Shorter Taleb: For a convex function, by Jensen’s inequality, the mean of the function is greater than the function of the mean. Hence, if you happen to live in a convex well, on average you will do better if you add noise.
Benoitsays:
Have you read Taleb’s “Antifragile”? He makes a similar and compelling argument against huge states and in favor of city-states.
The problem with the United States is that it is trying to have its union cake and eat it too, but it doesn’t want to get any icky unified icing on its “states’ rights.†The United States is obsessed with the illusion that it is a nation, but the moment the federal government attempts to do anything not related to foreign policy, the state governments complain that it has become tyrannical.
Just give up and admit y’all can’t play nicely with one another, all right?
Even Canada, where the province-versus-federation distribution of power is different, has its jurisdictional squabbles that threaten to engulf the actual important matters. But we seem to be coping a bit better; perhaps because of our smaller population.
I agree that a more unified Europe is probably undesirable. And having lived in the UK for two years now, I can tell you that the general feeling among the British population is for a weaker association with the rest of Europe, not a closer one. But it’s hard to tell how much of that is xenophobia and how much is a backlash from the recession (and the two are, of course, related).
What I find interesting about the Scottish referendum is that the UK government has done virtually nothing positive in trying to persuade people to vote “Noâ€. They have threatened, cajoled, and importuned. They don’t hesitate to cast dour prophecies for what an independent Scotland would be like, or how poor their relationship with the rest of the UK would be. Any sort of conciliatory rhetoric is entirely absent from the conversation. I find that very interesting. It suggests that the UK leadership still doesn’t get it, and either they are too deluded to see how close they are to losing Scotland, or they are so incompetent and corrupt that they just don’t care.
Benoitsays:
You might like him. His style can be a bit tiring, but he makes a lot of interesting arguments, not just about politics and city states.
Against large states: one-stop shopping for lobbyists, disconnect between the population and its rulers, less experimentation in all matters, etc.
This is the first thing that came to my mind when I read economists’ horrified reaction to the latest poll in Scotland.
Thanks for the pointer. I am not sure I understand Stross’ argument.
I will just point out that my own argument is not about economic growth. It is entirely possible that Europe would have been better off in 2008 with a more centralized government. You would not have had the collapse of Greece, for example.
I will concede the the US enjoys a huge open market. It makes it possible for any company to offer a service to hundreds of millions of people in one go. Doing the same thing in a world divided up into small states might be much more complicated.
There is some evidence that Canada is poorer because it offers a smaller market.
But this argument also applies to Imperial China. It had a huge market. The largest market of its time. And, in many ways, the Chinese empire was prosperous. But it was also very much stagnant.
That is what I see in the world today: too much stagnation.
The biggest news in tech today are about patent trolls. And there are vague promises of reforming patents… but the system is too big, too complicated… there is too much lobbying involved.
So we are migrating to some form of Imperial China where it is more important to have a huge bureaucratic apparatus fighting off patent trolls, than it is to come up with interesting new stuff.
If we had 55 genuinely independent countries in North America, at least one of them would be able to pull off a patent reform.
Mikesays:
“If we had 55 genuinely independent countries in North America . . . ”
Germany probably would have won the second world war. Then where would patent reform and civil liberties be. Maybe in a world that’s relatively free of material conflict this would be the preferred route,; but now?
But don’t you think being fragmented and poor are not necessarily the secret sauce for success? Take the examples of Africa, or the 3 South Asian countries that once comprised the historical India.
As I recall, the Indian states got their ass kicked by puny European countries starting with Portugual. Is your argument that a unified India would have been better off? Well, we had China which was unified… and it lost in a big way against the British and other relatively puny European countries…
As for Africa, the two African countries with the highest per capita GDP are Equatorial Guinea and Seychelles. Tiny places.
The largest African country is Nigeria. It is not doing well.
Singapore is tiny, but I would rather live there than in India. Much richer.
My point is not that tiny countries are richer. They are not. There are certainly good arguments in favour of large markets. But if you have many small countries, people can escape the bad ones more easily.
Technically, Britain and others had better technology back in 1700s and 1800s, which enabled them to colonize larger places. They couldn’t possibly defeat the huge Mughal empire at its peak, they were only able to control the subcontinent when the Mughal empire fragmented into many pieces and weak princely states. Scotland, as far as I understand, doesn’t have the technical advantage that the European countries enjoyed over their Asian competitors.
My argument was that the three South Asian countries spent and still spend a huge amount of money and resources in fighting with each other. The 4 wars of South Asia between 1947 and today resulted in so many deaths and set the region back so much!! These could have been prevented.
In case of the Scotts, I don’t know about their history or culture well enough to comment. But I feel that the drive towards independence has more to do with benefitting the politicians who would have greater power, than to benefit the people.
So, in the interest of peace and liberty, we should have few, large countries. Let us start eliminating small countries… maybe merging them with their neighbours. Maybe we can start with Israel. Let us merge them with Egypt. Before you complain, please note that it is in the interest of world peace.
As for Germany winning the war. Maybe Germany would have wiped out the USSR and the United Kingdom.
Except that the logic goes something like this: the bad guys are going to build huge empires, so we, the good guys, have to do the same…
So we are going to be driven by military needs… by the necessity of maintaining huge armies to fight each other.
Essentially, this argument works in favour of Imperial China, and against the fragmented Europe.
It also works against tiny countries like Israel. I mean, if we get a new Hitler, Israel will be too small to matter… we need huge countries like Egypt or Iran to fight off the bad guys.
And, of course, the big leap of faith you have to make here is that the American Empire is never going to turn bad. The Americans would never setup concentration camps on an ethnic basis (http://en.wikipedia.org/wiki/Internment_of_Japanese_Americans).
But, I assure you, these things happen. Big empires turn bad, and then people have nowhere to go. They are stuck in place.
In any case, I believe that the world is better off with a country like Israel than without. Sure, Israel could not stand alone against Nazi Germany… but it is not all about building gigantic armies. Freedom is better served with small countries.
In case of the Scotts, I don’t know about their history or culture well enough to comment. But I feel that the drive towards independence has more to do with benefitting the politicians who would have greater power, than to benefit the people.
I agree that this might well be the intention of the Scottish politicians. Similarly, I do not trust the Quebec separatists. I do not like their intentions one bit.
