The Skeptical Liberal: Live 8

The Skeptical Liberal

How can we live together in peace, prosperity, and harmony, while retaining our liberties as autonomous individuals who can, and must, create our own values? -- J.M. Buchanan


Live 8

Africa holds a special place in my heart. When I heard about the Live 8 concerts, I was glad to see a global voice being raised on behalf of Africa's poor. And when I looked further into what the Live 8 organizers wanted to promote -- more and better aid, truly freer trade, and debt reduction -- I was generally pleased. And any chance to hear U2 should be taken.

But . . .

Altogether too much focus on nations, and not people. Helping African nations is not the same thing as helping African citizens. People will not necessarily be helped by more aid flowing through governmental hands, and forgiving national debt also may not help the poor. Even freer trade won't help if people aren't free to develop their own comparative advantages (when are we going to give up the Ricardian notion that nations trade, and realize that international trade is simply an extension of trade between people across national boundaries?).

What Africa really needs is governments that restrain themselves, in order for their citizens to expand their own possibilities. Expansion of markets can help this process, as it is in China (where private property rights are slowly emerging as entrepreneurs call for protection against the possibility of arbitrary government seizures of property). But Africa's kleptocracies don't want to restrain themselves. What the international community can do is help create institutional structures that constrain governmental power in Africa. The devolution of power over resources and other decisions closer to the citizen level is important, as is the development of community decision-making bodies that actually control local resources. But nothing would be as helpful as the creation of stable property rights for individuals.

One of my former students, from Kenya, read Hernando de Soto's The Mystery of Capital, and said, "this is what east Africa needs." I agree. The path to establishing legal property rights is not an easy one, and is not sexy enough to bring out millions of people for a world-wide concert and party. But it is the foundation upon which the changes Live 8 wants to see would actually be built. Without the legal foundation for capitalism, free trade, expanded aid, and debt reduction are just sound bites. I just hope the sound bites get people thinking about what would really help.

For more, see de Soto's Institute for Liberty and Democracy.


At 7:54 PM, Blogger Bruce Janz said...

Perhaps true, but are stable property rights enough? I mean, isn't some sort of redistribution also required? Otherwise, we have the result of decades of neocolonialism (I wonder how much Moi tucked away outside of the country, for instance, never mind Mobutu), which is a pretty big hill to climb for the average person.

Another thing. Individual property rights seem like the right result, but don't those rights always take place within socially available options that are not reducible to markets? I know, heresy.

So sure, there are lots of terrible governments in Africa. Now what? I can think of several options, none very nice:

1. Overthrow the governments we don't like - Bush's solution, and a very poor one.

2. Do a little social engineering (sanctions, IMF pressure, good old World Bank capacity building plans), in the interests of establishing these rights - but isn't that a bit arrogant? And, haven't we seen that these don't work very well? And isn't it also top-down, dealing with nations rather than people?

3. Aid Africans in engaging in internal cultural change - but that would be to admit that there's something at work other than the market that matters to humans.

So, if this is to be something other than a utopian wish, there has to be more, I think.

Ok, just being contrary. I'm sure you'll have an answer to all this.


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