(Drivebycuriosity) - Catalonia (a region of Spain) and Kurdistan (a region of Iraq) both want to secede and to become independent nations. Being an economist with a strong interest in history I believe that both regions have a convincing agenda. Catalans & the Kurds would be better off if they go their own ways.
Secession isn`t a new idea. In the early 1990th many regions used the
breakdown of the defunct Soviet Union to gain freedom and to become
independent states: The Baltic states (Estonia, Latvia, Lithuania) plus
Ukraine, Azerbaijan, Uzbekistan, Moldova and more. At least some of the
them have flourishing economies now. Today the Baltic states Estonia, Latvia, Lithuania all have higher per capita income then the Russian Federation (
worldbank). Other parts of the former Soviet
empire also broke apart: Yugoslavia (into the separate states Serbia,
Croatia, Bosnia & Herzegovina, Montenegro, Macedonia & Slovenia) and
Czechoslovakia (into Czech Republic & Slovakia). There is global trend toward having more and smaller countries: In the mid-1950s, there were 80 states in the world. Today, there are 200 (
ibtimes).
History shows that even very small countries can prosper after
becoming independent. Switzerland has been
proving for many centuries that small states can do well. 1499 the country separated from the German federation, the Holy Roman Empire. Switzerland didn´t participate in World War I, neither in World War II and decided against a membership of the European Union. In 2016 Switzerland had a per capita income of $78,000 beating neighbors Germany ($41,000) & France ($36,000 ) and even the USA ($57,000 ) by far (
worldbank). The tiny independent states Luxembourg & Liechtenstein also belong to the richest nations of the world.
There are more success stories. Taiwan separated in 1949 from Motherland China which led to a "period of
rapid economic growth and industrialization, creating a stable
industrial economy" (
wikipedia). Today
Taiwan has a per capita income of $39,600, about 5-times of China ($8,100).
Hong Kong, which got separated in the 19th century, has a per capita income of $43,600.
Singapore did even better. The tiny state had been a part of Malaysia, but got kicked out in 1965 after political conflicts (
wikipedia).
The independence brought Singapore swift economic growth, thanks to the intense trade
relationships with the rest of the world. Today Singapore has a per capita income of $52,000, far above Malaysia ($9,500) and Indonesia ($3,500).
This is no coincidence. Small countries (and independent regions) are
less complicated than huge states. They are easier to govern and to
manage and therefore they are less bureaucratic. The government of a small
country is closer to their citizen and can respond better to local
needs. Government decisions about taxes, health car, public spending and more could be fairer & more efficient.
Creative Environment
Secession leads to decentralization. Decentralization "increases
efficiency - and effectiveness - due to reduction of congestion in
communications, quicker reaction to unanticipated problems, improved
ability to deliver of services, improved information about local
conditions, and more support from beneficiaries of programs" (
wikipedia).
Europe became the world’s most dynamic civilization after around the year 1500
partly because of political fragmentation and competition between
multiple independent states, wrote the historian Niall Ferguson (
bostonglobe). Small countries like
The Netherlands became global power and stayed wealthy till today. The
Italian Renaissance happened as Italy was just a cluster of small
independent city states like Milan, Florence, Pisa, Siena, Genoa,
Ferrara, Mantua, Verona and Venice. The competition between these places
created an creative environment that inspired advances in arts, science
and business (
wikipedia).
The independent
Greek city states (Athen, Byzantium, Sparta, Troy and more)
developed democracy and founded European culture. The huge Roman Empire instead, which spread from
Northern Africa to Southern England, broke down under its own weight. Today
Switzerland &
Norway aren`t member of the European Community - and
both countries are doing well. People worldwide are buying Swiss
products & services and don´t care whether the country is part of an
union or not.
I believe that Catalonia and Kurdistan each can repeat these success stories by focusing on their human capital and trading freely with the rest of the world as Switzerland & Singapore do.
I believe that small countries (and separate regions) have just one
disadvantage: They are military weak and could be easily overrun by
enemies. But the existence of Switzerland, Singapore, Luxembourg, Andorra and
other tiny states shows that this risk is very low today. It is not likely
that Catalonia will be attacked by its neighbors Spain & France.
Viva la independence.