But I also do not trust the UK politicians. I assure you that they are just as greedy and egotistical.
I also think it is entirely likely that, on the whole, the Scots are better off on the short term in the UK.
Technically, Britain and others had better technology back in 1700s and 1800s, which enabled them to colonize larger places.
And why is that exactly? Why were Venice, the Dutch Republic and Britain able to surpass much larger rivals with ease?
Why did you not get the same in the Indian subcontinent?
Surely, we agree that Indians are just as smart as Europeans.
I submit to you that Europe was literally a laboratory where dozens of models were tried at the same time… Whereas India, being much more unified, remained stagnant, trying fewer things.
Scotland, as far as I understand, doesn’t have the technical advantage that the European countries enjoyed over their Asian competitors.
No. It does not. My point is not that Scotland will do better economically. I have no idea. I do not know Scotland well.
My point is that with Scotland in the UK, we get less experimentation. Scotland could try different ways to do things. Maybe they would screw up. Maybe they would do better than the UK. If they do better, we can maybe learn from that. If they screw up… well, only the Scots suffer directly, other people can route around the problems.
My argument was that the three South Asian countries spent and still spend a huge amount of money and resources in fighting with each other. The 4 wars of South Asia between 1947 and today resulted in so many deaths and set the region back so much!! These could have been prevented.
I submit to you that big countries tend to make bigger mistakes, in the sense that it sets back more people when they go wrong.
If the Singapore government screws up… well… it is sad, but hundreds of millions of people do not suffer. If they get it right, other countries can try to learn from it.
Mikesays:
“So, in the interest of peace and liberty, we should have few, large countries.”
That’s what we’ve had for the past period of time. Liberty could have done better, but it could have easially done worse as well.
“Let us start eliminating small countries… maybe merging them with their neighbors. Maybe we can start with Israel. Let us merge them with Egypt.”
Who was suggesting this? I thought the question wasn’t about combining countries so much as breaking them up. In any event, while Egypt would be better off with a merger, I don’t think Israel would, and I’m pretty sure a few things would need to change before they’d agree to it. 🙂
“As for Germany winning the war. Maybe Germany would have wiped out the USSR and the United Kingdom.”
Maybe.
“Except that the logic goes something like this: the bad guys are going to build huge empires, so we, the good guys, have to do the same.”
It’s not a point to be taken lightly. The right way to think about it is that in the event of a powerful, ill-intentioned power, there had better be someone to keep them at bay. Does this mean that a handful a large powers are the best outcome — I don’t think so, and I don’t think my logic argues for that.
“So we are going to be driven by military needs, by the necessity of maintaining huge armies to fight each other.”
You dismiss large armies, large markets, large in general. Perhaps you’re right, but I think the nature of the country rather than it’s military size is the determinative factor.
“Essentially, this argument works in favour of Imperial China, and against the fragmented Europe.”
Can’t have it both ways. If a fragmented Europe gets credit for being more dynamic than ancient China or India, then similarly it should get the blame for being the epicenter to the largest wars in human history.
“And, of course, the big leap of faith you have to make here is that the American Empire is never going to turn bad. The Americans would never setup concentration camps on an ethnic basis.”
Couldn’t agree with you more. There have been such episodes and unless the right decisions are made going forward, the worst could happen. Your adoption of the Precautionary Principle, however, that keeping all nations weak and (more or less) fragmented, hasn’t worked in the past and (as I said previously) is highly unlikely to work or be adopted absent general wealth, stability and peace. In those circumstances I think small but better would probably be better — at least as far as liberty goes.
“In any case, I believe that the world is better off with a country like Israel than without. Sure, Israel could not stand alone against Nazi Germany… but it is not all about building gigantic armies. Freedom is better served with small countries”
Of course the world is better off with Israel than without it. It would be quite useful if all modern, advanced and democratic countries in the world agree and forcefully acted to ensure this remains the case. Forget about hypotheticals like Germany, Israel would have a pretty rough go of it as it is without outside military and economic support. I like small countries. Some of my favorite places are small countries. Someday, if we’re lucky, everyone can enjoy the benefits that come with living in a small country 😉
Who was suggesting this? I thought the question wasn’t about combining countries so much as breaking them up.
But isn’t it the same logic? If you argue against breaking up big countries on the account that big countries are better able to protect peace, then why should it not follow that aggregating small countries into big countries would be good?
If an independent California would be bad for the world, why is an independent Israel good?
You dismiss large armies, large markets, large in general.
I do not. I repeatedly concede that big countries have benefits.
Can’t have it both ways. If a fragmented Europe gets credit for being more dynamic than ancient China or India, then similarly it should get the blame for being the epicenter to the largest wars in human history.
The German Empire at the start of the XXth century was the recent aggregation of something like 30 different states like Bavaria, Saxony… into a large centralized state.
At about the same time, Italy was unified, a bit in the same manner.
Italy and Germany as strong centralized states are much to blame for WWII.
keeping all nations weak and (more or less) fragmented, hasn’t worked in the past
But it has!
You can blame almost all huge mistakes on large centralized governments. The Nazis created such a mess because they were handed out a large centralized Germany. Stalin was able to murder so many because of the USSR. Mao killed millions because of the centralized Chinese government.
All big tragedies can be traced back to men with too much power… and they almost all derive this great power from large and powerful countries.
Hitler as the ruler of Bavaria would have had to work much harder to conquer Europe.
Frankly, the US President scares the hell out of me. It would take one bad president to create a mess would might not recover from. I say it is too much power for a single man. Maybe you are confident you will always elect great presidents. I am not.
Suresh Venkatsays:
Hi Daniel
your argument about India in the comments is not quite historically accurate. India was riven by dissension and fragmentatio for much of its history, with a long history of invading armies playing local rulers off against each other for personal gain (starting with Alexander in the late stages of the Greek Empire, the Mughals (who came from Arabia) and then the British. In fact, there were few times when India was NOT a collection of warring kingdoms: one of them was under Akbar in the middle ages, and another time was under the kingdoms of the Mauryas (after Alexander came and went).
Michelesays:
This post reminded me about “Guns, Germs, and Steel” by Jared Diamond. 🙂
It’s not a point to be taken lightly. The right way to think about it is that in the event of a powerful, ill-intentioned power, there had better be someone to keep them at bay.
