Keep in mind that corrupt societies are the most likely to have their debts forgiven, i.e. they are not likely to pay back the money borrowed.

I really recommend reading The Dictator's Handbook to learn more about how corruption works.

Everyone constantly blames the West for all the problems of the world. If trade was really that deleterious to developing countries, you wouldn’t see the rise of China happening at all

Meanwhile Ghana had a dictator which was saddled with US loans who was overthrown. But the country still had to pay the loans back, despite them being will outside of their means.

Korean state had an extremely focused industrial policy to improve the added value created by the country's economic output.

The thing that needs critique here is that free trade would be somehow always beneficial. South Koreans state aggressively supported those industries it wanted to uplift.

Countries do rise up from third world countries to advanced industries. It just does not happen very often - sadly.

Another example of a country that rose from total poverty to industrialized advanced economy is my home country Finland which was in the 18th century dirt poor, started to industrialize, and only after second world war started to get some resemblance of wealth. However, the long history of poverty is still reflected to this day in lack of capital (are there other reasons for lack of capital I'm not sure).

Of course people in South Korea worked hard to get where they are. So did people in Ghana. But in South Korea, the US protected them and funded them. Meanwhile in Ghana, the US stripped them of their wealth.

How well off do you think South Korea would be if the US didn't intervene in the Korean War?

I would limit this discussion to "how can a once poor country become an industrialized economy".

Since not all countries do this, the question is incredibly interesting. Perhaps I were too harsh but "US helped them" is not a satisfactory answer.

The fact that north korea is poor and south korea is not, is an interesting part of this puzzle as rare empirical sample of an area with roughly equivalent starting position well into modern history, and it should not be explained away by "because US duh".

I found "Why Nations Fail" an extremely interesting book pondering the puzzle of apparent differences in economic outcomes between countries and warmly suggest it to anyone interested in the topic. It's not really about state failure but about the bigger picture of what makes some states successfull (using the metrics of the author of course).

I think the key point of the book is that unless there is a massive transfer of people from place to place the power of historical institutions can carry over generations and generations.

Is quality of institutions the one truth to explain it all? No, but I find it pretty hard to argue against that it is a relevant factor in historical evolution of polities regarding their quality of administration and general expectations of life outcomes of their populations.

My intent was not to sell the book as "the one truth", sorry.

You can talk about the legacy of the colonial institutions in the respective countries, but that has little to do with how hard South Korea worked in the 1950s, and more to do with how Japan and England administered their colonies, and how the transition from colony to state happened.

They're interesting books for sure, I remember enjoying reading them. But they're very selective in the facts they tell and how they tell them, and so they're almost worse than fiction in that respect.

I agree with what you wrote in general.

Why I find other explanations more worthwhile - which you opened up above - than "US helped them" is that is quite critical for countries to be able to advance economically. Based on several examples I don't think it can be explained simply by having a wealthy external sponsor. Hence it would be more important to focus on the things that made this thing happen, in order to understand if something could be replicated.

As an example of potentially replicable factors, for instance land reform seems to be a thing that has been at the roots of economic advancement of several countries. (Finland, South Korea). Of course, it can be screwed up as well (Zimbabwe).

I agree books that try to simplify things are dangerous, but really entertaining when they structure their thesis around solid facts. I don't think anyone has "the final truth" so an author that has at least tried to put forward an explicit thesis is always a worthwhile read - a clearly stated thesis is something the reader is then able to clearly refuse.

https://www.kdevelopedia.org/Development-Overview/official-a...

IMO more accurate to insinuate whether countries succeed or fail to develop is ultimately at the discretion of the (wealthy) hegemon. Especially more so in recent history with the viability of export led growth models and US / western bloc constituting huge % of global GDP, who can choose who to "uplift" via absorbing exports. Which is zero sum process, since demand is still finite, ergo Hegemon + co's policies / cooperation / coercion / indifference picks winners and losers, frequently explicitly via agreements / sanctions. Also The moat and wall around modern tech is so high that industrializing / modernizing / moving up value chain can only be expediently done with active facilitation from other advanced economies. Even primary resource states that on paper should be able to extractive their way to wealth (not equality) still depends on increasingly advanced tech to even get goods to market in first place.

SK / NKR good example. NKR initially more developed than SKR via USSR until US with more resources and consumption seriously invested in SKR while absorbing their surplus via industrial policy while keeping NKR down via sanctions. Even post Korean war, NKR had fairly competent residual industrial prowess. Once country has the industrial institutional memory, it's able to quickly rebuild base to technically flourish but they still need permission to grow unhindered. Most of destroyed european powers postwar got back on feet with push from Marshall plan. Except NKR got pushed down.

   > Of course people in South Korea worked hard to get where they are. So did people in Ghana.

https://www.ferris.edu/HTMLS/news/jimcrow/links/essays/vcu.h...

https://www.researchgate.net/figure/The-Lazy-Black-stereotyp...

The alternative is that you're being intentionally dishonest, I would hope that's not the case though.

the person who made the claim was thorougly roasted and edited their comment but you can ctrl + f 'ghana' and see the downstream context.

> Yes, similar to the assumption that the differences between North and South Korea can't be put down to "lazy people" and "hard working people" being magically seperated on opposite sides of the border.

