Economic Freedom Benefits

April 14th, 2008 at 2:13 pm by David Farrar

blogs on the benefits of economic freedom, and mentions and :

An interesting point of comparison is that in 1958 Cuba’s per capita was $3,170 while Hong Kong had a per capita of $2,924. Since then these two countries have followed very different development paths in terms of economic freedom . Today Cuba is one of the poorest countries in Latin America, very different from today’s Hong Kong.

So in 1958 Cuba had a higher GDP per capita than Hong Kong. And today?

Hong Kong is US$41,944 (PPP) compared to around US$4,500 for Cuba.

Cuba has a state which is basically 100% of GDP. In Hong Kong it is under 20%. In NZ it is 42%.

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46 Responses to “Economic Freedom Benefits”

  1. Pascal (2,015 comments) says:

    DPF: In NZ it is 42%

    And growing?

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  2. mawgxxxxiv (554 comments) says:

    More reason why Key should be taking more leadership on assets sales instead of following the poll driven me too line.

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  3. Redbaiter (13,197 comments) says:

    ..and National are gonna do exactly what about this??

    Great post BTW

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  4. gd (2,286 comments) says:

    Get the government out of my life Get the government out of my life Get the government out if my life

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  5. Andrea (10 comments) says:

    But Cuba has a free health system etc. etc. etc.

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  6. BlairM (2,266 comments) says:

    And high literacy!

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  7. toad (3,654 comments) says:

    Strange comparison – Cuba has also had a US economic blockade. Don’t you think that also might have had something to do with it DPF?

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  8. Ed Snack (1,535 comments) says:

    Toad, possibly quite a bit, with free trade they could possibly double the GDP of Cuba, but free trade is completely incompatible with Cuba’s political system. It only worked for HK as it was independent of China during the regimes most repressive and inward looking years.

    Cuba has used the excuse of the economic blockade for a long time as a convenient fiction, the major problem is the economic restrictions of the one party communist state. Hell, they received many, many millions in direct and indirect Soviet aid for an extended period, and that didn’t make them richer either. They’re a near perfect poster child for how not to run an economy. Note to politicians, socialism and (I’ll grant you this if you like) restrictions on trade make a country poor and even massive amounts of aid can’t change that. Puts the Green’s economic policies into a clearer focus doesn’t it ?

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  9. Bevan (3,965 comments) says:

    Strange comparison – Cuba has also had a US economic blockade. Don’t you think that also might have had something to do with it DPF?

    They shouldnt have let the Soviets erect some missile silos in the 60′s then now shouldnt have they…..

    A country cannot threaten death and destruction (or let its ally do such upon its neighbour), then run cap in hand crying foul when the neighbour responds…..

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  10. jafapete (766 comments) says:

    Toad: “Strange comparison – Cuba has also had a US economic blockade. Don’t you think that also might have had something to do with it DPF?”

    My thoughts exactly. Wouldn’t a better comparison be between HK and Singapore? Now, the Singaporeans are really into free markets, aren’t they? No, you say? Well I never.

    Or how about Cuba and Guatemala, the latter being right into the free market. (To the point where shooting trade unionists is a national sport.) Hmm, Cubans have higher quality of life than the vast majority of Guatemalans you say? Oh dear.

    What has DPF proved with this comparison? Nothing, beyond how inane the kiwiblog right can be.

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  11. Rocket Boy (163 comments) says:

    Anyone been to Hong Kong lately? How was the air quality? Is it still covered in choking smog 9 out of 10 days?

    Hong Kong is a great place for a stop over but who in there right mind would want to live there?

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  12. side show bob (3,660 comments) says:

    Lies, lies and more damn lies, David how do you expect to make friends on the left with figues like these. As our friends on the left and as Al Bore would put it, it’s just an inconvenient truth.

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  13. psw1959 (11 comments) says:

    Toad: “Strange comparison – Cuba has also had a US economic blockade. Don’t you think that also might have had something to do with it DPF?”

    Not much. Cuba has a good economic relationship with the old USSR and could trade with the rest of the world. If they wanted to that is, they just didn’t want to, they couldn’t. The last thing Castro wanted was people setting just what capitalism could produce and then demanding it in Cuba. Cuba had to “blockade themselves”. That was my point. Cuba didn’t have economic freedom, Hong Kong did and it shows.

