There are other ways to increase per-capita incomes

Author: 

There are other ways to increase per-capita incomes, of course, but they are limited. Leaders can put more people to work and compel them to work harder. But how far can you push people? Maybe an additional 10 percent, and then what? They can extract more raw materials (ores, lumber, etc.), assuming they are available, but there are limits to how much can be obtained and used. They can put more land under cultivation, but that too is limited by peoples' appetites. As an alternative, we must produces more and better goods and services for own people and for producing goods and services for trade with foreigners.

This requires large amounts of money ("capital"), which cannot be accumulated at home because that requires technology. It's a vicious cycle -- technology depends on capital, which depends on technology, etc. Thus, an initial loan or grant of "seed money" is required. Such loans, as we have seen from World Bank, IMF, and WTO efforts. There is an complex interplay of economy and polity, that produce known, effects, success of capital.

Poor transportation facilities must devote much of the acquired capital to improving it. This was done in the formative years in the US Otherwise, supplies cannot reach producers and products cannot reach customers cheaply enough to be bought by those with modest incomes. Even within countries with relatively few mountains and many waterways, such as in the US, the government of which has spent enormous sums of money, effort to reduce the inequalities of location, the poorest people today are located in mountainous, waterless regions. In the US, the state counties located in the Appalachian, Rocky, and Ozark mountains are the poorest. In contrast, those counties located in watered plains are the richest. Scanning the U.N. list from top to bottom, the only rich country that has too many mountains and too few navigable waterways is Switzerland.

We are talking here not only of innovative scientists and engineers -- but technicians, the people who must know enough math and science to make small decisions involving the operation of increasingly complex machinery. With a few exceptions, like China, Philippines, Indonesia, India, and some South American countries, the educational systems are abysmally antiquated.

 
On the other hand, those countries that prefer to spend time and education on religion matters cannot expect to enjoy high per-capita incomes unless they are among the fortunate few that sit above precious petroleum, gold or diamonds.

Furthermore, economies all over the globe, from small utopias (New Harmony, Lanark, Oneida in the US) to colossal nations (Russia, China), with very few exceptions, have given up on their attempts to establish societies because equality and incentive economy.
Copyright mediaforfreedom.com

Column: