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	<title>The Freeman &#124; Ideas On Liberty &#187; south africa</title>
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		<title>The American Land Question</title>
		<link>http://www.thefreemanonline.org/featured/the-american-land-question/</link>
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		<pubDate>Wed, 10 Jun 2009 17:27:59 +0000</pubDate>
		<dc:creator>Joseph R. Stromberg</dc:creator>
				<category><![CDATA[Featured]]></category>
		<category><![CDATA[Albert Jay Nock]]></category>
		<category><![CDATA[Brisco County Jr.]]></category>
		<category><![CDATA[colonial policy]]></category>
		<category><![CDATA[Edward Gibbon Wakefield]]></category>
		<category><![CDATA[employment]]></category>
		<category><![CDATA[english enclosures]]></category>
		<category><![CDATA[Frank Owsley]]></category>
		<category><![CDATA[freehold]]></category>
		<category><![CDATA[Henry George]]></category>
		<category><![CDATA[homesteaders]]></category>
		<category><![CDATA[independence]]></category>
		<category><![CDATA[John Marshall]]></category>
		<category><![CDATA[labor]]></category>
		<category><![CDATA[land ownership]]></category>
		<category><![CDATA[land reform]]></category>
		<category><![CDATA[modernization]]></category>
		<category><![CDATA[Murray Rothbard]]></category>
		<category><![CDATA[nieboer]]></category>
		<category><![CDATA[Okinawa]]></category>
		<category><![CDATA[Paul Gates]]></category>
		<category><![CDATA[peasantry]]></category>
		<category><![CDATA[personal independence]]></category>
		<category><![CDATA[rent-seeking]]></category>
		<category><![CDATA[robber barons]]></category>
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		<description><![CDATA[Widespread landownership long supported a kind of liberal-republican independence. Perhaps we should reexamine the nexus and ask ourselves how, in Donald Davidson’s words, we “let the freehold pass,” and whether that was really for the best.]]></description>
			<content:encoded><![CDATA[<p>In 1934 in the depths of the Great Depression, Southern agrarian (and historian) Frank Owsley called for an American land reform. He suggested that “unemployed or underemployed families be staked to a homestead, even subsidized, to remain on the land and produce.”</p>
<p>This proposal was not really all that shocking: Such a program would have been consistent enough with the advertised purpose of certain phases of American land policy from 1776 on. American governments handed out land (however acquired) for over a century to veterans, settlers, land speculators, railroads, timber corporations, mining companies, and other parties. (I’ll give you three guesses which groups made out the best). Governments did so as a source of revenue, for geostrategic reasons, to win favor with voters, or to reward a small class of typically American operators who flat-out deserved to be rich.</p>
<p>In a new, revolutionary, and republican society, there was of course much talk about widespread property as the bulwark of republican freedom. But the talk was so general that Federalists and Republicans could share it, while leaving themselves plenty of room in which to create a small class of owners of a disproportionate amount of the public domain. Overall—from the founding land speculators down to 1893, when the frontier allegedly ran out—American land policy resembled in both theory and practice the kind of “privatization” we see under mercantilist Republican administrations. One landmark in the process was Johnson and Graham’s Lessee v. William M’Intosh (1823). Here, Chief Justice John Marshall undertook to write a long essay on the received theory of how property previously stolen by European kings or their agents is best conveyed. As was his wont, Marshall proved entirely too much, in as clear a case of Albert Jay Nock’s “copper riveting” of narrowly focused property rights as we could want. (See my <a href="http://www.tinyurl.com/c67q7j">“Albert Jay Nock and Alternative History,”</a> <em>The Freeman</em>, November 2008.)</p>
<p>Southern agrarian Andrew Lytle noted that from the settler’s point of view the whole frontier process represented an attempt to get away from would-be aristocrats and other aspiring land monopolists. Consistent republican ideologists like Thomas Skidmore and George H. Evans agitated from the 1820s into the 1840s in favor of giving homesteaders first claim on the territories. Generally speaking, other claimants prevailed, while the politics of slavery and antislavery further complicated the matter. In the bigger picture, the Homestead Act of 1862 was the exception rather than the rule, as Paul W. Gates showed in a noteworthy 1936 paper (“The Homestead Law in an Incongruous Land System,” American Historical Review).</p>
<p>I cannot discuss here what an ideal policy based on “mixing one’s labor” with resources might have looked like. Suffice it to say that sales of thousands and tens of thousands of acres to individuals, land companies, and corporations were not especially consistent with any genuine republican ideal. The disappearance of most of the best land in California into the hands of a half-dozen individuals in a few decades comes to mind. But large-scale buyers had mixed their money with federal land officers, and that no doubt counts for something.</p>
