Why the Romans profited from their empire but the British did not from India

The British did not develop India because that would made it a worthwhile prize for another to steal. Rome face no serious rivals so we could take a long-term view on investing in colonies.

A prosperous colony is an attractive colony to conquer so imperial army and navy resources would have deployed to defending it. Prosperous locals and locally recruited troops can switch loyalties.

An empire full of prosperous colonies makes you an attractive target for other European powers to gang up on and divide the spoils. This may explain why some colonial powers had mixed feelings about developing their colonies. Robert Lucas observed that:

Stagnation at income levels slightly above subsistence is the state of traditional agricultural societies anywhere and any time. But neither did the modern imperialisms—the British included—alter or improve incomes for more than small elites and some European settlers and administrators…

The main economic event of the late 20th century was this diffusion of the Industrial Revolution to non-European societies (begun in Japan half a century earlier), a diffusion that will surely continue throughout the 21st century. A central question is why it did not begin much earlier, during the colonial period, at the same time that the Industrial Revolution was spreading throughout Europe.

France lost its once vast North American colonies through wars. Many colonies changed hands after the countless European wars as part of peace settlements.

Australia was first colonised in 1788 as a penal colony. Very expensive to do, but the British did fill-up the only valuable part – Sydney harbour – with 60,000 mainly riffraff and low life.

This penal colony for a number of decades made the only valuable part of Australia more unattractive to other European powers to conquer. Doug Allen explains:

In the case of Australia, the hypothesis might appear silly. How much reduction in the first-best value to a continent can come from 60,000 convicts?

However, one must keep in mind that the only value of Australia at the end of the eighteenth century was from Sydney Harbour, Norfolk Island, and a few other strategic locations.

On these margins, the convicts could lower the value considerably … After the War of 1812 Britain realized the strategic significance of Bermuda and subsequently established a penal colony there.

Deirdre McCloskey pointed out that by the middle of the 19th century, British traded with India with few opportunities for exploitation. What was the price of that?

The cost of protecting the Empire devolved almost entirely on the British people. (A century earlier the British had likewise paid for the defense of the first empire, in what is now the United States; the colonials refused to pay as little as a small tax on tea for imperial defense.)

British taxpayers 1877-1948 paid for the half of naval expenditure that was for imperial defense, a by no means negligible part of total British national income each year. They paid for the Boer War. They paid for the imperial portions of World Wars I and especially II. They paid for protection of Jamaican sugar in the 18th century and protection for British engineering firms in India in the 19th. They paid and paid and paid.

What were the vaunted benefits to the British people? Essentially nothing of material worth. Bananas on their kitchen tables that they would have got anyway by free trade. Employment for unemployable twits from minor public schools. The joy of seeing a quarter of the land area on world maps and globes printed in red. Economically, it did not matter. Public education mattered a great deal more to British economic growth, as did a tradition of industrial and financial innovation, and a free society in which to prosper…

Rich countries are rich mainly because of what they do at home, not because of foreign trade, foreign investment, foreign empire, past or present.

 

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Jane Kelsey oppose handcuffs on the democratic choices of future governments! Does she opposes labour and environmental standards in trade agreements too?

https://twitter.com/JimRose69872629/status/651230008875220992

One of my policy essays for my Masters of Public Policy Degree in Japan was on the social clauses of the GATT. I described the labour and environmental clauses is a new form of colonialism.

My classmates were government officials from all around Asia, more than 20 countries. As they spoke English as a second language, they were pleased to learn of a new way of describing social clauses in trade agreements in English.

A Filipino friend had a blunter way of referring to social clauses in trade agreements: “the whites are back, telling us what to do”.

Utopia - you are standing in it!

Jane Kelsey in a television interview said she opposes the reductions in sovereignty in trade agreements that result from investor-state dispute settlement (ISDS) provisions because they limit the democratic choices of future governments.

If so, she must oppose environmental and labour standards in trade agreements and, more importantly, binding the hands of future governments with climate treaties. All international treaties are about restrictions on sovereignty.

