Parts of this are true, others are nonsense:
The world desperately needs a fairer economy – here’s how we can make that happen
Mia Mottley and Ngozi Okonjo-Iweala
Inflation and the climate crisis are hitting developing economies hardest. Trade is the key to helping them
So far so good, yes, trade is indeed the key to that global development which will, for the first time in the history of our species, abolish absolute poverty. That devoutly to be desired end goal being perhaps a couple or three decades away.
International trade has a critical role to play in creating the better jobs, value addition and greater resilience that countries are seeking. We know that over the past 40 years, global economic integration has helped lift more than 1 billion people out of poverty.
Entirely so.
But even before the pandemic, it had become clear that many people in poor countries had not received a fair share of the gains from globalisation.
And that’s not true. Those places that have participated in the globalisation of free market capitalism have got rich. Those folk and places which did not have not. The clue being in the idea that only if you take part in the thing that makes people rich will you get rich.
Open and predictable markets are a prerequisite for this re-globalisation process. But they are not sufficient. Access to finance on prolonged and low-cost terms is an indispensable part of building a more sustainable, more inclusive global economy. The Bridgetown Initiative put forward by the government of Barbados calls for a reassessment of the current global financial architecture to drive multilateral and private sector financial resources towards climate mitigation and resilience. Following through on this initiative could play an important role in addressing the climate finance needs of developing countries and indeed the financing of the sustainable development goals.
But as the evidence of the last 40 years tells us, that first sentence is all that is needed. Free trade - including the freedom to set up and trade - is all that is required. That’s what has lifted that 1 billion out of abject penury. The mistake here is to try and insist - as is being insisted - that since that works we must not do that any more. Instead we must have that guided and political development that doesn’t work.
One obvious point about which is that development, economic growth, is about adding value. If there’s subsidy to the economic activity - especially if that subsidy is necessary - then by definition the activity isn’t adding value. Because things that add value don’t need subsidy, subsidy is definitionally the value that isn’t being added.
One not cynical in the slightest view of the argument being put forward here is that we’ve two politicians insisting that economic development must be politically guided. Otherwise, what use is there for politicians without an economy to guide?
Another entirely uncynical view of the argument here is that now that we know what abolishes poverty - free trade and capitalism - then the insistence is that we must stop using what we know works in abolishing poverty in order to abolish poverty. Which, while an accurate description of the argument being put forward, sounds like very bad logic to us.
Why not, you know, do what we know works, what we’ve established by experimentation? Get the politics and politicians out of the way and leave economic development to the people who actually do economic development - free people deciding what’s in their own enlightened interests?