27 Comments

You could have called this column Swiss Watch. You missed the pun. Turn in your dad card.

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Isn't the obvious right-wing explanation that Switzerland is full of Swiss?

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No, Switzerland is full of Germans, French, and Italians. The Italians are richer than the Italians in Italy, the French are richer than the French in France, and the Germans are richer than the Germans in Germany. Switzerland has a better government than France, Germany, and Italy because it is small and decentralized. However, their defense budget was big enough to deter Hitler from invading.

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Switzerland is proof that smaller federal gov't is better, in reality, than larger and "theoretically" more efficient.

Their referendum's on, and usually against, higher taxation has also made them have and keep a culture of individual responsibility.

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Not convincing; the Swiss are too much like the French, Germans, Italians, and Austrians.

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"The best governed polities tend to be about the size of Switzerland. Some badly governed polities are also small. The U.S. is one of the ten most populated countries. The other nine are governed so badly that you should be grateful to be here."

Not that I'm disputing your claim exactly, but perhaps there's a bit of cherry-picking going on? If you made this list 10 years ago, Japan would make the cut instead of Mexico

If you grab 10 countries from the middle of the population table you get:

Hungary, Tajikistan, Belarus, UAE, Israel, Austria, Togo, Switzerland, Sierra Leone, Laos

Arguably that's a slightly better list, but there are some stinkers in there too. This doesn't really convince me that small countries have systematically better governance, but it's more a reminder that good government is still a rare thing

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Japan, Germany, and the United States are the only populous countries with good government. There are at 10-20 others with bad government.

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Which raises (not begs :)) the question, why don't Libertarians spend more effort and energy on reducing immigration restrictions. [Yes, I know of Caplan and my perception of "not enough" is subjective, but Bob's your uncle.]

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After you put a teaspoon full of shit in a milkshake, you can't make it drinkable by putting in a teaspoon full of sugar.

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Fair enough. So how do we go about reducing the s--- content of the milkshake? "It has s--- in it!," is not an actional proposal.

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I will play, Thomas- illegal entry is a permanent bar to ever becoming a legal resident. Employing a person who is here illegally is federal crime with stiff penalties, both financial and penal in nature. No release on being captured while here illegally- immediately sent home without appeal.

On the legal increase in immigrants- you must have a job offer that you must accept before being allowed to enter. I am perfectly willing to increase H1B visas without limit, but the above paragraph is how you get the sh** out of the milkshake.

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Aside from increasing H1B visas without limit (we should make student visas a lot easier to get and convert to permanent residence, too), I'm not sure what your other proposal are. I guess removing the penalties for employing a persons who entered illegally and allowing person who have entered legally (with no other contraindication) from becoming citizens would be good, too but I'm not sure it that is what you meant.

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Why doesn’t it raise the question: why don’t progressives spend more effort devolving authority on more local forms of government, instead of imposing their preferred policies, one-size-fits-all, on the largest unit of state they can get their hands on? Seems like a far more obvious lesson from Switzerland.

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That would be a good idea for lots of areas like abortion, gun safety.

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And healthcare, taxation, public transportation, schooling, entitlements...

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Yes, public transportation, definitely. (Federal input into educations pretty minimal, anyway.) Healthcare? That's a pretty big ticket item for which the federal power to tax is useful. And of course that's what Medicare provisions of ACA tried to move toward. But taxation, no. There is enough interstate migration to make progressive (which I do not think is progressive enough) taxation at the state level unfeasible.

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Another advantage Switzerland, Singapore, and other small but very successful polities have is trade. Specifically, they can sell to big markets without being a big market. These countries always run big trade surpluses and hold foreign assets in big countries. In a way it's as if they are pushing the externalities of political scale onto their trading partners. Generally similar with the costs of military defense (many of these countries make proportional investments in defense, but still could not defend themselves against a larger aggressor without assistance).

I'm a big fan of both countries and would love to learn lessons from them, including agreement with your main points, but I'm not sure the model as it stands can scale to the rest of the world.

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Looking at imports/exports as % of GDP, international trade doesn’t seem more important to Switzerland than the other small (poorer) countries of Central Europe. Small countries almost by definition are more dependent on international trade than large ones. Trade is definitely a driving factor behind Singapore but not sure about Switzerland.

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I just looked at this, which seemed to show a growing share of trade surplus/gdp over time.

https://www.macrotrends.net/countries/CHE/switzerland/trade-balance-deficit

Admittedly, Singapore seems to be twice as bad.

https://www.macrotrends.net/countries/SGP/singapore/trade-balance-deficit

As to Latin America I'm not seeing it.

