Free market reforms hurting Iraqi economy.

[Kidlicious]

Originally posted by Imran Siddiqui

I suspect that as long as the country remains in ruins, we will continue to hear cries of 'chaos', regardless of how puny the Iraqi resistance is.

When were we solely talking about Iraqi resistance . We are talking about the mess the country is in without any real leadership. There is a massive power vaccum, which tends to dampen business greatly. People from the government layed off, etc. The violence isn't the entire picture here.

Yes, there is a lack of leadership there. Hopefully that problem will be solved in the next US presidential election.

[MichaeltheGreat]

Originally posted by Kidicious

So import those, but what does that have to do with DVD players?

You were talking as if importing anything was a sin, because the poor picked on Iraqis couldn't compete. DVD players and such are examples of a market sector where they can't hope to compete, but that's not true for all domestic manufacturing.

No way. They had tariffs on imports before. That maintained the local industry. Why do you think that removing those tariffs will support the same domestic industry?

And you're completely ignoring all the distortions in the Baathist economic system which tried to produce a huge (but inept) army, a billion palaces, so much money siphoned out by the rulers it would embarass the likes of Gotti and Capone, etc. Rule of law, intelligent levels of taxation, and reinvestment of foreign currency earnings from oil exports without quite as many layers of corruption will result in a much more competitive local economy for a number of items.

That's going to be a drop in the bucket. They need to get serious about putting people to work. They need to do everything they can. The better plan they have the less money we will have to pour into that place and the more likely that the whole situation will be a success.

You can't put people to work until you have stuff for them to do, and if you try to force a domestic production level that can't be supported by internal supply and logistics, you're still paying people to stand around on their own dicks, while messing things up even more.

Pay 'em to stand around on their own dicks while you fix things, and gradually integrate them into the economy.

[DanS]

First off, the government is excedingly stable, since it is the United States. However, that government has not yet put it paws on all government functions in an effective manner. That will take time.

Secondly, the economy of Iraq is not in chaos. The infrastructure of much of the country is better off now than before the war. The financial infrastructure for the entire country is much better now than before the war and will be immeasurably better over the coming months. Electricity to most areas of the country is much better now than before the war. Water to most areas of the country is much better now than before the war. The only thing worse than before the war for much of the country is security, but that problem can be solved more or less in the near term.

The biggest long-term challenge will be supplying industry with sufficient amounts of electricity. That's going to continue to be tough. You can't run all that fancy schmancy equipment that you bought from all over the Mideast without electricity.

[Kidlicious]

Originally posted by MichaeltheGreat
You were talking as if importing anything was a sin, because the poor picked on Iraqis couldn't compete. DVD players and such are examples of a market sector where they can't hope to compete, but that's not true for all domestic manufacturing.

That's not my point. My point is that if the money spent on the DVD player was spent on Iraqi goods that it would create jobs.

Originally posted by MichaeltheGreat
And you're completely ignoring all the distortions in the Baathist economic system which tried to produce a huge (but inept) army, a billion palaces, so much money siphoned out by the rulers it would embarass the likes of Gotti and Capone, etc. Rule of law, intelligent levels of taxation, and reinvestment of foreign currency earnings from oil exports without quite as many layers of corruption will result in a much more competitive local economy for a number of items.

I'm gonna go with the Chronicle on this one and agree with them that businesses are failing right now because of the imports. I'm fairly certain that's what's occuring.

Originally posted by MichaeltheGreat
You can't put people to work until you have stuff for them to do, and if you try to force a domestic production level that can't be supported by internal supply and logistics, you're still paying people to stand around on their own dicks, while messing things up even more.

Pay 'em to stand around on their own dicks while you fix things, and gradually integrate them into the economy.

Where's your faith in the ability of prices? When people have money and prices go up that encourages people to produce goods and services. I thought we could have agreed on that.

[MichaeltheGreat]

Originally posted by Kidicious

That's not my point. My point is that if the money spent on the DVD player was spent on Iraqi goods that it would create jobs.

So we're going to mandate what people spend their money on? And that's consistent with democracy and freedom how?

I'm gonna go with the Chronicle on this one and agree with them that businesses are failing right now because of the imports. I'm fairly certain that's what's occuring.

