Unlikely Heroes Of The Revolution
I was recently introduced to a character from recent history by David Farrer of the Libertarian Alliance who is an unlikely hero of the Classical Liberal Revolution and a public servant to boot. I am ashamed to say that I was completely unaware of Cowperthwaite and can only imagine how different life would have been in Britain today had he been in No 10 instead of the social and economic regulating Fabians of both the Labour Party and Conservative Parties lumped under the term Butskillism.
Sir John Cowperthwaite KBE CMG Financial Secretary to Hong Kong.
1915-2006
Sir John was sent to Hong Kong in 1945 to oversee its economic recovery after the war. What is remarkable about Sir John is that unlike any other colonial civil servants he decided on a course of positive non intervention in the economy.
This did not mean that Cowperthwaite sat around doing nothing, as P J O’Rourke put it –
“Quite a bit of government effort is required to create a system in which government leaves people alone. Hong Kong’s colonial administration provided courts, contract enforcement, laws that applied to everyone, some measure of national defense…, an effective police force (Hong Kong’s crime rate is lower than Tokyo’s), and bureaucracy that was efficient and uncorrupt but not so hideously uncorrupt that it would not turn a blind eye on an occasional palm-greasing illegal refugee or unlicensed street vendor.”
He took non intervention to such a length that he refused to collect economic data in case it provoked some bureaucrat to start trying to interfere.
“As for the paucity of economic statistics for the colony, Cowperthwaite explained that he resisted requests to provide any, lest they be used as ammunition by those who wanted more government intervention.”
Daily Telegraph Obituary.
He maintained a rule that Government spending should never exceed 15% of GDP, compare that statistic to Governmement spending in this country. Milton Friedman was also an admirer of Cowperthwaite.
“Direct government spending is less than 15 percent of national income in Hong Kong, more than 40 percent in the United States. Indirect government spending via regulations and mandates is negligible in Hong Kong but accounts for around 10 percent of national income in the United States.
“We are more productive than Hong Kong. But we have chosen, or been led by the vagaries of politics, to devote roughly half of our resources to activities to which Hong Kong devotes 15 or 20 percent. Our higher productivity means that we can produce with 50 percent of our resources the same per capita income as Hong Kong can produce with 80 to 85 percent of its resources.
“The real lesson of Hong Kong for the United States is that we’re using our resources inefficiently. Our government is spending our money to subsidize tobacco and to penalize smoking; to subsidize childbearing and to discourage childbearing; to build new housing and to tear down housing; to subsidize agriculture and to penalize agriculture; and on and on — not to mention converting square miles of forests into billions of paper forms and spending many man-years of labor filling them out and then filing them.”
Hong Kong did not just ‘happen’; it happened because one man held back the wrongheaded interferance of both Politicians and the Public Sector. He was, however, not a complete non interventionist as he presided over a massive expansion of public housing, making the Hong Kong Government one of the largest landlords in the world.
Would that we could persuade our politicians to stop arguing about how to spend the increasing amount of Tax that is levied from us by coercion and to adopt Cowperthwaite’s dictum.
“In the long run, the aggregate of decisions of individual businessmen, exercising individual judgment in a free economy, even if often mistaken, is less likely to do harm than the centralised decisions of a government, and certainly the harm is likely to be counteracted faster.”
Cowperthwaite would not have lasted five minutes in Whitehall.
Cowperthwaite passed away in 2006, his message ignored by his own country and the west, his legacy however the economic success of Hong Kong, now centrally placed in the strongest region in the world, while Britain and Europe slowly slide into decline and authoritarianism, and asking the East to bail the bankrupt economies of the EU out.
If you want to join with people who think that people like Cowperthwaite and his policies should be admired and emulated, please join us in the Libertarian Party.
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January 14, 2011 at 08:28 -
Having lived inAsia for a decade and in Hong Kong for two, I can say I felt freer there than I do here. I was not able to vote, but then again the State did not cross my path except to clear it. It was safe, efficient. I would live there again in a heartbeat.
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January 14, 2011 at 10:08 -
My time in Asia was shorter than this and my visits to Hong Kong were only two to three weeks at a time but I echo everything you say. And don’t forget the low rates of taxes which resulted from the low level of interference in peoples’ lives. And the strength of the HK Dollar (as was in those days) which led me to pay my salary into Hong Kong a soon as it arrived.
I’m just sad I didn’t know about Cowperthwaite.
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January 14, 2011 at 08:34 -
What a wonderful man. Can anybody name a British or European example of a beaurocrat following in his footsteps today?
Public sector =< 15%.GDP . Now there's a policy to vote for! I'd be happy with 30%.
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January 14, 2011 at 09:09 -
Would that we could have a Cowperthwaite here today. Such men would be despised and ridiculed set amongst our traitorous band, yet people would rally to their cause like the thirsty to clean water.
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January 14, 2011 at 10:50 -
Thanks for publishing this.
A few years ago I was invited to an event in St Andrews by the journalist Alex Singleton who was then a student. I was mainly a gathering of young folk who had just published a libertarian magazine. I went over to talk to an older gentleman standing in a corner. He told me that his name was Cowperthwaite. I was stunned. “Not the man who invented Hong Kong” I asked. Yes, it was the great man himself and he seemed surprised that anyone would know or appreciate who he was.
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January 14, 2011 at 11:22 -
If you doubt the wisdom of Cowperthwaite — sc. if you be a socialist — consider the following anecdote.
A few years ago — around this time of the year — either a strike or a technical failure interrupted the flow of data to and from the (British) Office of National Statistics, whereupon the almost hourly publication of the rate of ‘inflation’, the G.D.P., the Prince of Wales’s hat size and — well, everything except the weather, really — ceased. I forget how long the break lasted but, to the best of my recollection, it was a couple, three months.
Before the data dried up the markets — stocks, bonds, commodities and currencies ; even farmers’ — had, as usual, been up and down like a … like yo-yos. Almost as soon as data ceased to be available, on the other paw, the markets settled down, prices levelled out and the World was no longer about to end.
To paraphrase Henry : “Give me a Cowperthwaite or give me a break in official data !” Hmmm. Doesn’t have quite the same ring to it, does it ?
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