Category: Property Rights

“Sachs Aid Model Has Financed Tyranny”: More on Why Aftrica is Poor


Famine in Niger is no surprise — desert wastes, locusts and decades of Marxist rule keep it second-to-last on the world poverty list. Famine in the fertile climes of southern and eastern Africa, however, seems more shocking. But there’s a common thread: centralized state rule — incompetent at best — marked by corruption and sustained by aid. These are the shackles that keep Africans poor: It would be nice if EU and U.S. trade barriers were removed at trade talks in Hong Kong this week, but exports are a distant notion to the 75% of Africans who live off the land.
Niger is little-blessed by nature, but it has also spent its postcolonial era trying various forms of failed government, with Marxism reigning longest. A quarter of the population — 2.5 million people — faces starvation. Yet more temperate southern and eastern African countries are on the edge of famine, too, with 10 million affected in southern Africa alone. Again, we find the same economic profile: Zimbabwe, Malawi, Zambia, Mozambique, Swaziland and Lesotho all lack economic freedom and property rights; all have economies mismanaged by the state; all depend on aid. All these countries have a history of utopian schemes that failed to produce everlasting manna. State farms, marketing boards, land redistribution, price controls and huge regional tariffs left few incentives or opportunities for subsistence farmers to expand. Despite torrents of aid, these cruel social experiments could not turn sands verdant or prevent the granaries of southern and eastern Africa from rotting.
Ethiopia’s Prime Minister Meles Zenawi believes that allowing Ethiopians to own their land would make them sell out to multinationals. He seems to have overlooked a basic market principle: It demands a willing seller and a willing buyer at an agreed price. If that price is worth selling for, the farmer might have some money to reinvest elsewhere; if that price is worth buying for, the purchaser must have plans to make the land profitable. If there is no sale, owners might have an incentive to invest in their own land and future, having, at last, the collateral of the land on which to get a loan. After decades of socialism, Ethiopia’s agricultural sector — the mainstay of the economy — is less productive per capita than 20 years ago when Band Aid tried to defeat famine. Although 60% of the country is arable, only 10% has been cultivated. Ethiopia is entirely dependent on donations; but instead of grasping reality, Mr. Zenawi, a member of Tony Blair’s “Commission for Africa,” is forcing resettlement on 2.2 million people.
In Zimbabwe, the murderous kleptocrats of Robert Mugabe’s regime deny that land seizure has pushed their rich and fertile country into famine: Some three million people face starvation today.
. . .
African leaders must be pushed to reduce economic intervention, free financial markets, remove bureaucratic obstacles to setting up businesses, establish property rights and enforce contract law. These are the forces that release entrepreneurial energy. But the ruling cliques will do none of these unless forced to do so as a condition of aid. The Sachs aid model has financed tyranny and corruption for 40 years, leaving Africans destitute. The world trade meeting in Hong Kong will hear cries for “Trade Justice” for Africa, representing more protectionism and more state-run, aid-fueled schemes. What we really need is economic freedom and the rule of law at home: We are perfectly capable of improving our own lot if only allowed to do so.

For the full commentary, see:
FRANKLIN CUDJOE. “The Terms of Trade: Africa Needs Freer Markets — and Fewer Tyrants.” The Wall Street Journal (Weds., December 14, 2005): A20.
(Note: ellipses added.)
(Note: The WSJ identifies Mr. Cudjoe as “director of Imani, a policy think tank in Ghana.”)

