The freest economies in the world.

Discussion in 'Business & Economics' started by Undecided, Aug 29, 2004.

  1. Undecided Banned Banned

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    Which nations are the freest in the world? Well I will subdivide the states in these categories:

    Top Ten freest nations
    Top Five freest European nations
    Top Five freest American nations
    Top Five freest Asian nations
    Top Five freest Middle Eastern nations
    Top Five freest African nations
    Top Ten least free nations


    The rating is as follows 1 is the freest economy, and 5 is the most closed.

    Top Ten freest nations:
    1: Hong Kong- 1.34
    2: Singapore- 1.61
    3: New Zealand- 1.70
    4: Luxembourg- 1.71
    5: Ireland: 1.74
    6: Estonia: 1.76
    7: United Kingdom: 1.79
    8: Denmark: 1.80
    9: Switzerland: 1.84
    10: United States: 1.85

    Top Five freest European nations
    1: Luxembourg- 1.71
    2: Ireland: 1.74
    3: Estonia: 1.76
    4: United Kingdom: 1.79
    5: Denmark: 1.80

    Top Five freest American nations (excluding the Caribbean)
    1: United States: 1.85
    2: Chile: 1.91
    3: Canada: 1.98
    4: El Salvador: 2.24
    5: Uruguay: 2.55

    Top Five freest Oriental nations
    1: Hong Kong- 1.34
    2: Singapore- 1.61
    3: Taiwan- 2.43
    4: Japan- 2.53
    5: South Korea- 2.69

    Top Five freest Middle Eastern nations
    1: Cyprus- 1.95
    2: Bahrain- 2.08
    3: Israel- 2.36
    4: UAE- 2.60
    5: Jordan-2.73

    Top Five freest African nations
    1: Uganda- 2.70
    2: South Africa-2.79
    3: Cape Verde- 2.86
    4: Morocco- 2.93
    5: Mauritania- 2.94

    Top Ten Least free nations
    1: North Korea- 5.00
    2: Libya- 4.55
    3: Zimbabwe- 4.54
    4: Burma- 4.45
    5: Laos- 4.45
    6: Turkmenistan- 4.31
    7: Uzbekistan- 4.29
    8: Iran- 4.26
    9: Venezeula- 4.18
    10: Tajikistan- 4.15

    Source: The Heritage foundation.

    I do see a trend those nations which are freer are generally richer, more technologically advanced, have better social services, and are growing economies (most of the time). The lowest nations although they are restricted aren’t necessarily poor either. Most the lowest of the economies are quite socially advanced, but economic laggards. Iran, Venezuela, and Libya don’t need to reform they have ample oil reserves so reform is not needed. The other nations principally NK, Laos, Turkmenistan, Uzbekistan, and Tajikistan are/were socialist states. They have achieved a higher level of social development then for instance Uganda which is the freest in Africa. The question is how free does a nation really need to be to be economically successful?
     
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  3. Pangloss More 'pop' than a Google IPO! Registered Senior Member

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    767
    Interesting chart. This of course is a reflection of the trend away from Keynsian/control economics to market-based economics that swept the world during the '80s and '90s. It's fascinating to note that these economic trends bear little resemblance to political trends. One example of this is Chile under Pinochet. He brutally repressed his people on the political front while at the same time abruptly converting its planned economy into a market-based one. By 2000/1 Chile enjoyed the 7th fastest growing economy in the world.

    In fact, even deeper analysis reveals that in many ways the Keynsian approach to economics was, in some key respects, not all that different from the Soviet Union's "planned" economy. Both were based on the principle of control over what Lenin called "the commanding heights" -- manufacturing and heavy industries, transportation, and banking.

    Interesting essay on this very point:
    http://www.jpost.com/servlet/Satellite?pagename=JPost/JPArticle/ShowFull&cid=1089955401583

    If you ever get a chance to see "The Commanding Heights", grab it. It's out on DVD and is sometimes re-run on PBS. It's based on the excellent book by gifted historian Dan Yergin, who won a Pulitzer for "The Prize", his definitive book on the history of the oil industry.
     