Environmental and labour clauses in trade agreements and climate treaties all limit the powers of governments to legislate on environmental and employment law in accordance with the will of the people as expressed in the most recent election and change of government. Power to the people.

Jane Kelsey would do better focusing on those parts of the TPPA deal…

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The depth and breadth of European colonization 1500-1900

The Middle East and North Africa looked very different in 1914

Renegade liberals and the withering away of the proletariat

George Orwell, in his proposed preface of Animal Farm, wrote of the “renegade liberal”. Renegade liberals glorify socialist experiments and disdain middle-class life despite their own pleasant circumstances.

Renegade liberals search the globe for outlaw states and revolutionary movements to support, who, of course, would ship their local versions of these renegade liberals straight to the camps as soon as they won power. Iran, Castro and Hugo Chávez are their latest rebels without a clue.

The revolutionary excesses of the new socialist or Anti-American regimes are excused as the misadventures of ‘liberals in a hurry’, who understandably lost patience with the slow pace of democratic reform. It is all in the name of liberating the proletariat from their misery or throwing off the dead hand of colonial rule.

How is the immiseration of the proletariat going these days?

  • The immiseration of the proletariat is the central prediction of Marxism, the driver of class conflict, and this growing misery and poverty is what will finally push workers to wage a revolution against the capitalists.
  • It is a bit hard to argue that workers are poorer today than in 1848 when the Communist Manifesto was written. The central Marxist prediction is falsified by history.

I agree with G.A. Cohen when he argues that there is no group in advanced industrial societies united by:

  1. being the producers on which society depends;
  2. being exploited;
  3. being, in conjunction with their families, the majority of society; and
  4. being in dire need.

To avoid the inconvenient truth of modern affluence and the move of so many of the proletariat into the middle class, renegade liberals search endlessly for under-developed countries so they can blame their poverty on capitalism.

When they visit them in solidarity, these renegade liberals should read the visa stamp: ‘people’s republic’ or ‘socialist republic’ is so frequently on it. It is still mandatory for all political parties in India to be committed to socialism.

fidel.JPG

Nearly all of Asia (where much of the world’s population lives) has undergone rapid and sustained economic and social progress because they became market economies, starting with the Asian Tigers and recently in previously socialist India and communist China. Latin America adopted the inward economic polices of the mid-20th century that renegade liberals praise so much and they became development disasters.

As the world embraced free market policies in the late 20th century, living standards rose sharply; life expectancy, education and democracy improved and absolute poverty declined. Xavier Sala-I-Martin and Maxim Pinkovskiy (2010) found that between 1970 and 2006, poverty fell by 86% in South Asia, 73% in Latin America, 39% in the Middle East and 20% in Africa. The percentage of people living on less than $1 a day (in PPP-adjusted 2000 dollars) fell from 26.8% in 1970 to 5.4% in 2006.

To go further, P.T. Bauer disputed the lack of development in British colonies. Bauer argued that much of British colonial Africa was transformed in the colonial period.

Peter Bauer

Before British rule, there were no rubber trees in Malaya, no cocoa trees in West Africa, no tea in India:

“…Much of British colonial Africa was transformed during the colonial period. In the Gold Coast there were about 3000 children at school in the early 1900s, whereas in the mid-1950s there were over half a million. In the early 1890s there were in the Gold Coast no railways or roads, but only a few jungle paths…

Before colonialism, Sub-Saharan Africa was a subsistence economy, because of colonialism it became a monetized economy.

Before colonialism, the absence of public security made investment impossible.

After it, investment flowed. So too was scientific agriculture introduced by colonial administrations, or by “foreign private organizations and persons under the comparative security of colonial rule, and usually in the face of formidable obstacles…

In British West Africa public security and health improved out of all recognition… peaceful travel became possible; slavery and slave trading and famine were practically eliminated, and the incidence of the worst diseases reduced..” (P.T. Bauer)

Some colonial powers were better than others. After 500 years of Portuguese rule in East Timor, in 1975, there was one road – to the governor’s house – and the phone number of the Australian consulate was 7! Portugal itself may have not been much better at that time too. Colonial masters are like parents. You must choose them well.