This paper examines the problems of Russia's post-communist economic transformation. Its main thesis is that the Russian attempt at radical economic reform largely failed, because of extraordinary rent-seeking by old enterprise managers through export rents, subsidized credits, import subsidies and direct government subsidies, while they gained little from privatization.
Globalization, for all its benefits, also creates a risk of increasing inequality, as much or more in developing countries as in today's industrialized countries. High inequality makes the design and implementation of good social policy difficult. However, despite this, Latin America has a reason to be optimistic.
To compete in the global economy, Latin America has to have a labor force that has caught up with its competitors in Asia – in skills and therefore in productivity. Education matters.
Developing countries face special risks that globalization and market reforms will exacerbate inequality, at least in the short run, and raise the political costs of inequality. During that transition, more emphasis on minimizing and managing inequality would minimize the real risks of a protectionist and populist backlash.
Social policies probably cannot reduce income disparities in Latin America. However, their objective should not be to reduce income inequality, but to ensure opportunities for all and to make societies ever more meritocratic.
Iran’s growing weapons capabilities already pose a grave risk to U.S. allies and U.S. forces in the Persian Gulf region, but this threat could greatly worsen in coming years, as Iran graduates to even more potent weapons than it currently possesses, enlarges its missile arsenal, builds longer-range systems, and learns to mate its weapons of mass destruction with these advanced delivery systems.