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  5. Undecided Banned Banned

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    s fascinating to note that these economic trends bear little resemblance to political trends.

    Well there is one overriding trend with most of those states, they are stable democracies. Others have market leaning Emirs. Also many of the states are not industrial they are more service based economies, thus open markets is needed for them to survive.

    Chile under Pinochet. He brutally repressed his people on the political front while at the same time abruptly converting its planned economy into a market-based one. By 2000/1 Chile enjoyed the 7th fastest growing economy in the world.

    At what cost? Poverty in Chile is growing not shrinking. The problem with getting rid of the Keynesian/Fordist economic model is that the proletariat has almost no voice. The wealth of nations is getting compartmentalized, even in the US. Average wages haven’t grown past 10% in the last 20 years, but for the rich their wealth has grown by more then 100%. The problem with neo-liberalism (or liberalism for that matter) is that it has consistently disenfranchised the majority of the world’s population. Sure Neo-liberalism is a supply side economic model, but the inevitable outcome will be overaccumulation and the economy will collapse. Neo-liberalism is not all its cracked up to be…numbers are half the story.

    In fact, even deeper analysis reveals that in many ways the Keynsian approach to economics was, in some key respects, not all that different from the Soviet Union's "planned" economy.

    LOL! No, no I read the article you posted from Jpost, he stated that it was N.E.P that is in no way how the Soviet Union worked after 1928. You are trying to equate Stalinism with Keynesianism, that’s not true. Also we cannot forget that the markets did fail in the 30’s.

    If you ever get a chance to see "The Commanding Heights", grab it. It's out on DVD and is sometimes re-run on PBS. It's based on the excellent book by gifted historian Dan Yergin, who won a Pulitzer for "The Prize", his definitive book on the history of the oil industry.

    I watched it, and have the website (good analysis)…I recommend it too.
     
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  7. dixonmassey Valued Senior Member

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    If the saying "Anarchy is the mother of order" true. The freest countries are those where government power collapsed, diminished and individual settle their differences, build alliances/businesses using their God sent/not sent abilities mainly.

    Thus, my list of the freest countries

    Europe:
    Georgia (more exactly, multiple pieces it's broken to)
    Russia (largely due to its enormous size and 15 years long infrastructure decay. However, government beast is steadily raising its ugly head there)

    Asia:
    Tajikistan
    Afghanistan (except Kabul, I guess)

    Africa:
    Somali
    Sudan
    Kongo

    Americas:
    Colombia
    Brazil (some parts of it)
    Montana

    I think "freedom" and "government sponsored" freedom (you imply in your post) are somewhat different.
     
  8. Undecided Banned Banned

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    But I am not talking about social freedom, but economic freedom.
     
  9. Pangloss More 'pop' than a Google IPO! Registered Senior Member

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    767
    Of course. A careful analysis reveals that the analogy doesn't work at all. The point that it does illustrate is that there is a general belief, even dogma, in the US (and perhaps elsewhere, I don't know, I can only speak for my fellow countrymen) that freedom equates to market economics which in turn equates to success. As you point out, market economics has failed in the past, which is something they were neglectful about discussing in Commanding Heights (the book is a little more fair).


    Right-o, and it grew directly proportional with the reforms, just as it did in Argentina, Bolivia, Russia, Poland, etc etc etc. What the hope is is that as you whack off those state-provided jobs and return those companies to profitability, those workers will get hired back, either there or in another line of work, and the economy will move forward to a higher standard of living. That doesn't always turn out to be the case, unfortunately, which just goes to show how complicated things can get.

    Bolivia is a great example from that show. Reforms knocked out the 60,000% hyperinflation, but in the end there was nothing really there in terms of economic potential. So they went from a poor country with an unstable economy to a poor country with a (relatively) stable economy. Progress, perhaps, but obviously still work to be done.

