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Re: wikipedia: "Somalia now offers some of the most technologically advanced and competitively priced telecommunications and Internet services in the world"

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SuperMarioIsAwesome is not online. SuperMarioIsAwesome
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26 Dec 2011 10:00 PM
wtf
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27 Dec 2011 09:16 PM
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Yobobo10 is not online. Yobobo10
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27 Dec 2011 09:39 PM
They ripped out some country's undersea Optical Fibres, and fitted it. Problem solved with pirate tech, 24/7 technical support.
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XieXie is not online. XieXie
Joined: 06 Jun 2008
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27 Dec 2011 10:08 PM
The quick responses made by my friend on the other side of the economic aisle serve to prove a point: this fact is threatening.

Newsflash: government intervention destroys. Ignoring the Forbes Business source (which is apparently highly biased), it's interesting to read this article form the Wall Street Journal - which, I'm sure, is conspiring to prove laissez-faire economics via editorials about Somalia.

http:/[]/onlin[]e.wsj.com/article/SB10001424052748704608104[]575220570113266984.html

Look up Somalia in the CIA World Factbook. They've maintained a relatively healthy economy.

Civil War is terrible, and the fighting is atrocious. But it has done one good thing for the economy: it has all but collapsed an inept and overbearing bureaucracy and replaced it with extremists who don't do anything.
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EndTheModigarchy is not online. EndTheModigarchy
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27 Dec 2011 10:08 PM
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XieXie is not online. XieXie
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27 Dec 2011 10:10 PM
In absence of government regulations that stifle, the result is, empirically, prosperity. The more a government intervenes, the more damage is done. Companies in Somalia FORMED to meet demands, and because of the power of competition, the best service that is possible in a war-torn country like Somalia is provided.

Scrolling through the Wikipedia Article basically proves this:

[I had numerous quotes and their sources, but apparently those are against the rules. Read the economy section of the article]

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XieXie is not online. XieXie
Joined: 06 Jun 2008
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27 Dec 2011 10:11 PM
This article by Wikipedia is hysterical. It's an empirical deathblow to Keynesians, Paul Krugman, etc. More articles about Somalia that are downright shocking:

http://mises.org/daily/5418
http://www.cato.org/pubs/pas/pa649.pdf (how gov't intervention in general has caused issues with the economy and peace)
http://www.bbc.co.uk/news/world-africa-12278628

There are many, many more. It astounds me how people continually deny the effectiveness of a free market in the face of its numerous successes, and in the face of its alternatives' immeasurable failures.
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travis1908 is not online. travis1908
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27 Dec 2011 10:20 PM
http://mises.org/daily/5418 So your saying Somalia has the fantastic 4?
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MahPizzaIsHere is not online. MahPizzaIsHere
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27 Dec 2011 10:21 PM
I agree with Xie on this one. :)
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EndTheModigarchy is not online. EndTheModigarchy
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EndTheModigarchy is not online. EndTheModigarchy
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27 Dec 2011 10:32 PM
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XieXie is not online. XieXie
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30 Dec 2011 11:47 AM
You're kidding, right? I'm going to quote some of my favorite passages from the Ethiopian economy article. It's literally just evidence to prove my point:

- "Telecommunications remain a state monopoly, stifling the development of mobile phones that have become ubiquitous elsewhere in Africa."

- "In financial services, no foreign banks are allowed and it remains almost impossible to find start-up loans for small and medium businesses. Youth unemployment is estimated to be as high as 70%."

- "Ethiopia's agriculture is plagued by periodic drought, soil degradation caused by overgrazing, deforestation, high population density, high levels of taxation and poor infrastructure (making it difficult and expensive to get goods to market)."

- "...his has raised fears of food being exported to more prosperous countries while the local population faces its own shortage."

- "The mining sector is quite small in Ethiopia. The country has deposits of coal, opal, gemstones, kaolin, iron ore, soda ash, and tantalum, but only gold is mined in significant quantities."

