I made the mistake of actually reading a Post-Dispatch editorial the other day. Apparently some group held a conference here on World Hunger, and the Post decided to raise our awareness and propose solutions. Naturally, all the solutions were what the governments of developed countries could do, and they called on citizens to pressure the US Government to provide more aid to developing countries, citing some study showing a significant percentage of people living in Maryland wouldn't mind if like fifty dollars of their tax dollars went to such aid. Needless to say, I took offense, and having just read the wonderful book The Mystery of Capital by Hernado De Soto, I was armed with the information to write the following letter, which they ran.

You can reach the Post-Dispatch web page here.
You can send your own letter to the editor here.

Subject: Letter to the Editor

Your editorial on world hunger made good points about how prevalent world hunger is but stumbled badly as to solutions. First was the claim that Americans need to insist our government increase humanitarian aid. What an affront to the initiative of the American citizen. First and foremost we need to give our own time and money to the already existing private organizations that work to provide food and development aid to less developed countries. Why waste time on lobbying our government to do what we can already do on our own?

Secondly, the solution to these nation's problems lies within the nations themselves. All our humanitarian aid does is provide temporary relief. The real solution is to fix the laws and regulations that keep the majority outside the legal economy in developing countries. For instance, the Institute for Liberty and Democracy (ILD) discovered that it took 289 days of full time bureaucracy appeasement to open a legal business (a garment workshop) in Peru and that to obtain legal approval to build a house took almost seven years. And Peru is no worse than other developing countries. Consequently, most of the economy in these countries takes place outside the law, which means inefficient and under capitalized. The ILD has estimated that the poor of the developing countries have but do not legally own, and thus goes unaccounted for, real estate worth 9.3 trillion dollars, a figure that about equals the net worth of the stock exchanges of the 20 most developed countries and that dwarfs the investment, loans and aid to developing countries. These countries need to change their laws and regulations to bring all of their citizens into the legal economy, which will allow these countries to flourish just as the already developed countries did after they too brought all their citizens within the legal economy.

Kevin Murphy

Return me to Letter of the Week

Return me to The Murphy NexusTM

This page last updated 12 June 2001

© Contents copyright Kevin Murphy 2001. All rights reserved.