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January 2020, No. 93


Economy

Self-Sufficiency Means More Poverty


National security is a strategic national issue. In the area of ​​economics, economic security is provided when our economic strategy is to safeguard the national interest.


Iranian economist Dr. Musa Ghaninejad said, “If the policymakers think scientifically, the policy and strategy they adopt will have a well-defined, rational and coherent framework. When there is no normative thinking, there will be no coherent strategic policymaking. That is why we do not have a clear long-term strategy on major issues in foreign policy, international economics, and economic policymaking. Regardless of the political aspect, we have always been economically entangled because the policymakers have not had a normative and coherent economic thinking, they have observed economic issues expediently all the time.

“We want science for difficult situations,” he said in response to policymakers who blame difficult conditions, sanctions and economic wars to justify wrong economic policies. Under normal conditions, markets operate and the economy operates by itself. By the way, in times of hardship such as the time of sanctions, we must turn to science. If science fails to solve a complex problem, then what is higher than science to solve it?

Since the Revolution, due to the political ideology dominating the minds of the revolutionaries in our country, there has been no normative policy-making except in very short periods and at specific times and for specific cases. Contingent or short-term thinking is the opposite of long-term, scientific and strategic thinking, and contingent policy-making is opposed to a policy-making based on normative thinking; I mean thinking based on scientific principles. If the policymaker thinks scientifically, his policy and strategy will have a well-defined, rational and coherent framework.

But if policymakers do not have a normative thinking, they will suffice to contingent and expedient policies. From the viewpoint of political philosophy, this is a well-known issue. Ambiguity of the basis of dominant political thinking has been our plight since the beginning of the Revolution. When there is no normative thinking, there will be no coherent strategic policy-making. That is why we do not have a clear long-term strategy on major issues in foreign policy, international economics, and economic policy-making. Regardless of political aspects, our entanglement from economic point of view has always been that since the policymaker has not had a normative and coherent economic thinking, they have observed economic issues expediently all the time.


We need to define our national security and national strategy through expanding economic relations.


For example, when faced with inflation, the policymaker has gone for price control instead of seeking to investigate the root causes of inflation and solve the problem scientifically, because they have not been basically adhering to the fundamental idea with which the inflation problem could be explained. Decisions have been made on other issues in the same way on a day-to-day basis and based on the day’s requirements.

 Of course, this expedient thinking has its strengths and weaknesses. However, if we look at the root causes, we see that this is a long-term problem that is rooted in a fundamental flaw which is the absence of long-term, normative and strategic thinking. At times such as the current situation when we are faced with sanctions, and economic pressures and difficulties have been intensified further, contingent policymaking becomes more prevalent and more evident. However, these basic flaws are still in place under normal circumstances. 

How can policymaking based on the teachings of economics, contrary to claims, enhance national security?

National security is a strategic national issue. In the area of ​​economics, economic security is provided when our economic strategy is to safeguard the national interest. For example, what was China’s economic strategy in relation to the powerful and imperialist governments of the world, such as the United States and the Soviet Union in the 1970s and 1980s? The Chinese came to the conclusion that as long as they have not turned into a great economic power, they have nothing to say internationally in the military or political arena. As a result, they changed their course. They said we must solve the problem of poverty and become an economic power. The solution they found was to move to a market economy and use foreign investment.

The old misconception that Marxists promoted and was accepted in China during the Maoist era was that foreign capital inflows make the country dependent and exploited. The Chinese set aside that misconception and turned to scientific thinking. Scientific thinking is that, both parties benefit from free trade. Foreign investors benefit greatly from investing in China, but this is a mutual benefit. The Chinese benefit, too. As a result, a penniless China becomes wealthy due to interaction with the outside world. Is a wealthy China better able to provide more security to China or a poor China? Through strategic thinking, they concluded that China should become rich. They did not define their security in poverty and self-sufficiency.

China no longer sought to oppose foreign investment and to follow those stupid Marxist doctrines, but formulated its economic strategy based on scientific facts. As a result of this change China has now become a world economic power and its national security is by far greater than that of Mao Zedong’s era. We should have done the same, but we did the opposite.

Under the ninth and tenth governments, in conditions that our international relations were weakening and the tension in our foreign relations was escalating, instead of using the opportunity of increased oil prices to make more investments in the oil field and to raise oil exports, they reduced the oil production capacity and oil exports.

At the time when oil prices were high, we could increase our oil exports to five million barrels through heavily investing in oil and gas fields and using foreign investors so that they would not be able to impose sanctions on us.

If we were to export five million barrels of oil, world markets would depend on our oil and they would not be able to sanction on our oil, but when we export only two million barrels they would easily impose sanctions on us. How would national security be defined at that time? Unfortunately, since scientific thinking was not dominant, the path we took and the strategy we adopted, which of course was more of a slogan against the West, resulted in the reduction of the country’s oil production potential, and as tensions escalated in foreign relations, sanctions escalated and we could no longer do anything.

The absence of scientific thinking brings about such catastrophes for the country. Now our problem is the same. If we want to strengthen national security, in economic context, we need to have the most relationships with foreign countries, especially our neighbors, and make them dependent on our economy. When we liberate trade, interdependence is formed, it is true that we depend on other countries, but they also depend on us.

We must define national security in this context. If we sit down and say we restrict imports and exports and build a self-sufficient country, we should know that this self-sufficient country will become the most vulnerable country. This is a wrong and unscientific path. National security must be defined in the context of interdependence, not in the context of economic self-sufficiency. Which country has been able to secure its national security economically through economic self-sufficiency? Not even one country can be mentioned as an example. We are living at a time when economics and technology have become global. We can’t even imagine becoming a self-sufficient country in terms of industry, agriculture, etc.

We need to define our national security and national strategy through expanding economic relations. When we could do it through using oil, we missed the opportunity. Now, some are chanting self-sufficiency and non-dependence. This viewpoint is economically dangerous for our national security and should be set aside. Self-sufficiency only means more poverty. If we want to define security by poverty, we will become like North Korea and Cuba. The reality is that self-sufficiency leads to poverty, and poverty makes every country more vulnerable and not stronger. So this unscientific viewpoint must be set aside.

 

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