> Your implication is that Ghana failed where South Korea succeeded because they didn't work hard enough.

While Ghana has been under the rule of the IMF the whole time.

IMF policies are arguably extremely toxic; they basically guarantee that countries can't develop by keeping them open to a flood of subsidized products from more powerful countries, killing their ability to develop their agriculture and industry.

China developed similarly by stringently protecting its interior markets. The US did the same in the 19th century. Basically, all countries that successfully developed were staunchly protectionist, then became "free traders" once they become powerful enough to defend themselves on open markets.

See https://www.allencheng.com/kicking-away-the-ladder-book-summ...

Correlation, not causation. The whole point of IMF intervention is to rescue countries that are already in the toilet, and need to consolidate foreign debt.

If you mean whatever oligarchy is nominally in charge, well, the bankers can make sure they’re taken care of as long as the interest payments keep rolling in.

IMF loans are bandaids to stop the bleeding, but the cure depends on the disease. If the country does not cure the disease, the bandaid will not help after a while.

Some of those conditions involves avoiding any sort of export tariffs and using the declared value of goods to calculate profits (ex: if I spent 20$ extracting copper, and sold it for 20$ to an overseas company which totally isn't related to me, then the taxable profit in your country is 0$).

No, read the article before commenting please.

Edit: I just realized this comment breaks the site's rules

> Please don't comment on whether someone read an article.

I do wish @dang was around though, most of the comments in here don't reference the article at all, even though it's really insightful.

Woke politicians and economists are all too happy to talk up the cause of oppressed minorities until you point out the possibility that they are the root cause of the oppression... No, it's not the ancestors from a distant past who are the oppressors, it's happening now.

Other economists just assume that all of this debt is 100% voluntary and could be paid back at any time.

There is no way to ensure reliable and honest politicians. The best you can do is hope most policymakers are at least somewhat honest, and then institute stringent checks and balances to ensure a corrupt politician can't do too much damage. Which is what most developed democracies do, with varying degrees of success.

How to achieve that is left as an exercise for the reader :)

Are you confident that if rich countries hadn't done the bad debt/political things to the poor countries, they'd now be rich?

Why didn't this happen to countries like South Korea, Taiwan, Japan, etc?

> it's vitally important to live in a country which has reliable, honest politicians

Exactly. But the corrupt politicians do not get installed by other countries. They get installed by a culture of corruption within a country.

The difference many times in the level of success of a nation is the level and accessibility of corruption. The US is extremely corrupt, political office is held almost entirely as a means of personal enrichment. Economic consideration is exchanged quid pro quo as a matter of fact in many scenarios. However these corrupt practices are carried out in an open format under a set of guidelines that mean anyone with money can access the corrupt system. Anyone can look at the system and say objectively "this is wrong" but doing away with it only pushes it behind closed doors and limits access to a select few.

I think the "those countries" in your sentence could very easily include many rich countries as well as the set of countries you were originally contemplating.

I keep seeing the word "punished" used as though there are some parents somwhere who are meteing out deliberate action against their children. It's not like that. It's just bad situations happening to adults and children alike.

The only antidote we know of is having democracy and free(ish) markets to allow as much agency as possible to accumulate to individuals, rather than to state officials.

I mean think about it. Country A borrows from Country B and buys Country B products, which effectively finances Country B companies. This is particularly bad when the imported products aren't physical capital but basic necessities.

Is it not strange that investment bankers get into state institutions? Is it not strange that those rich countries do not mind your privacy (AMD PSP, Intel, ARM CPUs). As if intelligence agencies form a hidden legislative role and they fear their own citizens. Why is there a need to become like China?

Despite all that, people have many more potential conspiracies.

Popular ones are:

- Leader of the WEF - Soros - Gates

How valid those potential conspiracies are, is another question.

One example, Epstein supposedly killed himself. Some people are sceptical about that. But I would say: beware your confirmation bias. Potential coincidence should not make you disregard due process.

In my estimation, you do not need conspiracies. It is very simple, if you are very rich, you can buy yourself free from your duties (e.g. Amazon) and you can influence policy making (i.e., lobbying). It is also easy to see why the US or rather the intelligence agencies engage in conflict (e.g. Taiwan/TSMC).

To be fair, an article on Vox says that the above finding is false. It is hard to be certain on "truth" or to be "certain" at all. You end up with beliefs (which has many forms: assumptions, trust, axioms, ...). Better stay off politics and news.

[1] https://www.transparency.org/cpi/2021

[2] https://data.worldbank.org/indicator/NY.GDP.PCAP.CD?most_rec...

E.g. Greece is being talked about as if it was somehow an immoral country that is constantly living beyond their means and somehow the Germans are the heroes who bail out the Greeks who used the debt to buy uh what exactly did they buy? German exports? Wait a moment. If Greeks are buying German products, why aren't Germans just buying Greek products instead of bailing them out? It would be mutually beneficial and solve the debt problem. It turns out, paying off the debt is the last thing Germany wants. If anything, it wants the debt to stay there to act out a nationalist hero role that is both counterproductive to German and Greek citizens and only really benefits the German export industry and the handful of workers directly employed by them.

For Greek products to become competitive in Germany, wages in Germany would have to go up. In other words, Greece is a scape goat to distract from domestic issues in Germany just like the EU was the scape goat for the UK.