June 26, 2006

Hong Kong as an experiment

Milton Friedman uses Hong Kong as an experiment into the effects of a laizze-faire approach to running an economy, compared to several more statist governments (Isreal, Britian, and the USA). Uncerprisingly Hong Kong has performed much better than any of them. He concludes:
The real lesson of Hong Kong for the United States is that we’re using our resources inefficiently. Our government is spending our money to subsidize tobacco and to penalize smoking; to subsidize childbearing and to discourage childbearing; to build new housing and to tear down housing; to subsidize agriculture and to penalize agriculture; and on and on—not to mention converting square miles of forests into billions of paper forms and spending many man-years of labor filling them out and then filing them.
A lesson that Britian should learn as well, especially as we are far more government controlled than the USA and therefore stand to gain far more by removing that government control to more Hong Kong like levels.


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