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Nice post Anthony, a thought-provoking summary. I probably disagree with you in many ways but on the whole I think I'm with you (and therefore by extension the GI? ooer!) about the importance of local initiative (and aid fostering these where it can be helpful) as opposed to (some) imposed projects; healthcare and education I feel must be mostly provided by sovereign governments as in the UK though. And if said governments are too weak, too corrupt to do this, then what structural factors (often IFI-related, externally imposed) are contributing to this?

Just one point though, and I realise by quoting him I'm not going to change your mind, as I'm sure you consider him other-side-of-the-fence, but George Monbiot for one disputes the idea that Keynes was the force behind the Bretton Woods Institutions (this is described at more length in his The Age of Consent):


In truth, Keynes bitterly opposed them. He predicted that if the world economy was managed by these means, the wealth and power of the creditor nations would be massively enhanced, while the debtors would sink ever further into poverty and dependency. He called instead for an “international clearing union” which would automatically redeem imbalances in trade and cancel debt, by the ingenious means of forcing creditors to pay interest on their international currency surplus at the same rate as debtors.

Once again, the United States objected. It threatened to withold its war loan if the British delegation, led by Keynes, persisted with his proposal, and he was forced to back down and agree to the formation of the bodies which later became the World Bank and IMF. In a letter to the Times soon afterwards, Keynes conceded that the commercial policies the new bodies would permit may prove to be “very foolish” and “so destructive of international trade that, if they were adopted, Bretton Woods will have been rather a waste of time.”


"and if said governments are too weak, *or* too corrupt", I should have said


The thing about Monbiot - and especially Joe Stiglitz - is that they're spot on when discussing why certain institutions fail. But their conclusions always seem to be that the reason they fail is down to poor leadership, and that if they were in charge it'd work.

The beauty of smaller projects is that you eliminate the chance of "the wrong person being in charge", since no-one is!

Regarding the role of government in health and education, take a look at this. Not a complete solution, for sure, but a fundamental switch in thinking.


"Labour and Tory alike agree upon the importance of individual choice - regarding where to work and what to buy - as being the foundation of a prosperous society."

While I'm no expert on Keynes, he arguably believed the same thing. I came across a quote from the General Theory recently in which he said he saw "no reason to suppose that the existing system seriously misemploys the factors of production which are in use ... It is in determining the volume, not the direction of actual employment that the system has broken down ... [There] is no objection to be raised against classical analysis of the manner in which private self-interest will determine what in particular is produced, in what proportions the factors of production will be combined to produce it, and how the value of the final product will be distributed between them".

Now, you can argue over whether that is consistent with the rest of his work or even whether it's an internally coherent statement, but it seems clear to me that Keynes didn't see the role of government as the kind of total central planning you envisage.

And the same, I would argue, goes for the World Bank and DFID. Both fund some areas of government spending, sure, but if they were that obsessed with "large-scale planning [as] the best way to produce wealth" why have they been so keen on promoting privatisation in poor countries? DFID does not, to my knowledge, promote government ownership of the means of production in poor countries - in fact, I wouldn't be surprised if DFID funds a narrower range of government activities than we 'enjoy' in the UK, so I just don't see how you can argue that the strong version of central planning is alive and well in development economics. To equate *any* government spending in education, transport infrastructure and economic development with Stalinist control of every aspect of the economy is historically inaccurate and conceptually useless.

"The policy proposals that emerge from such an endeavor are what we already know - the rule of law, a competant and transparent government, private property rights, freer trade etc."

As China has demonstrated. Not.

I should say there's actually some I agree with in your post. I'm personally inclined towards bottom-up solutions - I just think there's a role in poor countries as in rich countries for public spending to enable bottom-up actors to make the most of their opportunities. My reading of the historical record is that a strong and effective public sector is supportive rather than destructive of a strong and effective private sector.

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