- "Aside from wholesale and retail trade, transportation, and communications, the services sector consists almost entirely of tourism. ... growth has been constrained by the lack of suitable hotels and other infrastructure, despite a boom in construction of small and medium-sized hotels and restaurants..."

- "Less than one-half of Ethiopia’s towns and cities are connected to the national [electricity] grid."

Also, fun quote: decreased government regulation (or none at all) is good for the economy there:

"Cross-border trade by pastoralists is often informal and beyond state control and regulation... This trade helps lower food prices, increase food security, relieve border tensions and promote regional integration.

So, Ethiopia: still has terrible infrastructure, is being crushed by an over regulated government, with almost 40% of the nation below the poverty line. The fact that Somalia can compete -- and compete well -- with Ethiopia in the middle of a MASSIVE CIVIL WAR proves my point.
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XieXie is not online. XieXie
Joined: 06 Jun 2008
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30 Dec 2011 12:02 PM
also, the government has realized it is killing its people and is relaxing regulations. The only issue is, there is a massive population explosion that requires a huge amount of jobs to be created per year, which the constrained economy cannot provide in the Status quo:

"The current government has embarked on a program of economic reform, including privatization of state enterprises and rationalization of government regulation. While the process is still ongoing, the reforms have begun to attract much-needed foreign investment."

^ so yes, the economy is growing. They're wealthier than Somalia (which, again, is in the middle of a civil war). But Somalia has been growing steadily, whereas Ethiopia has been showing signs of festering (the article gives a list of GDP, with a significant drop from 2010 to 2011). They're digging themselves out of a very, very deep hole. That's not a high bar. Going from stifled to slightly less stifled doesn't exactly prove much.

As for Somalia...

In 1995, the GDP was about 3.3 billion USD.
http://permanent.access.gpo.gov/lps35389/1995/wf950219.htm

In 2011, the GDP is estimated by the CIA to be roughly 5.731 billion USD.
https://www.cia.gov/library/publications/the-world-factbook/geos/so.html

Even if the statistics aren't spot-on, the point still stands: the Somalian economy has been growing, and has been growing fast. Peter T. Leeson, economist at the University of West Virginia, wrote a very fascinating paper on the subject entitled 'Better Off Stateless:
Somalia Before and After Government Collapse'. Look it up. Quotes from it include:

"Somalia is far from prosperous, but it has made considerable strides since its government collapsed 15 years ago."

As for Ethiopia, the "Macro-economic trend" of the article you linked to gives the change in GDP from 1990 to 2010 as plus 131 USD per person.

http://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&met_y=ny_gdp_pcap_cd&idim=country:SOM&dl=en&hl=en&q=somalia+gdp+per+capita

Y0u'll notice from this chart of public data that Somali GDP was about 130 USD per person and trending downwards in 1990. That means that in the middle of a Civil War, Somalia has raised its GDP almost 430 dollars, to roughly 600 USD per person.

Somalia -- and its lack of government -- prevails, and there's little question about it.
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History0 is not online. History0
Joined: 24 Aug 2010
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30 Dec 2011 01:44 PM
That BBC article gives data that shows the most important thing in Somalia's economy is not its free market.

"In the late 1990s, the UN found that remittances amounted to 67% of the Somali economy and that proportion is likely to be bigger today.

"That means that the Somali economy is more reliant on remittances than any other in the world," Mr Ahmed says."
______
http://goo.gl/2nzrH
That chart compares the changes in the Horn of Africa from 1991 to 2010, these are some things to conclude from it.
1- Somalia's GDP per capita has actually decreased, although barely.
2- Somalia has the lowest life expectancy in the region.
3- Ethiopia's GDP per capita and life have increased more than Somalia's.
4- Eritrea's life expectancy has increased more than Somalia's.
______
About the telecommunications in the country, my opinion is that they're actually a bad thing, since some people spend the money they need for more important goods in those things, I live in a 3rd world country and I know that when the government gives money to poor people it happens sometimes.
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Avogadro is not online. Avogadro
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30 Dec 2011 02:10 PM
Without government enforcement of contractual agreements, capitalism can't work.
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XieXie is not online. XieXie
Joined: 06 Jun 2008
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30 Dec 2011 02:40 PM
//That BBC article gives data that shows the most important thing in Somalia's economy is not its free market//

