaky attempt at reintroducing colonialism. Also, it shows a very poor understanding of how the world around us developed in the first place. All western countries were at one point presided over by warlord. They established themselves and once their interests were entrenched, they were enmeshed in politics. Many dynasties survived for generations and then lost in revolutions. Others were pensioned off and are still called Kings.

    These warlords are in effect establishing order by imposing their monopoly on power. What is needed a quick way of acknowledging their power and introducing stability in these countries. An example is Libya. It is quite possible that the rebels will hold on to a large swathe of land even if they do not win outright. So do these rebels automatically get a new country? By today's standards of international law, they probably won't get one.
    It is naive to believe that a foreigner would understand a complex third world society however poorly run it is.
    The whole argument is so infuriating.
    It is unfortunate that the elite and the middle class in India have forgotten the lessons from our time under colonial rule. Perhaps, it is more a comment on the failure of India to meet the aspirations of its people, including the pampered upper classes.

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  3. Charter Cities + Resource Hungry Chindia + Resource Rich Tinpot Nations+ Tax Havens + Global Spread of Small Arms (AK 47 types)+ Lawless Areas (like Somalia) = New East India Company and Neo Colonialism.

    Think about it , charter cities looks like a pretty dumb idea to me. Remember Fort St George or Chennai etc - well the Company Bahadur started out with its own trading forts, then Mughal law and order broke down so they hired their own army. Very soon they ate the country for breakfast and Bengal had a famine a decade.

    HISTORY DOESN"T REPEAT ITSELF BUT IT RHYMES - this is colonialism in a new guise .

    Suprised to see you support this really.

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