May 29, 2004

He makes the ankle-biters look puny...

After being exposed to so much of the infantile carping and sneering of Paul Krugman, it's a keen pleasure to encounter an economist one can admire! Australian Tony McDonald just jumped in and did a great job of work.

The Daily Telegraph | Economist who became a hero:...Before he returned after 10 months service in January, Mr McDonald rose through the ranks of the provisional authority to be senior adviser to Iraqi finance minister Kamal al-Gailani. He helped get payments out to a million pensioners and 1.3 million civil servants through a chaotic banking system.

In a letter to Treasurer Peter Costello, Iraq administrator Paul Bremmer said he "often acted solely upon Tony's macro- economic advice".

Under Saddam, the tax system consisted mostly of imposts on business and very high tariffs, designed to maintain the regime's monopoly on smuggling. Banks were not linked and money was safer "under the bed". Pensioners were paid $US4 a month and public servants' pay depended on how much they contributed to the regime's coffers.

"We were essentially dealing with a gangster economy. No one was happy with it but people had to live within it," he said."It is in the process of being rearranged to be very much more simple, with much more objective measures of overall income."...

Posted by John Weidner at May 29, 2004 7:46 PM
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