And your point is what, exactly? That people working in the free market abroad to send money back to those who are in Somalia disproves the free market? Just because the economy relies on remittances doesn't mean it isn't sound. The United States couldn't survive without exports.

A remittance is a wage that is sent back to family from abroad. While Somalia is certainly on the track to getting better, as I have shown, I make no claim to its superiority: it's not a fun place. The US, Europe, and other nations that are fairly free-market provide opportunity. That bolsters my point.

Additionally, the BBC article only cites data from a 14-year old UN report (one that is out of time timeframe of growth I outlined in the earlier post) and a single businessman. Even if I grant it 100% authority, that doesn't change any argument. Somalia has gotten better, not worse (the Somali GDP is roughly 5 billion in the present, meaning if those estimated 2 billion were directly sent to GDP (which is unlikely) the ratio would be slightly under 40% - a drastic improvement from 67% 1997), with the lack of a government to create ugly regulations.

//http://goo.gl/2nzrH//

1. This graph proves very little. PPP is an international unit that currency is converted to to determine objective income - how much I could buy with X amount of currency A versus X amount of currency B. It is a measurement BETWEEN NATIONS, and that really isn't a huge deal for countries that don't import a lot (Like Somalia). It does NOT provide an objective outlook for nations like Somalia because of dollarization:

http://en.wikipedia.org/wiki/Somali_shilling

Looking at a map of GDP v PPP, you can see some interesting idiosyncrasies here (You'll notice most nations become richer in the PPP scale):

http://en.wikipedia.org/wiki/File:Gdp_nominal_and_ppp_2005_world_map_single_colour.png

The Somali Shilling is worthless, and the only real economic indicator that should be relied in is GDP growth. I gave you the statistics in the last post relating the real increase in Somali wealth versus that of Ethiopia. I've already gone over the problems with Ethiopia; if you want to prove a point, you're going to have to make it through a nation besides that one.

2. Even so, as far as the economy goes, you'll notice Somalia still has higher PPP per/head than Ethiopia (almost 100 units greater). This data, pulled from the World Bank, shows a not-so-impressive look at Ethiopian GDP growth. Again, PPP is for international competition. It's not the best measure of wealth, especially in nations like Somalia.

http://earthtrends.wri.org/text/economics-business/variable-638.html

3. If you actually read my previous post, I write that Ethiopia is on the verge of a demographic crisis and for 2011, experienced a drop in real GDP (USD), but growth is correlative to the government's gradual relaxing of regulations over the past few years.

4. Yes, Somalians live for smaller periods of time. Civil War tends to kill people, as shocking as that may be.You'll notice, though, that life expectancy has grown throughout the years of the Civil War starting in roughly 1990.

5. Overall, this graph's data is very suspicious, as it flies in the face of the CIA Factbook estimates on growth - as I mention in my earlier post, Somalia's GDP has undisputedly grown. The question is by how much. Your graph shows stagnation, and the data sources for Somalia are "estimated" from the CIA, but are not congruent with the archives I linked to.

//About the telecommunications in the country, my opinion is that they're actually a bad thing//

And roads are bad, because people will buy cars. So are houses, because people could go into debt.

Somalians aren't stupid. If they need food or need a phone, they'll choose food. I'm sure someone, somewhere, has made a poor choice with phones, but saying 'development is bad because it encourages wasteful spending' is a woefully weak argument.
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Yobobo10 is not online. Yobobo10
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31 Dec 2011 12:45 PM
"(the Somali GDP is roughly 5 billion in the present, meaning if those estimated 2 billion were directly sent to GDP (which is unlikely) the ratio would be slightly under 40% - a drastic improvement from 67% 1997)".

