Topic: International Economics and Development

Remembering Georgia’s Freedom Fighter

Sometimes a person’s genuine significance can be assessed only after their passing. That seems to be the case of Kakha Bendukidze, Georgian entrepreneur, reformer, and philanthropist, who died unexpectedly early last month. While he was very well-known among libertarians in Eastern Europe and the former USSR, the reactions of some of the world’s leading media outlets suggest that his influence extended far beyond narrow ideological lines, making him one of the most important voices on public policy in the region.

Kakha was a close intellectual ally of Cato and did more than his fair share to promote free-market ideas in countries of the former USSR. In the early 2000s, he pressed for the adoption of a flat tax in Russia. Earlier than others, he understood Vladimir Putin’s true motives, sold his Russian businesses and moved to his native Georgia. It was there that he spearheaded, as Minister for Economy, the ambitious program of fighting corruption and liberalizing the economy, which led to extraordinarily high growth rates for Georgia’s economy. In 2007 alone, the economy expanded by 12.3 percent. After leaving public office, Kakha helped establish the Free University of Tbilisi, a private university offering Western-style undergraduate and graduate education, and the Knowledge Fund, a charity providing funding for teaching and research, including scholarships for Georgian students from poorer backgrounds.

Impressive as this account is, few would have guessed that his passing would prompt a wave of tributes and appreciations coming from sometimes unexpected places. On Foreign Policy’s Democracy Lab, Anna Nemtsova called Kakha one of Georgia’s “most progressive reformers and corruption fighters.” The New York Times published a lengthy obituary, which highlighted Kakha’s involvement with the new leadership of Ukraine. The Independent, in turn, called Kakha a “businessman and statesman who fell foul of Vladimir Putin but rescued Georgia’s post-Soviet economy.”

Finally, the New Yorker magazine offers a carefully written appreciation, offering a lot of details on Kakha’s life and activities in Ukraine prior to his untimely death, as well as the directness with which he communicated his ideas:

Even though he was unsure whether Ukrainians would accept the changes that he wanted to carry out, he agreed to work with [Ukrainian President] Poroshenko, friends say, because he saw Ukraine as the frontline of the battle for liberal reforms in the former Soviet states. With the same tough love that he had inflicted on Georgians, Bendukidze urged Ukrainians to stop blaming others for their problems. “You have broken every world record in idiocy,” he told an audience at the Kyiv School of Economics, in July. “You keep electing populists, people who promise you more. This means you are electing the worst.” He advocated cutting government spending, reducing retirement benefits for public servants, and radically deregulating the economy. Ukraine, he said, in one of his last interviews, had too many ministries and agencies. “Who needs them when the government’s sole function these days is to take money from the International Monetary Fund and pass it on in payment for Russian gas?” he asked.

A Tyranny of Silence: One Journalist’s Battle Against Modern-Day Restrictions on Free Speech

In their effort to provide the public with information about controversial yet important world events, journalists face constant intimidation. Whether it takes an extreme form—such as beheading or death threats—or a less violent one—like government censorship or enforced political correctness—it nonetheless constricts their ability to convey truthful information about key issues.

No one knows this better than Flemming Rose.

In 2006,  the Danish newspaper Jyllands-Posten published 12 cartoons of the prophet Muhammad, stoking the fires of a worldwide debate about what limits—if any—should constrain freedom of speech in the 21st century.

Rose, then the paper’s culture editor, defended the decision to print the drawings, quickly becoming the target of death threats and more, all of which he recounts in his new book, published by the Cato Institute.

In The Tyranny of Silence: How One Cartoon Ignited a Global Debate on the Future of Free Speech, Rose provides a personal account of an event that has shaped the global debate about what it means to be a citizen in a democracy and how to coexist in a world that is increasingly multicultural, multireligious, and multiethnic. Rose writes about the people and experiences that have influenced his understanding of the crisis—including meetings with dissidents from the former Soviet Union and ex-Muslims living in Europe—and takes a hard look at the slippery slope of attempts to limit free speech.

Rose’s message clearly resonates with lovers of liberty around the world. A special one-on-one conversation between Rose and Jonathan Rauch of the Brookings Institution, hosted at the Cato Institute in mid-November, saw over 100 in-person attendees with another 53 people tuning in online.

That impressive showing, however, was far outpaced by the mass response to Cato’s very first Reddit AMA, featuring Rose, which has been viewed well over 200,000 times since it was first published on November 13th, and continues to draw thousands of Reddit viewers every hour, almost two weeks later.

Rose’s AMA, entitled “I am a journalist and free speech advocate who has received hundreds of death threats since 2006. AMA,” quickly broke into the top ten discussions on the iAMA forum that week. As questions continues pouring in, Rose sat down for a second full hour session the day after the original session was scheduled.

You should definitely read the AMA yourself, but here are some highlights:

Enjoyed the discussion? You can read the whole thing here. And, of course, don’t forget to buy the book to read all of Rose’s harrowing tale.

Russia Should Bury Lenin’s Body and the Rest of Communism

MOSCOW—Red Square remains one of the globe’s most iconic locales. Next to the Kremlin wall is a small, squat, pyramidal building:  Vladimir Ilyich Ulyanov Lenin’s mausoleum.

Lenin is preserved within, dressed in a black suit, his face is grim and his right fist is clenched, as if he was ready to smite the capitalists who now dominate even his own nation’s economy.  He is one of history’s most consequential individuals. Without him there likely would have been no Bolshevik Revolution, Joseph Stalin, Cold War, and Berlin Wall.