Land Next to Proposed Ethanol Plant Suddenly Declared “Blighted”

(p. 1A) ORD, Neb. – Carl and Charlene Schauer were upset and more than a little offended when the City Council declared their 50-acre cornfield “blighted and substandard.”
Nothing is wrong with the cornfield, located almost five miles outside of town.
Nothing – except its proximity to the site of a proposed $75 million ethanol plant that local officials say will bring 34 jobs to the community of 2,300.
Invented to give cities the power to enlist private development in clearing slums, the “blighted and substandard” designation has become a critical tool for economic development projects across Nebraska.
It allows cities to use property taxes to help pay development costs on behalf of private enterprise, under a mechanism called tax increment financing. That allows increased property taxes generated by improvements of blighted property to be used to help fund the redevelopment.
Blighted land even can be condemned through eminent domain, then turned over to private developers. That practice was upheld by the U.S. Supreme Court last year.
Stunned by that ruling, several Nebraska lawmakers have introduced legislation to prevent local governments from using eminent domain to acquire private property that would be turned over to another private (p. 2A) owner for economic development.
Three bills (Legislative Bills 924, 910 and 799) specifically protect agricultural land, forbidding governments to declare it blighted. A fourth bill (LB 1252) would limit eminent domain to public projects like parks and roads.
And State Sen. Matt Connealy of Decatur proposes a constitutional amendment (LR 272 CA) to remove the requirement that land be designated as substandard and blighted before cities can use property taxes to help private developers pay project costs.
Connealy said it appears some smaller cities are pushing the boundaries of the blight definition.
The Ord ethanol project has been touted by Gov. Dave Heineman, the New York Times and others as an example of small-town hustle and progress.
Carl Schauer’s son, Curt, and his wife, Susan, however, have gone to court to try to stop it.
They live directly across Nebraska Highway 11 from Carl Schauer’s cornfield. Although not included in the proposed ethanol site, their home is less than 1,000 feet from where the plant would be built. They are worried about noise, smell, traffic and health hazards from the around-the-clock operation.
“I guess we’re the sacrificial lambs in the name of economic development,” said Susan Schauer, a licensed practical nurse.
A local official said the city does not want to take even the smallest part of Curt Schauer’s property if he doesn’t want to sell it.
“I don’t think anybody in this community would ever do that,” said Bethanne Kunz of the Valley County Economic Development Board.
After Schauer rejected an offer to buy a strip of his land for a railcar loading area, Kunz said, the ethanol site was reconfigured to leave out Schauer’s property. The field was annexed by the city as part of a redevelopment zone under a Nebraska law that allows small towns and villages to acquire outlying land through “remote annexation.”
The Schauer family still doesn’t know why the field was declared blighted – and it’s worried that the designation could spell trouble. Could their land be taken if another new factory wanted to locate in the area?
“I think it’s wrong that government can take private property and turn it over to private enterprise,” said State Sen. Tom Baker of Trenton.
Government already offers plenty of help – including grants and tax breaks – to business to encourage development, said State Sen. Deb Fischer of Valentine. “Does government have to give away the farm, too?”

Read the full story at:
REED, LESLIE. “‘Blight’ label raises concerns.” Omaha World-Herald (Sunrise Edition, Saturday, January 21, 2006): A1 & A2.

Chinese Version of ‘Eminent Domain”: Villagers Die Protesting Theft of Their Land

“People here have tried everything you can think of to get the problem solved before this happened,” said a resident who gave his name as Chen. “They talked to the village committee, the township and municipal governments. One of them even went to Beijing. But nothing is done – the village officials just simply ignore them.”
Mr. Chen described the peak of the protests, on Saturday night, when the deaths occurred. “It was like a war, so real and so brutal,” he said. “I did not see who started it, but I saw policemen were beating the villagers and the villagers were fighting back with stones and firecrackers.”
Since then, villagers said, many residents are being forced to report each morning to the police, who detain them until late in the evening, when they are allowed to return home until the next morning.
As with so many recent rural protests, Panlong’s problems began with land. Many villagers told stories of having been deceived by corrupt local officials who they said had enriched themselves by selling off rights to the villagers’ farmland.
“Two years back, one day some villagers were asked to attend a routine meeting,” said a 42-year-old farmer who gave his name as Fang. “They went and they paid 10 yuan for participation fees, and they signed in as usual. Later, when we discovered our land was being sold, we asked the village committee to explain what’s going on, and they answered that we had signed the contract. Suddenly we remembered that meeting, and everyone understood that we had already been cheated.”

