Economics and the mid-life crisis have much in common: Both dwell on foregone opportunities

C'est la vie; c'est la guerre; c'est la pomme de terre . . . . . . . . . . . . . email: jpalmer at uwo dot ca

. . . . . . . . . . .Richard Posner should be awarded the next Nobel Prize in Economics . . . . . . . . . . . .

Friday, February 11, 2005

Arafat's Money Maze

My friend, Jack, recently sent me a pdf copy of excerpts from a subscription-only article in the Feb 8th National Post of Canada (p37). The gist of the article was that Arafat had squirreled away considerable sums of money; furthermore, he kept track of his financial and political affairs on little notebooks that he carried with him, and sorting out his finances will be a long, complex ordeal.

When I tried to find another reference to this problem, I found lots of articles. But one that struck me was this 2002 interview with Reuven Brennan, a brilliant economist who specializes in the study of Economic Analysis of Law and Economic Anthropology.

... [S]uddenly you see that the treasurer (of the Palestinian Authority) is saying that Arafat has transferred I don't know how many millions of dollars and everyone knows that his wife is living on the fanciest avenue in Paris. He doesn't make a secret of that. Well, this is exactly the problem, it goes back to the subject of accountability. Here a country transferred capital to Arafat's government but without asking for any checks and balances and any accountability. Well then, he established his power, he more or less eliminated his competitors and the money didn't go where it should have gone. One lesson from that is you don't transfer money to a potentially corrupt government because it will just encourage corruption.

Throughout the interview, he draws some interesting parallels to the effects of how Canadian Aboriginal people have been treated.
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