(via LGF)   An article in Opinion Journal by Robert Pollack talks about the lack of rule of law endemic to Arab states and the Palestinian territory.

All politics are local and all economic problems begin politically:

At a time like this, with violence a daily reality and the peace process all but forgotten, it might seem that a lack of economic freedom is the least of the Palestinians' problems. But with bread riots becoming almost as common in the Palestinian territories as anti-Israel demonstrations, many Palestinians see the lawlessness and economic misery inflicted by Arafat & Company as a major factor in a generalized rage. "We want to be a democracy," says Khalil Shikaki, a Palestinian scholar and pollster. "We don't want to be a corrupt, mismanaged entity--just another Arab country."

A great anecdote from Milton Freidman on the topic of political and economic development:

A decade ago Milton Friedman had three words for countries struggling to make the transition: privatize, privatize, privatize. "But I was wrong," he said last year. "It turns out that the rule of law is probably more basic than privatization. Privatization is meaningless if you don't have the rule of law."