I think that the Americans are probably creating more of a mess than anything else.
My knowledge of India is weak. I guess you are reacting to this statement I made:
“I submit to you that Europe was literally a laboratory where dozens of models were tried at the same time… Whereas India, being much more unified, remained stagnant, trying fewer things.”
I do not know if this analysis makes any sense. It might not make any sense.
Still, Portugal, of all countries, could come in and create a Portuguese India. Even back then, Portugal was not a large country, you understand.
Yes, the Europeans had neat technology, but it is not like Indians were uncivilized savages that could not work metal.
It is quite clear to me that Europeans had more initiative at that time.
Atul Mehtasays:
@Ragib/@Suresh
The Maratha empire ended the Mughal empire, and not the British. The Marathas were a formidable fighting machine, and despite lacking in numbers, they defeated the mighty Mughals. The Brits arrived well-equipped with for more advanced (and deadly) firearms/guns than their counterparts. The only way to wrest control off the Marathas was to severely fragment the Maratha empire, a trick which they pulled off, with better diplomacy (aka treachery skills) under the clever guise of DBA as East India Company.
Colonialism is no doubt worse than even facism. My point was not that the British empire was a good thing… but that a fragmented Europe lead to the rise of powerful nations like England.
Paulsays:
1) Cities are richer than rural areas, so of course small nations that consist entirely of urban cores are wealthier than larger nations. Highest per capita GDP by city paints a much more balanced picture: #2 is Dongguan in China (small countries are overrepresented in the list, but much less black and white). Richest cities by GDP leans towards large cities in large nations. If the major cities in any nation declared independence they’d be immediately very wealthy per capita, and the surrounding area would be immediately impoverished looking, statistically.
2) Germany is to blame for WWII because it was large, but England is to blame for its colonialism because it was small? How about the Western world? The sprawling Aztec empire and the small, independent native North American tribes both collapsed.
3) China is now the second largest economy and for a while has been the fastest growing major economy. The growth has been sustained for decades. Europe lead through the Industrial Revolution, but I don’t think you can discount the USA’s leadership in the post-WWII global economy.
I actually agree with a lot of what you say, the importance of small autonomous regions, but I think you’re vastly overstating the case for it. The world is complex and at different times large and small nations have played leading roles.
Cities are richer than rural areas, so of course small nations that consist entirely of urban cores are wealthier than larger nations.
In developed countries, more than 80% of the population lives in urban areas. So you are describing an effect that can only amount to a ~10% difference on a per capita basis… at the extreme.
No matter how you square it, underdeveloped countries are not going to rank first on a per capita basis.
China is now the second largest economy and for a while has been the fastest growing major economy. The growth has been sustained for decades.
China has been growing so fast because it was extremely poor for so long…
Still big countries, through economies of scale, can be much more efficient than small countries everything else begin equal.
And for this reason, you should not consider it obvious that Singapore is one of the top-3 richest countries in the world. You should not take it for granted that Israel is one of the leading country in wealth and technology.
What should be surprising is that the two biggest countries in the world (India and China) are far from the richest on a per capita basis.
Times and times again, small countries hack their way up the ranks despite their lack of raw power and scale.
That is the foundation of modern western civilization. The Europeans did not take over the world by sheer force… they did it by hacking their economies and politics in clever ways that had never been tried.
I don’t think you can discount the USA’s leadership in the post-WWII global economy.
Big countries are more powerful than small countries, everything else being equal.
But I think that the world would be better off on the long run with 55 different states in North America. The result would be a weaker conglomerate… on the short run. But my claim is that you would see some of these places thrive like it is not possible right now. On the long run, we would be better off because it would make things possible that are unthinkable in our current setup. Some political reforms can never be tried in North America as it stands right now.
Germany is to blame for WWII because it was large, but England is to blame for its colonialism because it was small? How about the Western world?
The colonial UK was no longer small. It was an Empire just like the Chinese Empire or the German Empire.
I do not say that England was rich *because* it was small. I say that Europe allowed the emergence of great wealth because it experimented with many more models. There were no Adam Smith in India or China. Not for lack of great minds… but for lack of political experimentation.
So we got the Dutch Republic and then England… Elsewhere in the world, in comparison, there was political stagnation.
Scotland, by the way, contributed greatly to this process… as one of the centres of the industrial revolution. Yes, Scotland was and is still a tiny place… but its uniqueness made us all much wealthier today.
Had Scotland been tightly integrated into an homogeneous Empire, we would probably would not have had the Scottish enlightenment (a crucial historical period for our current civilization).
So I want more Scotlands and fewer large empires.
The sprawling Aztec empire and the small, independent native North American tribes both collapsed.
North America fell to the Europeans much more slowly than South America. All they had to do in South America is walk up to the capital of the Empire and grab the King.
Some North American nations are still around. The Aztec… has been wiped out entirely.
Though much less powerful, and often much less advanced, the relatively barbaric North American nations as a whole kept the French and British at bay for much longer.
Simply put, large empires are fragile. You can topple them with one bullet. You can corrupt them with one coup.
Mark Ssays:
I thought this post was inspired by “If Mayors Ruled the World” by Benjamin Barber (whose work Taleb cited in his Antifragile).
The US had this argument at the time when The Federalist Papers came out, not? I think that US’s 500K dead in WWII vs Europe’s tens of millions sorta indicates that Hamilton was right and more tightly knit unions are better. Maybe the US has a more powerful spying agency that it would have as a confederation, but at least the states haven’t been at war with each other for a while.
I think that US’s 500K dead in WWII vs Europe’s tens of millions sorta indicates that Hamilton was right and more tightly knit unions are better.
As I stated before in the comments, WWII can be traced back the recent new large centralized states in Germany and Italy. And in many ways, the world wars are just a continuation of this impulse to unify ever larger territories under one banner. Hitler wanted to unify Europe and had he succeeded, there would have been peace in Europe. No more wars.
I only said Hamilton was right in that the kind of union that he advocated for North America was a better idea for North America than a confederation would have been. Not that any union is a good idea.
Hitler’s United States of Europe, as Churchill called that emerging state in a letter to Roosevelt, was a different kind of union. What does its failure tell us?
