On Wednesday night the ASI played host to Mikheil Saakashvili, the President of Georgia. In his speech, Saakashvili explained how Georgia went from an economic basket-case crippled by corruption to the World Bank’s ‘Number One Reformer’: through a programme of privatization, deregulation and tackling the black economy, Georgia shot up from 112th to 11th in the ease of doing business index in just a few years.
However, the main function of the evening was for the President to outline plans for one of the most sensible pieces of legislation enacted since the United States’ Constitution: The Liberty Act. This seeks to constitutionally enshrine the economic reforms pursued since the Rose revolution, by imposing a strict cap on the remit and size of any future government. Under the Act, government spending is not permitted to exceed 30% of GDP, while the budget deficit is capped at 3% and public debt at 60%. Price controls and state ownership of financial institutions are banned, and no new taxes or increase in tax rates can be imposed without a referendum.
The questions from the packed floor covered a wide range of topics, from Georgia’s relationship with Russia and the EU, to monetary policy and the firing of bureaucrats (hear, hear!). One question in particular elicited a marvelous response. When asked why he was seeking to bind his successors, the President promptly replied, “I don’t trust any government, including my own”. British politicians, please take note!