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  14. PhilBest (5,112 comments) says:

    Classic, classic, classic case study for lefty in-denial-ism.

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  15. PhilBest (5,112 comments) says:

    Yeah, leftwing health and education is ALWAYS better, yeah, RIIIIIIIIIIIIGHT………the investigate journalism and the freedon with which the same can be carried out within Cuba is just the TOPS, too………

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  16. jafapete (766 comments) says:

    Yeah, well I’ve actually been to Cuba (and Guatemala) and talked to the locals.

    To be fair, the Cubanos’ point of reference was their cousins in Miami, and they weren’t interested in hearing about how much better off they were than the Guatemalans (or many Mexicans, for that matter).

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  17. Paul (1,315 comments) says:

    gd “Get the government out of my life Get the government out of my life Get the government out if my life”

    Now open your eyes, look around, that’s it blue sky and smiley faces all participating in society (without the capital I). I admire your convictions however there is no way you or anyone would be able to operate without some form of governance, and if said government was removed pretty bloody quickly some other form of governance would fill the void, it’s a human trait.

    Failing that on your way to work today via the road system, past the police cars and schools and hospitals (taking average care of Dad4) which part of society would you be able to operate without?

    Nice ideological position, meanwhile back in the real world…

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  18. stephen (4,063 comments) says:

    Anyone like to specify and disprove any “lies” then.

    ‘rrrrraaaaaaaaaaaahhh socialists!!!’

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  19. labrator (1,691 comments) says:

    The funniest thing I’ve heard about Cuba recently is that you can get divorced in about 5 minutes (it’s your right too after all) but you may end up living together for several years more because of the government restrictions on building new houses mean there is a severe shortage and you have to go on a waiting list to move out!

    I’m not sure how socialists ever manage to defend this sort of stuff. Cuba is in a worse position than Hong Kong because of communism and what is the reponse? “How was the air quality?” We need governments to enable very disparate groups in society to co-exist without war. We don’t need governments to micro-manage everything they want in a “we know best” mentality. This sort of mentality has been proven time and time again throughout history to fail.

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  20. unaha-closp (1,033 comments) says:

    Chinese Communist Party is really much better than Cuban Communist Party.

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  21. labrator (1,691 comments) says:

    Cuban Divorce Is Easy, Housing Is Harder

    Also, if we were in Cuba, we wouldn’t be commenting on this blog because it likely wouldn’t exist.

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  22. psw1959 (11 comments) says:

    Toad: “Strange comparison – Cuba has also had a US economic blockade. Don’t you think that also might have had something to do with it DPF?”

    Not much. Cuba had a good economic relationship with the old USSR and could trade with the rest of the world, had it wanted to. It just didn’t want to, it couldn’t. The last thing Castro wanted was people setting just what capitalism could produce and then demanding it in Cuba. Cuba had to “blockade themselves”. That was my point. Cuba doesn’t have economic freedom, Hong Kong has more, and it shows. GDP per person isn’t a perfect measure of well being, but it is a rough guide to average living standards. And by that standard Castro has much to answer for.

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  23. kevin_mcm (152 comments) says:

    would be interesting to see a list of all counties, GDP 30 years ago, GDP now, average % GDP is government spend – then you could make some reasoned comments. Comparing these two lacks sample size to be relevant.

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  24. dime (8,752 comments) says:

    milton friedman said if you want to see capitalism in action.. go to hong kong..

    small govt is defined as 20% or less of GDP..

    i cant believe we are 42%!!!!!

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  25. GNZ (228 comments) says:

    Not exactly a fair comparison.
    Of course if Cuba was interested in growth being a tax haven/holiday location would obviously have been a better strategy and if HK had been communist it would just be another part of China – of course that still means growing at 10+ % per year.

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  26. decadentmeerkat (27 comments) says:

    The comparison is, as others have pointed out, ludicrous on historical grounds. However, you small government types might want to read this:

    [url]http://www.stats.govt.nz/products-and-services/nz-in-the-oecd/government-spending-receipts.htm[/url]

    Yep, as of 2004, New Zealand was the second lowest spending and seventh lowest taxing of 27 OECD countries. The biggest spenders? Sweden at 57.1% of GDP (Swedish taxes accounted for 58.3% of GDP). Hasn’t exactly done Sweden any harm, has it?

    “milton friedman said if you want to see capitalism in action.. go to hong kong..”

