13 May 2017

Bribes for peace

A headline from Mailonline:
Could $175bn pay for the removal of Kim Jong-un? Huge bribes of $30m may be enough to convince North Korea's top officials to abandon their dictator, says expert by Julian Robinson, 12 May
I'm happy to see that the judicious use of financial incentives to achieve a desirable social outcome is at least being considered by one academic. The piece continues:
In his bookStop North Korea!: A Radical New Approach to Solving the North Korea Standoff, [Professor Shepherd] Iverson imagines a scenario where the top tiers of North Korea's power elite could be bribed to ensure a peaceful transition.
I've made similar suggestions myself: under a Social Policy Bond regime targeting, say, Middle East peace, bribes could be paid to troublemakers, but only if bondholders think that to be one of the most efficient ways of ensuring peace. As I'm sure Professor Iverson would agree, while the fanatics themselves are unlikely to be moved by lavish cash handouts, their enablers and supporters are another story.

This particular type of activity is one that neatly illuminates one of the less obvious advantages of a Social Policy Bond regime: whereas governments would find it politically impossible to pay such bribes, and whereas if they were anyway to offer such payments, there would very likely be a counterproductive reaction, holders of Social Policy Bonds need suffer no such qualms. Even if the bonds were issued and backed by some government or combination of governments, bondholders are not agents of government. It's entirely up to bondholders to decide how best to achieve the targeted goal, and if bribery is the most effective way of doing so, then that's how they'll do it. Notions of justice and fairness may have to be suspended but, in the case of North Korea (and others), avoiding catastrophe should be our highest priority.

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