I guess the first place I'd go look is east Asia, but I don't think the oligarchs ever really went away there. Or even stopped dictating policy. Does the middle east just need smarter oligarchs?

About 1% of all Nobel prizes go to the 20% Muslim part of the world. Don't know the specific number for MENA. But mass education is always a good thing: Tax something, preferably the rich, then use the money to fund cheap as free education.

but your question was what the West can do. I don't know, really...solve Israel-Palestine and get the fuck out of the region to lift the siege mentality, allow some introspection and self-criticism. Allow the Brotherhood to fail in Egypt. Keep making pop culture stuff and lots of internets to seduce the young and gullible to our kuffar ways..

Do your thoughts feel provoked?

Oligarchy is a sort of natural state of things, the strong dominating and all that. But if the oligarchs think it in their interest to cede some power in order to stay on top, they will: see China. This may be what Tom Scudder means by smarter oligarchs.

The best 'cure' for oligarchism may be time. As oligarchical companies - generally conglomerates and holding companies - mature, they will need to specialise and fragment in order to expand beyond their geographical confines. This should lead to a degree of competition between second-degree oligarchs, who will then begin to see the value of laws that limit the potential hold of their rivals (and themselves) over Leviathan.

This fragmenting effect will also be driven by generational shifts. What will the children and grandchildren of the oligarchs do with their holdings? Occasionally, members of the family may preserve the family holdings intact, but the lesson of the US robber barons is that while some wealth may remain in the family, the oligarchical firm or conglomerate changes ownership and/or purpose.

Of course, this process will take decades, and offers little to satisfy those who wait for democracy and her handmaidens to parachute from the sky.

Simon

Afraid Simon I don't see time being the cure to the problem. Time plus pressures, maybe, but not time alone. Fragmenting is easily dealt with.

There is no natural exit from the death grip of the Oligarchs. It strikes me that the "West" needs to support economic liberty, but how does one do so without letting economic liberty be captured by the Oligarchs.

But oligarchy thrives on regulation and other barriers to entry. Oligarchs can't "capture" real economic liberty -- it would be like trying to nail jello to a wall. People can be endlessly inventive in their economic lives if given half a chance to do so.

Well, there is "deregulation" and there is "deregulation" ....

I was inexact in my phrasing. My experience in watching market liberalisation has been that when undertaken in a highly attenuated fashion (as is typical in these economies), the Oligarch's tend to build up an arsenal of oligopolies and informal barriers (market or administrative, rather than tariff). For smaller economies that on their own simply are not attractive enough to justify FDI with sharp elbows, the Oligarchs end up capturing the "liberalisation" such that "liberalisation" ends up being discredited.

There is my concern.

It's important to define terms, I guess. "Market liberalization" doesn't necessarily imply real "economic liberty." You can, for example, remove tariffs and allow foreigners equal access to your domestic market. But if it still takes 270 days and 20K USD to form a company, you still haven't got much "economic liberty."

An economic/social/political oligarchy is, by definition, about centralization. To the extent you create frameworks that allow people to act and organize independently, oligarchies are undermined. I'm quite dubious as to whether WTO-style macroeconomic adjustments do much to really promote "economic liberty." On the other hand, things like reliably enforceable property rights and a simplified and efficient company law regime can potentially work wonders.

The problem, of course, is that it's very difficult to encourage these kinds of changes from the outside. A foreign government can easily demand that some country remove its Elderberry tariff (or whatever) but trying remodel someone else's legal system can be a bit prickly. This is the true genius of the EU ascension system. They have carte blanche to demand all kinds of changes that would cause anti-colonial riots in the streets if anyone else tried it. It's a pity the EU can't figure out a way to suck North Africa into to process.

- this is prolly economically subliterate wanking, but isn't oligarchy basically a problem of monopoly? And if so, isn't the remedy fervently upheld anti-trust regulation along with liberalisation? Can't have the benefit of a free market without real competition.

I also wonder, in the light of secretdubai's recent comments on your previous post, if patriarchy in society is not part of the oligarchy problem as well. Someone big and powerful to look after us.

Patriarchy?