    Or Pinochet’s Chile. Which was, after all, the great free-market laboratory experiment long before teh revolution was a gleam in Roger Douglas’ beady little eyes.

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  27. decadentmeerkat (27 comments) says:

    The comparison is, as mentioned by others, ludicrous on historical grounds. That said, our resident Friedmanites may be interested in this:

    [url]http://www.stats.govt.nz/products-and-services/nz-in-the-oecd/government-spending-receipts.htm[/url]

    Yep, as of 2004, New Zealand had the second lowest rate of government spending and seventh lowest rate of taxation of the 27 countries in the OECD. The highest rate of spending was Sweden (57.1% of GDP), who also took in 58.3% of GDP in terms of tax receipts. But hey, what do those dirty commie Swedes know?

    “milton friedman said if you want to see capitalism in action.. go to hong kong..”

    Or Pinochet’s Chile. Which was, of course, the great free-market laboratory experiment long before teh revolution was a gleam in Roger Douglas’ beady little eyes.

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  28. decadentmeerkat (27 comments) says:

    The comparison is, as mentioned by others, ludicrous on historical grounds. That said, our resident Friedmanites may be interested in this:

    http://www.stats.govt.nz/products-and-services/nz-in-the-oecd/government-spending-receipts.htm

    Yep, as of 2004, New Zealand had the second lowest rate of government spending (as a proportion of GDP) and seventh lowest rate of taxation of the 27 countries in the OECD. The highest rate of spending was Sweden (57.1% of GDP), who also took in 58.3% of GDP in terms of tax receipts. But hey, what do those dirty commie Swedes know?

    “milton friedman said if you want to see capitalism in action.. go to hong kong..”

    Or Pinochet’s Chile. Which was, of course, the great free-market laboratory experiment long before teh revolution was a gleam in Roger Douglas’ beady little eyes.

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  29. ISeeRed (244 comments) says:

    decadentmeerkat: good stats. Any for 2007?

    DPF: where do you get 42% from?

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  30. NX (597 comments) says:

    But Cuba has a free health system etc

    It costs hundreds of thousands of dollars and about as many hours of devoted study to train a skilled surgeon. Now why would anyone go through that to work in a crap hospital, for crap pay?
    I had a university tutor who banged on about how wonderful Cuba is with their ‘free’ health care. But in my mind it didn’t stack up! I didn’t go back to his tutorial ;).

    Chinese Communist Party is really much better than Cuban Communist Party.

    HK was British ruled till 1997. It still has a fair bit of autonomy from mainland China.

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  31. Redbaiter (13,197 comments) says:

    “I had a university tutor who banged on about how wonderful Cuba is with their ‘free’ health care”

    Wow really? An “educator” pushing communist ideology? Don’t you know they don’t exist. Ask any leftist if you’re in doubt.

    As for Cuba’s supposedly superior levels of health care and education its all a sad sick myth. Typical leftist propaganda, repeated over and over again until its accepted as the truth. Guess where the stats that underpin these claims come from? Castro’s gang of totalitarian thugs of course, and why ever would they lie??

    Cubans who have escaped Cuba have been tested and found to have nothing like the literacy claimed by Castro and his propaganda spreading acolytes. Secondly, the methodology that Cuba employs to arrive at the statistics is error prone, and not part of any standardised system.

    When asked by an independent Canadian panel to justify their figures, the Cuban reply was “our claim is based on the percentage of persons between the ages of 14 and 48 who are considered by us a being able to learn how to read and write.” When they asked the Cubans how they defined “able to learn” the Canadians were told that was none of their business.

    What a joke. Only the braindead left could buy into something so transparently false. However, there’s a worse joke than this. A tragic joke, for while sundry extreme leftists help propagate Castro’s lies, the law in Cuba relating to teaching children says -

    “all persons, including teachers, are required to be literate as well as to contribute to the “formation of the communist personality of the youth.”

    So the whole idea is just to make them literate enough to indoctrinate them with commie crap. Real education in Cuba is sacrificed at the alter of political power. Just like somewhere else we all know so well right???

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  32. NX (597 comments) says:

    Excellent deconstruct of the socialist argument Redbaiter.