    In the end what all this says to me (and this is strictly my non-expert opinion here) is that history has shown us that a market economy is better than a planned economy, but that a totally free market economy is also a bad thing. You need some governmental control to deal with the excesses.

    And if you look back up at your list, you'll see that reflected pretty accurately. All those countries handle their economies somewhat differently, but in the end, they're all market, and they're also all controlled to some degree. There's no Ayn Rand in any of those governments, but at the same time, there's no Lenin either.

    Hopefully we've moved past the stage where we focus solely on unemployment and poverty as the key indicators of success. Obviously you want to get rid of those if you can, but if you put guarantee everyone a job, and do nothing else, then all you do is guarantee a bad economy. (Although when I see Michael Moore screaming about jobs as a fundamental human right, I have to wonder if we'll be learning this lesson again.)

    At the same time, I hope we've also put behind us the notion that a totally free economy is the way to go. Although I have to wonder when I talk to libertarians and a lot of Republicans, etc. We may have to learn that lesson again as well, sadly.
     
  10. Undecided Banned Banned

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    Of course. A careful analysis reveals that the analogy doesn't work at all.

    Of course the analogy doesn’t work, because communism never happened, and the path in which Lenin wanted to take the USSR (not unlike that of Sweden) was perverted to the opposite extreme by Stalin. Keynes economics saved capitalism from its greatest enemy…itself.

    Right-o, and it grew directly proportional with the reforms, just as it did in Argentina, Bolivia, Russia, Poland, etc etc etc. What the hope is is that as you whack off those state-provided jobs and return those companies to profitability, those workers will get hired back, either there or in another line of work, and the economy will move forward to a higher standard of living.

    In a Fordist economic theory yes, not in this new world economic order. The problem you did not mention was that capital is not circulated within the economy anymore; capital is now transnational as a result major corporations like Wal-Mart for instance destroys local business thus leaving a Wal-Mart to lower wages and thus bring down the standard of living. What you don’t mention is that labour is now a commodity, we are a commodity we can be essentially bought and sold, we aren’t indispensable anymore. With the weakness of unions becoming apparent the old economic theories just don’t work anymore.

    In the end what all this says to me (and this is strictly my non-expert opinion here) is that history has shown us that a market economy is better than a planned economy, but that a totally free market economy is also a bad thing. You need some governmental control to deal with the excesses.

    Of course that is true, but the question is how much is too much for either? Lassiez Fair economics failed in spectacular fashion, Keynesian economics stagnated (I wouldn’t say failed), and now we have neo-liberalism which is reverting back to the problems of pre-depressionary era.

    Hopefully we've moved past the stage where we focus solely on unemployment and poverty as the key indicators of success.

    Are you serious? Those are the indicators of everything, an economy with an $11 trillion GDP with 60% unemployment is an economy ready for collapse. Unemployment and poverty determine the attitude in a democratic society, in order for a democratic society to remain free market, there has to be tangible results. What I fear is that because capital is over labour that labour standards world wide are going to depreciate. We must remember that the Russian revolution was a result of worker alienation. Are we going to repeat the same mistakes?

    Obviously you want to get rid of those if you can, but if you put guarantee everyone a job, and do nothing else, then all you do is guarantee a bad economy.

    There is a healthy unemployment rate, then there is an unhealthy unemployment rate, a 1% unemployment rate is unhealthy the country is inefficient, but a 10% unemployment rate is also unhealthy because it shows that the economy is underperforming. A healthy unemployment rate should be around what? 3-5%.
     
  11. Pangloss More 'pop' than a Google IPO! Registered Senior Member

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    767
    Right, they used to call that "structural unemployment", but I believe the term was either changed or removed a few years ago. I'd have to look it up.

    Just out of idle curiosity, and I mean this in a friendly way, but do you *ever* look on the bright side of things? Maybe it's just endemic to the medium but it seems like you're always worried about society being on the absolute verge of collapse. (grin) You are WAY too young to be such a pessimist!
     
