THE ANSWER IS BOTH, NOT ONE OR THE OTHER

Joseph Stiglitz (3 April) posts on “Social Europe” HERE 

“Reforming China’s State-Market Balance”

“No country in recorded history has grown as fast – and moved as many people out of poverty – as China over the last thirty years. A hallmark of China’s success has been its leaders’ willingness to revise the country’s economic model when and as needed, despite opposition from powerful vested interests. And now, as China implements another series of fundamental reforms, such interests are already lining up to resist. Can the reformers triumph again?

In answering that question, the crucial point to bear in mind is that, as in the past, the current round of reforms will restructure not only the economy, but also the vested interests that will shape future reforms (and even determine whether they are possible). And today, while high-profile initiatives – for example, the government’s widening anti-corruption campaign – receive much attention, the deeper issue that China faces concerns the appropriate roles of the state and the market.”

Comment

Stiglitz confronts the dominat issue that has contrary remedial policies for adherents of the idealogical “solutions” to the question that he asks of “the deeper issue” facing China” (and every other country) of “the appropriate roles of the state and the market.”

China’s “deep” question is not unique.  The same question dominates all countries that exist, or can exist anywhere since Homo sapiens walked upright out of the African bush.  

The division of labour was not invented in a ‘pin factory’; it appeared long ago with early humans because of wide natural variations in human abilities; some were good at tracking food, especially sources of meat, other weren’t as good; some were better at making stone tools or woodern weapons to secure food; others good at making fires and securing night-time stopping places; and so on across the skill sets that separated small groups of humans from nature and what was necessary for their survival.  Some, albeit, minmal co-operation within the separated groups trumped short-sighted selfishness in others.  Humanity was never given a free-pass to survive on Earth for ever, or at all.

It was ever thus.  And still is.  Today the first few thousand of the human species is now 7 billion strong and counting.  The false question is not whether we rely on state or market provision; we are bound to have both.  Of course, we can have 'too much' of one and 'too little' of the other.  

The argument is about the appropriate balance for both, because human societies need both and, I would venture to suggest in our high-tech complex societies, they cannot subsist for long with all of one (state provision, say) and no markets, or vice versa, except in the fantasies of those who are not paying attention either to the present arrangements or to history plus so-called ‘pre-history’, which is 'written' in the physical remnants of the past that passed away where we find their skeletal remains amidst their self-created detritus.