Secure Development

J

Joseph Russo

Guest
I am an avid reader ofyour publication. Having married a Dominican woman in 1996, I have taken a keen interest in the political discourse in your beautiful country. Over the years it has become a passion and a frustration. I have come to know many hard working law abiding citizens and have shared in their frustrating search for a secure future. Of course I realize that their search is not unique and answers to improving their condition not simple and easy to come by. Things will change slowly becuse the people will demand of their leaders. The other day, I came across this article which I do believe discusses the kinds of issues faced by a developing nation. I hope you find it intersting enough to share it with your readers.

Thanks.

Joseph Russo
Vancouver Canada

Thursday 4 January 2001

A curb on capitalism Lack of secure property rights keeps poor

countries poor

LORNE GUNTER

Edmonton Journal

The world's wealthiest nations could all double their foreign-aid

contributions. They could triple or even quadruple them. They could

forgive the debt of the 40 or 50 poorest nations. They could honour the

crank solutions to globalization proposed by every window-smashing

anarchist in Seattle, Washington and Prague, and by every United

Nations commission ever. And poor countries would still be poor.

What separates the rich from the poor among nations is something the

increasingly militant global left has never considered, and never will. The

alleged income gap is not the result of a lack of assets - lack of money

and property - nor lack of entrepreneurial spirit nor genetic impairment

among the poor.

The gap results almost entirely from a lack of secure property rights.

Where it is difficult to secure title to one's home, business, ideas and

investments, it will be difficult to secure mortgages, working capital and

buyers for one's shares, according to Peruvian economist Hernando de

Soto, in his stunning new book The Mystery of Capital: Why Capitalism

Triumphs in the West and Fails Everywhere Else.

In Lima, registering title to a home involves 207 separate steps, and

that is a breeze next to opening a legal business.

Long and Expensive

A team of de Soto's assistants "spent six hours a day at it and finally

registered the business - 289 days later." The cost of registering the

one-worker garment shop was $1,231, the equivalent of 31 months' pay

for that lone worker. It's small wonder most Peruvian entrepreneurs

choose to operate their businesses illegally.

In the Philippines, simply registering a title on a home or parcel of land

would "necessitate 168 steps, involving 53 public and private agencies,

and take 13 to 25 years." If the property is in an area deemed

agricultural by the Philippine government, add 45 steps, 13 agencies and

another two years.

De Soto and his colleagues found the same to be true in Haiti and

Egypt. Nearly one in 10 Egyptians lives in an illegal home - is, in effect,

a squatter - because building a legal home to which one may obtain title

takes five to 14 years of bureaucratic manoeuvring, after which time

the next government, or even the next minister within the same

government, can revoke ownership when the policy breeze shifts

direction.

"In the West, by contrast," de Soto writes, "every parcel of land, every

building, every piece of equipment or store of inventories is represented

in a property document," and almost instantly.

The True Marvel

While one might marvel at the technological triumph involved in buying a

stock online, only after reading Mystery of Capital is it driven home that

the true marvel is a legal one. No one but the residents of nations with

firm, equal, democratic property rights would consider buying a stock

instantly via the Internet.

Where property rights are not universally understood and respected,

buying from an online trading house would involve two distinct risks,

rather than one: the risk of the investment itself, and the risk of one

not being able to prove one's ownership of the stock being purchased.

Poor countries are poor because their people, while prepared to risk

their homes and standards of living for a chance at a better life, are

unprepared to risk their homes and standards of living and their claim to

any profits or gains on assets that arise from the first risk.

They are also poor because, nearly always, they could not risk their

homes and lifestyles even if they wished to. "They hold these assets in

defective forms," de Soto explains. Because title is sketchy or because

property rights are mostly disregarded where title can be secured, the

assets of the world's poorest people is "located where financiers and

investors cannot see them."

They are what de Soto frequently refers to as "dead capital."

Mystery of Capital could be the modern Wealth of Nations - that is, the

seminal book for an era of revived thinking about free markets - except

for its insistence the failure of capitalism outside the West is not

cultural in origin.

De Soto spends much of his book arguing the West has so completely

imbibed reverence for property rights that it no longer even sees its

own reverence. People in the West respect each other's property by

rote. That seems the essence of a cultural tradition to me.

Yet that's a small point. If Mystery succeeds in changing Third World

and former-Soviet-bloc thinking on the centrality of property rights to

economic freedom and development, it might yet become an economic

landmark on a par with Adam Smith's famous work.

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F

Frederic

Guest
THANK YOU for your contribution!

I am circulating to my friends in the DR and the rest of the Caribbean and Central America.

I am sure others will too.
 
G

Gabriel Arroyo

Guest
Dear fedreric on or during the month of december possibly the last week of Dec 2000, a theft of cattle took place in el estrecho Luperon Puerto Plata . a total of six cattle were taken. please contact coronel.Jaime martes Martinez National police Santiago . or General Aquiles Cruz Gomez DR. If you or someone has any information regarding this matter please contact ; Manuel Cruz 718 965 9446 or 718 499 7437.
 
F

Frederic

Guest
If I hear anything I'll let you know. But I live in Santo Domingo, not in the North Coast.

So maybe some of our north coast readers could help.