Mexico appears to be close to 0%?

https://www.macrotrends.net/countries/MEX/mexico/trade-balance-deficit

Brazil is close to 0%?

https://www.macrotrends.net/countries/BRA/brazil/trade-balance-deficit

Guatamaela is negative?

https://www.macrotrends.net/countries/GTM/guatemala/trade-balance-deficit

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Maybe I'm talking about Trade Balance and you're just talking trade. We can all indeed have ever increasing levels of trade, but we can't all have trade surpluses simultaneously.

My point is simply this. These countries running trade surpluses can only do so if the trade partners allow it and if such foreign capital accumulation is in their own interests. It's not clear that they could re-invest capital domestically and get the same real rate of return as they do investing abroad. Like everything else, there are diminishing marginal returns. Because they are small and their trading patterns are big, they can run huge trade surpluses in their own GDP terms without exhausting the markets of their much larger trade partners. But if everyone tried to do the exact same thing it wouldn't work.

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Trade surpluses? Really? On a libertarian blog?

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Yes to having a gov't & culture give the opportunity to create wealth.

"South Africa The Solution" (1986) [https://archive.org/details/southafricasolut00louw/mode/2up] recommended setting up tribal cantons for the 10+ SA black tribes & 2 white tribes. Had it been implemented then as part of an ending of Apartheid, it would have been far better for most citizens, both white and black.

It also could have occurred in Yugoslavia, and maybe even Czecho-Slovakia, as these states decentralized. Recently South Sudan would still be a good candidate for cantonization - with aid going more thru the more local cantons than thru the almost-inevitably corrupt central gov't and the current tribe in power.

Who is the Swiss President? (It doesn't matter so much, their President has less gov't power, and a 1 year term, and the Federal gov't has less power. )

Scott and Arnold focus more on top talent, but I suspect that it's even more important for the culture to have good life choices for low IQ folk, with good morals. This means both higher expectations of working independently, and more opportunities to find work and show up with good work habits. Next on my reading list is Freddie deBoer's "The Cult of Smart", tho I already know about its support for better culture for the non-academic oriented folk. I suspect the Swiss have better jobs, with resulting higher self-respect & dignity, for their lower-IQ Swiss citizens, but don't talk much about it.

Scott also specifies some 5 or 6 US & Swiss similarities:

1. Relatively decentralized.

2. Lots of referenda.

3. Traditionally more free market than most developed economies (although the edge is eroding.)

4. Much lower than average taxes for a rich country.

5. A long period of isolation from warfare (on their soil), and a haven for dissidents fleeing persecution. [6] Also a good place for migrants who want a business-friendly system.

We need some focus on both tails - allowing the top talent to fly, while helping the least talented to avoid being squashed.

Welfare dependency doesn't lead to self-respect nor good morals. Right now a national, state, county, or city guaranteed job offer seems among the best policies to help poor folk help themselves. But it does require the anti-Libertarian acknowledgment that some folk need more help to live decently - tho it also notes that such folk have a huge responsibility to live with good morals, that don't require money nor status.

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Solving cretinism throughout Switzerland also helped them.

https://bigthink.com/strange-maps/history-of-cretinism/

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Switzerland is the only part of Greater Germany that didn't suffer from world wars, totalitarian regimes and foreign occupation. Of course it's richer than the other parts.

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While this is true, the extent of damage done by WW2 isn’t that predictive of economic performance. Poland got it worse than any other eastern bloc country and yet is doing better than virtually every eastern bloc country. Germany quickly outperformed all the large western countries that suffered far less from the war. And the gap between Germany and Switzerland is pretty big.

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In 1914 the current territories of Poland, Slovenia and Czechia were already more developed than the rest of Eastern Europe. It is no coincidence that the most western countries (including the Baltics which are further east but are the maritime border) are the richest. Usually development radiates from a core area, the Blue Banana in Europe, Japan in East Asia.

Germany didn't suffer only from WW2. WW1, national socialism and marxism leninism also killed, imprisoned and drove into exile lots of people while between 1914 and now Germany had to pay for wars and arms races, paid huge reparations, lost half of its territories, reunited with some of them and had to rebuild them, suffered foreign occupations etc.

The Soviet occupied area is still economically weaker than the rest of Germany so it's not surprising to me that peaceful Switzerland is the richest part of Greater Germany.

Why is Germany richer than other countries even after all that suffering is a different question.

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Why are the French in Switzerland richer than the French in France? Why are the Italians in Switzerland richer than the Italians in Italy?

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They have an excellent education system. With everything being at the canton level it becomes difficult to extort benefits for special interests without the voters having a say.

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