For the full story, see:
FRENCH, HOWARD W. “Panlong Journal: Visit to Chinese Anytown Shows a Dark Side of Progress.” The New York Times (Thurs., January 19, 2006): A4.

Only 13% of Americans Want to Live in Dense Urban Places

(p. A8) Strict growth limits have driven population and job growth further out, in part by raising the price of land within the growth boundary, to communities across the Columbia River in Washington state and to distant places in Oregon. Suburbia has not been crushed, but simply pushed farther away. Portland’s dispersing trend appears to have intensified since 2000: The city’s population growth has slowed considerably, and 95% of regional population increase has taken place outside the city limits.
This experience may soon be repeated elsewhere as planners and self-proclaimed visionaries run up against people’s aspirations for a single-family home and low-to-moderate-density environment. Such desires may constitute, as late Robert Moses once noted, “details too intimate” to merit the attention of the university-trained. Even around cities like Paris, London, Toronto and Tokyo — all places with a strong tradition of central planning — growth continues to follow the preference of citizens to look for lower-density communities. High energy prices and convenient transit have not stopped most of these cities from continuing to lose population to their ever-expanding suburban rings.
But nowhere is this commitment to low-density living greater than in the U.S. Roughly 51% of Americans, according to recent polls, prefer to live in the suburbs, while only 13% opt for life in a dense urban place. A third would go for an even more low-density existence in the countryside. The preference for suburban-style living continues to be particularly strong among younger families. Market trends parallel these opinions. Despite widespread media exposure about a massive “return to the city,” demographic data suggest that the tide continues to go out toward suburbia, which now accounts for two-thirds of the population in our large metropolitan areas. Since 2000, suburbs have accounted for 85% of all growth in these areas. And much of the growth credited to “cities” has actually taken place in the totally suburb-like fringes of places like Phoenix, Orlando and Las Vegas.
. . .
It is time politicians recognized how their constituents actually want to live. If not, they will only hurt their communities, and force aspiring middle-class families to migrate ever further out to the periphery for the privacy, personal space and ownership that constitutes the basis of their common dreams.

For the full article, see:
JOEL KOTKIN. “The War Against Suburbia.” The Wall Street Journal (Sat., January 14, 2006): A8.
For more of Kotkin’s observations, it might be worth consulting his: The City: A Global History. Modern Library, 2005.

Nebraska’s Ban on Corporate Farming May be History (Three Cheers)

(1A) Initiative 300 generally bans corporations and certain other business entities from owning farmland or engaging in agricultural activity in Nebraska, although there are a number of exceptions geared toward family-based organizations.
It was added to the Nebraska Constitution through a petition drive and vote of the people.
Since receiving 57 percent of the vote in 1982, Initiative 300 has survived several state and federal court challenges, a petition drive to repeal it and attempts by state lawmakers to circumvent it.
The ban was promoted as a way to protect family farms in Nebraska from large corporations.
But Camp ruled that the effort to protect Nebraska farmers violated the U.S. Constitution’s commerce clause because it discriminated against out-of-state interests.
“There is considerable evidence to support the premise that Initiative 300 was conceived and born in a protectionist fervor,” the judge said.
Camp acknowledged that the ban might promote legitimate state interests, such as conservation of natural resources and rural economic development. But she said the state had not shown that the ban was the only (p. 2A) way to reach those goals.
In the lawsuit, Jones said the result of the ban has been a loss of income because he cannot contract with out-of-state corporations for raising and feeding livestock. The ban also reduces the value of his land and his stock in the family farm corporation by barring potential purchasers.
Other plaintiffs said the ban has prevented them from transferring their farm and ranchland as they wished and has interfered with their ability to compete in a national market.
In addition, the judge agreed with two of the plaintiffs who said the ban violated the Americans with Disabilities Act, because it says the person holding a majority of a farm must supply a majority of the day-to-day labor on the farm.
One was Shad Dahlgren of Lincoln, who was paralyzed as a teenager and uses a wheelchair. The other is Todd Ehler, an Elkhorn man who also is disabled.
Both said they are limited in their ability to own farms, since they cannot provide the day-to-day labor required under Initiative 300.