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  33. LCSchroeter (1 comment) says:

    Roger Kerr wrote a great article about Hong Kong and economic freedom for the Otago Daily Times last Friday. The article can be found here: http://www.nzbr.org.nz/documents/articles/Hong%20Kong.pdf

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  34. gd (2,286 comments) says:

    A mate of mine went to Cuba last Xmas with wife and 2 children Said what a depressing hell hole Tourists are ripped off and this is scantioned by the government the food was crap as well as being expensive The people were in poor health especially the children and old people ( who were probably really quite young)

    All in all as a very well travelled family they were shocked at what they found

    Sounds like NZ will be in 20 years if we have Clark et al in charge God forbid

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  35. adam2314 (377 comments) says:

    Cuba’s 100% GDP would include our local government spending..

    What is the NZ percentage when this is added to Central government spending ???.

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  36. PhilBest (5,112 comments) says:

    Yeah, well said, Redbaiter, that’s what mine of 4.43PM was getting at…….It’s sickening how lefties expect us to believe stuff about regimes where there is no freedom of the press or freedom of speech. How does anyone know what the truth is? The one thing you can be sure of is that anything the regime itself says won’t be it.

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  37. gd (2,286 comments) says:

    Redbaiter Its just like the Socialist government here blathering on about how good the education system is whilst we have teachers who cant read write or add up teaching children to……………………………..

    Over the past three decades the system has gone to hell in a handcart.

    I challenge the Ministry of Education to subject every teacher to a spelling writing and arithmetic test at the same level as School Certificate in the mid 1960s.

    I bet less than 50% would pass and most likely 66% would fail.

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  38. stephen (4,063 comments) says:

    Is this some kind of joke? Thought-crime alert at a university – NX didn’t go back to the tutor because s/he disagreed with the tutor?? Universities come up with all sorts of ideas which are even debated sometimes, but debate doesn’t work if you just run away and start complaining to others and acting like you’re proud of running away on an internet forum – wimp!

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  39. Redbaiter (13,197 comments) says:

    “Universities come up with all sorts of ideas which are even debated sometimes”

    But mostly are not. Otherwise why are there so many recently established organisations dedicated to academic freedom?? In the US that is. Here in hoplessly PC NZ, (one of the worst places I’ve seen in the world for PC bullshit) where the commies have a stanglehold on information and education, they’re not yet that common.

    NZ’s education system is merely an induction process for totalitarian socialist society, where speech and mind control are daily practised by charlatans who call themselves educators but are really agents for the implantation of leftist ideology in the minds of the young. Sometimes without even being aware of it themselves.

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  40. stephen (4,063 comments) says:

    I don’t really care ‘what’ academics are, all I want to see is critical thinking and debate.

    We’ll all turn into *something* bad if we just run away crying like NX did…

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  41. Redbaiter (13,197 comments) says:

    “I don’t really care ‘what’ academics are, all I want to see is critical thinking and debate.”

    Going by the clash of logic apparent in that sentence, its doubtful you’d recognise critical thinking. Furthermore, students are easily intimidated by lecturers/ teachers, and young university goers who have resisted attempts to instil leftist doctrine have been punished and victimized for their courage. You write Stephen as if you are completely ignorant of what is going on. Let me help you. Go here, and read a few of the case studies-

    http://www.studentsforacademicfreedom.org/

    ..and there is an informative opinion piece here

    http://www.theaustralian.news.com.au/story/0,,23545660-7583,00.html

    that presents a good argument against the claim that efforts to break the absolute power of the left in the education sphere are attacks on free speech themselves. (Leftists are experts at convincing themselves that such propaganda, that in fact presents the exact opposite of reality, is the truth.)

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  42. Redbaiter (13,197 comments) says:

    Some text from the above referenced opinion piece-

    ————————————————

    Examples of bias poured in: course lists comprised solely of radical left texts; essay assignments asking students to explain why “President Bush is a war criminal”; a history professor at Duke University professing “I don’t have a bias against anyone … except Republicans”; another professor informing a Kuwaiti Muslim immigrant that he would need “regular psychotherapy” for writing an essay that defended America’s founding fathers and the US Constitution; another student whose economics professor demanded he drop out of his introduction to micro-economics class or face harassment charges for praising Milton Friedman and free market ideals.

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  43. stephen (4,063 comments) says:

    Appalling for sure (though the ‘republicans’ one would have to be a wry joke), though I don’t see how i’m supposed to be aware of everything happening in the thousands of universities across the world…so what then? Tongue-half-in-cheek: A political test before being employed?

