Thursday, September 18, 2014

Does Scotland deserve its own independent country?

That question will be answered by the Scottish people in a very short period of time(hopefully by 10:30 pm ET on 9-18-2014). However, in light of the ability of IS to control its own territory inside Iraq and Syria, I'd say the Scottish should easily qualify.  Each situation is a prime example of socioeconomic development in the 21st century.  he separation of market economies from nation-states will innately increase over time.

Throughout history, it has been the role of nation-state actors to: (1) control territory; (2) develop market systems; (3) fund government services; and (4) provide public goods  The Industrial Revolution in the UK (r.i.p.?) was the first modern market system, beginning in the 1800s. Before the IR, it was the British control of vast ocean supply routes, development of the US colonies and superior naval force that provided the economic engine of a robust export economy.

The role of the British Navy and western style economic development-- complete with deep and liquid financial markets-- has contributed to the prosperity in Western Civilization for hundreds of years.  Militias, such as IS, are able to control territory that is not supported by liquid socioeconomic market systems, in the absence of government services and public goods.  The demand for political establishment to develop court systems and military capabilities is  obvious --- the demand from the cities is a natural part of socioeconomic system, whereas IS profits from the demand and provides services that are in some twisted shape, a form of rent seeking.

Well, why does this happen? The success of organizations such as IS is rooted in theory of small and large concentrated interests. Small groups are more efficient, less bureaucratic, nimble entities that owe their survival to adaptation to the environment.  Essentially, it is a lot easier to go to dinner and pay a bill with 5 people than it is to split it with 15 people. This enables IS to seek rents, develop military capabilities and control territory, albeit on quite a large scale.  Their ideology appeals to a certain aspect of society that reads the works of Sayid Qtub, the Egyptian poet that provides the theoretical basis for modern extremism.