Of course, without Lenin there still would have been a Bolshevik movement. But it would have lacked his intellect, tactical skills, and, most important, determination. So feared was he by his enemies that he became Germany’s secret weapon against Russia, sent back to Russia to spread the bacillus of radical revolution.

Lenin pushed the Bolsheviks toward power as the authority of the moderate Provisional Government, which had ousted the Czar, bled away. Lenin was no humanitarian whose dream was perverted by his successors. He insisted on solitary Bolshevik rule, brooked no dissent even within the party, established the Cheka secret police, and employed terror against opponents.

Lenin was left helpless by three strokes.  He died on January 21, 1924, just 53 years old. His body lay in state for four days, during which nearly a million people passed by.

Within a week of his passing the idea of preserving his body was broached. The mausoleum started as wood and turned into the current granite and marble structure in 1929.

Communist imagery, including Lenin’s mummy, came under attack with the dissolution of the Soviet Union. Moscow’s anti-communist mayor backed burying the corpse and restoring Red Square to its pre-revolutionary state. Boris Yeltsin, the first president of non-Communist Russia, also proposed to bury Lenin. But Yeltsin’s health faltered and political strength weakened.

In 2001 Yeltsin’s successor, Vladimir Putin, expressed fear that burial would suggest the Russian people had lived under “false values” all those years. He concluded in 2011 that the decision would be made when the time was right.

Yet the same year Vladimir Medinsky, then a leading member of Putin’s United Russia Party, proposed burying the corpse next to Lenin’s mother in St. Petersburg and turning the mausoleum into a museum. In 2012 Putin appointed Medinsky Minister of Culture, suggesting support for removing Lenin’s body. However, Putin failed to act and since has ignored the issue.

While Russia cannot escape its history, it should stop glorifying the country’s turn down one of humanity’s great deadends. Although an unjust despotism, Imperial Russia could have been transformed into some form of constitutional rule.

But by entering World War I the Czarist autocracy sacrificed that opportunity. The Provisional Government, led by liberal constitutionalists and democratic socialists, put the previous regime’s commitment to war before the Russian people’s interests.

Unfortunately, the victorious Bolsheviks suppressed free markets, stole private property, crushed political dissent, murdered political opponents, imposed materialist ethics, and exalted ruthless dictatorship. The result was a sustained assault on the history, traditions, ethics, and very essence of the Russian people. Although Russians finally were able to turn back from this deadly detour, the same old authoritarianism has been born again, repackaged to make it more palatable to Russians today.

As I point out on Forbes online, “Burying Vladimir Lenin would be a powerful symbolic gesture to close an era. That still might not help the West understand what Vladimir Putin is, but it would emphatically show what he is not. And that would be no small feat at a time of dangerously rising tensions between Russia and the West.”

Someday Russians will be free. Liberation will come only through the Russian people’s own efforts, however, not from the West. Only they can make their own future. The day liberty arrives will be the real Russian Revolution.

Video: The Fate of Our World

The state of the world is improving. Child mortality, poverty, and violence are declining, while life expectancy, incomes, and education are increasing. While many problems remain, most indicators of human well-being are trending in the right direction—especially in the developing world.

If you are interested in a realistic look at the state of humanity, then I highly recommend that you watch this video:

Learn more.

Iran’s Economy, With and Without a P5+1 Agreement

The haggling between Iran and the so-called P5+1—the permanent members of the United Nations Security Council, plus Germany—is scheduled to come to a close on Monday, November 24th. The two parties each want different things. One thing that Iran would like is the removal of the economic sanctions imposed on it by the United States and its allies.

After decades of wrongheaded economic policies, Iran’s economy is in terrible shape. The authoritative Economic Freedom of the World: 2014 Annual Report puts Iran near the bottom of the barrel: 147th out of the 152 countries ranked. And the “World Misery Index Scores” rank Iran as the fourth most miserable economy in the world. In addition to economic mismanagement, economic sanctions and now-plunging oil prices are dragging Iran’s structurally distorted economy down. So, it’s no surprise that Iran would like one of the weights (read: sanctions) on its economy lifted.

Just how important would the removal of sanctions be? To answer that question, we use the Institute of International Finance’s detailed macroeconomic framework. The results of our analysis are shown in the table and charts below the jump.

Ebola: Human Progress Is the Best Medicine

With the media frenzy over Ebola now thankfully fading, let us view the outbreak within the context of humanity’s continually improving ability to solve new problems.

Today, the world is better prepared than it has ever been to respond to an outbreak of an infectious disease. For example, there are more skilled medical professionals available to tend to the sick and conduct research on effective treatment. The number of physicians per person is rising globally.

While there is not yet a cure for Ebola, many people are hard at work coming up with one. Countless maladies that once were death sentences can now be treated. The development of effective antiretroviral drugs for HIV/AIDS, for example, serves as one of the great medical accomplishments of the past two decades.

Today, the tools to prevent transmission of disease are more accessible than ever. Ebola and many other diseases are partly spread through poor access to sanitation. Thankfully, more people are gaining access to improved sanitation facilities.

The Ebola threat should be viewed in the context of human ingenuity. As Princeton University professor and HumanProgress.org advisory board member Angus Deaton writes in his book The Great Escape, “Need, fear, and, in some circumstances, greed are great drivers of discovery and invention.”

Today in Cato’s Growth Forum

Cato’s special online forum on reviving growth continues today with the following new essays:

1. Morris Kleiner makes the case against occupational licensing.

2. Tim Kane calls for more immigration.

3. Alan Viard advocates moving to a progressive consumption tax.

4. Donald Marron argues for a carbon-corporate tax swap.