Another strategy is to insist on the privatization of large-scale government enterprises. For over the years development specialists have learned that, for the most part, because of the incentives involves involved, privately held companies tend to run more honestly and efficiently than large public corporations. Equally important is the obvious fact that, if you simply reduce government size, you also reduce the opportunities for corruption. The logic is: if you reduce the public sector opportunities for graft, you thereby reduce the graft. We should understand, therefore, that the emphasis recently by development specialists on privatization is not always primarily motivated by an ideological commitment to private sector capitalism but by a growing realization that (1) the private sector functions generally more efficiently and honestly than the public sector, and (2) reducing public-sector size also reduces government corruption.
A few words should be said about the issues of lawlessness and narcotrafficking. Crime and violence in most developing countries are mushrooming, reaching unprecedented proportions. Most of the crime is not directed primarily against foreigners, their investments, or government agencies; rather, the primary victims are the individual citizens of these countries. This is something new, a product of the last twenty years, because many traditional societies in the past, particularly under strict authoritarian rule, were among the safest, most law-abiding places on earth. Violent television, the movies, the ready availability of guns and drugs, the breakdown of historic norms of morality, desperation on the part of poor people, and simple greed and machismo have all fueled the rising crime and violence rates.
Crime, including violent crime (rape, armed robbery, murder, and kidnapping), is so pervasive and widespread in some countries that people are afraid to leave their homes, go about with arrned bodyguards, buy expensive armored vehicles, and wall their neighborhoods off with security fences, doge, and armed guards. Crime in these countries often reaches levels many times those of the worst U.S> neighborhoods, and has become increasingly vicious, mindless, and random. It goes without saying that such soaring crime rates are inimical to development, frightening away investment as the middle class (the “brain drain”) in many developing countries. Rising crime is particularly prevalent as a development-retarding issue in Sub-Saharan Africa, Latin America, and Southeast Asia, but much less so in East Asia (the Confucian ethic?) and the Moslem countries (strict Islamic law?)
Narcotrafficking is also a major problem, closely linked to the rising crime rate, in many countries. In some countries (Colombia, Peru, Afghanistan, and Bolivia) drugs are the major export product; the drug barons that do the exporting from large gangs that intimidate judges, bribe and kill government officials, take over whole areas of the country, and destroy through violence and intimidation the fabric of society. Many are so powerful that they live like kings, above the law, even while maintaining local popularity by paying generous salaries and functioning like patronage politicians through sponsorship of churches, health clinics, and soccer teams.
But it is not just the poor producer countries that are victimized by the narcosis; such countries as Haiti, the Dominican Republic, Mexico, and Central