Economics – Economy Types – Page 3 – education and deconstruction.com

Siberia Bound

The Book of the Week is “Siberia Bound” by Alexander Blakely, published in 2002. This is the personal account of a recent college graduate who decided life in the United States was too easy.

In the early 1990’s, the author moved to Novosibirsk, Siberia to see, with a business partner, whether he, fluent in Russian, could help a region of the former Soviet Union make the transition from Communism to capitalism. He and his partner borrowed money to buy cocoa beans and sold them to chocolate factories on credit.

Blakely wrote about Siberian culture. One amusing passage told of the detergent brand “Barf” imported from Iran. “Things got dirty all the time: In summer, it was dust and car exhaust. In winter, it was coal soot and body odor trapped by layers of insulation.” The relationship between Blakely’s business partner’s wife and her mother-in-law was less than friendly. This was partly because the wife spoiled her young daughter, and the mother-in-law was strict with her– the opposite behavior of mothers and grandmothers in American culture.

Sadly, the moral of the author’s story became “Be careful what you wish for.” He realized that the major cultural, political and economic changes taking place in his community meant that Siberians had become like Americans. They started riding in cars instead of walking. They ate fatty foods for lunch and the men stopped exercising. The women started going to aerobics classes at the gym.

Blakely thought that bringing capitalism to them would be a good thing. However, they soon developed an insatiable appetite for consumer goods. Once they were made of aware of their severe deprivation by the media and increased their connections with the rest of the world, they became depressed. Previously, they had been happy due to their ignorance of how materially poor they were.

Read the book to learn of the sea changes taking place at the author’s business, which sold not just chocolate, but surgical gloves, potatoes and other products; and the formerly Communist community, over the next four years.

Jeffrey Sachs

The Book of the Week is “Jeffrey Sachs: The Strange Case of Dr. Shock and Mr. Aid” by Japhy Wilson, published in 2014. This ebook emphatically argues that the highly influential Ivy League economist Jeffrey Sachs has wreaked havoc on at least three nations’ economies in the last thirty years with his non-stop publishing, lecturing and implementation on and of, (in the author’s opinion) delusional, elitist, anti-communist, anti-union schemes; he is, arguably, an economics criminal, so to speak (the counterpart to a war criminal) in that the implementation of his policies caused deaths. As an aside, this blogger disagrees with the author’s spelling of “publically” rather than “publicly.”

Sachs has refused to acknowledge that his “shock therapy” method employed in Bolivia, Russia and Poland was a dismal failure. It was supposed to help them make the transition to capitalism through conferring responsibility for previously government-led distribution of goods and services, to private citizens without warning them of extreme measures to be imposed in accomplishing this. The countries were forced to adopt a model at the far opposite end of the spectrum of the welfare state.

Sachs’ first victim, Bolivia, was experiencing 60,000% inflation and 20% unemployment in the summer of 1985. By 1987, pursuant to Sachs’ plan, a free market had been created, but the costs included a 50% higher unemployment rate and a 40% lower real-wage level. Over the next five years, the mining and industry sectors lost jobs by the tens of thousands.

In Russia, a few powerful wealth owners were already experienced in “managing” assets, so their receiving additional private property– with no laws requiring them to treat their workers in a humane manner– made them even more exploitative. In the early 1990’s, leader Boris Yeltsin became a convert of Sachs. The result was mass corruption. On the other hand, this has helped the United States and other nations with already evolved capitalist systems to maintain their economic dominance in the world. This blogger is not saying such a goal is right or wrong, but merely suggesting that this might have been Sachs’ goal.

Sachs also helped the rich get richer in Uganda, by providing specially chosen farming families with certain resources, such as fertilizer and seeds, in a few villages. The goal was to have those politically connected farmers “… magically combine entrepreneurial self-interest with community spirit, based on a patronizing representation of the deserving poor.” This smacks of a similar kind of mentality in the New York City schools under former Mayor Michael Bloomberg in the early 2000’s, based on the mistaken notion that all students were bound for college. Sachs’ program started charging money for conferring some of its resources, “… which inevitably privileges those with the ability to pay.” Bloomberg imposed various policies (still in effect as of this writing), that inevitably privilege those students who have the ability to pay for private school, and testing and tutoring services. That is just the tip of the iceberg in both cases.

A World Trade Organization conference in Seattle in 2000 was discontinued because “… Suddenly, this orderly world of billionaire philanthropy and elite policymaking was overturned by massive street protests involving unions, NGOs, and activist groups, demanding an end to the global neoliberal agenda of free trade, privatization, and corporate power.”

Read the book to learn of additional outrages associated with Jeffrey Sachs.

Burned Bridge

The Book of the Week is “Burned Bridge, How East and West Germans Made the Iron Curtain” by Edith Sheffer, published in 2011.

This book discusses the history of the splitting of Germany post-World War II, and its effects on Neustadt, a Western border city, and Sonneberg, an Eastern border city, both connected by Burned Bridge. Pursuant to agreements made at Yalta, “… on July 1, 1945, Soviet forces entered Sonneberg, and the U.S. Army withdrew into Neustadt… bighearted Americans distributing gum and chocolate from tanks with images of brutish Soviet solders in tattered horse-drawn wagons.”

In the late 1940’s, frequent border-crossers included black marketeers, undocumented workers, refugees and begging children. In both the East and West, border guards were easily bribed to accept fake travel permits. Families had been rent asunder by the creation of the artificial border.

