May 30, 2010

WILL FREE MARKETS give way to state capitalism? “In Bremmer’s telling, the world’s autocratic states learned a valuable lesson from the implosion of the Soviet Union: command economies do not work and when they fail, they can bring down the over-arching political system with them. They also watched the post Soviet experiment in crash liberalization with horror. To protect their hides and preserve their privilege, autocratic rulers in China, Russia, Saudi Arabia and elsewhere have created a ‘hybrid’ system that leverages many of the tools of capitalism to generate wealth while the heavy hand of the state ensures that wealth is put to the service of the elites and rulers of each country.”