To me it tells that not all unions are alike. The EU for instance has already proven more stable than Nazi Germany’s attempt at a united Europe. I think (naively? maybe not?) that voluntary unions tend to do better than involuntary (and it’s a continuum and not a binary distinction), and that there are other factors along those lines making some unions do better than others.
Could a bunch of city states fight Nazi Germany? Hardly!
I think evolution points to bigger unions tending to win; look at the size of them we have right now. My bet is we’ll end up with a world government and the only question is how much blood it takes. Sure, it’s all eggs in one basket, but the human (or animal) body is billions and billions of eggs in one basket and that proved rather successful.
From an abstract perspective city states are more appealing to me than huge governments on many levels. I just wouldn’t bet my money on this model actually winning.
P.S. What could destroy the EU in the near future? That it’s a confederation, not a federation; hence the difficulties with respect to monetary policy coordination, etc. The federalists’ arguments seem as relevant as ever…
One point worth stressing is that you may “blame” Nazism and Fascism on large states, but the real question is whether they can be stopped by anything other than large states.
If you say “large states are evil” but see no way to minimize that evil except through, well, large states, then you agree that it’s a necessary evil, not unlike people who fall out of windows dying as a necessary evil result of gravity. Basically your advice then becomes “form large states” despite how you (or I) feel about them.
If you see how Nazism and Fascism can in fact be stopped by city states or something like North American native tribes (who might have been more effective in their resistance to Europeans than South America’s native, but not nearly as effective as the British et al were in their resistance to Nazi Germany), then I very much doubt it, but it’d be fascinating to read your thoughts on it.
The trend is probably irrelevant however. What we have seen throughout history is a back and forth. Huge empires arise, then they collapse and smaller and leaner countries come about… some of these winners grow big through military conquest and the circle repeats itself. Thankfully, we are out-evolving military conquest. There are fewer and fewer territorial wars. This suggests we might reach a stationary state made of smallish states.
Sure, it’s all eggs in one basket, but the human (or animal) body is billions and billions of eggs in one basket and that proved rather successful.
Not that I think that it is an apt analogy, but the human body is closer to anarcho-capitalism than to a centralized state.
P.S. What could destroy the EU in the near future? That it’s a confederation, not a federation; hence the difficulties with respect to monetary policy coordination, etc. The federalists’ arguments seem as relevant as ever…
Regarding the EU, you may think that it is not sufficiently integrated, or that it should never have existed in the first place. I am in the latter camp. In fact, I think that many European countries are too big. Germany and the UK should be broken up.
All they really need is free trade and open borders. No need for political integration.
I don’t “seek” to maximize military strength any more than falling objects seek contact with the Earth. If you lack military strength, then someone who has it will conquer you.
There are more and more territorial wars – we have right now the Russia/Ukraine business, ISIS, and there’s one big one coming up when Iran becomes nuclear. What has stopped (some) wars since WWII if not huge nuclear superpowers? Surely most smaller states survived due to the protection of larger states. How can this be seen as anything but evolution towards larger states?
The human body is rather far from anarcho-capitalism. Legs follow head’s orders, head feels pain when legs are hurt, no choice, no way to choose another brain or to ignore the legs’ plight. The heart does not compete with the liver. Cells competing with other cells for living space are called cancer. How apt this analogy is is another question.
I love anarcho-capitalism and have read Rothbard and David Friedman (the latter was more enjoyable by far). There’s no way this thing will ever work. Friedman cites some northern tribes as having sustained anarcho-capitalism for what, 300 years before being conquered by a king?
As to breaking up nation states – economists (I think David Friedman in particular) will point out that nation states will expand to control all people speaking a given language because it creates a taxation monopoly (it’s much harder for a German to work in France where they speak another language than it would be to escape a small German state to work in a neighboring small state where they speak the same language). Nation states follow from economics among other things. (Why does a nation with a taxation monopoly necessarily crushes its neighbors lacking such monopoly? Because its monopoly results in more taxes, hence in a larger standing army. Germany becoming a large state was the inevitable reaction to being badgered by its neighbors, it’s just a matter of time.)
I actually love the way you’re looking at it and I tried for a lot of time to look at it that way. It just doesn’t compute to me. To me it is obvious that if you break up all the “too large” states in Europe, Europe will simply be conquered by Russia. Gravity.
I guess however that it’s one of those cases where the facts can support many viewpoints to some extent, but unquestionably prove nothing…
I do not accept the premise that we should organize politically in order to most efficiently carry war.
Even so, the Americans did not fight to stop fascism. They fought to protect the interests of their empire.
There is an important difference. E.g., the Americans closed their borders to the Jews… they were unconcerned with Jews suffering, but very concerned with having to deal with immigration.
There are more and more territorial wars – we have right now the Russia/Ukraine business, ISIS, and there’s one big one coming up when Iran becomes nuclear.
That is false. We never had fewer territorial wars… mostly because they are becoming irrelevant.
ISIS is made of something like 20k fighters with no industry to back them. It is hardly a war. They are only a problem because the US has been arming them (unwillingly).
The Russia/Ukraine thing is annoying and sad… but it is hardly a territorial war. The real tragedy is that Ukraine is a mess economically.
Iran has mostly been a peaceful country. Though they are sometimes run by madmen who oppress the population, they are hardly belligerent.
Shorter Taleb: For a convex function, by Jensen’s inequality, the mean of the function is greater than the function of the mean. Hence, if you happen to live in a convex well, on average you will do better if you add noise.
Have you read Taleb’s “Antifragile”? He makes a similar and compelling argument against huge states and in favor of city-states.
@Benoit
Unfortunately, I have never read Taleb.
The problem with the United States is that it is trying to have its union cake and eat it too, but it doesn’t want to get any icky unified icing on its “states’ rights.†The United States is obsessed with the illusion that it is a nation, but the moment the federal government attempts to do anything not related to foreign policy, the state governments complain that it has become tyrannical.
Just give up and admit y’all can’t play nicely with one another, all right?
Even Canada, where the province-versus-federation distribution of power is different, has its jurisdictional squabbles that threaten to engulf the actual important matters. But we seem to be coping a bit better; perhaps because of our smaller population.
