Monday, October 24, 2005

Who Knew It Was So Simple?!

From Ethiopundit: Billions of lives improved!
Lost in a maze of debt, poverty, corruption and foreign aid?
Left in the lurch by Marx and Lenin?
Try Basic Property Rights with Rule Of Law!
Billions of lives improved!
Thus begins a tribute by Ethiopundit to the winner of the Milton Friedman prize for advancing liberty given every two years by the Cato Institute. The winner in 2004 was Hernando de Soto of Peru. This tribute is not so much to the man, but rather to his economic philosophy. That philosophy can be summed up as capitalism with an emphasis on property rights and the rule of law. Here is a taste:
In and interview in Reason Online de Soto elaborates

"Agrarian reform is a process by means of which government assigns lands to the peasants...Until you have universal, well-protected, clear, and transferable private property rights, you cannot have a market economy.

If you take a walk through the countryside, from Indonesia to Peru, and you walk by field after field--in each field a different dog is going to bark at you. Even dogs know what private property is all about. The only one who does not know it is the government."
The conclusion applies the analysis to Ethiopia.
Indeed, North Vietnamese land reform in the 1950s led to widespread famine and revolts against the Communists resulting in thousands of deaths. One must wonder then, why do governments stick by the dead end of absent individual rights to own land?

The answer is easy and obvious - when no one can own land, the ultimate source of freedom and prosperity lays in government hands. It is all about absolute control of everyone at any cost. For example, Ethiopians today are the serfs or at best sharecroppers of a tiny revolutionary feudal aristocracy that trades mass destitution for their own place in power.

The Creation of a Nation of Serfs tells how this lethal nonsense came to Ethiopia. Marx Reloaded (not Groucho) reveals some clues about the origins of this despotic absurdity.

The importance of the rule of law and property rights in developing free and prosperous societies is not a matter for debate it is simply a fact that is amply demonstrated by history. Those that deny private property rights understand the truth more than anyone - they just choose to ignore it.
The complete article is well worth the read. Ethiopundit looks like it will be a valuable addition to my blogroll.