Expeditionary Economics: Should US military be educated in economics?

Carl Schramm of Kauffman foundation writes an intriguing piece. It was an article written for foreign affairs. As that is paid, the author provides a free version but cannot extract from the piece. So, it will be a small post.

In nut shell the article says that US track record of rebuilding economies after conflicts or natural disasters has been disappointing. Take the case of Afghanistan or Haiti, both still suffer from serious economic problems. He says one main reason for this failure is over reliance on international aid. The solution is to promote entrepreneurial development in these economies.

He points US military documents carry no mention of the term economic development in these operations. Ironically the manuals have the central planning mindset! He adds it is important that US military develops some competence in economics. Economic reconstruction should be part of the three legged strategy of invasion, stabilization or pacification and economic reconstruction. This the author calls as Expeditionary Economics.

The author points that entrepreneurship is critical to any economy and US has a great record in the same. US creates small businesses at a much faster rate than most economies.  But we don’t see Expeditionary Economics based on similar principles. He points to issues with this idea and it surely has its criticisms. But this is the case with other programs as well which have not delivered. Each economy is different and the case for development of entrepreneurship will differ. THis is where the challenge is but can be done. It is much better than wasting so much money on projects that have shown that they don’t work.

He concludes saying US armed forces have a unique role to play in world peace. If applied properly, it could lead to revolution in eco growth.

Excellent stuff. Though the author does not expand on the suggestion list. Creating entrepreurship is ideal but has been a struggle for many economies. It is a long drawn process which needs huge developments and reforms in legal, security, financial and general market place. It takes many number of years and with each country being different, the challenges become more complex.

Having said this, it is a different idea and makes one rethink on rebuilding nations and their economies. 

I was wondering if this could be merged with Paul Romer’s idea of charter cities (see a detailed post here). All these devastated economies need economic growth and vibrant cities are an important ingredient of growth. Now, the country in need may lack both credibility and finances to build new cities. So charter to develop new cities could be given to others. Infact, it could be given to US military which could then take other partners to finance and develop the city. A vibrant city with all proper rules will lead to migrants and help prosper entrepreneurship which is the idea of Shramm as well.

Unlike other economies where charter cities could run into problems, there is nothing like this here. You need to rebuild the economy and cities from scratch, so charter city idea could be looked into. See again, I am not saying the idea is  very simple and can be done without any issues. I do understand the complexity and challenges. But can we look at the two ideas together? What do the readers think? Let me know….

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