Last week the Heritage Foundation published the 2010 Index of Economic Freedom. According to that rating, Hong Kong is the world’s freest economy, it is much freer than the USA. Armenia is freer than Brazil, Estonia is much freer than Germany, and Kazakhstan is freer than India. Russian economy is not free, Tajikistan outstrips it.

It is interesting that the authors of the 2010 Index, while supposing a direct connection between the level of “economic freedom” in a country and its wellbeing, do not care about the countries’ real achievements. When reading the list one can see that there is no correlation between the countries’ positions in the rating and their economic progress. It is impossible to say that all the “free” economies prosper, while “non-free” countries are on the decline. But the contrary cannot be stated either. For example, the rating of Latvia, which faces bankruptcy, is far higher than India, which develops dynamically. On the other hand, Japan and Germany outstrip impoverished Armenia only by 1 or 2 points (those three countries are the rating leaders).

If to consider the 2010 Index more carefully, it is getting clear that its authors used a strange system of factors. Evidently, the liberal ideologists believe that the economic freedom is the lack of the state control and of its interference in the economic processes. But, at the same time, there is such a factor as “protection of the property rights”. I wonder how a state will protect those rights with interfering in nothing. And what does the freedom have to do with it?

Protection of somebody else’s property from my encroachments is limitation of my freedom. For example, I like my neighbour’s cap. I take the cap from him and put it on. So I act as a free man, who is not limited by any state rules. If my neighbour protests, this is his problem. He is also a free man, and can fight with me, run away or take a cap from anyone who is weaker than he is.

Is it cynical? Not at all. Thomas Hobbes, a founder of the modern political philosophy, whose works fundamentally influenced the formation of the liberal thought, described the freedom in such a way. It was quite clear to the classics of liberalism that laws limited freedom, that the power of law and the freedom of persons, including the economic players, contradict each other, but the development of society requires balance between these factors and freedom has to be limited if we want to preserve it. However, modern liberal thinkers are not interested in those details.

Meanwhile, the freedom itself may be a terrible phenomenon. If to return to the initial thesis and to declare a state’s non-participation in economic processes to be the freedom criterion, then today the maximum of potential freedom is in Haiti, which, after the earthquake, has no government at all. But the economic life continues to exist. The stolen humanitarian aid can be sold perfectly according to the market laws for the price that buyers can offer, to those who have money or some barter resources. Therefore, those, who do not have enough money or the resources, can die of starvation unless they have guns by means of which the people can solve their problems.

True, here is a question that is unpleasant for liberal thinkers: what is of more importance – the property rights or the human rights? The theorists believe that those two things automatically imply each other, so one should not discuss those subjects. But the practitioners have their own problems – for example, they should decide if it is permissible to open fire on starving people trying to ransack food depots. If to allow them to pilfer the food, which they cannot afford to buy, what about the property right? And would their killing be a violation of human rights?

Haiti’s experience visually illustrates an old, but unpopular fact: the bourgeois standards and rules are effective only in a well-established bourgeois society, because they are created only for this kind of society. In the same way, the football rules are good for football, but they are bad for hockey.

The rules themselves do not create the society. The rules are being formed simultaneously with the society, but it is impossible to build the social relations system if only to proclaim the rules and values or to pass the laws. It is extremely naïve to think that if you introduce in your country the official standards inherent in the developed bourgeois society, like the Western society, you can create a European democracy. The situation would be completely different – the rules would not be effective. At best, they will be ignored.

The rules of the respectable bourgeois society are ineffective in the earthquake-destroyed Haiti, and they would be ineffective in a peripheral capitalist society, which the modern Russia is, as well. They were ineffective in Western Europe about three hundred years ago, when the bourgeois system was imposed on the people through violence, repressions, revolutions and dictatorships. The societies were always and everywhere modernized in such a way.

Only when the people were trained against their will to a certain system, when the resistance of opponents was suppressed and alternative standards, rules and values were abolished, when the government intimidated everybody – then the foundations of the freedom in the respectable bourgeois society were laid down.

Maybe, it is not necessary to repeat this way for such a long time. Three hundred years is a too long period for our rapid life. For example, fifty years may be enough. But the question is if it makes sense to repeat that way in the first place.

Boris Kagarlitsky is a Director of the Institute of Globalization and Social Movements

January 28, 2010