Free markets, rule of law

Democracy without free markets is an economic disaster which leads to increasingly populist and secatarian government, with ever more bureaucrats hired to increase the government's "payroll vote", and ever more subsidies to crony businesses and non-productive voters, to boost the "client vote". Before long we have an unreformable mess, where the democratic process is an obstruction to change, instead of a mechanism for preventing the entrenchment of particular interest groups.

But this is nothing to the problems of a society without the rule of law. Because free markets are inherently bottom-up operations, they don't need to be part of a rotten democratic process: the traders and consumers can engage in vountary exchange, while the politicians claim credit for the fact that people have jobs. But a society without the rule of law combines all the disadvantages of anarchy, with all the disadvantages of the arbitrary state.

Hillary Johnson writes about this here.
It also means, dare I say it, that most of our foreign-policy activism that is aimed overtly at promoting "democratic" reform is wasted effort, in the absence of a foundation of judicial and economic reform. One need only look at the absurdist "democratic" rise of Hamas to see that democracy can't really function properly in a corrupt legal and economic system.

So the neoconservative project doesn't work in Iraq or anywhere else the U.S.A. is pushing it, because the intellectuals concerned have bought into the sixties liberal pap about "democracy" equals "niceness". An earlier generation of U.S. foreign policy experts thought that "Uncle Joe" Stalin was more of a humanitarian than Winston Churchill, and the U.S.A. had more in common with the U.S.S.R. than with the British Empire.

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