Sunday, January 6, 2013

Obama Nominates Micro-Central Planning Economist

Esther Duflo has been nominated by President Obama to join a government body dedicated to advising the administration on "global development policy."

Called the Global Development Council, the group was founded by Obama in 2010 to help shape US development efforts abroad.

Reports France24, the French born Duflo, "who was raised in a 'left-leaning Protestant' family, said she became aware of economic divides and social injustice at a very early age."

Among her views, according to F24:
 “I was always conscientious of the gap between my existence and that of the world’s poor,” she told weekly French magazine l’Express in a January, 2011 article. “As a child, I was extremely troubled by the complete randomness of chance that I was born in Paris to an intellectual, middle class family, when I could have just as easily been born in Chad. It’s a question of luck. It inspired in me a sense of responsibility.”
The problem here is that she seems to not understand the difference in the structure of law and property rights that exist in France versus Chad, and the impact the differences have made. Where you are born is luck, but the structure of the government in that country  is not. It is the actions of men in the country. Chad is ranked on the Heritage Fund freedom scale at 166th, right between Comoros and the Republic of Congo. But there is nothing in her work that discusses this ranking and the link between  government interventions and poverty.

Instead, she discusses all out freedom as an evil for the poor and reaches the conclusion that poor people make bad decisions and thus should have decisions made for them by the government:

Only Obama would nominate someone who thinks that in the free world everything is taken care of for "the rich," even "if they make no decisions." And that the poor are the ones fraught with decisions. And it is all these decisions which cause the poor to make "bad decisions," and therefore the decisions need to be made for them.

She has done "research" on this, btw. NYT reports:
The small group of economists who work at the Jameel Poverty Action Lab at M.I.T., led by Esther Duflo and Abhijit Banerjee, were mentioned far more often than anyone else.

Ms. Duflo, Mr. Banerjee and their colleagues have a simple, if radical, goal. They want to overhaul development aid so that more of it is spent on programs that actually make a difference. And they are trying to do so in a way that skirts the long-running ideological debate between aid groups and their critics.

“Surely the most important societal question economics can help answer is why so many people are crushingly poor and what can be done about it,” David Romer, a professor at the University of California, Berkeley, said. The macro issues (like how to build a democracy) remain maddeningly complex, Mr. Romer noted. But thanks in part to the poverty lab, we now know much more about how to improve daily life in the world’s poorest countries.

The basic idea behind the lab is to rely on randomized trials — similar to the ones used in medical research — to study antipoverty programs. This helps avoid the classic problem with the evaluation of aid programs: it’s often impossible to separate cause and effect. If aid workers start supplying textbooks to schools in one town and the students there start doing better, it could be because of the textbooks. Or it could be that the town also happened to hire a new school administrator.

In a randomized trial, researchers would choose a set of schools and then separate into them two groups. The groups would be similar in every respect except for the fact that one would receive new textbooks and one wouldn’t. With a test like this, as Vinod Thomas, the head of independent evaluation at the World Bank, says, “You can be much more accurate and much more clear about the effect of a program.”
This is just total leftist nonsense. The best way to test what works and doesn't work is to allow anyone to try and test anything they want anywhere. That's how the internet and cell phones have developed. Tons of "decisions" are made by consumers on the free market and the cream rises to the top. No one is making bad decisions walking around with old cellphones.

What's really going with this lefty nonsense is the lefties are trying to eliminate choices and direct everything in their elitist direction.  The poor in countries like Chad, who have been screwed over by their governments, have good reason to not trust their governments, and yet people like Duflo see this distrust as a problem that should result in the poor being coerced by government making "decisions" for them:

What a bizarre example to use. It wasn't only the poor that had/ have concerns about the measles vaccination. A warning about the vaccination (correct or not) was published in the prestigious UK medical journal, The Lancet. The 1998 paper published in the journal presented apparent evidence that autism spectrum disorders could be caused by the MMR vaccine, an immunization against measles, mumps and rubella. The Lancet retracted the article in 2010, but many still have concerns and it is not only poor people in Chad.

Note, also the quote in the NYT clip above tells us that to build democracy is "maddeningly complex." First, this implies that democracy is the best form of government. But secondly, it implies that micro-central planning is an important alternative to "building" a democracy.

This confuses the form of government with the economic structure. Two very different things. It's possible to have a democratically socialist government and also possible to have a monarchy run on free market principles. 

Bottom line: Obama has nominated someone, who comes out of the micro-central planning elitist camp. Duflo fails to understand the teachings, or ignores the teachings, of the economists Ludwig von Mises and Friedrich Hayek, who taught about the importance of price signals in advancing an economy and the impossibility of attempting to micro-manage decisions. From what Mises has taught us, it is clear that the micro-managing that Duflo is promoting will do nothing but suffocate individuals and keep them in poverty.   


  1. African poverty is directly related to its adoption of hipster democratic socialism learned by its "elites" at western universities at the time of colonial independence. In addition to the grinding poverty induced by socialism, multi-ethnic democracies will almost always vote ethnic with the biggest group winning the election (the first and last) and, because the government "owns" everything, owning the entire country. It's a recipe for horrible poverty, ethnic cleansing and genocide.

    Thanks again to you "progressives" for all that you've done and continue to do for mankind.

  2. Me, I'm taking her advice and am logging in to Etrade with my helmet firmly strapped on.

  3. "Duflo fails to understand the teachings, or ignores the teachings, of the economists Ludwig von Mises and Friedrich Hayek" - dont forget Elinor Ostrom. She did her studies primarily on small communities like villages in Nepal and africa, studying resource management and utilization by those so very bad decision-making poor people!

    1. I was just about to quote this as well, haha

  4. It's not like she's even that much smarter any way. In her TED talk she said sometimes the water in India gives you diarrhea. Then she asked the people if you have diarrhea if you should drink more water, and the locals said no. Then she chastises them for being so stupid for not knowing that they need hydration.

    But she disregards the fact that they got sick from the water in the first place! What a clown this woman is.

  5. President Obama might have hired Mrs. Duflo so he's constantly reminded what 'not to do'. Also, many of you are suggesting that Africa's problems are self inflicted and those governments should impose the economic ideals of von Mises and Hayek, you fail to mention that Africa is still under the strangle hold of the colonial powers. The Wests addiction to African resources is as strong as 100 years ago, if not stronger. Free market principles only apply to the western companies making billions bribing and arming despot governments to maintain and certify poverty for the masses. The big elephant in the room is the West. How can any country in Africa see real 'middle class' growth when primitive capitalist ideals instruct and demand shareholder loyalty versus social and community empowerment.

    Mr. Roddis, was there ever 'colonial independence'? What African country did not have crippling Western influence after so called 'independence'?

    Lastly, the free market principles of von Mises and Hayek always result in 'wealth concentration' for a small minority groups that inherently restricts opportunity for others. The genetic make-up of classic capitalism is significantly flawed when applied to the developing world because it implies that their is no continued colonial 'vice grip'. A new innovative and inclusive theory has to be derived and the 'destructive greed gene' has to be removed and replaced with another variable that encourages and promotes the masses out of poverty. Once those poor citizens are educated then they can make intelligent decisions for themselves. What they don't need are Western trained soldiers orchestrating coups or US State Department officials thwarting the democratic process.

    Please be sincere and honest when discussing Africa and her problems. Maybe suggest a suitable medication for the 'withdrawal symptoms' that would occur if West decided to quit her addiction. Cold turkey will never work. Patch Anyone?

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