And a lot of businesses will fail in any economic transition. Doesn't mean that nothing will come back and replace those businesses. It also doesn't mean that grossly inefficient businesses which sprouted in the sanctions environment won't have to adapt or change themselves.

Where's your faith in the ability of prices? When people have money and prices go up that encourages people to produce goods and services. I thought we could have agreed on that.

And/or it encourages them to drop the local currency and export capital to protect them against inflation, or it encourages them to cut costs if their marginal costs rise faster than revenues, etc. The results depend on the distrubution of money and demand for goods and services in the population, the availability of capital and infrastructure to support new additions to manufacturing capacity, and the rate of inflation. I'm not a fan of radical transformations.

[Kidlicious]

Originally posted by MichaeltheGreat
So we're going to mandate what people spend their money on? And that's consistent with democracy and freedom how?

That's how it works everywhere and everytime.

Originally posted by MichaeltheGreat
And a lot of businesses will fail in any economic transition. Doesn't mean that nothing will come back and replace those businesses. It also doesn't mean that grossly inefficient businesses which sprouted in the sanctions environment won't have to adapt or change themselves.

No, only when there is incompetent leadership following ridiculous dogma.

Originally posted by MichaeltheGreat
And/or it encourages them to drop the local currency and export capital to protect them against inflation, or it encourages them to cut costs if their marginal costs rise faster than revenues, etc. The results depend on the distrubution of money and demand for goods and services in the population, the availability of capital and infrastructure to support new additions to manufacturing capacity, and the rate of inflation. I'm not a fan of radical transformations.

The govt has certain responsibilities here. One is a banking system, which should already be up. Another is helping people start businesses. One can only hope that they won't screw that up.

[DanS]

My point is that if the money spent on the DVD player was spent on Iraqi goods that it would create jobs.

They could not have spent that money on Iraqi goods. That's what I've been trying to impress on you in the last four posts.

I give up.

[Tuberski]

Kidicious has to be one of the best Trolls I've ever seen. You guys are always willing to jump right in the middle with him.



ACK!

[MichaeltheGreat]

Originally posted by Kidicious

That's how it works everywhere and everytime.

Well, funny that. I don't see anyone following me around telling me what to spend my money on.

No, only when there is incompetent leadership following ridiculous dogma.

Yes, the Baathist party's economic leadership was abysmal, and the merger of socialism and kleptocracy practiced by that leadership was pretty ridiculous.

The govt has certain responsibilities here. One is a banking system, which should already be up. Another is helping people start businesses. One can only hope that they won't screw that up.

I doubt they have ATM's on every block yet, but some portion of the banking system is functioning. And "helping people start businesses" isn't our job. We should move towards creating Iraqi authority and letting them decide how they want to grow their economy.

[MichaeltheGreat]

Originally posted by Tuberski
Kidicious has to be one of the best Trolls I've ever seen. You guys are always willing to jump right in the middle with him.



ACK!

It's low grade entertainment.

[Tuberski]

I agree, I have fun reading you guys beating him defenseless, and watching him come back for more.

ACK!

[Kidlicious]

Originally posted by DanS
My point is that if the money spent on the DVD player was spent on Iraqi goods that it would create jobs.

They could not have spent that money on Iraqi goods. That's what I've been trying to impress on you in the last four posts.

I give up.

And I've been trying to impress upon you that they could have and in fact jobs in Iraq have already been lost due to the imports. Furthermore, no significant domestic industry will develope in Iraq as long as free market dogma is followed. I'll bet my last dollar on that. Either they abandon this nonsense or the Iraqi economy will never develope. My guess is that they will eventually abandon it.

[DinoDoc]

Originally posted by MichaeltheGreat
It's low grade entertainment.

You're easily amused, aren't you?

[Kidlicious]

Originally posted by MichaeltheGreat
And "helping people start businesses" isn't our job.

It's this type of thinking that will doom the operation to failure. Mark my word. There is no chance of success.

[Tuberski]

Originally posted by DinoDoc
You're easily amused, aren't you?

Some of us are, yes.

I find it amusing to read, not to argue with him though.

ACK!