Bono, Foreign Aid, Capitalism

U2's Bono Courageously Embraces Capitalism - Forbes: " . . . Question: Which countries gave foreign aid to the U.S. during the 19th century as it became the wealthiest country in the world? Answer: None, but considerable foreign capital was invested along with a lot of international trade. Similarly, Zhou Xiaochuan, the head of China’s central bank, has stated that China’s policies for further economic growth must be based on continuing to “promote trade and investment.” Foreign aid, in contrast to trade and investment, has a dismal record. Countries that have received large aid packages have largely remained poor. Two World Bank studies attribute this to the fact that foreign aid often props up regimes that govern poorly. Statistics have shown that the most aid-dependent countries have averaged slightly negative economic growth, leaving them mired in poverty. Aid isn’t the answer. How encouraging, then, for me to learn that Bono now understands that, too. One of my students sent me a video clip, showing Bono addressing an audience of students at Georgetown University, in which he states, “Aid is just a stop-gap. Commerce—entrepreneurial capitalism—takes more people out of poverty than aid.” Bono also says, “In dealing with poverty here and around the world, welfare and foreign aid are a Band-Aid. Free enterprise is the cure. . . .” (read more at link above)

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Innovation, Capitalism, Entrepreneurs

Why Innovation Is Still Capitalism’s Star - NYTimes.com: " . . . Edmund S. Phelps, a professor of economics at Columbia University and a Nobel laureate, has written an interesting new book on the subject. It’s called “Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge and Change” (Princeton University Press), and it contains a complex new analysis of the importance of an entrepreneurial culture. Professor Phelps discerns a troubling trend in many countries, however, even the United States. He is worried about corporatism, a political philosophy in which economic activity is controlled by large interest groups or the government. Once corporatism takes hold in a society, he says, people don’t adequately appreciate the contributions and the travails of individuals who create and innovate. An economy with a corporatist culture can copy and even outgrow others for a while, he says, but, in the end, it will always be left behind. Only an entrepreneurial culture can lead. Is the United States really becoming corporatist? I don’t entirely agree with such a notion. Even so, President Obama has been talking a lot about innovation as a job creator this year, and while some of his intentions may be good, I’m afraid that some of his proposals look a little corporatist, and might suppress individual initiative. . . ."

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