I agree that a more unified Europe is probably undesirable. And having lived in the UK for two years now, I can tell you that the general feeling among the British population is for a weaker association with the rest of Europe, not a closer one. But it’s hard to tell how much of that is xenophobia and how much is a backlash from the recession (and the two are, of course, related).
What I find interesting about the Scottish referendum is that the UK government has done virtually nothing positive in trying to persuade people to vote “Noâ€. They have threatened, cajoled, and importuned. They don’t hesitate to cast dour prophecies for what an independent Scotland would be like, or how poor their relationship with the rest of the UK would be. Any sort of conciliatory rhetoric is entirely absent from the conversation. I find that very interesting. It suggests that the UK leadership still doesn’t get it, and either they are too deluded to see how close they are to losing Scotland, or they are so incompetent and corrupt that they just don’t care.
You might like him. His style can be a bit tiring, but he makes a lot of interesting arguments, not just about politics and city states.
Against large states: one-stop shopping for lobbyists, disconnect between the population and its rulers, less experimentation in all matters, etc.
This is the first thing that came to my mind when I read economists’ horrified reaction to the latest poll in Scotland.
@Benoit
Lack of experimentation is a critical weakness of large states. They go with one solution, as if they knew what they were doing.
Noted SF author Charlie Stross (who does get a vote this time) is arguing much the same thing about small vs large countries, but from the point of view of social liberties rather than economic growth. See: http://www.antipope.org/charlie/blog-static/2014/09/the-referendum-question.html
That’s next week, next Thursday in fact.
@Eloise
Thanks. I edited my blog post to match the actual deadline. I imagined that it was still a few weeks away.
@Eppstein
Thanks for the pointer. I am not sure I understand Stross’ argument.
I will just point out that my own argument is not about economic growth. It is entirely possible that Europe would have been better off in 2008 with a more centralized government. You would not have had the collapse of Greece, for example.
I will concede the the US enjoys a huge open market. It makes it possible for any company to offer a service to hundreds of millions of people in one go. Doing the same thing in a world divided up into small states might be much more complicated.
There is some evidence that Canada is poorer because it offers a smaller market.
But this argument also applies to Imperial China. It had a huge market. The largest market of its time. And, in many ways, the Chinese empire was prosperous. But it was also very much stagnant.
That is what I see in the world today: too much stagnation.
The biggest news in tech today are about patent trolls. And there are vague promises of reforming patents… but the system is too big, too complicated… there is too much lobbying involved.
So we are migrating to some form of Imperial China where it is more important to have a huge bureaucratic apparatus fighting off patent trolls, than it is to come up with interesting new stuff.
If we had 55 genuinely independent countries in North America, at least one of them would be able to pull off a patent reform.
“If we had 55 genuinely independent countries in North America . . . ”
Germany probably would have won the second world war. Then where would patent reform and civil liberties be. Maybe in a world that’s relatively free of material conflict this would be the preferred route,; but now?
But don’t you think being fragmented and poor are not necessarily the secret sauce for success? Take the examples of Africa, or the 3 South Asian countries that once comprised the historical India.
@Ragib
As I recall, the Indian states got their ass kicked by puny European countries starting with Portugual. Is your argument that a unified India would have been better off? Well, we had China which was unified… and it lost in a big way against the British and other relatively puny European countries…
As for Africa, the two African countries with the highest per capita GDP are Equatorial Guinea and Seychelles. Tiny places.
The largest African country is Nigeria. It is not doing well.
Singapore is tiny, but I would rather live there than in India. Much richer.
My point is not that tiny countries are richer. They are not. There are certainly good arguments in favour of large markets. But if you have many small countries, people can escape the bad ones more easily.
Technically, Britain and others had better technology back in 1700s and 1800s, which enabled them to colonize larger places. They couldn’t possibly defeat the huge Mughal empire at its peak, they were only able to control the subcontinent when the Mughal empire fragmented into many pieces and weak princely states. Scotland, as far as I understand, doesn’t have the technical advantage that the European countries enjoyed over their Asian competitors.
My argument was that the three South Asian countries spent and still spend a huge amount of money and resources in fighting with each other. The 4 wars of South Asia between 1947 and today resulted in so many deaths and set the region back so much!! These could have been prevented.
In case of the Scotts, I don’t know about their history or culture well enough to comment. But I feel that the drive towards independence has more to do with benefitting the politicians who would have greater power, than to benefit the people.
@Mike
So, in the interest of peace and liberty, we should have few, large countries. Let us start eliminating small countries… maybe merging them with their neighbours. Maybe we can start with Israel. Let us merge them with Egypt. Before you complain, please note that it is in the interest of world peace.
As for Germany winning the war. Maybe Germany would have wiped out the USSR and the United Kingdom.
Except that the logic goes something like this: the bad guys are going to build huge empires, so we, the good guys, have to do the same…
So we are going to be driven by military needs… by the necessity of maintaining huge armies to fight each other.
Essentially, this argument works in favour of Imperial China, and against the fragmented Europe.
It also works against tiny countries like Israel. I mean, if we get a new Hitler, Israel will be too small to matter… we need huge countries like Egypt or Iran to fight off the bad guys.
And, of course, the big leap of faith you have to make here is that the American Empire is never going to turn bad. The Americans would never setup concentration camps on an ethnic basis (http://en.wikipedia.org/wiki/Internment_of_Japanese_Americans).
But, I assure you, these things happen. Big empires turn bad, and then people have nowhere to go. They are stuck in place.
In any case, I believe that the world is better off with a country like Israel than without. Sure, Israel could not stand alone against Nazi Germany… but it is not all about building gigantic armies. Freedom is better served with small countries.
@Ragib
In case of the Scotts, I don’t know about their history or culture well enough to comment. But I feel that the drive towards independence has more to do with benefitting the politicians who would have greater power, than to benefit the people.
I agree that this might well be the intention of the Scottish politicians. Similarly, I do not trust the Quebec separatists. I do not like their intentions one bit.
But I also do not trust the UK politicians. I assure you that they are just as greedy and egotistical.
I also think it is entirely likely that, on the whole, the Scots are better off on the short term in the UK.
Technically, Britain and others had better technology back in 1700s and 1800s, which enabled them to colonize larger places.
And why is that exactly? Why were Venice, the Dutch Republic and Britain able to surpass much larger rivals with ease?