  12. Undecided Banned Banned

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    Just out of idle curiosity, and I mean this in a friendly way, but do you *ever* look on the bright side of things?

    Not really, because I feel that only looking at the bright side blinds you to the reality. It is always better to be prepared by pessimism, rather then be blissfully ignorant with optimism.

    Maybe it's just endemic to the medium but it seems like you're always worried about society being on the absolute verge of collapse. (grin) You are WAY too young to be such a pessimist!

    The society we once knew is collapsing, slowly but it is this is a new world order here. If you think that society is on the absolute verge of collapse from my posts, then in your opinion it must.

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  13. Undecided Banned Banned

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    What I will do next (because I am bored today) is take those nations and compare their GDP per capita, IQ’s, and their HDI figures:

    The world’s average GDP PPP per capita is: $8,200
    The average IQ level is 100
    The top HDI figure is 0.100

    Top Ten freest nations:
    1: Hong Kong- 1.34/ $28,700/107/0.903
    2: Singapore- 1.61/ $23,700/104/0.902
    3: New Zealand- 1.70/ $21,600/100/0.926
    4: Luxembourg- 1.71/ $55,100/101/0.933
    5: Ireland: 1.74/$ 29,800/93/0.936
    6: Estonia: 1.76/$ 12,300/97/0.853
    7: United Kingdom: 1.79/$27,700/100/0.936
    8: Denmark: 1.80/$31,200/98/0.932
    9: Switzerland: 1.84/$32,800/101/0.936
    10: United States: 1.85/$37,800/98/0.939
    Average: 1.71/$30,070/99.9/.826

    Top Five freest European nations
    1: Luxembourg- 1.71/$55,100/101/0.933
    2: Ireland: 1.74/$29,800/93/0.936
    3: Estonia: 1.76/$12,300/97/0.853
    4: United Kingdom: 1.79/$27,700/100/0.936
    5: Denmark: 1.80/$31,200/98/0.932
    Average: 1.76/ $31,220/97.8/0.918

    Top Five freest American nations (excluding the Caribbean)
    1: United States: 1.85/$37,800/98/0.939
    2: Chile: 1.91/$9,900/93/0.839
    3: Canada: 1.98/$29,700 /97/0.943
    4: El Salvador: 2.24/$4,800/84/0.720
    5: Uruguay: 2.55/$12,600/96/0.833
    Average: 2.106/$18,960/93.6/ 0.8548

    Top Five freest Oriental nations
    1: Hong Kong- 1.34/$28,700/107/0.903
    2: Singapore- 1.61/$23,700/104/0.902
    3: Taiwan- 2.43/$23,400/104/.900*
    4: Japan- 2.53/$28,000/105/0.938
    5: South Korea- 2.69 /$17,700/106/0.888
    Average: 2.12/$24,300/105.2/0.9062

    Top Five freest Middle Eastern nations
    1: Cyprus- 1.95/$16,000/92/0.883
    2: Bahrain- 2.08/$17,100/83/0.843
    3: Israel- 2.36/$19,700/94/0.908
    4: UAE- 2.60/$23,200/83/0.824
    5: Jordan-2.73/ $4,300/87/0.750
    Average: 2.344/$16,060/87.8/0.8406

    Top Five freest African nations
    1: Uganda- 2.70/ $1,400/73/0.493
    2: South Africa-2.79/$10,700/72/0.666
    3: Cape Verde- 2.86/$1,400/N/A/0.717
    4: Morocco- 2.93/$4,000/85/0.620
    5: Mauritania- 2.94/$1,800/N/A/0.465
    Average: 2.844/$7,720/76.6/70.5922

