Experience is more important than money

( Valery Vasiliev )

In the second half of April, several prominent foreign economists from the USA, New Zealand, Chile and Peru visited Moscow. The trip was organized by the United States Administration for International Development (USAID).

The visiting economists are united by three circumstances. Firstly, they are a rare type of specialist who combines the qualities of researchers (economics professors) and practitioners. As you know, most economists who claim to be considered theorists are organically incapable of giving practical practical advice. The career of a professor and the career of a political adviser are significantly different, and their areas of activity rarely overlap. (V. Lenin noticed this when he wrote with irritation his famous phrase “The economist writes theses.”) Secondly, we were visited by economists whose reforms were successful - many were even included in textbooks on economic theory and in manuals on the implementation of economic policy . Thirdly, we were visited by liberal economists, widely known for carrying out liberal reforms.

Arnold Harberger, one of the most famous economists of the Chicago School, was involved in implementing reforms in Brazil, Argentina and Chile. That is, in those Latin American countries that, after several decades of economic chaos, were able to reverse the evil infinity of the populist economy and embarked on the path of macroeconomic stability and sustainable growth.

Carlos Bologna is the former finance minister of Peru in the Fujimori government during the period when the Peruvian president, elected under populist slogans, abandoned his election program and decided to take the path of tough stabilization measures. This was difficult as the country was suffering from hyperinflation on the one hand and a wave of terrorism on the other. The dictatorship of socialist-oriented generals led to the collapse of the financial system, and parliament prevented the implementation of a responsible economic course. The president, contrary to the constitution, dispersed parliament, held a referendum on the new basic law, called new elections and was able to ensure relative stabilization of economic life. It is worth reminding Russians that this happened in the spring of 1992, that is, when violent clashes began between the first post-communist government, which was trying to stabilize the economic situation, and the Supreme Council, which demanded that the Central Bank controlled by it print new fiat money. (The Peruvian Congress was dissolved on April 5, when the 7th Congress of People's Deputies began its work in Russia, which demanded the abandonment of the course on macroeconomic stabilization. That's how History jokes.) And ensuring financial stability and continuing reforms in the conditions of the political crisis was entrusted to Carlos Bologna.

Roger Douglas and Graham Scott were respectively New Zealand's Minister of Finance and Secretary of the Treasury during a period of deep liberalization reforms. In New Zealand, one of the most socialist countries in the capitalist world, the economic system was constrained not only by a high level of social guarantees, as in Scandinavia, but also by extreme monopolization of economic activity. In a certain sense, the state served the interests of the largest monopolies and did not so much stimulate competition as prevent it. Lobbyists representing the interests of major industrial sectors effectively ran the government. Growth rates naturally fell. The situation was reversed by the right-wing government, which sharply limited the political influence of various types of monopolistic associations and carried out deep deregulation of economic activity. At the same time, a radical reform of the state apparatus was carried out, the old bureaucracy was practically destroyed (not physically, of course, but politically), and many functions of state power were transferred to private structures.

Finally, José Piñera from Chile is perhaps the most famous of the celebrities who visited us. He was Minister of Social Security and Labor in the Pinochet government and is one of the fathers of the Chilean "economic miracle". Piñera gained worldwide fame thanks to the pension system he proposed. The funded pension system created powerful incentives to work, since pension savings were directly related to earnings, and at the same time made almost all Chileans the owners of significant savings - after all, pension money did not go to the budget, but accumulated in the personal accounts of citizens. Private pension funds had the right to place funds only in very reliable (usually government) securities. It was truly a brilliant invention. Deposit owners turned out to be interested in the government's stable economic policy and in a stable economic system. They were already much more cautious about the promises of irresponsible populists. The "revolutionary worker" has become a "responsible voter."

The importance for Russia of the practical experience available to visiting economists is more than obvious. Responsible fiscal policy, deregulation, administrative and civil service reform, pension reform and turning our citizens into responsible voters are all issues facing us now. However, reforms must be hard-won by each country and can only be developed by each country itself. And this is perhaps the main lesson of successful economic development.