Governments do not know, and usually do not seek, the most efficient market structure. When they try to impose one, as in the Nebraska ban on corporate farming, their actions almost always end up reducing efficiency, and increasing prices for consumers.
For the full article, see:
Stoddard, Martha and Bill Hord. “Ruling Hits Corporate Fram Ban: Initiative 300 Unconstitutional, Judge Says.” Omaha World-Herald (Sunrise Edition, Friday, December 16, 2005): 1A & 2A.
(The online version is, I believe, the version printed in the evening edition of Thurs., Dec. 15, 2005, which I believe is the same, except for the headline.)

Indians “continually raiding and fighting, band against band”

IndianWarsBK.jpg Image source: online version of WSJ article cited below.

The Indians, as Mr. Yenne shows, were far from peaceful, cooperative peoples living in harmony with each other and with nature. They were continually raiding and fighting, band against band, tribe against tribe. They saw each newly arrived white group — whether English, French, Spanish or Dutch — as just another tribe to contest with. Some Indian tribes were weakened or decimated by these encounters, others were strengthened by getting hold of guns, iron tools and horses. Adopting the horse culture increased the power of the Plains Indians dramatically, making them especially tough foes for the whites moving into the Great American West.

ROGER D. MCGRATH. “Red vs. White, Uncolored by Ideology.” The Wall Street Journal (Tues., December 13, 2005): D8.
The book McGrath is reviewing:
Bill Yenne. Indian Wars. Westholme, 2005. (325 pages, $26)

In Defense of Suburban Sprawl

SprawlBK.jpg Image source: web version of WSJ article quoted and cited below.

(p. P16) For at least half a century, academics, aesthetes and all-purpose agonizers have looked at our ever-sprawling cities with disdain and even horror. The spectacle of rings and rings of humankind nested in single-family homes has inspired in them all sorts of revulsion and, relatedly, a whole discipline of blame: Suburban sprawl has been faulted for exacerbating racial tension, contributing to energy shortages, worsening pollution and heating up the globe — even expanding waistlines.

Largely missing from this debate has been a sound and reasoned history of this pattern of living. With Robert Bruegmann’s “Sprawl: A Compact History,” we now have one. What a pleasure it is: well-written, accessible and eager to challenge the current cant about sprawl.
No, Mr. Bruegmann says, don’t go blaming the Federal Highway Administration for sprawl or the executives at General Motors and Exxon or racist developers fleeing urban environments. Don’t even blame Karl Rove. You really don’t need to blame anyone. Mr. Bruegmann notes that contemporary sprawl — best defined by places like Los Angeles, Phoenix and Houston — is nothing new. It represents “merely the latest chapter in a long and curious history.”
What propels that curious history is something often overlooked by the makers of grand theories — the particular choices of individual human beings. Mr. Bruegmann places the urge to sprawl squarely where it belongs: on people’s logical desire to escape the high costs, crime, pollution, congestion and lack of privacy that accompanies life in dense cities.

For the full review, read:
JOEL KOTKIN. “In Praise of ‘Burbs. Academics, planners and tastemakers may vilify suburbia as an American blight. But even the Romans knew: It can be nice to get out of the city.” The Wall Street Journal (Sat., December 10, 2005): P16.

The book that Kotkin’s review is praising:
Robert Bruegmann. Sprawl: A Compact History. Chicago: University of Chicago Press, 2005. (264 pages, $27.50)

“Treat Me with Benign Neglect.”

Source: Screen capture from CNN “Refusing to Leave” report by Dan Simon on the morning of 9-9-05.

