The new dictators roll out a red carpet for money-launderers worldwide

One democracy after the other is undermined or falls victim to authoritarian schemers. These new strong men not only thrive on corruption in their own countries. They open the door wide for criminal organisations and money-launderers from all countries, according to a new analysis from Better Future Economics.

Social credit systems increasingly common even in western democracies

Airbnb is now using an AI-powered tool to scan social media for signs that a guest might trash a renter’s home or be a psychopath.

According to documents reviewed by the Evening Standard, the tool finds posts on the internet, criminal records and other information to identify personality traits such as narcissism and psychopathic disorders. Airbnb acquired a startup Trooly in 2017 that developed the method.

This is an uncomfortable reminder that the technology behind the ominous Chinese social credit system will be used in democracies as well. A key question will be to what extent political views are sanctioned. For example, would someone who expresses radical political ideas on social media risk being classified as less trustworthy by Airbnb and denied service? Navigating these issues provides ample ground for Better Future researchers to dig into. 

The IMF embraces our proposal

In 2015 Stefan Fölster och Dag Detter published their book “The Public Wealth of Nations” showing how countries can vastly improve the social return on public wealth such state owned enterprises and real estate. The book was a “Book of the Year” in the Financial Times and the Economist. It was followed by “The Public Wealth of Cities” in 2017.

Now the IMF has embraced the authors’ conclusions. For one, it has let  Fölster and Detter write in the IMF’s publications.

In addition the IMF has published its  own report along the same lines. The head of the IMF,  Christine Lagarde, is an active proponent of the authors’ proposals.

Renaissance for Reforms

The new book Renaissance for Reforms has met wide international interest. It is currently being reviewed in 37 different countries and translations in several languages are planned.

Renaissance of Reforms is based on an analysis of 109 governments that completed their term of power in OECD countries between the mid-1990s and 2012. The authors show that governments that introduce market reforms not only can boost entrepreneurship and job creation, but also increase their own chances of re-election.

“This is the required companion volume to Why Nations Fail by Acemoglu and Robinson. While those authors demonstrate that poor institutions are the explanation for economic failure, it is Sanandaji and Fölster that provide the the successful strategy to overcome the obstacles. They demonstrate that market reforms lead to both economic and electoral success. Policy makers no longer have an excuse for not following the best policies. Renaissance for Reforms is required reading for all interested in policy change: academics, students, policy makers and politicians.”

– Dr. Nigel Ashford, George Mason University.

Order the book here

Twenty five years of Swedish Reforms

This report  describes the growth-oriented reforms implemented in Sweden from the early nineties onwards. In the 1990s, the entire tax system was reformed, a public expenditure ceiling was put in place, collective wage bargaining found an entire new form, Sweden entered the EU, state owned monopolies became subject to competition and the fixed exchange rate was abolished. Moreover, privately owned companies were allowed to start schools and enter healthcare markets. Also, completion legislation was strengthened thereby reducing the number of cartels and their impact.

The results of this wave of reforms are remarkable. During the twenty years before 1995, GDP and productivity growth was substantially lower than in other countries. Virtually no net jobs were created in the private sector and government debt increased rapidly. Moreover, disposable income of Swedish households grew only in a very slowly.

Since 1995, every aspect of the Swedish economy has changed. GDP and productivity growth have been higher than in comparable countries. Employment in the private sector has grown by more than 1% annually, while public sector employment has decreased. Public finances are now stronger than in most countries. Furthermore, median disposable income of Swedish households has grown 4 times faster after 1995, compared to the previous 20 years.

One would expect that these results would induce further efforts from policy makers to continue reforming the Swedish economy. Much room for improvement remains. Unemployment among youth and immigrants remains high, and growth has slowed considerably in recent years. Despite these indicators, as we show in the concluding section of this paper, the pace of reforms in Sweden has slowed considerably. In particular, Sweden’s reform efforts in last five years have slowed to half the world average and lag behind the pace in the rest of Europe.