Why did you not get the same in the Indian subcontinent?
Surely, we agree that Indians are just as smart as Europeans.
I submit to you that Europe was literally a laboratory where dozens of models were tried at the same time… Whereas India, being much more unified, remained stagnant, trying fewer things.
Scotland, as far as I understand, doesn’t have the technical advantage that the European countries enjoyed over their Asian competitors.
No. It does not. My point is not that Scotland will do better economically. I have no idea. I do not know Scotland well.
My point is that with Scotland in the UK, we get less experimentation. Scotland could try different ways to do things. Maybe they would screw up. Maybe they would do better than the UK. If they do better, we can maybe learn from that. If they screw up… well, only the Scots suffer directly, other people can route around the problems.
My argument was that the three South Asian countries spent and still spend a huge amount of money and resources in fighting with each other. The 4 wars of South Asia between 1947 and today resulted in so many deaths and set the region back so much!! These could have been prevented.
I submit to you that big countries tend to make bigger mistakes, in the sense that it sets back more people when they go wrong.
If the Singapore government screws up… well… it is sad, but hundreds of millions of people do not suffer. If they get it right, other countries can try to learn from it.
“So, in the interest of peace and liberty, we should have few, large countries.”
That’s what we’ve had for the past period of time. Liberty could have done better, but it could have easially done worse as well.
“Let us start eliminating small countries… maybe merging them with their neighbors. Maybe we can start with Israel. Let us merge them with Egypt.”
Who was suggesting this? I thought the question wasn’t about combining countries so much as breaking them up. In any event, while Egypt would be better off with a merger, I don’t think Israel would, and I’m pretty sure a few things would need to change before they’d agree to it. 🙂
“As for Germany winning the war. Maybe Germany would have wiped out the USSR and the United Kingdom.”
Maybe.
“Except that the logic goes something like this: the bad guys are going to build huge empires, so we, the good guys, have to do the same.”
It’s not a point to be taken lightly. The right way to think about it is that in the event of a powerful, ill-intentioned power, there had better be someone to keep them at bay. Does this mean that a handful a large powers are the best outcome — I don’t think so, and I don’t think my logic argues for that.
“So we are going to be driven by military needs, by the necessity of maintaining huge armies to fight each other.”
You dismiss large armies, large markets, large in general. Perhaps you’re right, but I think the nature of the country rather than it’s military size is the determinative factor.
“Essentially, this argument works in favour of Imperial China, and against the fragmented Europe.”
Can’t have it both ways. If a fragmented Europe gets credit for being more dynamic than ancient China or India, then similarly it should get the blame for being the epicenter to the largest wars in human history.
“And, of course, the big leap of faith you have to make here is that the American Empire is never going to turn bad. The Americans would never setup concentration camps on an ethnic basis.”
Couldn’t agree with you more. There have been such episodes and unless the right decisions are made going forward, the worst could happen. Your adoption of the Precautionary Principle, however, that keeping all nations weak and (more or less) fragmented, hasn’t worked in the past and (as I said previously) is highly unlikely to work or be adopted absent general wealth, stability and peace. In those circumstances I think small but better would probably be better — at least as far as liberty goes.
“In any case, I believe that the world is better off with a country like Israel than without. Sure, Israel could not stand alone against Nazi Germany… but it is not all about building gigantic armies. Freedom is better served with small countries”
Of course the world is better off with Israel than without it. It would be quite useful if all modern, advanced and democratic countries in the world agree and forcefully acted to ensure this remains the case. Forget about hypotheticals like Germany, Israel would have a pretty rough go of it as it is without outside military and economic support. I like small countries. Some of my favorite places are small countries. Someday, if we’re lucky, everyone can enjoy the benefits that come with living in a small country 😉
@Mike
Who was suggesting this? I thought the question wasn’t about combining countries so much as breaking them up.
But isn’t it the same logic? If you argue against breaking up big countries on the account that big countries are better able to protect peace, then why should it not follow that aggregating small countries into big countries would be good?
If an independent California would be bad for the world, why is an independent Israel good?
You dismiss large armies, large markets, large in general.
I do not. I repeatedly concede that big countries have benefits.
Can’t have it both ways. If a fragmented Europe gets credit for being more dynamic than ancient China or India, then similarly it should get the blame for being the epicenter to the largest wars in human history.
The German Empire at the start of the XXth century was the recent aggregation of something like 30 different states like Bavaria, Saxony… into a large centralized state.
At about the same time, Italy was unified, a bit in the same manner.
Italy and Germany as strong centralized states are much to blame for WWII.
keeping all nations weak and (more or less) fragmented, hasn’t worked in the past
But it has!
You can blame almost all huge mistakes on large centralized governments. The Nazis created such a mess because they were handed out a large centralized Germany. Stalin was able to murder so many because of the USSR. Mao killed millions because of the centralized Chinese government.
All big tragedies can be traced back to men with too much power… and they almost all derive this great power from large and powerful countries.
Hitler as the ruler of Bavaria would have had to work much harder to conquer Europe.
Frankly, the US President scares the hell out of me. It would take one bad president to create a mess would might not recover from. I say it is too much power for a single man. Maybe you are confident you will always elect great presidents. I am not.
Hi Daniel
your argument about India in the comments is not quite historically accurate. India was riven by dissension and fragmentatio for much of its history, with a long history of invading armies playing local rulers off against each other for personal gain (starting with Alexander in the late stages of the Greek Empire, the Mughals (who came from Arabia) and then the British. In fact, there were few times when India was NOT a collection of warring kingdoms: one of them was under Akbar in the middle ages, and another time was under the kingdoms of the Mauryas (after Alexander came and went).
This post reminded me about “Guns, Germs, and Steel” by Jared Diamond. 🙂
@Mike
It’s not a point to be taken lightly. The right way to think about it is that in the event of a powerful, ill-intentioned power, there had better be someone to keep them at bay.
I think that the Americans are probably creating more of a mess than anything else.
@Suresh
My knowledge of India is weak. I guess you are reacting to this statement I made:
“I submit to you that Europe was literally a laboratory where dozens of models were tried at the same time… Whereas India, being much more unified, remained stagnant, trying fewer things.”
I do not know if this analysis makes any sense. It might not make any sense.
