Posted on 12/08/2010 4:19:34 AM PST by Kaslin
Of the 6 billion people on Earth, 2 billion try to survive on a few dollars a day. They don't build businesses, or if they do, they don't expand them. Unlike people in the United States, Europe and Asian countries like Japan, South Korea, Hong Kong, etc., they don't lift themselves out of poverty. Why not? What's the difference between them and us? Hernando de Soto taught me that the biggest difference may be property rights.
I first met de Soto maybe 15 years ago. It was at one of those lunches where people sit around wondering how to end poverty. I go to these things because it bugs me that much of the world hasn't yet figured out what gave us Americans the power to prosper.
I go, but I'm skeptical. There sits de Soto, president of the Institute for Liberty and Democracy in Peru, and he starts pulling pictures out showing slum dwellings built on top of each other. I wondered what they meant.
As de Soto explained: "These pictures show that roughly 4 billion people in the world actually build their homes and own their businesses outside the legal system. ... Because of the lack of rule of law (and) the definition of who owns what, and because they don't have addresses, they can't get credit (for investment loans)."
They don't have addresses?
"To get an address, somebody's got to recognize that that's where you live. That means ... you've a got mailing address. ... When you make a deal with someone, you can be identified. But until property is defined by law, people can't ... specialize and create wealth. The day they get title (is) the day that the businesses in their homes, the sewing machines, the cotton gins, the car repair shop finally gets recognized. They can start expanding."
That's the road to prosperity. But first they need to be recognized by someone in local authority who says, "This is yours." They need the rule of law. But many places in the developing world barely have law. So enterprising people take a risk. They work a deal with the guy on the first floor, and they build their house on the second floor.
"Probably the guy on the first floor, who had the guts to squat and make a deal with somebody from government who decided to look the other way, has got an invisible property right. It's not very different from when you Americans started going west, (but) Americans at that time were absolutely conscious of what the rule of law was about," de Soto said.
Americans marked off property, courts recognized that property, and the people got deeds that meant everyone knew their property was theirs. They could then buy and sell and borrow against it as they saw fit.
This idea of a deed protecting property seems simple, but it's powerful. Commerce between total strangers wouldn't happen otherwise. It applies to more than just skyscrapers and factories. It applies to stock markets, which only work because of deed-like paperwork that we trust because we have the rule of law.
Is de Soto saying that if the developing world had the rule of law they could become as rich as we are?
"Oh, yes. Of course. But let me tell you, bringing in the rule of law is no easy thing."
De Soto started his work in Peru, as an economic adviser to the president, trying to establish property rights there. He was successful enough that leaders of 23 countries, including Russia, Libya, Egypt, Honduras and the Philippines, now pay him to teach them about property rights. Those leaders at least get that they're doing something wrong.
"They get it easier than a North American," he said, "because the people who brought the rule of law and property rights to the United States (lived) in the 18th and 19th centuries. They were your great-great-great-great-granddaddies."
De Soto says we've forgotten what made us prosperous. "But (leaders in the developing world) see that they're pot-poor relative to your wealth." They are beginning to grasp the importance of private property.
Let's hope we haven't forgotten what they are beginning to learn.
If you think about estate taxes, you will realize that income is not just taxed once. There is a web of taxes woven around anyone having property or income.
On income, you pay regular state and federal taxes - and in some places, county or municipal taxes. In addition, there are Medicare taxes and Social Security taxes taken before you see your check. When you go to spend “your” money, there are sales taxes, again, perhaps, at several levels. If you try to grow your money, then you will pay income taxes on dividends or interest. If you are too good at growing your money, your estate will be charged for that, too.
I truly believe that,
Poverty is a state of mind and a way of life.
I truly believe that.
Poverty is a state of mind and a way of life.
Matthew 26:11 The poor you will always have with you.....
“and then you have to pay taxes on the property every year forever...”
Your post allows me to say this (This is not directed at you, Kellis):
You stupid conservatives sat on your fat asses for 40 years, never attending local council meetings or county board meetings. Now you bitch because property taxes are high.