    Top Ten Least free nations
    1: North Korea- 5.00/$1,000/N/A/N/A.
    2: Libya- 4.55/$6,400/84/0.794
    3: Zimbabwe- 4.54/$1,900/66/0.465
    4: Burma- 4.45/$1,900/86/0.551
    5: Laos- 4.45/$1,700/N/A/0.534
    6: Turkmenistan- 4.31/$5,700/87/0.752
    7: Uzbekistan- 4.29/$1,700/87/0.709
    8: Iran- 4.26/$7,000/84/0.732
    9: Venezeula- 4.18/$4,800/88/0.778
    10: Tajikistan- 4.15/$1,000/87/0.671
    Average: 4.418/$3,500/83.625/0.665

    As you can see that generally the more open the economy the greater GDP per capita the state has also they are higher up on the much more accurate HDI formulation brought forward by the UN. The Asian states have proven themselves again to be the more educated of the bunch, they have a very strong educational ethic, and the stereotype is true, Asia as we all know is the fastest growing region in the world today and the growth in the region in almost every term has been spectacular. Asia is now the world’s wallet, the West cannot compare to the financial wealth of the Asians Japan, China, and Taiwan alone have in excess of $1 trillion of FOREX, they control to a large extent currency markets. IN Europe you have a different story, the nations in Europe that are on this list are nations primarily that have reformed successfully into more lean economies, the UK was the first in Europe to really break the shackles of the “mixed economy”. Although with great social costs to the country, which wealth being concentrated in London while the rest of the country stagnates. The surprise was Estonia, a country that was part of the USSR was able to grow quickly afterwards, being near the Scandinavian states she has been able to reform quickly with excellent role models up north. Luxembourg is a financial state, a thing that has been almost a constant for many of the states involved, they are states that specialize in services. In the America’s we have the traditional states represented, we have the US and Canada which are super capitalist, and in Canada’s case an excellent balance between neo-liberalism and “socialist” government programs. Canada has been able to balance the budget consistently for the last 7 years or so, and has been increasing government expenditures. In Latin America you have the traditional advanced state Uruguay being in the top five (being from there) I know that it is reminiscent of Europe in the 70’s (pre-neoliberalism), strong tradition of social programs, strong tradition of strong credit rating (AAA), strong middle class, and soon to be the capital of the world’s third largest trading bloc, Mercorsur. Chile is a state that during the horrid rule of Pinochet grew economically but at a great cost. More Chileans are living in poverty today, and the growth in her economy has been exceptional but the benefits of that growth are largely concentrated in the upper echelons of Chilean society. Unlike Uruguay that has a very generous distribution of wealth, Chile is an example of what to expect from too much reform. In the Middle East you have largely small states with small populations that have reformed. Israel which began to reform from a socialist economy in the 70’s to a capitalist one in the 80’s and 90’s would be in good economic waters. But the government of Israel depends on US aid to a large extent; also Israel’s fundamentals are not good at all. If Israel does not get serious about peace, then her economy will begin to show the strain. The other states like the UAE have become a very important place for commerce, they are in the Persian Gulf, stable (a rarity), and open to westernization with an Islamic twist. I don’t see why Iraq was needed; the best examples are in Dubai. African states still have a ways to go, they are opening but they aren’t necessarily open yet. Education should be the best bet for development, along with stable democratic governments. Uganda is the state that although still poor has better fundamentals; it is one of the highest Sub-Saharan states in the HDI list, and by African standards a relatively well educated population. South Africa is a disappointment, consistently her development scores have been falling from the Apartheidist era. But after 80 years of white rule and black disenfranchisement what could be expected? The lowest states in terms of freedom are low in all indicators, low economic prospects does equate to lower education standards. But many of the states are ok economically in the sense that they don’t depend on services, or industry for their economic growth, they mostly depend on commodity exports. So there is very little incentive for these states to reform to any large extent. What is common in these states is that they have very high population growth rates, which shows that lower income means more children. Also most of those states are not democratic, actually to my knowledge only Tajikistan and Venezuela are democracies. What I found to be intriguing is the correlation btwn IQ levels and education; personally I don’t believe IQ is much of an indicator of real intelligence. But as shown higher education levels lead to higher economic levels.