Paternalism, but what the fuck does Patriarchy have to do with this?

As for the issue of anti-trust regulation. Well, yes. But how do you bloody well get it (although it may not be monopoly but rather trusts and cartels, oligopolies).

Right, the trick is antitrust legislation that isn't just an excuse for the political powers-that-be to round up those who've fallen out of favor. cf Putin, Vladimir.

woopsie, wrong word. Paternalism, not patriarchy, of course.

It seems it's a case of the chicken and the egg. Economic liberalisation + anti-trust/cartel helps break the power of oligopolies, but this legislation won't be introduced unless the power of oligarchs is broken. Yes, no? Like Anon's EU praise, where EU overrides that catch-22. Maybe a MENA free-trade organisation then. Bloody hard to maintain monopolies across borders.

One can easily have the legislation on the books, indeed like many things one often has it in the market. Enforcement, and how enforced. There is th ekey.

Nothing much to add to this, except of course that I generally agree with the Lounsbury Doctrine above, that market driven-societies --> liberal institutions --> pious middle empowerment is the fundament for successful democratic development, peace and all the rest. In MENA and elsewhere.

And:

1. tom sc - Does the middle east just need smarter oligarchs?

Catchy and true. One important issue for outsiders who want to push the MENA towards liberal democracy, stability and all that (EU, US etc) would be how to create incentives to lure these particular oligarchs in the right direction, no? (Since they are normally the ones in control of their national legislation.) Perhaps best done through unilaterally opening up a market space that they would want to fill.

In oil-driven economies this will be particularly hard, since they have a secure source of state-controlled funding that the West can't (won't) mess with. But in other places, it would help a lot if the West would just start dealing fairly with the region (real free trade etc) to encourage profits to migrate towards fields that require sound economic/governmental institutions and a modicum of good governance. That isn't really being done now: it's certainly happening with globalization etc, but more despite than because of Western trade regulation. To unilaterally scrap trade quotas and other nonsense from the EU's side would help massively in bringing new players into the game on the MENA side, as well as force the traditional elites to move faster in a liberalizing direction.

This would of course require some EU countries to confront strong national pressure groups, e.g. axing the French Farmers -- which would be both a huge obstacle and an added bonus.

2. the lounsbury- Paternalism, but what the fuck does Patriarchy have to do with this?

Quite a lot, I'm sure. That women's empowerment went alongside economic liberalization and political progress in the West is surely no coincidence, the issue is what is cause and what is effect.

3. About a MENA free trade organization (klaus), there are a number of those, I think, but none with very spectacular results. The EUROMED thing isn't exactly in fast-gear either.

Axing the French farmers - that should have been done long ago. 2013 is the expiry year for the current EU subsidies arrangement. Something to look forward too.

Well, then, some further thoughts.

Nothing much to add to this, except of course that I generally agree with the Lounsbury Doctrine above, that market driven-societies --> liberal institutions --> pious middle empowerment is the fundament for successful democratic development, peace and all the rest. In MENA and elsewhere.

Well that makes me happy.

Lounsbury Doctrine. No magical thinking allowed.

1. tom sc - Does the middle east just need smarter oligarchs?

Catchy and true. One important issue for outsiders who want to push the MENA towards liberal democracy, stability and all that (EU, US etc) would be how to create incentives to lure these particular oligarchs in the right direction, no?

Perhaps.

Depends on the market. If some of the major players can be engaged to support real economic liberty, or more realistically step-wise liberalisations leading to economic liberty - well it's a good divide and conquer play.

Heading into local power structures like a dim wit full of idealistic sperm backed up, it's a great way to engage in self involved whanking, and a great way to fail.

(Since they are normally the ones in control of their national legislation.)

They, and others.

Perhaps best done through unilaterally opening up a market space that they would want to fill.

Explain?

In oil-driven economies this will be particularly hard, since they have a secure source of state-controlled funding that the West can't (won't) mess with.

Indeed it is impossible, unless as in Dubai you luck out with authorities that are at least marginally willing to play the game.

But I doubt Dubai will play Singapore in the long run. It could, but I doubt it will.