Still, Portugal, of all countries, could come in and create a Portuguese India. Even back then, Portugal was not a large country, you understand.
Yes, the Europeans had neat technology, but it is not like Indians were uncivilized savages that could not work metal.
It is quite clear to me that Europeans had more initiative at that time.
@Ragib/@Suresh
The Maratha empire ended the Mughal empire, and not the British. The Marathas were a formidable fighting machine, and despite lacking in numbers, they defeated the mighty Mughals. The Brits arrived well-equipped with for more advanced (and deadly) firearms/guns than their counterparts. The only way to wrest control off the Marathas was to severely fragment the Maratha empire, a trick which they pulled off, with better diplomacy (aka treachery skills) under the clever guise of DBA as East India Company.
The British rule wasn’t stellarly civilized as compared to the Mughal and Maratha empires. For example, 10 million died in the Great Bengal Famine alone: http://en.wikipedia.org/wiki/Timeline_of_major_famines_in_India_during_British_rule. As far as I know, starving people to death is far more cruel in contrast to Hitler’s deeds.
This article makes an unconvincing
example of either of actions,
fragmentation or unification.
Various historical examples
aren’t helping. The world has changed
a bit since 1800s.
@Atul
Colonialism is no doubt worse than even facism. My point was not that the British empire was a good thing… but that a fragmented Europe lead to the rise of powerful nations like England.
1) Cities are richer than rural areas, so of course small nations that consist entirely of urban cores are wealthier than larger nations. Highest per capita GDP by city paints a much more balanced picture: #2 is Dongguan in China (small countries are overrepresented in the list, but much less black and white). Richest cities by GDP leans towards large cities in large nations. If the major cities in any nation declared independence they’d be immediately very wealthy per capita, and the surrounding area would be immediately impoverished looking, statistically.
2) Germany is to blame for WWII because it was large, but England is to blame for its colonialism because it was small? How about the Western world? The sprawling Aztec empire and the small, independent native North American tribes both collapsed.
3) China is now the second largest economy and for a while has been the fastest growing major economy. The growth has been sustained for decades. Europe lead through the Industrial Revolution, but I don’t think you can discount the USA’s leadership in the post-WWII global economy.
I actually agree with a lot of what you say, the importance of small autonomous regions, but I think you’re vastly overstating the case for it. The world is complex and at different times large and small nations have played leading roles.
@Paul
Cities are richer than rural areas, so of course small nations that consist entirely of urban cores are wealthier than larger nations.
In developed countries, more than 80% of the population lives in urban areas. So you are describing an effect that can only amount to a ~10% difference on a per capita basis… at the extreme.
No matter how you square it, underdeveloped countries are not going to rank first on a per capita basis.
China is now the second largest economy and for a while has been the fastest growing major economy. The growth has been sustained for decades.
China has been growing so fast because it was extremely poor for so long…
Still big countries, through economies of scale, can be much more efficient than small countries everything else begin equal.
And for this reason, you should not consider it obvious that Singapore is one of the top-3 richest countries in the world. You should not take it for granted that Israel is one of the leading country in wealth and technology.
What should be surprising is that the two biggest countries in the world (India and China) are far from the richest on a per capita basis.
Times and times again, small countries hack their way up the ranks despite their lack of raw power and scale.
That is the foundation of modern western civilization. The Europeans did not take over the world by sheer force… they did it by hacking their economies and politics in clever ways that had never been tried.
I don’t think you can discount the USA’s leadership in the post-WWII global economy.
Big countries are more powerful than small countries, everything else being equal.
But I think that the world would be better off on the long run with 55 different states in North America. The result would be a weaker conglomerate… on the short run. But my claim is that you would see some of these places thrive like it is not possible right now. On the long run, we would be better off because it would make things possible that are unthinkable in our current setup. Some political reforms can never be tried in North America as it stands right now.
Germany is to blame for WWII because it was large, but England is to blame for its colonialism because it was small? How about the Western world?
The colonial UK was no longer small. It was an Empire just like the Chinese Empire or the German Empire.
I do not say that England was rich *because* it was small. I say that Europe allowed the emergence of great wealth because it experimented with many more models. There were no Adam Smith in India or China. Not for lack of great minds… but for lack of political experimentation.
So we got the Dutch Republic and then England… Elsewhere in the world, in comparison, there was political stagnation.
Scotland, by the way, contributed greatly to this process… as one of the centres of the industrial revolution. Yes, Scotland was and is still a tiny place… but its uniqueness made us all much wealthier today.
Had Scotland been tightly integrated into an homogeneous Empire, we would probably would not have had the Scottish enlightenment (a crucial historical period for our current civilization).
So I want more Scotlands and fewer large empires.
The sprawling Aztec empire and the small, independent native North American tribes both collapsed.
North America fell to the Europeans much more slowly than South America. All they had to do in South America is walk up to the capital of the Empire and grab the King.
Some North American nations are still around. The Aztec… has been wiped out entirely.
Though much less powerful, and often much less advanced, the relatively barbaric North American nations as a whole kept the French and British at bay for much longer.
Simply put, large empires are fragile. You can topple them with one bullet. You can corrupt them with one coup.
I thought this post was inspired by “If Mayors Ruled the World” by Benjamin Barber (whose work Taleb cited in his Antifragile).
http://benjaminbarber.org/books/if-mayors-ruled-the-world/
There’s lots of his talks on Youtube as well.
@Mark
Thanks. I did not know about Barber.
The US had this argument at the time when The Federalist Papers came out, not? I think that US’s 500K dead in WWII vs Europe’s tens of millions sorta indicates that Hamilton was right and more tightly knit unions are better. Maybe the US has a more powerful spying agency that it would have as a confederation, but at least the states haven’t been at war with each other for a while.
@Yossi
I am not arguing against Hamilton.
I think that US’s 500K dead in WWII vs Europe’s tens of millions sorta indicates that Hamilton was right and more tightly knit unions are better.
As I stated before in the comments, WWII can be traced back the recent new large centralized states in Germany and Italy. And in many ways, the world wars are just a continuation of this impulse to unify ever larger territories under one banner. Hitler wanted to unify Europe and had he succeeded, there would have been peace in Europe. No more wars.
