Sunday, March 13, 2011

What Is A Brazilian Baboon Wax

THE MIRACLE OF MAURITIUS

OF JOSEPH STIGLITZ project-syndicate.org

Suppose someone were to describe a small country that provides free college education for all its citizens, school transportation for children and free health care - including cardiac surgery - for everyone. One might suspect that this country is extraordinarily rich or prefereziale lane for a fiscal crisis.

After all, the rich countries of Europe are increasingly realizing that they can not pay for university education, and ask young people and their families to bear the costs. For their part, the United States have never attempted to offer free college for everyone, and it took only an uphill battle to ensure access to 'health care to poor Americans - a protection that now the Republican Party is working hard to destroy, because the country can not afford it.

But the island of Mauritius, a small nation off the east coast of Africa, are neither particularly rich nor on because of budget crisis. However, they have spent the last decades to successfully build a diversified economy, a democratic political system, and a strong social safety net. Many countries, not least the United States could learn from his experience.

In a recent visit to this tropical archipelago of 1.3 million people, I had the opportunity to see some of the progress made in Mauritius - achievements that may seem puzzling in light of the debate in the U.S. and elsewhere. Consider home ownership: while American conservatives say the government's attempt to extend home ownership to 70% of the U.S. population has been the cause of the financial meltdown, 87% of Mauritians have their own home - no food no housing bubble.

But now comes the difficult to Mauritius's GDP has grown faster than 5% a year for almost 30 years. Surely, there must be a trick. The Mauritius should be rich in diamonds, oil, or some other valuable commodity. But Mauritius has no exploitable natural resources. In fact, when approached independence from Great Britain, obtained in 1968, the prospects were so sad that the winner of the Nobel Prize for Economics in 1961, James Meade wrote: "It will be a great result if [the country] will be able to ensure productive employment for its population without a severe reduction of current levels of life. ... The prospects for a peaceful development are weak. "

How to show that Meade was wrong, Mauritians have increased the per capita income less than $ 400 at the time of independence to more than $ 6,700 today. The country has progressed from monoculture of sugar-based 50 years ago to a diversified economy, including tourism, finance, textiles, and, if current plans will bear fruit, advanced technology.

During my visit, my interest was to understand better what had led to what some have called the Miracle of Mauritius, and what you might learn. There are, in fact, many lessons, some of which should be kept in mind by policy makers in the United States and elsewhere, who fight their battles in the budget.

First, the question is not whether we can afford to provide health care or education for all, or guaranteeing home ownership in a widespread manner. If the Mauritius can afford these things, America and Europe - which are several orders of magnitude more rich - can too. The question is rather how to organize society. The Mauritians have chosen a path that leads to higher levels of social cohesion, welfare and economic growth - and at a lower level of inequality. Second

place, unlike many other small countries, Mauritius has decided that most of the military spending is wasteful. It is not necessary that the United States come to this: only a part of the money that America spends on weapons against enemies that do not exist, would go a long way towards creating a more humane society, including healthcare and 'not whether the education to those who can afford it.

Thirdly, Mauritius acknowledged that without natural resources, its only resource was the people. Perhaps this appreciation of its human resources is also what led to the Mauritius to realize that, given the differences in religious, ethnic and political of the country - some had tried to exploit to cause it to remain a British colony - education for all was essential to social unity. So there was a strong commitment to democratic institutions and cooperation between workers, employers and government - exactly the opposite of that kind of dissent and division which is now led by conservatives in the United States.

This does not mean that in Mauritius there are no problems. Like many other successful emerging market countries, Mauritius is affected by a loss of competitiveness of the exchange rate. And, as more and more countries have intervened to weaken their exchange rates in response to the attempt to make America competitive devaluations by quantitative easing, the problem is getting worse. Almost certainly, also Mauritius will have to intervene.

addition, like many other countries, Mauritius today are concerned about imported inflation from food and energy. Respond to inflation by raising interest rates would only aggravate the problems of high prices with a high unemployment rate and a much less competitive. Direct intervention, restrictions on capital inflows in the short term, capital-gains taxes, and stabilize the banking system through prudential regulation, are all measures that should be considered.

The miracle of hard Mauritius since independence. But the country's fight even with some of its colonial legacy: the inequality in land ownership and wealth, as well as vulnerability to global politics at high risk. The United States occupies an island off the coast of Mauritius, the Diego Garcia, as a naval base, without compensation, officially hired by the United Kingdom, which has not only maintained the Chagos Islands, in violation of United Nations and international law, but has also expelled its citizens and refuses to allow them to return.

The United States must now act well towards this country peaceful and democratic Mauritius to recognize the legitimate property of Diego Garcia, to renegotiate the lease, and redeem the sins of the past by paying a fair sum for the land illegally occupied for decades.

Original version:

Joseph Stiglitz
Source: www.project-syndicate.org
Link: 03/07/2011 http://www.project-syndicate.org/commentary/stiglitz136/English


Italian version:

Source: http://vocidallestero.blogspot.com/
Link: 09/03/2011 http://vocidallestero.blogspot.com/2011/03/il-miracolo-delle-muritius.html


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