Παρουσίαση Claude Rochet: "Ο Δρόμος για την Ανάκαμψη:...

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The Marshall Plan and the Road to Recovery: Learning from the Past Crises The Role of the Strategist State Prof. Claude Rochet Athens, Mars 5 th 2014

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Παρουσίαση του καθηγητή Claude Rochet κατά την ομιλία του στην εκδήλωση του ΙΓΜΕΑ με θέμα "Σχέδιο Μάρσαλ: Οι αληθινοί Σύμμαχοι"

Transcript of Παρουσίαση Claude Rochet: "Ο Δρόμος για την Ανάκαμψη:...

Page 1: Παρουσίαση Claude Rochet: "Ο Δρόμος για την Ανάκαμψη: Μαθαίνοντας από τις Κρίσεις του παρελθόντος, ο Στρατηγικός

The Marshall Plan and the Road to Recovery:

Learning from the Past Crises The Role of the Strategist State

Prof. Claude Rochet Athens, Mars 5th 2014

Page 2: Παρουσίαση Claude Rochet: "Ο Δρόμος για την Ανάκαμψη: Μαθαίνοντας από τις Κρίσεις του παρελθόντος, ο Στρατηγικός

Before the Marshall Plan: The Morgenthau Plan

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Deindustrialization Weak Political power

= a clear intention of destroying a country => Fostering a negative synergy among ALL European countries

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The Malthusian consequences of a Morgenthau plan

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No industry => Malthusian trap

No industry => economic collapse

No industry => Negative synergies, recession for all

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Rediscovering the traditional mercantilist wisdom

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Speech by G. Marshall June 5th 1947

Town and industries are at the heart of economic synergies as engines of wealth creation

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What the Marshall Plan was NOT?

Only a massive transfer of monetary ressource to finance imports from the US

Just a political operation to contain communism

The catalyst of European recovery

Monetary orthodoxy Free market orthodoxy

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What it was: Strong public intervention: Gov’t failures are always

preferable to market failures Alleviation of war controls on prices and quotas,

exchange rate stability, BUT under mixed economies re-distributional systems

Priority to productive investments Considering the economy as a whole and not specific

firms as market mechanisms would do + Knowledge transfer => Strong multiplier effect Political consensus on welfare state Bretton-woods system: no currency straitjacket

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A key issue neglected by the folk vision of the Marshall plan:

Knowledge transfer accounted for 1,5% of the total cost of the plan (20bnUS$)

4-6 weeks study tours were organized in the US to learn management methods

Productivity solutions suited to local conditions Workers Unions supported the plan under the condition that

productivity benefits will be shared between owners, workers and consumers

This resulted in dramatic productivity increase of 25-50% with no increase in fixed assets, and an historic increase of TFP

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Why it succeeded?: Applying the old recipes

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Searching for synergies between economic activities

All activities are not alike and growth is an uneven process

Increase the technological content of products and labour

Prodty increase in the absence of a manufacturing sector

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Play it again, Sam!

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As Time Goes by, the fundamental things apply… Why did the plan worked:

- Linking agriculture and industry - Creating free-trade zone, BUT within

symmetrical partners - Relying on technologies and activity

specific sectors These are the principles formulated by F. List in 1841

The preconditions for wealth, democracy and political freedom are all the same: a diversified manufacturing sector

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Troïka policies are akin to Morgenthau plans (1)

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De-industrialization as a massive destruction weapon….

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Troïka policies are akin to Morgenthau plans (2)

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… with a particular emphasis on Greece

Morgenthau plan in action

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Troïka policies are akin to Morgenthau plans (2)

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Morgenthau plan in action

A process of primitivization: • Loss of skills and

emigration • Retrogression to

primitive state

Unemployment (% GDP)

Investment (% GDP)

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Lessons from the past: Development is an uneven process Activities are not alike Wealth is not valued by hours of work but

with knowledge Infant activities protection is needed to

preserve the first mover advantage High quality activities spill over all the society

=> civic humanism

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The issue of Good and strong Gov’t is still topical as a condition for growth

Clisthenes’ principles: isotopia, isonomia, isocratia

Allegory of the Good Governement, Sienne Town Hall, by A. Lorenzetti

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What is the role of a strategist state?

1. A strategic vision borne by sovereign state

2. Power and plenty are linked 3. Understanding the role of high

quality activities 4. Modernization of public

administration and political strategy are closely intertwined

5. Promoting the entrepreneurs and fighting the rentiers

6. Keeping a tight rein on finance

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follies are alike