How is one supposed to understand anything about the economy, if most things published on the subject are egregiously unintelligent. See, for instance, this article titled “It’s stupid economists, people.” I don’t know if economists are stupid, but the author of this article definitely is.
The article’s author, who obviously has no understanding of the post-Soviet economies, chooses to pontificate about them:
After the fall of communism, for instance, many economists urged the leaders of the formerly planned economies to switch to market-based economies in one big bang. Since few people knew how to behave in a market economy, it was a disaster.
Within a very short period of time, the post-Soviet people learned, however. Today, just 21 years after the fall of the Soviet Union, there are functioning market economies in the FSU countries. Things are not perfect but the level of economic well-being has soared compared to what was in existence in 1990. Russia, for instance, has weathered the global economic crisis quite well. Ukraine, with its 300+ years of brutal colonial domination, is not doing quite well. Still, I can’t think of a single person I know back home whose economic well-being has not improved dramatically in the past 20 years.
The article suggests that it would have been a better idea to avoid the shock therapy in the FSU countries and, instead, drag out the transition period forever. Yeah, tell that to the people who only have one life to live. Living in a state of transitional uncertainty is very stressful to the majority of people. We went through a couple of bad years when I was in my late teens. But if that period had been extended to a few decades, I can’t see what I would have gained by being 40 instead of 20 when the economy started going back into a working mode.
An attempt to introduce elements of the market economy slowly and make them coexist with Socialist economic mechanisms was made by Gorbachev in the late eighties. This attempt was a resounding failure since the market economy was so much more robust and attractive that it literally exploded the Soviet economic structure from within.
It would be great if the author of the article learned a few things about that before pontificating.
After making these uninformed statements about the post-Soviet countries, the article’s author trots out the old and tired myth about how it is possible to make collective ownership work because, if one looks hard enough, one might find a couple of instances of it possibly working in Nepal and Maine. The journalist seems to recognize that you need to “comb the world” to find something as unnatural and unusual as a successful collective ownership of anything, yet it does not prevent him from cheering on a system of ownership that, I’m fairly certain, he would not have tolerated for two days in his own life.
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