The rule of law and the wealth of nations

The Aug/Sept issue of Reason magazine has been in my mailbox for several days. I got it out today and thumbed through it. There's an interesting article about a study by the World Bank (don't leave yet, please) about the true nature of wealth in both rich nations and poor nations. To sum it up, natural resources and capital resources (machinery, buildings, infrastructure) make up less than one-fourth of a nation's true wealth. About 77 percent of a nation's true wealth is in the education and skills of its people and in the people's confidence in and abiding by the rules of their society. Strong institutions create wealth.

I could draw a parallel between the true wealth of nations and the situation here in West Virginia, but I won't. We've talked about that enough so that readers can draw their own conclusions.

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For what it's worth, the online version of Reason has an article looking at whether we really should expect more hurricanes with global warming. I'm not passing judgment on that article, but I did find the final paragraph interesting:

Nevertheless, the coasts will remain population and development magnets and a richer society will be able to afford better hurricane defenses, such as, stronger buildings, higher levees, and protective surge barriers. But what's the best way to pay for them? One proposal would be instead of depending on "federal assets," local jurisdictions should be pushed to pay for and maintain their own hurricane defenses. If New Orleans needs new and better levees, then the city's citizens should pay for them. If New Orleans residents refuse to tax themselves enough to do so that means that it doesn't make economic sense to live and work there. One proof of the adequacy of their levees would be the willingness of private insurers to offer flood policies to residents. The same logic applies to all coastal counties. Ultimately, instead of retreating from the shore, I believe that we will instead learn how to live with stronger storms.

The feds got tired of paying for flood damage in West Virginia. They began buying out people in the flood plains. Know what I mean?