Possible Responses to the Refugee Crisis

In an interview I gave to a Swedish newspaper last week, I said that Sweden could consider new responses to the refugee crisis.

My comments were prompted by conversations with several Swedes who remain committed to the principle of helping people in need but are convinced that familiar strategies are not working. They said that some of the refugees who have been admitted into Sweden are frustrated by life on the margin of society. The frustration seems to be particularly acute for young males. Symptoms include concentrated settlement patterns like those in the banlieues of Paris, with higher rates of crime, including gang violence.

The most perceptive comment I heard was that young immigrant men were doing things in Sweden that they never did in their home countries. It was not that they brought a “homegrown a culture of crime or violence” with them. Rather, it was that after they arrived, they adopted a specific culture of the Western developed world, the oppositional culture of the street gang.

My observation was that there are other options besides continuing to do what Sweden has done in the recent past or refusing to do anything at all. As the interviewer notes, I have not yet joined the World Bank and have not had a chance to explore views about the refugee crisis with anyone there.

The reporter, who was admirably precise, says that what the Bank was looking for when it asked me to join was someone who could spur consideration of new ideas. I am not selling any “silver bullet” answers and it was not buying. Our shared commitment is to dispassionate consideration, grounded in evidence and logic, of new possibilities. This commitment springs from an urgent optimism: It is possible for life to be better for everyone on earth.

You can find the original article here:

http://www.dn.se/ekonomi/skapa-en-frizon-for-flyktingar-i-sverige/

Below, I’ve provided a direct cut-and-paste of the text from Google Translate.


Sweden may establish a free zone for refugees where they will be completely self-sufficient. They may in that event live and work there, without any cost for Swedish taxpayers. It suggests Romer, incoming chief economist at the World Bank.

Johan Schück

Paul Romer is a world renowned American economist, has long been expected as the recipient of the Economics Prize Memory of Alfred Nobel.

His major research effort to the theory of endogenous growth, where economic growth is explained by factors such as technological development and increased knowledge.

He also gained a reputation as a debater, with a controversial proposal that will establish financial havens as a way to face overpopulation and migration flows.

One example is Hong Kong – at the time a British crown colony – which received millions of refugees from China and created a high level of prosperity.

Now Paul Romer current as newly appointed chief economist at the World Bank. He has not taken office yet, but does so at the next month.

Therefore, Paul Romer sure to what he has to say is own views, which have not been anchored within the World Bank. But it is clear that there has amassed an ideas man, which according to him was also the bank management’s intention.

The reason Paul Romer’s visit is in place for him to keep a so-called Heckscherföreläsning. It is the Stockholm School of Economics and business think tank Ratio standing invitation.

But it’s in an interview with Dagens Nyheter that he unleashes his ideas:

– The refugee issue is a huge problem, but there are possible solutions. Sweden, a sparsely populated country, would be able to rent a land area of Hong Kong’s size. There could receive millions of people who must support themselves and not have to cost anything.

As a comparison, Hong Kong has an area of at Öland and a population of over seven million.

– It is important then that this free zone shall be counted as an independent unit, with its own laws and rules – not as part of Sweden. Those who live there will not be Swedish citizens, but to live his life completely separate from the rest of society, says Paul Romer.

This means that wages can be lower, longer working hours – and so on. In Sweden should there be strict border control, making it impossible for the free zone inhabitants to move to the other side of the border. They are, quite simply, had to cope financially themselves.

– I have previously suggested that the US might use Guantanamo to such a free zone, instead of so far as detention centers. There are all prerequisites, since it concerns a secluded area of the United States rents of Cuba indefinitely. Those who come there are not counted as Americans, but must live his own life.

Paul Romer’s proposal has sparked debate, but have not met the ear of decision makers. That does not mean he now gets close adviser to World Bank President Jim Yong Kim who is also American.

It has raised concerns about US dominance, especially as Paul Romer’s representatives as chief economist Kaushik Basu from India. He sees no worries:

– I do not represent the United States or its government. My task is to present ideas on how important problems can be solved. Then you have to think freely, without restrictions.

The refugee issue, in which tens of millions of people need a new home, is one such problem. Global warming is another.

Romer also emphasizes health issues, which is well – especially as World Bank President Jim Yong Kim has a background as a doctor.

Self Romer is optimistic, at least in the long term. According to him, there really are no obstacles to continued economic growth based on technological development and increased knowledge.

– But at the same time there must be decision makers who know what they want and dare to take risks, he points out.

The model is Paul Volker, the US central bank in the 1980s as the tough decisions brought down inflation from double digits and thus created new conditions for the economy.