My 2003 Bet
By David Henderson
I mentioned on my post yesterday that I had made a bet in 2003 about an outcome in the MIddle East in 2008 and that I won my bet, although the other bettor didn’t pay up. Interestingly, none of the commenters asked what the bet was about. We made it in September 2003. Here was what she bet:
At least 3 countries in the Middle East that were not democracies at the time of our bet would become democracies by September 2008.
The context was the discussion of the Iraq war. The U.S. government had invaded in March of that year and in a session at the Mont Pelerin meetings where I was on a panel, a member of the audience (the aforementioned woman) said that the invasion was a good thing because it would lead to “lots of” countries in the Middle East moving to democracy. I suggested that we translate “lots of” into “three or more” because surely no one would seriously bet on, say, five or more. I think her optimism reflected the unrealistic optimism at the time about the result of the U.S. invasion. I had never shared that optimism. If you think unintended consequences apply to domestic economic policy, where, at least, some of the results of the policies are visible to people who live here and some of the victims get to vote, think about how bad the unintended consequences can be when the victims aren’t people who are visible and they don’t get to vote in our elections. I made this point in my article, “The Economics of War and Foreign Policy: What’s Missing?” Defense and Security Analysis, Vol. 23, No. 1, March 2007.