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Tuesday, November 30, 2010

 

One Adaptation of the Stalin Method

Steven Levitt briefly discusses Nicolae Ceauşescu, the former Communist dictator of Romania, in chapter four of his famous book, Freakonomics. In 1966, Ceauşescu declared abortion to be illegal in Romania, stating that, “The fetus is the property of the entire society… Anyone who avoids having children is a deserter who abandons the laws of national continuity” (115). He implied that it was a person’s responsibility to have children—that he or she owed it to the country. Further, “all contraception and sex education was banned. Government agents regularly rounded up women in their workplaces to administer pregnancy tests. If a woman repeatedly failed to conceive, she was forced to pay a steep ‘celibacy tax’” (116).

The Romanian government strongly coerced citizens into having children, and Ceauşescu gave an… interesting… moral incentive for people to do so. His incentive for coercing people, though, was purely a material one. Most people in Romania at the time were extremely poor, while Ceauşescu and other government officials (40 of whom were members of his family) were quite wealthy—Levitt mentions that Ceauşescu’s wife had 40 homes! To maintain such an extravagant lifestyle, Ceauşescu needed more and more resources. So, it seems he figured, if the population was larger, there would be more people to tax, thus more to steal.

Stalin may have been Ceauşescu’s inspiration. In chapter 7 of Power and Prosperity, Olson describes methods Stalin used to increase his “tax theft.” He said, “Stalin’s innovation was to confiscate for his own purposes almost the total natural and tangible capital stock of the country and then use these resources to produce…[what he] wanted” (114). I’m not familiar with any of Ceauşescu’s other policies, but considering his policy on abortion, it seems he just employed a cruder version of Stalin’s tax collection policies—he claimed all fetuses as the government’s property, thus made it so there would be more people to steal from in the future. The birth rate of Romania doubled within one year of the abortion ban (Levitt 116), so Ceauşescu got his wish in that sense. However, perhaps it’s worth mentioning that Romania’s infant mortality rate dropped fairly suddenly in 1989, when the abortion ban was lifted (and Ceauşescu and his wife were executed).

Comments:
Can a tsunami hit politics not economics in any given country?

Looking at what is happening around the world; one would argue that politics and economics are indeed intertwined. Therefore, when there is a fire in economy, politics will feel the heat. This may be true when you observe what is going in Eurozone. Greece, one of the European members was to be bailed out by Euro bank because it was almost on the edge of a financial precipice. Because of the flip flop, George Papandreou, the Greek prime-minister, calling - and then cancelling - a referendum on the bailout plan. Papandreou is to resign because he was seen as incapable for assuring other European members that they will pay back.

Also, due to prevailing economic-political situation, Italy may be the next. Next, the politic and economic sphere in Greece pushed stocks around the world into the fresh shockwaves of doubts about the sustainability of the Eurozone.

Stacy Meichtry, in Wall Street Journal; quotes Girgio Napolitano, Italian president saying that Silvio Berlusconi, Italian prime-minister is to resign and a new national unity government is to be formed in order to tackle and overhaul Italy’s economy and take immediate steps to reduce its 1.9 trillion euro debt.

Altough dynamics are different, US politics is not safe when it comes to the influence on politics and economics vice versa. According to Daniel Eisenberg, University of Michigan and Jonathan Ketchan, University of Southern California contended in their article “Economic Voting in the US Presidential Elections: Who Blames Whom for What” in which they presented four evidences that influence voters namely:

1) Which is more important for determining people’s votes, national or local economic conditions?
2) What time frame do people consider in economic voting?
3) Which demographic groups are most sensitive to the economy in their voting behavior?
4) How does economic voting depend on the political context—in particular, whether a candidate is running for re-election, and whether the incumbent party also controls Congress?
To sum up, their findings showed how economic conditions influence greatly voter’s decision.

Reference

http://www.bepress.com/cgi/viewcontent.cgi?article=1285&context=bejeap

http://online.wsj.com/article
 
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