Here’s a man bites dog story. The United Nations is setting up a commission on the
property rights of the poor and the hurdles and obstacles the poor face as they try to
make a living.
It’s surprising because, for more than a century, the global bien-pensant elites have
brushed aside the question of property rights. They have experienced that the way
for the poor to advance was by clientage to the political power of the educated elite.
Vote for us, the educated elite told the poor, and we will have our experts look after you.
But now, according to
Alejandro Chafuen,
the UN is taking a look at the narrative developed by Peruvian businessman Hernando De Soto.
And guess what. The new “High Level Commission on Legal Empowerment of the Poor” will be
led by former US Secretary of State Madeleine Albright—and Hernando De Soto himself.
Founder and director of the Institute for Liberty and Democracy (ILD) in Lima, Peru, and author of the landmark 1986 book on property rights, "The Other Path," Mr. De Soto has demonstrated to policy makers worldwide that an organized "legal property system" is the single
most important factor -- the "hidden architecture" or "missing link," he calls it --
that will determine whether individual entrepreneurs and national economies have even
a chance of achieving success.In capitalist economies, Mr. De Soto notes, business transactions are made
possible by widely accepted rules governing legally defined property. Such concepts
often don’t exist in the developing world, where existing legal systems (or the lack
thereof) may not recognize the assets and transactions of some 70 percent of the
population.
And if that doesn’t persuade you there is the testimony of William L. Lewis in
The Power of Productivity in which he shows that the biggest problem faced by anyone,
rich or poor, is the lack of a flat and fair playing field for economic competition. Usually,
Third World countries are hobbled by vast structures that favor producers over consumers and
distort the economy with a miasma of subsidies.
Of course, all the UN is proposing to do for now is to talk. But still, progress is progress.