<p>Meanwhile, the judiciary—state and federal—busily remodeled the common law and shifted the burdens of industrialization onto third parties, extensively modifying the older law of nuisance. Harry Scheiber finds that “law was often, if not to say usually, mobilized to provide effective subsidies and immunities to heavily-capitalized special interests [under] either ‘instrumentalist’ or ‘formalist’ doctrine.” Even existing doctrines of “public rights” and eminent domain came to serve business interests. Finally, federal judges’ discovery in the 1880s of corporate “personhood” in the Fourteenth Amendment perfected the Federalist Party’s original mercantilist program. All these changes importantly influenced just who would benefit from the American State-system of land tenure (to use Nock’s phrase) and its attendant modes of preemption and exploitation.</p>
<h2>Land and Independence</h2>
<p>Many writers have seen a special relationship between landownership and personal independence. And here we hit on what is perhaps the truest insight of republican theory—one taken up by many classical liberals. Briefly, this holds that a broad “middle class” of property owners is essential to the maintenance of free societies. The point is as old as Aristotle. On the negative side, in decrying the social effects of England’s fabled land monopoly, radical liberals like Percy Bysshe Shelley, Thomas Paine, Thomas Hodgskin, and John Bright implicitly affirmed the republican axiom.</p>
<p>A typical nineteenth-century American “self-help” book aimed at young men did not say, “Get a job working for wages within an increasingly intricate division of labor so as to enjoy a greater variety of consumer goods.” Instead, it said, “Get yourself a competency”—a vision fraught with republican implications suitably modernized. Working for wages, if one did it at all, was a temporary stage—to be endured while learning a skill or trade and abandoned later in favor of real or potential independence. This independence, derided in our time as “illusory,” left one free (within limits) not just from state interference but also from nineteenth-century employers. And if independence is illusory in our time, it is at least partly because the political activities of well-connected elites long since removed the preconditions of independence deliberately and systematically.</p>
<p>One key (but not the only one) to this much-sought-after independence was access to land, a theme taken up by Catholic writers Hilaire Belloc and G. K. Chesterton in early twentieth-century England. Sociologist Robert Nisbet commented that never, after reading Belloc, did he “imagine that there could be genuine individual liberty apart from individual ownership of property.” In any case, as historian Christopher Lasch put it, “Americans took it as axiomatic that freedom had to rest on the broad distribution of property ownership.” Perhaps Americans were wrong to believe such a thing. But let us examine the matter a bit more.</p>
<p>This American axiom receives support from those political economists who believed that the land/labor ratio importantly determines social structure. Edward Gibbon Wakefield somewhat gave the game away in the 1830s by opposing easy access to land in Australia, lest potential wage-earners try for self-sufficiency before spending “enough” years working for others. Marx chided Wakefield for letting this “bourgeois secret” out and was in turn chided by Franz Oppenheimer, Achille Loria, and Nock for not learning the right lesson from Wakefield’s recommendations on rigging the market.</p>
<p>H. J. Nieboer argued (1900) that where resources are “open,” few will work for big enterprises, and the latter will (if they can) institute some form of slavery. Evsey Domar writes (1970) that one never finds “free land, free peasants, and non-working owners” together. Why? Because where political leverage allows, aspiring lords and (literal) rent-seekers will eliminate the free land, the free peasants, or both.</p>
<h2>Colonial Policies</h2>
<p>With this theorem in view, let us survey some colonial evidence. Enterprisers in colonies have always wanted regular supplies of cheap labor for their projects. Although there is no evidence in favor of a “right” to such a thing, these prospective employers were never discouraged. Aided by colonial administrators with the same assumptions, they gradually overcame native economic independence. Land was the key, and neither the colonizers nor the natives doubted it. No matter how hard natives worked on their holdings, colonialists decried their “idleness”—and their uncivilized failure to work for wages.</p>
<p>We may therefore give the overworked English Enclosures time off (for now) and look at some other cases. Consider the Japanese colonial administrator in Okinawa who complained in 1899 that the typical Okinawan held land and therefore had low expenses and few wants. For these reasons, the native saw “no need to undertake any other business, nor to save money.” Since native lands were held informally, they could not be capitalized. Such people and properties did little for the great cause of development and, shortly, the Japanese government (!) denounced Okinawans’ customary arrangements as “feudal” and set out to modernize the island. American occupation later perfected this anti-agrarian revolution. Doubtless, however, much “employment” was created in the post-World War II Okinawan service economy dominated by the U.S. military.</p>
<p>Turning to English colonies in the Caribbean and Africa, we find comparable phenomena. England abolished slavery in the colonies in the 1830s. (Never mind that, as historian Eric Foner comments, “Through a regressive tax system, the British working classes paid the bill for abolition.”) By this time, English policymakers had embraced Adam Smith’s view that positive incentives motivated labor better than fear of starvation or draconian punishments did. But an ocean made all the difference, