Thomas Donlan's Excellent Point

I'm sure Tom Donlan wasn't thinking of Dambisa Moyo when penning this week's Barron's editorial. Yet one line brought the Zambian economist to my mind:

China's adoption of capitalist methods has lifted more people out of poverty than all the world's foreign aid since World War II.

Reading the Financial Times this weekend, I see that backers of the failed Aid-model are increasing their attacks on Moyo. Even going so low as to make their attacks personal. Oh well, so much for honest, open debates.

She seems like a brave and courageous lady from what I've seen. That she has the facts on her side is even better.

Comments

[Patrick]

I'm a fan and poster on your blog for a couple years, I enjoy it and hope you continue your good work.

But I think the rise in Chinese prosperity has more to do with its increase in openness to FDI rather than an embrace of capitalism. Capitalism requires protection of property rights, transparent courts, market pricing of interest rates and goods, and consumer- and investor-driven allocation of capital. As the 10s of millions of Chinese returning to their villages becomes 100s of millions, we may learn that the Chinese peasant gains may be as ephemeral as the trillions of dollars of gains to the American banking class. If this were the case, the Chinese could pride themselves on fleecing foreign investors rather than the their fellow taxpayers. One thing I have learned from our current crisis is that in terms of judging economic success, you should take everything with a grain of salt - 20 years is a very short time in terms of economic history.

[John]

@Patrick: Thanks for reading, and I'm glad my Japanese consumer lender disasters didn't run you off! ;-)

I think the Mainland Chinese are more or less capitalist, but that's just MHO. My point is that what's gone on in Mainland China over the past 30 years has benefited average folks there far more than the aid-model has benefited average folks in Africa over the same time frame.