Ethics and the Modern Economy

Josh Ruxin gives Us a clear picture of the difference between Present-Day Kenya and the 1994 genocide in Rwanda, though his analysis of the economic consequences may be a little flawed. The root of both Conflicts remain Tribal antagonisms, and each was incited by an attempt to impose One-Party Rule by a significant Tribe. I include this Opinion because it highlights the fallacy of expecting too much Gain from the provision of Economic Aid to underdeveloped countries. Rwanda and Kenya each had a fairly stable, growing economy prior to the instigation of Violence; Kenya serving as a Pearl of African development. Tribal conflict will always destroy economic opportunity far faster than economic development can build, and economic aid must be distributed equally between Tribes, lest Tribal jealousy will lead to suicidal destruction to economic underpinnings. Such a Scenario always requires introduction of firm democratic institutions, before economic inputs can survive the rivalry.

The Chinese possess a long tradition of the suppression of Workers, and economic fuel from Developed nations can incite a prolongation of that subjugation because of its insistence on the cheapest production costs. Plant managers will always hide hazardous conditions for labor, if those same practices provide substantial savings in production costs. Business personnel from Developed nations inevitably limit their interaction with Natives to Plant management personnel, they literally aware that knowledge leads to added Costs to themselves in the final prices which they will pay. The Short-Sightedness of such polices lead to destruction of domestic Production in the Developed nations, the shift of Production Costs unto Native labor through destruction of their labor potential, and grant corrupt Native management undue wealth and control in Native societies. The sadness of the entire situation comes from the fact that such Gains will always be temporary, and only lead to the enrichment of criminal elements in the economies of both Native and Developed nations.

This article relates to the previous articles in a profound way, though most Economists will deny the connection. We have a Housing slump occasioned by the issuance of bad Mortgages, a practice engendered by an over-rapid increase in Home prices over the previous decade; a Condition created by an Imagery that Housing would pay for itself, which it won’t. The benefits of Outsoucing Production has long been canceled by higher Materials pricing, especially Oil. Business Investment has been channeled Overseas, and the business managements of Developed nations are finding that traditional labor Costs have not disappeared–only been shipped Overseas. The domestic economies of Developed nations, though, have been ripped apart by the loss of resiliency within their own Consumption markets, having disrupted their own Profit margins. The Situation faces many difficulties, and I am reminded of the old biblical story of Seven Fat Cows followed by Seven Lean Cows. We may have to trim a lot of Fat to make the Lean Cows survive. lgl