Well, surprise, surprise. You, you dumb-bunny conservatives, allowed left wing Marxists to take over your local government because you were too busy fishing, adding an addition to the kitchen or working overtime to make more money.
I worked in local government for years, and it was impossible to get you up off your butts and devote one hour a month attending local government meetings. Then when your taxes went through the roof and you couldn’t nail a picture on the wall without paying off a fat bureaucrat, you sat around scratching your ass wondering how that happened.
Duh!
If you want local taxes reduced, run for your local council seat. If you don’t want some bureaucrat telling you that it’s illegal to cut down a tree, show up at your county land use board (which shouldn’t exist in the first place) and start screaming at these fascist pigs. Go to these meetings by the hundreds and tell these pigs that you’re the boss and their happy rides on your backs ends NOW!
Get up off your fat butts and take back your neighborhoods. Then you won’t see high property taxes. And you’ll be much happier, too.
Good teaching tool ping.
My, My! Aren’t we snippy?
Well, it is very apparent that you have not been around long enough to know how politics work.
The rules are:
1. Do everything and anything to stay in office, whether legal or illegal.
2. Never, never (as a politician) introduce an item to a local, state or federal public forum or meeting without first making sure that it is already a “done deal” and all of the players have selected and simply let the voters spew and fume over it when introduced. This is always the case.
Anytime any level of government introduces a bill, project or regulation for review...it is a done deal BEFORE being introduced to the taxpayers.
Politicians are in it for themselves and not for you. They will tell the public anything they wish to hear and those people will vote them in every time. If you tell the public what they don’t want to hear you will not be in office long.
To sum it up, the sad fact is that our political system is not made up of managers and fiscally responsible individuals, it’s made up of nothing more than “yes men and women.” In all cases they leave office with more than they came in with.
Because you are a middle-income guy living within his means? On another note, your post sounds like lyrics from a Talking Heads song!
What is the laws of dynamics? a body in motion tends to stay in motion, and a body still tends to stay still?
First one must have the idea, of having something they have never had, nor their father nor their relatives, nor their grandfathers, etc. An idea of something new. An expectation, a possibility, an idea of a goal, a DREAM. This is huge. It is not even a glimmer in the deepest part of the minds of impoverished peoples that have lived that way all their lives.
The idea of being paid for their work with MONEY with which to buy necessities like food and shelter, clothing, ...
When people are at the bottom ... think the untouchables in India, or the people that ‘do not exist’ in Islamic countries. How can a mind conceive of completely unknown states of being? Hope?
Conditioning follows all of us. Those that are denied everything and manage to live in the garbage pits, are fighting to live each day.
There are Nations/countries that have millions upon millions of the lowest of the low.
The United States of America has/have sent food, clothing, endless amounts of monies and most of it is kept and spent by the people in positions of power. Africa, Sudan, Korea,etc., We sent food to starving North Korea, the leaders took these products and sent them to China for money in their pockets. Unconscionable!. The UNITED NATIONS is scandalous for how they rape the programs meant for the poor and needy of the world.
God help them all.
To look for the good where there is essentially no good is not the way of change. Programs must be followed up, checked out, monitored, audited. It is not likely to happen. How can we keep people from evil? All yield to temptation. again and again.
These poor have life. God given life. It is a test of the world how shamefully they are treated and how most look away, MOO!
Most small businesses are financed initially by home mortgages, but without a title and without a legal system to back up the transaction, a home owner cannot get credit from any sensible bank. So nothing happens, and that capital sits dead in the water, often for generations.
12 years ago it was like an epiphany for me but is ti so true. I heard Neil Boortz say, “The poor (in America) aren’t poor because they have no money, they are poor because they have poor judgement.” Pregnant at 15 or alcoholic/drug addict at 18 is just a demonstration of this poor judgement.
The failure of the “Great Society” just proves this and the lotteries just confirm it. Givning poor folks oney doesn’t help them. If anything it hurts them.
In other words: are they rationalizing moochers or are they willing to earn it.
Like when a certain “leader” took General Motors from it’s rightful owners and gave it to the unions? That rule of law?
bkmk
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