None of it worked. Transition had no grassroots support and its
prescriptive - and painful - nature caused wide resentment and
obstruction.
The process of transition informed us that markets, left to their own
devices, unregulated and unharnessed, yield market failures, anomies,
crime and the misallocation of economic resources. The invisible hand
must be firmly clasped and guided by functioning and impartial
institutions, an ingrained culture of entrepreneurship and fair play,
classes of stakeholders, checks and balances and good governance on all
levels.
Wealth, behavioral standards, initiative, risk seeking - do not always
"trickle down". To get rid of central planning - more central planning
is required. The state must counteract numerous market failures ,
provide some public goods, establish and run institutions, tutor
everyone, baby-sit venture capitalists, enhance innovation, enforce
laws and standards, maintain safety, attract foreign investment, cope
with unemployment and, at times, establish and operate markets for
goods and services. This omnipresence runs against the grain of
Anglo-Saxon liberalism.
Moreover, such an expanded role of the state sits uncomfortably with
complete political liberty. That capitalism is inextricably linked to
democracy is a well-meaning fallacy - or a convenient pretext for
geopolitical power grabs.
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