Freedom from accountability

Projects in the misery industry pay lip service to serving the population of the poor country, but their underlying motivations can be best summed up in one phrase: self-preservation. Like any bureaucracy isolated from the healthy feedback of the free market, the organization does not exist to serve its customers, but rather the insiders within it. Failed policies can continue for decades as long as they are financed. For the International Financial Institutions, their access to a line of credit from the Federal Reserve grants them immunity from failure on the market. It's worth remembering the crucial fact that they face absolutely no opportunity cost to their lending, since they do not incur a loss if their investments are unprofitable. After seven decades, their budget and staff have continued to grow each year and show no sign of abating. It is the nature of every bureaucracy to behave in its own interest, and in the case of the International Financial Institutions, this incentive is even more unchecked than in national bureaucracies because of the larger disconnect between the beneficiaries and the funders. National bureaucracies operate mostly within the countries from which they are funded, but international bureaucracies operate on different continents from their funders. William Easterly has written extensively on the failures of the development industry, and his paper The Cartel of Good Intentions provides a good overview of some of the main problems.

The more one reads about it, the more one realizes how much of a catastrophe it is to have this class of omnipotent unaccountable bureaucrats unleashed on the world's poor with their endless line of Federal Reserve credit allowing them to buy and control entire nations. These organizations can easily override domestic property rights and institutions in the name of development. The World Bank can decide on a development project, and have the local government work on implementing it regardless of the domestic impact. Indigenous populations are removed from their lands, private businesses are closed to protect monopoly rights, taxes raised, and property confiscated to make the projects happen for the sake of development. Tax-free deals are provided to international corporations, under the auspices of the IFI's, while local producers need to pay ever-higher taxes to accommodate their thieving governments' fiscal incontinence. Individuals' lives are repeatedly destroyed in pursuit of the greater good, as measured by dimwit economists with ridiculous mathematical models.

The utilitarian and totalitarian impulses of the demented socialist and Keynesian textbooks taught to these development planners come to the fore in their dealing with poor populations. These textbooks teach that welfare and human well-being can be judged through statistical aggregates which central planners need to manage, and through measuring the impact of policies on society. The fact that economics is fundamentally subjective, as Austrian economists teach, and that welfare metrics cannot be meaningfully measured any more than feelings can be measured, is not something that has ever occurred to the kind of "economist" miseducated with Marxist and Keynesian drivel.

The misery industry never lets methodology or logic get in the way of a good third world loan, and so they have devised astonishingly ridiculous, and downright criminal, ways of measuring the welfare impact of their policies and loans. Since the goals of development pertain to things like health, education, and general well-being, development planners will put prices on all these things, and attempt to make economic plans to maximize national welfare, which would be a measure that includes GDP, years of schooling, life expectancy, and all sorts of other development metrics. This might sound innocuous at first, but its application is the best argument against the mathematicization fetish in economics. By putting a price on human lives, it becomes possible for central planners to come up with projects that destroy human lives and go ahead with them as long as the return financially is larger than the "cost" in human terms. As everything has a price, nothing is outside the purchasing power of bureaucrats with a limitless credit line, and the entirety of poor countries exists like these bureaucrats' play thing. And since these values placed on human lives, health, and education are a product of the fictions of these economists, they can always be manipulated in whichever way makes the project sound good. World Bank project projections always look great on paper, while always failing in implementation. The failure is an inevitable outcome of planning based on fictitious numbers whose sole purpose is to entice third world governments for signing up to the loans.

So, a coal plant that would require the displacement of an entire village of indigenous populations, and that produces enough pollution to ruin the lives of thousands of people who live on a river downstream for it, will look great on the World Bank's projections studies, because they will find that the extra benefits from tax revenue for the government and jobs created is more valuable than the lives ruined by the factory. This is simply the inevitable outcome of using the demented collectivist mathematic fetish of twentieth century dimwits economists as the guiding light for planning people's lives. In a free market, no coal plant is able to displace the local population, but with World Bank loans, greedy governments can. Proper economic analysis is methodological ly individual because it recognizes there can be no basis for collective decisions, because welfare is not comparable between individuals, and it cannot be added or subtracted, so all collectivist calculations are fundamentally invalid, and the economists who engage in them are no better than actors being paid by the IFI's to play that role in front of third world governments.