View Full Version : Beware ... Statists Bearing Gifts

11th January 2011, 10:20 AM

In the course of this public TV program they interviewed some poor Peruvian peasants near Machu Picchu. They complained their family had lived on the land for generations and yet had no paper to show that they owned the land. One peasant said that one day someone from the city showed up and told them that he was the owner and from that day forward they were working for him.

Later a government reform came about that permitted cooperatives. Yet it wasn't complete reform because it was the coop that owned the land and the peasant complained that he was paid only $.50 per day for his labor to the coop.

The reform outfit calculated that the Peruvian poor were tying up over 10 trillion dollars of assets that they could not mortgage. Since they had no land title they could not borrow on those assets and therefore could not finance businesses. Because they were poor they had no identity and could not obtain passports. Because they had no "title" they had no way of passing estate to their children as heirs.

So using this data the Peruvian government elected for land reform and started handing out titles. Oh, joy ... now they may sell these bits of land, now they may be taxed on the property it represents, now they may go into debt based upon the title they hold, now they may pass this title on to the next generation.

Now this is all well and good. . . . for Peru. But don't forget that these peasants have survived on the land using their old customs for many generations. While they were poor the state ignored them. Now that they have title they must pay tax or else the state will remove the title from them and remove them from the land they have occupied for so many years. To generate the commerce to pay for the property tax they must engage in business.

Color me skeptical but I believe in the end analysis they might decide they were better off before they were given the gift.