That's 3 billion in ransom money.
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XieXie is not online. XieXie
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01 Jan 2012 02:58 PM
hysterical.
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Yobobo10 is not online. Yobobo10
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01 Jan 2012 06:21 PM
Don't be so sarcastic.
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History0 is not online. History0
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10 Jan 2012 02:21 PM
"And your point is what, exactly? That people working in the free market abroad to send money back to those who are in Somalia disproves the free market? Just because the economy relies on remittances doesn't mean it isn't sound. The United States couldn't survive without exports."

"meaning if those estimated 2 billion were directly sent to GDP (which is unlikely) the ratio would be slightly under 40% - a drastic improvement from 67% 1997), with the lack of a government to create ugly regulations."

Even that figure is terribly bad, and that is only considering remittances, you're ignoring the rest of the aid, which comes not only in the form of wealth, but also of people.

The point is that a completely free market is not important.

"if you want to prove a point, you're going to have to make it through a nation besides that one."

Fine, and I'll use one of your sources ( http://earthtrends.wri.org/text/economics-business/variable-638.html ). That page says that Sub-Saharan Africa has had an amazing growth in the 2002-2006 period, the region's GDP per capita almost doubled!

"Yes, Somalians live for smaller periods of time. Civil War tends to kill people, as shocking as that may be.You'll notice, though, that life expectancy has grown throughout the years of the Civil War starting in roughly 1990."

I tried to make a comparision of the situation in Somalia with the one in Sudan during the Second Sudanese Civil War which lasted for a similar time (22 years compared to 20 [20 because this year has just started]). I made an average of the two estimates of the death toll provided at http://en.wikipedia.org/wiki/Second_Sudanese_Civil_War and http://en.wikipedia.org/wiki/Somali_Civil_War , calculated what percentage of the modern day population of Somalia (3.9473684210526314%) and that of the addition of Sudan and South Sudan (4.25%), both of them rounded up (to 10 million and 38 million, respectively). With that I concluded that their countries' civil wars affected them similarly, and I went on to find statistics about the life expectancy changes in the civil war periods which I got from http://goo.gl/E7dEH and http://goo.gl/eOVfL (I know that for Sudan the data is not very good because it doesn't cover the whole civil war, but that's the closest I could get) (the numbers are in the "Demographic Information" section) and I found that both improved an equal amount of years.
From this we can conclude that a civil would have a similar effect in a country regardless of if it has a complete free market or not.

"And roads are bad, because people will buy cars. So are houses, because people could go into debt.

Somalians aren't stupid. If they need food or need a phone, they'll choose food. I'm sure someone, somewhere, has made a poor choice with phones, but saying 'development is bad because it encourages wasteful spending' is a woefully weak argument."

An earlier thread in this forum about loans to poor people proves financial unsoundness exists. In a country with so many troubles (as you may know, the Horn of Africa is experiencing a famine, another important things is that according to the Mises article, access to safe water has decreased), it matters little whether it affects a big or small part of the population. I will consider the new technology good once the situation improves.
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History0 is not online. History0
Joined: 24 Aug 2010
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10 Jan 2012 02:22 PM
I meant "Demographic Indicators".
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XieXie is not online. XieXie
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10 Jan 2012 06:24 PM
//Even that figure is terribly bad, and that is only considering remittances, you're ignoring the rest of the aid, which comes not only in the form of wealth, but also of people.//

This is literally just false.

