Recommended by Ricochet Members Created with Sketch. A Tale of Two Camps

 

Some time ago, Russ Roberts hosted Richard Davies, the author of Extreme Economies, on EconTalk. One of the stories that Davies told was of two UN-run Syrian refugee camps in Jordan.

Zaatari, the first camp, was built quickly in response to the Syrian refugee crisis and before the UN was able to “get it right” by their lights. The camp was built near a Jordanian town, allowing trade to occur. In addition, the Syrians were able to buy goods at the camp’s UN stores with their UN-issued debit cards and sell those goods to Jordanians for cash. The currency enabled them to create a thriving, monetary-based economy in the camp. All sorts of businesses sprang up: food, hardware, and even wedding dress stores. Over 60% of working-age adults were employed and the community was vibrant and growing.

Unfortunately, freedom led to inequality. Some people got relatively wealthy and some used their wealth to add onto their UN-supplied homes. Naturally, the UN found this unacceptable.

By the time the UN built Azraq, the second camp, they had learned their lessons. Azraq was built in the middle of the desert and was surrounded by armed guards. As a result, no external trade was possible. Employment was around 9% and the camp was made up of drab, identical homes populated by people of identically low wealth.

Strangely, Syrian refugees were desperate to be sent to Zaatari, despite its inequality, rather than to Azraq, the UN’s egalitarian utopia. Silly refugees.

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  1. Al French of Damascus Moderator

    Richard Fulmer: Some time ago, Russ Roberts hosted Richard Davies, the author of “Extreme Economies,” on EconTalk

    March 9. I haven’t listened yet. I’ll move it up in the queue.

    • #1
    • June 2, 2020, at 8:06 PM PDT
    • 2 likes
  2. repmodad Coolidge

    This was a great episode. A lot of those stories really brought home Russ Roberts’ favorite Hayek quote: “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.”

    • #2
    • June 2, 2020, at 8:40 PM PDT
    • 4 likes
  3. colleenb Member
    colleenb Joined in the first year of Ricochet Ricochet Charter Member

    Thanks for the recommendation. I don’t check EconTalk as often as I should. 

    • #3
    • June 3, 2020, at 12:40 AM PDT
    • 1 like
  4. repmodad Coolidge

    colleenb (View Comment):
    I don’t check EconTalk as often as I should. 

    This sums up my relationship with EconTalk. I might look at the episode description and think 20% sound interesting. Then I listen to one and end up playing five in a row because they are all fascinating. 

    • #4
    • June 3, 2020, at 4:16 AM PDT
    • 4 likes
  5. OmegaPaladin Moderator

    The existence of Bill Gates or Elon Musk does not change my social status. Even when I was poor (working two jobs part-time with no benefits) I did not care about the zillionaires. Unless I was literally going to get their money, it just did not matter. Sometimes I was annoyed at some rich person wasting their money (give me the money you spent on single event, and I could nuke all my debts and have enough money so I was not living paycheck to paycheck) but the very existence of rich people never was a problem.

    Hell, I wanted them to give me a job so I could make money like I do now.

    So income inequality never made sense as an argument. After all, if everyone has no money at all, how is that superior to our in unequal capitalist system? Who would want that?

    • #5
    • June 3, 2020, at 2:00 PM PDT
    • 5 likes
  6. Richard Fulmer Member
    Richard Fulmer

    Material inequality is the inescapable result of material progress. If a new product is created, it cannot possibly be simultaneously distributed to every person on earth. So, the first time someone invented something – the loin cloth or the stone hammer, perhaps – inequality instantly appeared in the world.

    • #6
    • June 3, 2020, at 3:19 PM PDT
    • 1 like