I recall with some amusement the observation of a good friend of mine, CFO of an energy firm in MENA and native of a non-hydrocarbon exporting MENA country: "I pray to God we do not discover oil, it is a curse."

But in other places, it would help a lot if the West would just start dealing fairly with the region (real free trade etc) to encourage profits to migrate towards fields that require sound economic/governmental institutions and a modicum of good governance.

I agree on many levels. The EU-MENA engagements are masterpieces of gross hypocrisy in this area.

Whatever one can critique the US on the political field, at least their trade agreements (ex-intellectual property) are straight up.

The EU's approach to the MENA - Med initiative (driven by France and Spain) stinks of French hypocrisy.

That isn't really being done now: it's certainly happening with globalization etc, but more despite than because of Western trade regulation. To unilaterally scrap trade quotas and other nonsense from the EU's side would help massively in bringing new players into the game on the MENA side, as well as force the traditional elites to move faster in a liberalizing direction.

I absolutely agree.

Or to scrap the various bariers against benchmarks for real MENA market liberalisation (or course the same really needs to be the case of EU, as the fiasco of the EU finacial services directives shows) would do more than 1 billion of subsididies or other sops to dynamize the Med region, that has for millenia been a dynamic trade region and could do vastly more.

This would of course require some EU countries to confront strong national pressure groups, e.g. axing the French Farmers -- which would be both a huge obstacle and an added bonus.

France, runner-up to the Americans for self-delusional politics.

2. the lounsbury- Paternalism, but what the fuck does Patriarchy have to do with this?

Ahem

Quite a lot, I'm sure.
Bollocks.

That women's empowerment went alongside economic liberalization and political progress in the West is surely no coincidence, the issue is what is cause and what is effect.

Spare me the West bloody liberal whinging.

Women are fully capable of being fucking oligarchs as note.

Gender as such has fuck all to do with the subject.

Don't be a moron.

3. About a MENA free trade organization (klaus), there are a number of those, I think, but none with very spectacular results. The EUROMED thing isn't exactly in fast-gear either.

EuroMed is a hypocritical French style posturing over substance sop.

Bureaucratic, difficult and frankly mere window-dressing.

re the oil wealth, wasn't that exactly what has happened to Qatar, unless I'm misinformed? Modest reforms, education, the works. Then the oil price went up, and the leadership saw no further need for reform.

re gender, I don't think it directly relates to oligarchy - which is about family and friends - but got me thinking a bit about conservatives and liberals. If the presumption is that economic liberty = social liberty, then social conservatives are going to be against free markets. Nothing did more to attack 'family values' (*gag*) than getting women out in the workplace. Suddenly they could afford divorce and independence. Blimey.

As in Tories vs Whigs.

Economic liberty may or may not mean social liberty per se, depending on what you call "social liberty."

well, I'm mostly out of my poorly conceived ideas, but seems to me a genuine free trade zone is the best remedy for oligopoly. If officials are too corrupt or friendly with oligarchs to enforce the anti-trust legislation in the books, I can't see change coming from within, except where the rare enlightened dictator takes the reins. It's certain oligarchs have had little chance of getting hold of Eastern Europe because of the EU. I understand Ukraine has some problems here, precisely because they are not part of EU. Organized crime is a different matter, though, these can be helped by free trade zones.

Oh well, my Aqoul window just crashed and the comment has to be rewritten. So this will be a good deal shorter than I planned.

the lounsbury - Explain?

Well, that really just referred to the part about the EU scrapping its trade barriers further down.

France, runner-up to the Americans for self-delusional politics.

I actually think the French may win that one. It's just that it's harder to tell, because (a) French delusions of grandeur do not get the same dramatic consequences on the world stage, and (b) the French interestingly enough, and completely unlike the US, seem convinced that they are playing a hard-nosed realist game, and take some peculiar pride in openly admitting their own cynical selfishness. When in fact they're just digging themselves into completely undefensible positions. (I will resist the temptation to bring up the Maginot line here.)

