Thursday, July 02, 2009

Dictatorships are good at concealing problems while democracy is good at advertising defects

I disagree with most of this Foreign Policy article on the rise of Asia, but one thing does strike me as true:
Dictatorships are good at concealing the problems they create while democracy is good at advertising its defects.

Take, for example, the breathless writing about how China is surpassing the US in alternative energy spending. Now American VCs and the US government are smart folks and they know how to innovate and invest as good as anyone else, so it's hard to imagine them being left behind by the Chinese. More likely, the Chinese mandarins are investing wildly without any real RoI view; or they're just bsing about this whole thing.

Link
Comments:
Agree that VCs are smart enough not to throw good money behind duds, but can't say the same about the US government. The big now-failed push for ethanol during the last couple Bush years was exactly what you suspect the Chinese are doing - investing wildly (i.e., subsidizing) on a political impetus without any real RoI view. Ditto for Obama's plans to built a new, green economy. Not to say a greener economy is not desirably, but this administration's narrative seems to suggest that government spending alone (and not the market's will) can bring this about. So China-like, no?
 
I have a more nuanced view on the wisdom of governments.

Whatever little opportunity I have had to deal with officialdom from various countries, I feel that US local/federal government bureaucrats are as smart and committed as the wisest in the industry. Indian and German officials don't come anywhere close.

I don't know about the relative quality of politicians though. I've seen some brilliant politicians from US, Europe and India, but I have no idea how smart the "average" politician is.

I am not sure if Chinese bureaucrats are in the same league as the Americans. The Chinese give an outward appearance of being on the ball and being very committed, but then who knows what's going on behind the scenes?
 
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