Here is some food for thought. This perspective is not new. But, it bears repeating. The Western world is now in an era where austerity and fiscal prudence writs large out of necessity.
As Western thinkers and commentators sift through the charred landscape of capital market and financial excess, their perspectives are instructive to us in Malaysia. We must never stop learning. I have taken the liberty to make some formatting edits on this extract from the Economist to emphasise some matters that I believe to be important:
- Straightforward steps to improve the environment for business—less red tape, more flexible labour markets, simpler tax and bankruptcy regimes—will be more effective than handouts to favoured firms or sectors. Europeans ought to be seeking to strengthen the rules of their single market rather than pushing to dilute them; a long-overdue single European patent process would be a good start. Competition will do far more for jobs than coddling.
- Second, governments should invest in the infrastructure that supports innovation, from modernised electricity grids (a smarter way to help green energy) to basic research and university education. The current fashion for raising barriers to the inflows of talented researchers and entrepreneurs hardly helps.
- Third, rather than the failed policy of picking winners, governments should encourage winners to emerge by themselves, for example through the sort of incentive prizes that are growing increasingly popular.