In 1952, the East German government cracked down on border residents who had made, or were liable to make trouble– activists and frequent border-crossers who might spread the word to Easterners about the Western (capitalist) way of life– by forcing Easterners to move farther east, away from the border. Through the 1950’s, the East German government launched propaganda campaigns to lure former Easterners back to Sonneberg, offering residences, jobs, wages and farms superior to previous ones. Returnees exploited such opportunities, obtaining high-level education for their children as well, in the process. The physical Wall was erected in August 1961.

For about a decade after the war, West Germany flourished economically, after which various untoward events in the 1960’s and 1970’s slowed its growth. There occurred the scandalous Spiegel Affair, violence stemming from student and anti-nuclear protests, terror perpetrated by the Baader-Meinhof gang, oil shocks and anti-immigrant sentiments.

The late 1980’s saw a relaxation of westward travel. Nonetheless, the East German government was resistant to change, and continued to oppress its people through the fall of 1989. In November, dissatisfaction reached critical mass. “Most still recall exactly where they were and what they did when Burned Bridge opened, and cry with joy at the memory.” During reunification of East and West, people who were infrequent border-crossers experienced shock at the stark economic, cultural and social disparities between the two.

Street Without A Name

The Book of the Week is “Street Without a Name” by Kapka Kassabova, published in 2009. This autobiography describes the brand of Communism the author experienced as a child in 1970’s and 80’s Sofia, Bulgaria, and the Bulgarian historical events that interested her.

It was an unspoken, dirty little secret that the Communist lifestyle was actually inferior to that of the West. The Bulgarian government told the people that “Politburo comrades were heroes of the anti-Fascist resistance” and “the labor camps were for enemies of the people.”

The author’s mother branded Bulgaria’s leader and his cronies “idiots in brown suits.” The State oversaw all academic, athletic and musical events, such as a contest called the Olympiads, in which grade-school kids competed in different subjects. At ten years old, Kassabova was convinced that the West consisted of drug addicts, criminals, capitalists and dreadful child labor, based on one story: Dickens’ “David Copperfield.”

Her parents both worked in the field of engineering, which placed the family in the middle class. Even so, the family lived in a third-class (out of four classes) concrete neighborhood where blocks were numbered. At the furniture store, there was a three or four-month waiting list for shelves and beds, that only afforded one the opportunity to physically fight for the desired items when the delivery truck arrived at the store in the wee hours.

One time, when the author was eleven, her father met someone from the Netherlands through his work, and invited his family to go “camping” with his own, on the outskirts of Sofia. The Dutch visitors arrived in a recreational vehicle (RV), while the Bulgarian family had brought a hard-to-obtain, shabby military tent. (As an aside, the cost of the RV equalled about twenty years’ worth of the author’s mother’s income.) The Dutch were horrified by the disgusting state of the toilets, and the “rubbish and dogs everywhere.” The Dutch, in addition to their sparkling new vehicle, brought Western goods, including Gummi Bears, chocolate biscuits, juice in little cartons, and one of ten varieties of potato grown in their home country.

The Kassabovas knew their standard of living under Communism was way overrated by their government but they could not leave Bulgaria– until the Berlin Wall fell. Even then, they had to complete a ton of bureaucratic paperwork and wait years. During such time, the author’s mother underwent a stay in the hospital, where there were newspapers instead of sheets, and soap and towels had to be provided by patients themselves. The author’s father paid a large bribe to the head doctor so as to see the patient emerge from the hospital alive; during Bulgaria’s transition to capitalism, there was more corruption than before– which is saying a lot.

Read the book to learn more about the author’s perspective on her life and birth country.

Crossing the River

The Book of the Week is “Crossing the River” by Victor Grossman, published in 2003.

This autobiography tells how an American defected to East Germany during the Korean War. A very unusual story, indeed. He was brainwashed by both his parents, intellectual Communists, in the 1930’s and 1940’s.

He tried to rationalize his penchant for suffering by saying that the cruel and unusual goings-on in the US actually provided a worse way for people to live, than the East Germans did. In the early 1950’s, the McCarthy era was in full swing, the US had ousted the leader of Guatemala in a bloody affair, and instigated another shameful coup in Iran; there was the ugliness at Peekskill, there was still segregation; besides, the Soviets had helped defeat Germany. Comrade Stalin was a god, to the Communists.

The author argues that in 1960, the quality of life wasn’t so bad in East Germany. Yes, there were severe food shortages, but everyone’s medical care was paid for, and everyone had a job or was provided with necessities for survival, and assistance for finding a job, according to his own need. Of course, the people also spent needless hours every day manually washing clothes and dishes, lighting a fire in the pot-bellied stove, and patiently waiting for unreliable public transportation, or hoofing it, because they couldn’t afford a car.

In the early 1960’s, the East Germans kept trying to attack the integrity of the Federal Republic (of West Germany) (with good reason) by publicizing the fact that a large number of ex-Nazis (who had committed unspeakable war crimes) were working in civil service– as judges, even(!) and in the West’s armed forces. It was somewhat alarming that so many Nazis were helping Germany to re-arm, and becoming a pivotal force in NATO.

In the late 1980s, the East German leaders staged a few media incidents, trying to continue to isolate the “German Democratic Republic” (the misnomer that was East Germany) clinging to power, believing that only they could be keepers of the flame. The East Germans, like the Chinese, were into self-criticism circles. They had “tutors”, who bullied doubters and discouraged free-thinkers, cutting them down with questions such as, “Are you questioning the collective judgment of experienced Marxist leaders, able to assess factors far better than any individual? Could you be more correct than they are?”

It was a traumatic time for the author when Khrushchev revealed Stalin’s crimes in the mid 1950’s. But the author continued to rationalize that his adopted homeland was still a better place to live than imperialist America. It’s an excellent book anyway.