Sunday, April 10, 2005

More on the Modern State

The diversity of points that were brought up -from economic to social and political- simply show how broad a definition of 'the modern state' can be. Having studied Economics and Economic History, I would like to contribute a few thoughts on the economic and political aspects of development. After all, isn't a modern state one that has been able to develop organically? (Of course, the relationship between economics and politics can always be seen like that between the chicken and the egg, but I don't want to get into that in this post).

Thinkingman, you referred to the examples of the Asian Tigers: Taiwan, South Korea, Singapore; as well as the new emerging economic forces such as China, Poland, Dubai, etc. I think that it is important to remember that the challenges faced by countries such as South Korea or China were very different from those that the Arab World face. Inparticular, the global geopolitical context has changed. Many countries such as South Korea, Japan and the Philippines saw inflows of US aid at a time when the US were strengthening the front against communism. I suppose now one could transpose this to the Middle East and say that countries such as Egypt and Saudi Arabia receive aid in exchange for their participation in "the war against terror". Of course, in all development stories there are common economic and political ills like unemployment and corruption, but while the main objective for the governments of the Asian countries was to lift the population out of poverty, the main challenges in the Arab world have become political.

The smaller the state the better?
Many of the countries cited as successes of economic development actually often had strong states. Corruption did not disappear, but it was targeted; for instance in South Korea alliances were forged between the State and the large business conglomerates known as chaebols. What lacks in our region is a visionary plan. Some may argue Hariri may have been such a visionary. But there is no single recipe. Taiwan's economy, for example, was much more based on small family businesses, which paved the way for the emergence of property rights and political representation.

As Hummbumm mentioned, Lebanon already has a developed banking system, and property rights (although are they always enforced?). Yet I have to disagree: I do not think that limiting the size of government on the assumption that it will be corrupt is the right way to go.
lebanon in the 1950-60s did alright, one of the reasons being a limited government, which led to manageable corruption as govt was a small part of GDP, very little debt, no foreign debt etc... But basically the same political leadership who enjoyed their perks but apart from destroying INTRA bank did not affect the economy too much one way or another. (Hummbumm)
Well, Lebanon did do well economically in the 50s and 60s. The state did not intervene much in economic affairs, yet corruption was still there. However the liberal economic model adopted created important weaknesses in the system which were to resonate significantly in the next few decades(much economic concentration occured, great imbalances emerged between Beirut and the rest of the country). Some academics even believe economic inequality widened substantially, exacerbating internal tensions that lead to the civil war. This view certainly downsizes the importance of external shocks and political factors, yet it raises the question of the sustainability of the economic model adopted in the 1950s.

It's education stupid!
if i was to pinpoint what i think is THE most important thing to change for the Arab world to function better, i would say education: (Mustapha)
Education has been identified as a key aspect of development in the last few decades. This shift from the macro perspective of states and markets, to the micro perspective of human development is illustrated by examples such as Sri Lanka and South Korea. Even for those countries which can grow by being the 'factories'of the world (such as China), it is no longer sufficient to have a cheap, unskilled labour force. Recent history has given us more than enough proof of what can happen when the gullible minds of ignorant people are manipulated. Of course, as Raja mentionned, it is not enough to provide education. States and markets should also create the opportunities for the educated to put to use their knowledge and creativity. But education is a double edged sword. The more educated the people, the more potential the country contains, but the weaker the grip of the state. Which brings me to my last point...

Lessons from Schiller
I went to see a play yesterday: Don Carlos, by the German 18th century playright, Schiller. It takes place at the 16th century Spanish court, when Spain's empire was caught in the stranglehold of the Spanish Inquisition. In the play, the larger themes of freedom of conscience and of expression, and the dignity of the individual, clash with the unforgiving and conservative forces of repression. Schiller actually wrote his 16th-century tragedy to challenge the political absolutism of the 18th century. The ideals of the Enlightenment taken up in the play also appealed to early-20th century German audiences who opposed the regime of the Third Reich. Although the global context and the nature of the repressive forces have changed, the struggle against unquestioning power today can still find echos in Schiller's protagonnists.

Domingo to Alba (both self-interested courtiers):
Elizabeth and Carlos were cast in the same mould-
Reformers, innovators, both over-full of zeal.
They have contracted the same terrible disease: Humanity
And Humanity, you know, is very contagious. (Act II, Scene 9)


Raja said...


Can you say more about the taiwan experience? there seems to be some interesting parrallels btw. taiwan and Lebanon. To list just three:

1. both are relatively small states
2. both business communities are mainly family-run businesses
3. both have much larger neighbors that share the same language and, to some extent, culture.

Also, I didn't quite get your rationale for claiming that the state becomes weaker as people get more educated.

And finally, would you consider Cellis and Libancell as examples of the "targeted corruption" you were talking about? Both companies weren't exactly clean, and they're not chaebols either. But a significant portion of the shares were onwed by Lebanese, they both appeared to be competitive, and they were looking to expand by investing in other countries.

Don Cox said...

Not just education, but relevant education. Students need both professional and intellectual skills, they need to be shown how to ask questions and find things out for themselves.

Rote learning, whether of science or other subjects, is not very useful.

But in some countries, even basic literacy would be a big step forward.

Doha said...

I believe that as much as education is essential, what is more important is linking the skilled labor pool into jobs. Job creation in essence not only leads to economic development, but social and political development as well.

The Arab world has been ailing from unemployment for decades, whether caused by economic reasons or induced by government policy (like in Saudi Arabia for so long.) I believe that when all those educated are put to work, and most importantly in their own countries, we will start to see vibrant societies emerging. A person who is able to meet his and his family's basic needs, will be more invested in the community he lives in whether by caring about its environment or furthering its educational system, etc., will be able to actively participate in politics by voting without necessarily falling in the trap of being "bribed" to vote for this person or that out of need, and will also be more "positive" in his outlook towards the myriad of issues that face us daily. And positive means here the opposite of negativity (hatred, parochialism, ignorance, fundamentalism..)

Therefore, there should be a link between education, employment, and economic development...a surer way to a locally-defined modern society.

Raja said...


I whole-heartedly agree with your link between work for the educated and the emergence of the kind of vibrant societies that we'd like to see in our country.

When the best scientists, businessmen, enonomists, industrialists and educators leave their host countries, who is left in our "civil society"?

Those who remain are the most desperate people who are at the mercy of politicians (and remitances) for food on their tables!

In my opinion, that gives politicians too much power! It gives them the ability to do what they like without taking a strong civil society into consideration. The result, as we all can see, is that politics suffers!

An interesting segway to this comment is Jumblatts call for "members of the opposition" to come up with political programs. I am curious to see what they come up with and how they do it!

Will every single one of them have a plan???

reem said...


Even more than Taiwan, Singapore can be juxtaposed to the Lebanese case: it is small, has about the same population, which is in addition ethnically diverse; it has no resources and had to create its niche in manufacturing first, then in services. The state plays a large role. For example, most housing is state housing. By concretely delivering economic results, the successive governments have been able to avoid political unrest linked with ethnicity. This came at a price, though: I believe that until recently individual liberties and freedom of expression were somewhat curbed...