The country then experienced economic crisis in 1997 with the rest of the region. During the economic reforms being implemented after the financial crisis, the information technology (IT) sector was one of several that was targeted and considered to be an important factor in the recovery of the nation’s economy. In 1999, the government implemented the program known as Cyber Korea 21, which was intended to accelerate IT development.

In 1999, the government provided US$77 million in loans with preferential rates to facilities service providers (FSP). In 2000, another US$77 million was provided in loans for suburban areas, small cities and towns, and regional industrial areas. Another US$926 million was provided until 2005 in order to supply the rural areas with broadband.

Commensurate with its investment funding, the government implemented various policies designed to increase internet use among the general population. The government provided “internet literacy” lessons to homemakers, the elderly, military personnel, and farmers. In June 2000, the government implemented what was known as the “Ten Million People Internet Education” project, the purpose of which was to provide internet education to ten million people.

Korea now has the highest penetration of broadband in the world. The number of broadband subscribers in Korea reached 10 million in October 2002, with about 70% out of 14.3 million homes connected at the speed of over 2 Mbit/s.”

This is hardly a market that was left on its own to develop is it. I agree with you wholeheartedly that government should only play a facilitating role in development.

If that means making sure that the IP protocol is developed and that it and HTML is not owned by anybody then so be it. Without that we would not have had the internet we have today.

You say: “Creating industry in South Africa may be good for job creation, but with true free markets you will export what you are good at, and import where you lack. Importing cheap Chinese clothes may be bad for the 10, 000 potential local workers, but can benefit 20 million paying less for their clothes.”

The thing is, you have to have money in the first place to buy cheap goods. In case you have not noticed, we are one of the most unequal societies on earth.

Did Korea, Japan or China allow unfettered competition when their economies were vulnerable and developing.

Does the US and Europe even now countenance free markets in what they consider to be strategic industries?

The problem with this kind of free market talk, is that it sounds great in theory, but practical evidence, also in this country shows otherwise.

http://en.wikipedia.org/wiki/Communications_in_South_Korea#Internet

“The government was active in promoting privatization and deregulation in general, and the information technology (IT) sector was no exception.”

Creating industry in South Africa may be good for job creation, but with true free markets you will export what you are good at, and import where you lack. Importing cheap Chinese clothes may be bad for the 10, 000 potential local workers, but can benefit 20 million paying less for their clothes.

Government should only play a facilitating role in development.

In the end loans were granted by Banks purely on the basis that house prices will always go up.

What do you mean with the phrase ‘by bowing to labour’? What labour?

If the US goverment did not bail out the banks, the megoliths, as you call them we would have been, in Time Magazine’s words ‘ Fucked’.

Re China: Are you saying that capitalism attaches an innate value to human lives. Not really, the state has to intervene to guarantee it in the West, and therefore is at an disadvantage to China where capitalism is freer from government with regards to labour legislation.

Telkom is a great example. In case you did not check its a private company thats not regulated. The worst of both worlds. In fact I wrote about this before. Do read it.

http://mhambi.blogspot.com/2007/04/telcom-should-be-nationalised-now.html

James, did you know that in the 1920’s this country had no industrial sector to speak of. The Sappe, the party of the free market and capital were very happy for us to export all our raw material to the West. It took the interventionists Nationalists, Barry Hertzog, to be precise to build up our industrial sector through state subsidies. Capitalism would never have delivered that. But guess what our economy and the capitalists benefited.

All we are seeing now is a mucg timely correction. In 1990 maxist orthodoxy was discredited, and we got extreme capitalist theuries in turn.

Now a last we can return to sanity in the middle.