It's kind of like the Neocons, who revel in being "tough" and "realist", and making the "hard choices" to employ military action or torture. (Another similarity with first-generation Bolsheviks, btw.) I'm getting really sick of hearing that the Perle-Wolfowitz crowd is combining "realist" methods (a cynical use of violence) with "liberal" goals (secular, progressive democracy etc). Maybe they do, but what good is that if the overall political is more adjusted to Tolkien's Middle Earth than today's Middle East?

(The real equation is more like this: [Liberal values as goals] + [Realist cynicism in methods] + [Magic mushrooms for political strategy])

Now, for the culture wars:

Spare me the West bloody liberal whinging. / Women are fully capable of being fucking oligarchs as note. / Gender as such has fuck all to do with the subject. / Don't be a moron.

(I like how the slashes make it look like poetry.)

Of course women can be oligarchs. It's just that normally, in the MENA, they are not, and if that were to happen, then we'd have some fresh blood right there.

On a grander scale, I do think there's some real merit to the amateur-psychological whinging about patriarchy (in gender relations and culture etc) being reproduced on other levels of society, but, more importantly, that women's emancipation in itself has a very significant economic and political impact, even if gradual. MENA won't see any suffragette hijab-burning rallies in a while, but social dynamics matter even when not immediately visible.

On the other hand, women's lib also takes a certain level of economic and political development to come about -- or has done so, historically. So I'm not saying that, say, Iraq would be in for fundamental change if more women had just been quota-elected into parliament, along the lines of that vulgar old stupidity of "if women ruled the world, there would be peace" (on the contrary, women can power-drill Sunni infidels too, should that be necessary). That would be a near-formality. But elsewyere, expanded de facto electorates, changed family patterns, slower population growth, enlarged labour pools, a new educated workforce pushing upwards towards social/gender barriers -- all that to some extent matters, where it matters.

So, in other, more stable and well-functioning countries there may be more of a tipping point for this, although not necessarily where western preconceptions would lead one to expect. Take the interesting phenomenon of how (solidly ideologically patriarchal) Islamist movements, like the Muslim Brotherhood, is putting lots of effort into organizing and politicizing women's movements, and turning them into a political force. (Which coincides with, or, I would think, is a result of, massively increased women's education these last decades.) This creates a new group of active political subjects in these societies, may in itself shift the priorities of the political elites (before and after an MB takeover), as they have to rely more on women for political support -- and may well in the future lead somewhere the Brothers had not at all intended.

good points, alle, and I agree, but off topic relative to oligarchy, who maintain their economic stranglehold through sometimes quite brutal financial maneuvers and generally tilting the board in their favour. Old-fashioned monopoly stuff. It's the economic reality that matters. Russia was and is not particularly anti-woman's lib, more than anyone else that is.

Economic liberalism (as opposed to dirigism or socialism) is a no-brainer in its superiority over other systems, so definitely, the "West" (namely the US - I wouldn't rely on France for that) needs to push it through its clients/allies. It's just in everyone's interests. Stating the obvious.

Now, I don't see a contradiction between oligarchies and economic freedom. Oligarchies are a natural part of things, and I don't believe in revolutions. IMNSHO, one of the biggest reasons for MENA failures is the fact much of its elites hopes for a complete change in power structures instead of co-opting them - whether in politics or in economy. That's like waiting for the Messiah. Well established power structures don't go away easily and frontal attacks on them don't bring any good. Besides, oligarchies subcontract, create offshoots, concentrate enough capital to undertake important investments, etc. Under their wings, there's a lot of room for the new comers who want to complement them. Outside their playing field, there's a lot of room for the new comers who are ready to innovate. As long as you make sure there's some rule of law for small/medium sized entrepreneurs (understand: the next bastard in charge is not going to expropriate your business because he likes it or put you out of competition by throwing you in jail), economies will thrive. How can the West (=the US) help in this? By co-opting small/medium sized businessmen in the region, and by keeping their SOBs at bay. IOW, be realpolitik and look the other way on human rights if you want to - to a reasonable extent not to have too many side-effects -, but don't look the other way on economic liberty because that's in no one's interests but the SOBs' in question. The rest can only be done from inside by the MENA elites themselves. It takes two to tango.