Thursday, August 12, 2010

Information control is bad economic policy

The Chinese want increased ability to censor Google, Saudi Arabia, the UAE, India and other countries have recently threatened to cut off Blackberry service if they don't get access to encrypted customer information and communication. They claim they need access and censorship for national and regional security. But it could prove to be an economy killer.

Information is perhaps the most closely guarded asset global corporations have. If they can't trust that their information is safe, especially in countries where piracy is already a problem, they may ultimately decide that the risk of losing precious intellectual property is not worth the potential reward of establishing themselves in emerging markets.

Countries and regimes that work too hard to control information may or may not achieve increased security, but they will not achieve increased prosperity in the long run. Entrepreneurs, risk takers, producers will go where the risk/reward equation makes the most sense. Nobody wants to see the fruits of their labor simply taken from them, without warning or compensation. Not even in the name of security.

Governments and by extension the populations that enable them to remain in power, must decide if they want a vibrant economy because their government needs money to enforce control or because they want a higher living standard for individuals within the country. Order and control are not virtuous ends in and of themselves. They can be a consequence of good policy, as a happy and satisfied population can be peaceful and orderly. They are not primary goals. Any idiot with a weapon can impose order. It takes wisdom and leadership to enable and inspire creativity, production, trade and freedom.

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