Posted on 12/20/2007 12:12:28 AM PST by bruinbirdman
Middle East peacemakers should take a cue from what's been happening in Northern Ireland. The dispute there between Protestants and Catholics has been bloody and has lasted for more than three centuries. Yet there now seems to be real progress toward peace. Why? Not because diplomats suddenly became more able but because of the profound changes to the south, in the Republic of Ireland, which for centuries had been one of the poorest economies in western Europe.
Things started to change dramatically in the 1970s. Dublin aggressively courted foreign investment, using tax cuts and tax holidays as bait. Other tax and regulatory changes were made. Result: Ireland today is the most vigorous economy in western Europe. Its per capita income is now larger than that of Britain, France or Germany. The great boom in Ireland did not go unnoticed in the North, and in fact that region has benefited greatly from the Republic's prosperity. A vigorous, new middle class is rising in all of Ireland. As people become more prosperous they tend to focus on bettering their lives more than on blowing up their neighbors.
One of the things our diplomats should be pressuring Mideast countries on is economic reform. That does not mean the IMF, whose economic prescriptions of devaluation and higher taxes are always toxic. Instead, we should be firmly advocating genuine changes that will bring about prosperity. One would be a Hong Kong-like flat tax. Another would be currency boards, such as Estonia's, or a variation of one, such as Latvia's, which have stabilized the once inflation-prone currencies of those two countries. More reforms could be taken from the World Bank publication Doing Business, which surveys 178 economies on everything from the ease of setting up legal businesses to enforcing contracts. It's no surprise that most Mideast countries (as well as African ones) are economic laggards. One happy exception is Egypt, which seems to be making real progress in instituting pro-growth policies. A vibrant middle class, long term, is the key to genuine and lasting peace.
Something we should have pushed at the recent Middle East peace summit in Annapolis, Md. is for the Palestinian government, such as it is, to enact pro-growth policies.
Israel has made significant changes--especially under Benjamin Netanyahu, who was finance minister (2003--05)--but it could do a lot more, including instituting a low-rate flat tax. Until recent years, in fact, Israel's economy was grossly overregulated, overtaxed--hardly an inspiring free-enterprise model. The faster it can move to a Hong Kong/Estonia/Switzerland model, the better for its own well-being and security. A free-enterprise boom would be noticed by neighbors--and quietly emulated.
Without private property rights and the rule of law there’s no foundation for prosperity.
Ireland also benefits from a series of very generous cash donations from the European Union - in other words, Britain, France and Germany paid for their economic “miracle”.
Sorry, Steve, it’s a little tough to preach rational behavior to irrational murdering thugs. Even the IRA preached “talk-talk, fight-fight”. All you get from Hamas and Fatah is “murder-murder”.
Forbes puts out a foreign policy feeler for Rooti Tooti, gets four different negative first impressions.
Huckabee put his foreign policy thoughts in CFR and got slammed.
It will be interesting to see if Giuliani issues a foreign policy white paper that deviates from the above Forbes screed.
yitbos
Their aid certainly helped Ireland, but no country can go too far without certain things in place. Look at what our foreign aid HASN'T done for many countries around the world. Countries that don't have the rule of law and educated citizens willing to operate a free-market system will blow all the money dumped on them no matter how much moola is given to them. The Irish just needed a change in their tax laws and a little economic stimulus. Give them some credit.
Fair enough, I accept that they have used the cash they have been given very wisely.
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