Governments may come, go, or even vanish, but the free market lasts forever. The Economist published an article last April on the status of everybody’s favorite failed state, Somalia. Those in favor of strong central governments (or even those who like a government) often point to the Horn of Africa as an example of the dangers of anarchy. Soon, the region will have as many mobile phone providers as my home state of South Dakota in the USA. Coca-Cola has recently opened a plant in Mogadishu, complete with mortar-proof concrete to protect against warlords’ attacks. The extra costs of protecting from the lawlessness point out that this is obviously not a viable solution for statehood. However, we can’t ignore the resiliency of the invisible hand in one of the least hospitable lands on Earth.
This characteristic is hardly limited to areas desperate for goods of any sort, as is Somalia. Indeed, many were skeptical about the ability for Eastern and Central Europe to bounce back from generations of Communist rule; many were proven wrong. “We were like a radish”, the Poles like to say, “red on the outside only.” When the oppressive hand of the Communist state was lifted from the people along the wrong side of the Iron Curtain, markets for even the most high-tech consumer goods sprouted like mad.
When naysayers doubt the ability for a culture to adapt to the “whims of the market,” they actually mean that people are completely unable to find a way to trade resources amongst themselves so everyone gets what he or she wants because of cultural or social concerns. Whether in anarchic east Africa, liberated Eastern Europe, or even here in India post-reforms, the free market has shown the ability to last and serve her masters far longer than any government.
The opinions expressed in this essay are those of the authors. They do not purport to reflect the opinions or views of CCS.