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  44. stephen (4,063 comments) says:

    I did actually read them…I think the ‘indoctrination’ accusation is to a moderate extent, an assumption that university students are stupid, nothing but willing sponges for whatever a big mighty professor announces to them.

    Well most universities prohibit any sort of harassment anyway, one would have thought. All i can think of is getting the thought police into the university (probably cos im a trotsky-ite/marxist/pinko/commie etc), through a bureaucratic tribunal being established at each university – the challenge would be to ensure the ‘right’ doesn’t take it so far as to say, “let’s monitor those lefty professors and keep tabs on what they’re saying; and while we’re at it, let’s withhold federal funds from programs that do not display “ideological balance”…and let’s demand that academic institutions demonstrate a commitment to hiring conservatives; and let’s make sure that the material our students read is pro-American and free of the taint of relativism; and let’s publish the names of those who do not comply.” http://chronicle.com/free/v50/i23/23b01301.htm

    As for “its doubtful you’d recognise critical thinking.” – easy, opinion on a subject that differs from my own. wow!

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  45. NX (597 comments) says:

    Thought-crime alert at a university – NX didn’t go back to the tutor because s/he disagreed with the tutor?? Universities come up with all sorts of ideas which are even debated sometimes, but debate doesn’t work if you just run away and start complaining to others and acting like you’re proud of running away on an internet forum – wimp!

    We’ll all turn into *something* bad if we just run away crying like NX did…

    Well I suppose I better defend myself – because obviously Stephen wasn’t there (not that I know of).
    The tutorial wasn’t a debate forum. Tutorials generally aren’t and are meant to cover things discussed in the lectures. But this guy was rabbiting on about how great Cuba was & how NZ has accepted socialist dogma as the way forward (or something to that effect), with no chance to interject. In fact, to my credit, the old dinosaur tutor noted the pissed look on my face & said ‘you obviously disagree’, but he didn’t give me a chance to say why. If he did ask I was all prepared to say ‘then why the hell do so many Cubans try & escape to Florida if life is so great for them’…?

    This was a few years ago now & my interest in politics was only in passing. I didn’t really have an ideology to defend. But now I realise that socialists achieve that exact opposite to what they intend. For example Helen Clark attacked Dr. Brash’s Owera speech as racist – yet there wouldn’t have been an Owera speech if it wasn’t for her government’s PC driven Maori policies. Their goal of achieving racial equality actually made it far worse. The same applies to wealthfare – removing incentives & individual responsibility actually ties people into poverty. The Working For Families package is so stupid if a family is taxed more than they receive in support – why tax them in the first place??
    While I benefit from Interest free student loans, wouldn’t the money be better spent reducing fees rather than paying for our interest. This means we wouldn’t have to borrow as much to begin with. As it is students have no incentives to limit their borrowing.
    I also find the left use miss-leading language (well at least Helen Clark does) & often dumb down issues to suit their ideology i.e. they play people for fools. For example; the EFA suppose to protect politics from big money. That sounds good, but actually destroys individual rights.

    But Stephen is right, I’m a wimp if I don’t do anything about it. So with that in mind I’m considering volunteering for the National party this election.

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  46. stephen (4,063 comments) says:

    The ‘wink’ you put in made it seem like you were proud of getting out of there…My own political science tutorials varied in format, but inevitably if you are discussing things in lectures, SURELY that should involve some sort of debate!?!! I probably would have gone down the ‘bollocks we’re socialist (in the classical sense), it’s been neo-liberalism all the way since the 80s, with a few mitigation measures which have slowed it, but far from reversed it’. I certainly would have been annoyed if I had a tutor who was ‘rabbiting on’ about anything, let alone something that is well, debatable like Cuba being ‘great’. You don’t necessarily need an ‘ideology to defend’, you just need to be knowledgeable enough and willing to poke holes in whatever people say, whether they’re on your ‘side’ (yuk) or not.

    At the same time the Right’s(?) ‘political correctness’ ‘the nanny state’ phrases have almost lost all meaning for me – government does something ‘bad’ = nanny state; government not doing enough ‘won’t the government DO something?!’ I thought the issue with WFF was that the only way to target specific groups for less tax was to make them apply for it, though I suppose an exemption could be given based on how the age of the children changes, as well as their own income – shouldnt be that hard to keep track of…etecetra.

    Good on you if you volunteer though

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