The United States is very strict about giving money to terror organizations. From 2002-2011, the Us gave 11.5 billion dollars to nations in the Horn of Africa, and less than 8% of that overall went to Somalia. Roughly 8.5 hundred million dollars went to Somalia, which, when divided by 9 years, equals less than 100 million per/year. If we take Somalia's GDP to be roughly 6 billion, then aid, which presumably goes to the government controlled territories (comprising the vast minority of Somalia), then less than 16% of the Somalian's GDP is comprised of foreign aid from the US.
www.usaid.gov/our_work/humanitarian_assistance/disaster_assistance/regional/files/east_central_africa_humanitarian_assistance_review_2002-2011.pdf

And, al-Shabaab has declared war on western agencies, extremely limiting the amount of aid that can be given since 2009. And yet, it www.newyorker.com/reporting/2009/12/14/091214fa_fact_anderson

But, as I'm fairly certain I've said before, Somalia is not a utopia. It's miserable. I don't need to prove massive leaps and bounds in its economy to make my point. The far that Somalia, in the middle of civil war and recession, can GROW AT ALL is enough. Everything from healthcare to banks have sprung up where government regulations have fallen.
http://www.scribd.com/doc/22522103/Svrger-2008-Vol-4

The only thing I take issue with is "The point is that a completely free market is not important." Of course it is. It has raised the quality of life. The extent to which is preferable is debatable, but it is nonetheless preferable to the former status quo.

//Fine, and I'll use one of your sources ( http://earthtrends.wri.org/text/economics-business/variable-638.html ). That page says that Sub-Saharan Africa has had an amazing growth in the 2002-2006 period, the region's GDP per capita almost doubled!//

Firstly, 596 -> 920 is not "almost double" - the double of 596 is 1192, which is well near 300 higher than 920.

Secondly, saying that Sub-Saharan Africa's GDP grew doesn't do anything for you. So what? Have you proven that is a result of tighter government regulations? That's your burden. Throwing numbers at me does very little; I can assert that the growth further proves my point as free trade agreements come in to full swing and nations start to create more open markets in the area. i.e., as a freer market develops.

//From this we can conclude that a civil would have a similar effect in a country regardless of if it has a complete free market or not.//

Again, totally misunderstanding my point. The argument is not that the free market lessens civil wars. The argument is that in the face of civil wars, when death is aplenty, economic growth is noteworthy - when looking at the facts, it becomes apparent that the lack of a government has, in the strictly economic sense, done good for the country.


And to reiterate: that means nothing to you in terms of offense unless you prove Sudan did so while still maintaining a government AND while increasing regulations. The Darfur conflict ended the lives millions of people, most of whom were poorer. Yes, expectancy may increase - but that's because the weaker people all seemed to just collapse due to drought, famine, and war. The loss of 1-2 million is contrasted to Somalia, which has lost less than quarter of of that number - which is significant, because even though populations are proportional, its absurd to assume Civil Wars are all the same in Africa and kill the same amount of people. It's entirely plausible that the same number of people could have been causalities in the Somali CIvil War.

//An earlier thread in this forum about loans to poor people proves financial unsoundness exists. In a country with so many troubles (as you may know, the Horn of Africa is experiencing a famine, another important things is that according to the Mises article, access to safe water has decreased), it matters little whether it affects a big or small part of the population. I will consider the new technology good once the situation improves.//

This is an absurdly arbitrary line. Why should we continue allowing healthcare there? What if it advances? People could spend money on non-elective surgeries and the entire nation would go bankrupt. What about advanced foodstuffs? I mean, what's wrong with millet? It costs more to but junk food? Microloans are for enterprises - if they fail that means the business fails. Markets are for consumers -- they can't fail, and the existence of businesses like the telecommunications ones in Somalia show that they're doing fine.

This is an absurd, and quite frankly, rather offensive argument. The idea that people will spend on all non-essentials in the face of their own lives is a bad one. Even if that were true, the free market gets what it wants. If people crete demand -- the ability to sustain purchasing of something -- for telecommunications markets (which, according to you, is a bad thing) the supply will form. Terrible!

On a side note, the decrease in water is the result of a famine/drought. The free market in Somalia, given its still primitive state, can do nothing about the convergent forces of nature. It mitigates them, but nowhere do I claim it solves all ills everywhere.

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