Leading from behind in Libya

President Obama and Secretary of State Clinton have come out well with the limited role they gave to U.S. support of the now victorious Libyan insurgents. President Gaddafi was removed from power (and life) without the help of American boots on the ground. It was a victory by Libyans and the outcome, and they are just at the beginning of chapter two, will be theirs to celebrate or lament.

The American approach this time around has several advantages. The hit on our over taxed budget was small and is likely to remain small. But more importantly, the resentment that always follows eventually when our (or any ones) troops occupy a country will be missing. This will also contain long run costs and improve American security.

More important still is the almost certainty that the prospects for Libya to develop a liberal democracy that respects its citizens are larger if they must build it themselves. If they fail, that will be theirs as well.  A viable government that respects human rights cannot be simply stepped into no matter how good a model we might give them. It must be the product of give and take and negotiation amount competing Libya groups. Libya is now entering into such an internal struggle. We should take the side of proper principles of government and human respect, but not the side of a particular group. President Obama’s reserve in limiting American involvement makes such a process among Libyans possible. It will not be easy and I wish them well.

About wcoats

I specialize in advising central banks on monetary policy and the development of the capacity to formulate and implement monetary policy.  I joined the International Monetary Fund in 1975 from which I retired in 2003 as Assistant Director of the Monetary and Financial Systems Department. While at the IMF I led or participated in missions to the central banks of over twenty countries (including Afghanistan, Bosnia, Croatia, Egypt, Iraq, Israel, Kazakhstan, Kenya, Kosovo, Kyrgystan, Moldova, Serbia, Turkey, West Bank and Gaza Strip, and Zimbabwe) and was seconded as a visiting economist to the Board of Governors of the Federal Reserve System (1979-80), and to the World Bank's World Development Report team in 1989.  After retirement from the IMF I was a member of the Board of the Cayman Islands Monetary Authority from 2003-10 and of the editorial board of the Cayman Financial Review from 2010-2017.  Prior to joining the IMF I was Assistant Prof of Economics at UVa from 1970-75.  I am currently a fellow of Johns Hopkins Krieger School of Arts and Sciences, Institute for Applied Economics, Global Health, and the Study of Business Enterprise.  In March 2019 Central Banking Journal awarded me for my “Outstanding Contribution for Capacity Building.”  My most recent book is One Currency for Bosnia: Creating the Central Bank of Bosnia and Herzegovina. I have a BA in Economics from the UC Berkeley and a PhD in Economics from the University of Chicago. My dissertation committee was chaired by Milton Friedman and included Robert J. Gordon.
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