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Yet another myth about democracy: “democracy+capitalism = prosperity”

When I wrote my first commentary on this blog, I outlined three common myths that people frequently believe without question when they think about democratic governance. Obviously, an idea as blindly and fervently worshiped as ‘democracy’ will have far more than just three myths associated with it. I continue my exploration of this ideology by discussing another myth that is frequently accepted without critical examination.

MYTH #4: Rich countries prospered by adopting liberal democracy and free markets

This myth is largely unsupported by history. In fact, in the last 500 years or so when democracy has gained prominence as a political ideology, NO COUNTRY has managed to uplift themselves from the status of a developing country to that of a developed country by adopting the combination of liberal democracy and free markets.

If one were to look at a list of highly developed countries (regardless of metric, be it per-capita income or human development index), or to ask people to name a few countries in that category, the US, EU, and other OECD member states are probably the first ones to come to people’s minds. It is hard not to notice the fact that almost all countries on such lists are fairly stable liberal democracies (according to traditional western standards) with relatively mature and open capitalist economies. It is also not surprising that the combination of liberal democratic political governance and free market economics (which I’ll sometimes abbreviate as ‘LD+FM‘ in this post)  is the only model of development publicly promoted by the US and EU in academics, media, government, and international institutions (i.e. World Bank, IMF, etc.), and the only model prescribed to developing countries.

The US, above all others, is most frequently touted as an example of democratic development. But those who advance that view more often than not ignore the fact that until the early 20th century, meaningful political participation was limited to males with the “proper” racial and economic backgrounds – in other words – white, land-owning males of Western European descent. Furthermore, during America’s period of rapid economic development (mid-19th to early 20th centuries), political and economic outcomes were monopolized by the likes of Rockefeller and Carnegie, whose power and wealth were greater those of oligarchs in post-Soviet Russia (i.e. Berezovsky, Gusinsky, etc.). The US, for most of its history, including its period of emergence onto the global stage, was in fact a de facto oligarchy, and NOT a democracy.

What if we examined other countries’ political and economic models  during their respective periods of rapid developmental ascent? Well, here is a short-list (click on the picture for a larger version):


Of course, it would be exhausting and overly complicated to catalog the developmental history of every single nation-state in the world (especially given that most of them didn’t exist until the last hundred years or so), but if we were to look at the most prominent examples of developmental success, NONE of these countries adopted the LD+FM combination. Only two countries arguably had democracies of ANY kind (Japan and India), and only one MAY qualify as a “liberal” democracy (India) by traditional western standards. There are plenty of examples where a greater degree of participatory governance was instated AFTER economic development reached a certain height, but as long as a country was under-developed relative to world standards, the LD+FM model was NEVER used to propel a society forward.

In sum, the liberal democracy + free markets combo propagated by the West is a developmental model that has NO RECORD OF SUCCESS for poor, developing countries. While I do not discount the possibility that LD+FM may work in the future under the right circumstances, but it is certainly NOT the “silver bullet” that it’s advertised to be by US/European-dominated political and civil institutions.

  1. N.M.Cheung
    March 15th, 2014 at 18:59 | #1

    Let’s just examine the myth with respect to U.S. today. Is U.S. really a democracy as defined by majority rule? U.S. was set up with major hurdles to prevent real democracy. Even with the voting given to women and blacks and other minorities and the election of Obama the plutocracy is winning the battle and the election of 2014 will probably see Republican dominating not only the House but probably the Senate. The minimum wage is farther eroding despite some local success. By any economic measurement, the majority is getting less of the total incomes and inequality is widening. Ask any labor leader and he will tell you the free market is a disaster for working people. It is a failure not only for the developing countries but for U.S.. Obamacare may survive but little else is being accomplished, and both parties are not really representing the people.

  2. Matchut
    March 19th, 2014 at 17:48 | #2

    “Managed democracy” is an interesting term, and I suspect that many of the developed, self-proclaimed “democracies” today are just “managed democracies”. I’d consider the existence of things such as ridiculously high candidate nomination deposits (like in Japanese general elections) and/or taxpayer-funded gifts to powerful political parties (like in Canadian federal elections) to be evidence of “management”.

