If the week before last was dominated by Iraq and the Petraeus/Crocker testimonies then the visit of the Pres. of Iran dominated this week’s. Coverage was extensive and largely unfavorable – which likely played into his hands. He wasn’t talking for us he was posturing for his domestic audience and very effectively and successfully.
There’s a lot of other Iranian and ME news the two most important of which were the secret airstrike by Israel on Syrian targets. Which nobody denies, is perfectly willing to talk about but not to tell anybody anything. “Informed sources”, i.e StrategyPage and StratFor are puzzled but think it likely that three things were going on. There was Nkorean nuclear equipment in Syria, messages were being sent to Syria and others and the key other was Iran. The rest of the news indicates that everybody’s loosing patience with Iranian posturing to the point where there are very…very public discussions of targeting methods and tactical capabilities. The Soviets call that Maskirova – or disinformation. One doesn’t discuss that sort of thing other than as part of such a Masque. What’s happening at minimum is that the pressures are being raised and the continued Iranian support for all insurgents inside Iraq is finally beginning to receive its’ just reward.
On a more hopefully note, and it is incredibly hopeful, Egypt and Saudia Arabia are making serious progress in reforming their institutions and how business friendly they. One can’t under-estimate, despite how much is left to do, how critically important the foundations of a stable, honest and free society is. So let me also draw your attention to the posting on which institutions are critical for economic growth and socio-political development.
Special & General
Egypt, Saudi Arabia Rise in World Bank Rankings Egypt and Saudi Arabia, long considered bureaucratic mazes, changed their laws and regulations to make it substantially easier to start and run businesses, according to a yearly World Bank report that tracks business reforms globally. Among the top 10 "reformers" cited by the World Bank in its fifth-annual ranking were four countries from Central and Eastern Europe (Croatia, Macedonia, Georgia and Bulgaria); two from the Middle East (Egypt and Saudi Arabia); two from Africa (Ghana and Kenya); and China and Colombia. The bank has regularly lauded the Eastern European countries, China and Colombia for reducing barriers to business; the emergence of Saudi Arabia and Egypt is new. Egypt was listed as the top reformer, having made improvements in five of 10 categories affecting business tracked by the World Bank. Developing nations compete with one another to move up on the World Bank rankings of 178 nations, figuring a better ranking will mean additional investment and, ultimately, economic growth.The report also becomes a way for the World Bank's private-sector unit, International Finance Corp., to encourage economic ministries to press ahead with market-friendly changes. A computer simulation model on a World Bank Web site, www.doingbusiness.org, lets officials see how changes in, say, their bankruptcy or tax rules would likely affect their standings. [www.doingbusiness.org ]
· Which institutions matter for economic growth?, by Liam Brunt, Vox EU Historical evidence from a natural experiment in South Africa suggests that changing particular institutions is really only tinkering at the economic margins. Establishing clear property rights, by contrast, facilitates almost all economic interactions and unleashes the full potential of the economy. Several developing economies – such as Vietnam and China – have recently been moving down this road, and history suggests that the economic gains are likely to be large.It is obvious that a country’s political, legal, economic and social institutions will affect its rate of economic growth. However, it is much more difficult to identify exactly which institutions matter and exactly how they matter. This is an issue of some practical importance. Countries are free to redesign their institutions in order to improve their economic performance. But, unless they can pinpoint the beneficial aspects of particular institutions, the only option is to import wholesale the institutional structures of another, more economically successful country. This happened in Japan in 1945 with respect to many US institutions and again recently in Dubai, which adopted the entire panoply of commercial law that regulates the City of London. However, in many cases it may be infeasible or inefficient to change the entire institutional régime, or it may be politically or socially unacceptable. For this reason, it would be useful if we had a better idea of exactly which aspects of which particular institutions were beneficial for stimulating growth. But the evidence on this matter is very mixed.
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as measured by progress on security, stability, political reform and central government development. Which hasn't stopped the MSM punditocracy from downplaying all that or not covering it at all. And of course the Democracts are downplaying for everything they're worth since they announced multiple times last year that the Surge was an abysmal failure before it even got started. And that's not to underestimate the fragilities and risks that are still in front of us or the Iraqis either. But there are two major things, actually three, that are not getting reported in any venue that I can find. As we've already mentioned (WRFest 30Mar08(Iraq): the Emergence of Central Authority) the launching of a major effort on the part of a Shia central government against other Shia is a huge and amazing step forward.