“This is America. Has your neighborhood ever been invaded by state troopers from another state?” “I will leave when I am dead.” Ashton O’Dwyer can’t understand why he is being forced to leave his dry, intact home in New Orleans. He asks the city: “Treat me with benign neglect.” The 9-9-05 report was followed up by Drew Griffin on 9-10-05 with the “Staying Put” report that presented businesses, and Afro-Americans, expressing sentiments similar to O’Dwyer’s.
Dr. Michael Baden on the “On the Record” Fox News show, hosted by Greta Van Susteren at about 9:47 PM central time on 9-9-05, stated that there was little danger from the “toxic” water unless people drink it. (Toxic water is the main reason given for the current, post-hurricane, forced evacuations.) Baden claims if the city wants to help people, they would be much more effective if they sprayed the water against mosquitoes.
(Dr. Michael Baden is the Chief Forensic Pathologist of the New York State Police, and was formerly the Chief Medical Examiner of New York City.)

Watch the CNN report: “Refusing to Leave“:

Watch the CNN report: “Staying Put“:

For more on O’Dwyer, see also:
CHRISTOPHER COOPER. “Old-Line Families Escape Worst of Flood and Plot the Future.” THE WALL STREET JOURNAL (September 8, 2005): A1.

Looting New Orleans


“In downtown New Orleans, where looters are floating garbage cans filled with clothing and jewelry down the street.” From an online slideshow of looting at Wal-Mart and Walgreens in New Orleans. Caption for photo, and photo itself, from: http://www.nbc10.com/slideshow/news/4917518/detail.html?qs=;s=4;p=news;dm=ss;w=400 (POSTED: 9:45 pm EDT August 30, 2005; UPDATED: 10:53 am EDT August 31, 2005; Downloaded Sept. 5, 2005)
Harold Andersen reports on the observations of his wife’s cousin, Michael Ross, a member of the faculty of the history department of Loyola University in New Orleans:

When the levees broke and put the major share of New Orleans under water, a substantial portion of the city was still dry because it was on higher ground, above sea level. Included were the French Quarter, some attractive residential neighborhoods and the land on which Loyola University is located.
There was some wind damage in the higher-ground areas of the city, but those areas were basically preserved and could have served as a base from which the city could be rebuilt.
“But they’re gone now, as a result of looting,” Ross told us.
The looting wasn’t random. Organized street gangs, armed with weapons stolen from looted stores, went about looting quickly and systematically, Ross said. In residential areas, they went down streets kicking in the doors of house after house after house, leaving the residences in shambles.
One unforgettable scene, Ross said, was the telecast showing five pickup trucks of gang members leaving a looted Wal-Mart store with dozens of weapons they had stolen.
Ross is pessimistic about the chances that Loyola and Tulane Universities will reopen this fall, even if their campuses are intact. Students, particularly new students, are most likely to be discouraged from attending school in a nearly destroyed city.
On a personal note, Ross expects that the house in which he has been living will be a victim of looting and his computer files are likely to have been destroyed.

Andersen, Harold W. “If New Orleans is Dead Forever, Looters Delivered the Fatal Blow.” Omaha World-Herald (Sunday, September 4, 2005): 13B. Also online at: http://www.omaha.com/index.php?u_pg=609&u_sid=2006986

New Orleans is the opposite of America, and we must hold onto places that are the opposite of us. New Orleans is not fast or energetic or efficient, not a go-get-’em Calvinist well-ordered city. It’s slow, lazy, sleepy, sweaty, hot, wet, lazy and exotic. (p. 9)

Childress, Mark. “Tribute: What It Means to Miss New Orleans.” New York Times, Section 9 (September 4, 2005): 9 & 11.
OK, so then why is it that all us fast, energetic, efficient, go-get-’em Calvinists are responsible for coughing up billions to save a lifestyle we don’t much get to enjoy?

Stealing Indian Land

These lands once belonged to the Kiowas and the Crows, but we whipped these nations out of them, and in this we did what the white men do when they want the lands of the Indians. We met the Kiowas and the Crows and whipped them at the Kiowa Creek, just below where we now are. We met them and whipped them again, and the last time at Crow Creek.

Oglala Lakota Leader Black Hawk, 1851; as quoted in a display at the Western Historic Trails Center in Council Bluffs, Iowa, designed and built by the National Park Service, and observed on 8/13/05.