  3. Zack
    March 19th, 2014 at 18:34 | #3

    makes me wonder just how much f those naive taiwanese students currently protesting have been infiltrated by NED groups?
    it really was over the top when they started singing that song from ‘les miserables’
    yeah, bub, enjoy your little moment of being that rebel, crying freedom; the rest of us are going back to work and getting enough to eat.

  4. Black Pheonix
    March 21st, 2014 at 09:45 | #4


    It’s a stupid protest organized by some DPP people to try to win votes.

    The Pact is already OK’ed by Taiwan farmers, who hold a huge portion of DPP support basis, because the Taiwan farmers get preferential treatment for farm exports to mainland China.

    Now, DPP sees that it might lose more support in the next election, so it agitates students to this protest.

    It’s stupid, because the students don’t even know what they want. They just make stupid generalized demands about “transparency”.

    News flash, the bill is open for public examination, and the KMT has the votes to pass it. What’s left to “debate”?

    Some idiot told me that they want the bill “discussed LINE BY LINE”.

    I asked, when was the last time any government discussed a bill “LINE BY LINE”?? He couldn’t answer, because it’s almost never done, (because that would take F*ING forever to pass laws).

  5. Zack
    March 26th, 2014 at 02:06 | #5

    the hidden part of the equation is that democracy+capitalism (+hypocritical industrial espionage)= prosperity

    man oh man, i can’t help but note with smug satisfaction that the NSA has been proven to be spying on Huawei for the sake of their american industries.
    i expect Cisco’s share price to continue their downward spiral as Huawei ascends

  6. Black Pheonix
    March 26th, 2014 at 11:01 | #6

    Taiwan cracks down on student protesters.

    At this stage, the students are just hosing Taiwan’s future. Keep China out?? Yeah, who’s that going to hurt? China?

  7. raffiaflower
    March 26th, 2014 at 13:14 | #7

    Interestingly, the issue of Taiwan’s independence pops up again, together with the student protests & the Crimea potboiler. Taiwan’s China Post, however, editorializes that the islanders are far less inclined to break away than Western media like to portray.
    The Situation In Taiwan & Crimea is Different (March 27th):

    “In Taiwan, ethnic Chinese form a 98-percent majority of the population, with indigenous people accounting for the remaining 2 percent. Only about a third of the 70-percent Hoklo Chinese majority prefer independence, but seven out of every 10 people of Taiwan want to keep the status quo of a divided China because they know independence is impossible. These people also believe China will be eventually unified.”

    Obviously, there is a Taiwanese identity, just as there are regional differences/rivalry between Shanghai & Beijing. Or that some New Yorkers claim that America really begins from New Jersey. And, for some reason, the Catalonian and Venetian demands to secede do not get much airplay or column inches in Western media. Hmmm…

  8. Zack
    March 27th, 2014 at 07:46 | #8

    they should just make it a law that any protester who sings “do you hear the people sing” at rallies should be made to do community service by taking care of Chinese Civil War veterans or Veterans of the war against Japanese Aggression

  9. AngryFarmer
    September 21st, 2016 at 06:30 | #9

    Democracy is the current framing mythology used to control much of the world. We are no more “free” under Barrack Obama as current leader of the democratic world than people were made “good” under Charlemagne as protector of Christianity. Seems to simply be an inverted monarchy where the kings stand behind the church instead on top of it. So now secular priests rule us peasants handing the mandate of heaven to billionaire kings. Money is God become material and we must bow down in worship as we are ever further seperated from having a controlling hand on the production that sustains civilization. Farmers control cattle by uniting the physical pillars of food and shelter. Humans are controlled by uniting us under the arch of power between church and state. We are being tax farmed, and until the church of democracy steps back up and controls the power of money creation, putting the kings power back into our democratic churches, we will remain unfed cattle under the arch of power.

  10. AngryFarmer
    September 21st, 2016 at 06:42 | #10

    Industry is the true state, ran by kings, democracy is the church, ran by secular priests , the politicians, neo-liberal globalism has been working to hollow out our democracies to wear like a new shell on a hermit crab. Briltzkrieg by bank instead of tank, the ultimate art of war is to defeat your enemy without drawing your sword, don’t have to destroy infrastructure if you can take it without a fight, took 70 more years, but the Nazis won anyway. We followed the rules and have been loading ourselves into the concentration camps of poverty in this machavelian/orwellian world where we have allowed ourselves to be convinced we are free, a word defined by our masters and their consumer propaganda.

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