Unpopular Opinion: We need to initiate a new Marshall Plan and increase the budget of DFID

by Tom Guyton-Day 4 months ago in politics

North Africa.

Unpopular Opinion: We need to initiate a new Marshall Plan and increase the budget of DFID

When the Americans initiated the European Recovery Programme, in 1948, the US provided over $15 Billion (a staggering $159 Billion in 2019 prices) to help an impoverished and war torn Europe reconstruct its cities and hold communism at bay.

The idea being that these recovering European nations would one day provide as consumers for American exports, help to drive economic growth through fostering trade links between each European state, but also the US. The idea also encouraged Germany and France to hug each other so very tightly that they couldn't hit each other for example and keep world peace against the USSR.

Post WWII Europe was in something of a great desperate hole, with millions of its citizens being killed or seriously wounded in World War II, along with other related atrocities such as that of the Holocaust.

Reports provided to Marshall (the namesake of the scheme) had suggested, many regions on the continent were sitting on the brink of famine, as a result of war disrupting agriculture and food production due to the fighting.

Along with this, much of the major infrastructure, the roads, bridges, railways, and ports of the continent, major arteries of trade, had been badly impacted by years of war and were in need of major repair to get the continent back up and running.

There are many problems that arise in much of North Africa. Some are very similar to that of Europe post-war - specifically the under investment in rail, road, and ports. However, parts of North Africa represents sections of the world with a great deal of opportunity and if given the right monetary resources could prove to be a wealthy middle class customer for US/EU goods and a stable part of the world to further the cause of Western values...

Much of North Africa does not fall into the major development traps that Economist and Professor Paul Collier outlines in his book 'The Bottom Billion". The four major limiting factors appear to be conflict, natural resources, being landlocked, and bad governance.

Most countries in North Africa are close to the ports on the Mediterranean coast; most countries have few natural resources (more so in the North West) and are less likely to be impacted by extractive politics and economics, as well as Dutch disease, due to this (specifically minerals like oil, gas, diamonds, or gold); they're not landlocked - so have access to the coast and can access the open market.

The only major set back in these developing countries is bad governance, specifically a lack of property rights, as suggested by Daron Acemoglu and James Robinson in their book 'Why Nations Fail'. This is important to allow individuals to benefit from technology they develop and effort they put in without fear of confiscation. Whether this is land, patents, or your general income. But there is hope however on this front with countries in North Africa, just as there had been in post-war Europe.

When we look at Europe post 1945, to the East, we had the USSR and the Warsaw Pact (which did not benefit from US aid). To the Centre and West of Europe, we had a mixture of half democracies, and monarchies, and Dictators, troubled by extractive political and economic chains, yet America invested heavily. There were of course many reasons for doing this.

When the Americans came in and invested vast sums of money, they found a Europe that had been wrecked by war and had previously been ruled by monarchs, dictators, and very very few actual democracies that protected property rights.

So, I ask the question - what is the major starting point difference between what we find in many parts of North Africa today and Europe in 1948, bar the will do anything having disappeared? Potentially, due to lack of political muscle, strategic thinking on the world stage by Western governments, or just not caring.

politics
Tom Guyton-Day
Tom Guyton-Day
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Tom Guyton-Day

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