    Those are just my thoughts of course….
     
  14. Pangloss More 'pop' than a Google IPO! Registered Senior Member

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    767
    Haha! Well I certainly can't fault your consistency! (grin)

    What's funny is that I think of myself as an optimist, and I believe in the power of the human spirit to overcome obstacles, and yet amongst many of my friends I'm the one they see as the radical, the pessimist, the conspiracy theorist, etc! Not in so many words, perhaps, but I sense a trend in that direction when we speak on the issues. It's partly because most would rather talk about sports or entertainment, but also because they're not regularly exposed to issues discussion in general.

    I just sent an email, in fact, to all my friends reminding them to vote in the Florida primaries tomorrow, and included a ton of voter information, voting records sites, and endorsement sites. I doubt most of them even know where they are registered, what they're registered AS (Florida runs a closed primary), or even who will be on their ballot box, much less have formed an opinion on who they should vote for.

    It's sad, but I think such is common in my country.
     
  15. Undecided Banned Banned

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    What's funny is that I think of myself as an optimist, and I believe in the power of the human spirit to overcome obstacles,

    As do I, I believe in the human spirit and the endurance of mankind to overcome all obstacles that God, nature, whatever puts in our way. I’ve always been an admirer of humanity, I am a humanist and I believe that humanity has too much untapped potential. In a holistic sense I am optimistic about the future of mankind, even though we have our petty differences mankind is still one. I love the human spirit because it’s fallible and it never gets boring. But I am pessimistic about the specific issues; there is an intellectual deficit out there.

    It's partly because most would rather talk about sports or entertainment, but also because they're not regularly exposed to issues discussion in general.

    As Marx said religion is the opiate of the masses, in today’s society it is celebrity. I watched the Olympics I liked it; I watch the CFL occasionally, and other sports. But it does not rule my life, men all over the world have been dumbed down by the opiate that is sports, all the analytical, and intellectual vigor for relevant things like politics, economics, and other necessary things are ignored so men can discern who will win the next game, and by how much. It is a critique of modern man…you can watch sports that’s a good thing but to be obsessed is what worries me.

    It's sad, but I think such is common in my country.

    Yes the US is the best example, but its not the only example.
     
  16. Pangloss More 'pop' than a Google IPO! Registered Senior Member

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    767
    Makes sense to me.

    "Happiness is the exercise of rational powers along lines of excellence in a life affording them scope."
    - Aristotle, Nicomachean Ethics
     
  17. guthrie paradox generator Registered Senior Member

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    Aristotles happiness, certainly.
     
  18. nbachris2788 Registered Senior Member

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    Sports is not the antithesis of intellect. The great genius Niels Bohr was an outstanding college athlete. But yes, I agree, pro sports can be a great distraction from the real world. The irony is that the drama and exhilaration of pro sports is even greater in high stakes politics. In figure skating, one dances for 3 minutes and is scrutinized by 6 judges. In policies, one dances for months in front of millions and is judged by that many on election day.
     
  19. Undecided Banned Banned

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    Sports is not the antithesis of intellect.

    Of course it is imo, because it puts emphasis on something other then the cultivation of the mind. That doesn't mean that I have less respect for someone who actually plays a sport. Quite the opposite they have a ability which I largely lack. But to those who sit on their armchairs and watch games like robots, using their intellectual abilities to discern who will win a game is a opiate. Politics unto itself is a opiate, but the difference is that least in Politics you can actually make a difference in the eventual outcome.
     
  20. TruthSeeker Fancy Virtual Reality Monkey Valued Senior Member

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    That was the bigest paragraph I've ever seen...

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  21. Maria Registered Member

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    Well if it has been, few students in Ireland know as last year my economics text discussed it using that term.
    Come to think of it,in my business text the US was described as a free system and Ireland as a mixed economy. Wouldn't have thought our system was more free, but guess it is.

    My Economics text still doesn't say GNI either.
    Perhaps they don't want to confuse us with our puny iqs.
     

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