I only said Hamilton was right in that the kind of union that he advocated for North America was a better idea for North America than a confederation would have been. Not that any union is a good idea.
Hitler’s United States of Europe, as Churchill called that emerging state in a letter to Roosevelt, was a different kind of union. What does its failure tell us?
To me it tells that not all unions are alike. The EU for instance has already proven more stable than Nazi Germany’s attempt at a united Europe. I think (naively? maybe not?) that voluntary unions tend to do better than involuntary (and it’s a continuum and not a binary distinction), and that there are other factors along those lines making some unions do better than others.
Could a bunch of city states fight Nazi Germany? Hardly!
I think evolution points to bigger unions tending to win; look at the size of them we have right now. My bet is we’ll end up with a world government and the only question is how much blood it takes. Sure, it’s all eggs in one basket, but the human (or animal) body is billions and billions of eggs in one basket and that proved rather successful.
From an abstract perspective city states are more appealing to me than huge governments on many levels. I just wouldn’t bet my money on this model actually winning.
P.S. What could destroy the EU in the near future? That it’s a confederation, not a federation; hence the difficulties with respect to monetary policy coordination, etc. The federalists’ arguments seem as relevant as ever…
One point worth stressing is that you may “blame” Nazism and Fascism on large states, but the real question is whether they can be stopped by anything other than large states.
If you say “large states are evil” but see no way to minimize that evil except through, well, large states, then you agree that it’s a necessary evil, not unlike people who fall out of windows dying as a necessary evil result of gravity. Basically your advice then becomes “form large states” despite how you (or I) feel about them.
If you see how Nazism and Fascism can in fact be stopped by city states or something like North American native tribes (who might have been more effective in their resistance to Europeans than South America’s native, but not nearly as effective as the British et al were in their resistance to Nazi Germany), then I very much doubt it, but it’d be fascinating to read your thoughts on it.
@Yossi
The EU for instance has already proven more stable than Nazi Germany’s attempt at a united Europe.
I am not sure stability is what we should seek. Nazi Germany’s instability was its one redeeming feature.
Stability also means stagnation. The Catholic Church is very stable.
You want a system where new ideas are tried all the time, and where failures are quickly recognized and corrected.
Could a bunch of city states fight Nazi Germany? Hardly!
If you seek to maximize military strength, then, by all means, create large empires.
I think evolution points to bigger unions tending to win; look at the size of them we have right now.
I think that the trend is in the other direction.
We have more and more countries every decade…
http://en.wikipedia.org/wiki/Lists_of_sovereign_states_by_year
The trend is probably irrelevant however. What we have seen throughout history is a back and forth. Huge empires arise, then they collapse and smaller and leaner countries come about… some of these winners grow big through military conquest and the circle repeats itself. Thankfully, we are out-evolving military conquest. There are fewer and fewer territorial wars. This suggests we might reach a stationary state made of smallish states.
Sure, it’s all eggs in one basket, but the human (or animal) body is billions and billions of eggs in one basket and that proved rather successful.
Not that I think that it is an apt analogy, but the human body is closer to anarcho-capitalism than to a centralized state.
P.S. What could destroy the EU in the near future? That it’s a confederation, not a federation; hence the difficulties with respect to monetary policy coordination, etc. The federalists’ arguments seem as relevant as ever…
Regarding the EU, you may think that it is not sufficiently integrated, or that it should never have existed in the first place. I am in the latter camp. In fact, I think that many European countries are too big. Germany and the UK should be broken up.
All they really need is free trade and open borders. No need for political integration.
I don’t “seek” to maximize military strength any more than falling objects seek contact with the Earth. If you lack military strength, then someone who has it will conquer you.
There are more and more territorial wars – we have right now the Russia/Ukraine business, ISIS, and there’s one big one coming up when Iran becomes nuclear. What has stopped (some) wars since WWII if not huge nuclear superpowers? Surely most smaller states survived due to the protection of larger states. How can this be seen as anything but evolution towards larger states?
The human body is rather far from anarcho-capitalism. Legs follow head’s orders, head feels pain when legs are hurt, no choice, no way to choose another brain or to ignore the legs’ plight. The heart does not compete with the liver. Cells competing with other cells for living space are called cancer. How apt this analogy is is another question.
I love anarcho-capitalism and have read Rothbard and David Friedman (the latter was more enjoyable by far). There’s no way this thing will ever work. Friedman cites some northern tribes as having sustained anarcho-capitalism for what, 300 years before being conquered by a king?
As to breaking up nation states – economists (I think David Friedman in particular) will point out that nation states will expand to control all people speaking a given language because it creates a taxation monopoly (it’s much harder for a German to work in France where they speak another language than it would be to escape a small German state to work in a neighboring small state where they speak the same language). Nation states follow from economics among other things. (Why does a nation with a taxation monopoly necessarily crushes its neighbors lacking such monopoly? Because its monopoly results in more taxes, hence in a larger standing army. Germany becoming a large state was the inevitable reaction to being badgered by its neighbors, it’s just a matter of time.)
I actually love the way you’re looking at it and I tried for a lot of time to look at it that way. It just doesn’t compute to me. To me it is obvious that if you break up all the “too large” states in Europe, Europe will simply be conquered by Russia. Gravity.
I guess however that it’s one of those cases where the facts can support many viewpoints to some extent, but unquestionably prove nothing…
@Yossi
I do not accept the premise that we should organize politically in order to most efficiently carry war.
Even so, the Americans did not fight to stop fascism. They fought to protect the interests of their empire.
There is an important difference. E.g., the Americans closed their borders to the Jews… they were unconcerned with Jews suffering, but very concerned with having to deal with immigration.
@Yossi
There are more and more territorial wars – we have right now the Russia/Ukraine business, ISIS, and there’s one big one coming up when Iran becomes nuclear.
That is false. We never had fewer territorial wars… mostly because they are becoming irrelevant.
ISIS is made of something like 20k fighters with no industry to back them. It is hardly a war. They are only a problem because the US has been arming them (unwillingly).
The Russia/Ukraine thing is annoying and sad… but it is hardly a territorial war. The real tragedy is that Ukraine is a mess economically.
Iran has mostly been a peaceful country. Though they are sometimes run by madmen who oppress the population, they are hardly belligerent.
The world has never been so peaceful.