ECONOMIC DEVELOPMENT AND WORLD AFFAIRS - MEANING AND IMPORTANCE by Henry G. Aubrey In the past, the process of economic growth was much more generally taken for granted than now. Over the last two centuries, since the so-called industrial revolution in Europe, economic growth had been left to proceed at its own pace, rapid at some times in certain countries, more slowly in other periods and places. In our time, the less developed countries will not wait; they want their economic revolution now, and they expect its fruits within 2 generations rather than 2 centuries.
The reasons for this radical change of temper and rhythm are, I submit, partly economic, partly psychological-political.
Historically, in the heyday of western economic growth, population increased only slowly and the needs of growing numbers did not call for an accelerated schedule of progress. Today, by contrast, most underdeveloped countries are already densely settled and their population is increasing at unprecedented rates. It takes therefore more rapid growth just to keep up with growing needs. Even faster growth is necessary to raise the generally depressed standard of living. This, then, is an economic reason for making haste deliberately.
While it is increasingly difficult to provide for growing numbers, vast masses of people have become aware of the better things of life and are demanding a greater share. Quite naturally, most governments could not remain passive in the light of such social and political pressures. They feel compelled to act instead of waiting for growth to come about in its own good time.
Thus, as gradual growth is replaced by accelerated development "under forced draft," the role of Government is being transformed in the process; if changes have to be brought about quickly, the Government tends to take on functions of assistance, promotion, or even operation which a more leisurely course of events would not seem to call for.
This trend has taken distinct forms in Communist-controlled countries and in free nations. In the former all initiative and activity is centrally
controlled, while in the latter important functions are reserved to free enterprise, notwithstanding a measure of programing or planning.
It may be well to recall that a tendency toward broader Government functions is not by any means unprecedented even in the more advanced free-enterprise economies. In times of stress most countries, including our own, have assigned far-reaching functions to Government. Moreover, historically, most free-enterprise economies in the Western World have, at one time or another, relied on State intervention to a much greater extent than is often realized. Nonetheless, such periods of increased Government activity have been followed in due course by more—not less— private initiative after the preconditions for faster growth had been created.
Hence, the prevalance of Government activities in early stages of economic development need not necessarily be taken as prima facie evidence of socialistic tendencies. The need to marshal scarce resources, to coordinate scattered efforts, and to formulate a judicious path of development makes measures of planning unavoidable. It is eminently desirable to distinguish between this need and the overall direction of enterprise which characterizes a Socialist economy.
In fact, the creation of planning institutions that are compatible with democratic concepts offers the best prospects for the new countries to develop a stable alternative to the lure of totalitarian centralism.
By the same token, it would be harmful to allow the Communists to monopolize the idea of premeditated economic development, for they are already trying very hard to be identified with the cause of industrialization in the minds of the people in retarded areas.
In this respect, the Communists have shown themselves well attuned to one of the strongest emotional drives in large areas of the world today—the desire for economic and social betterment.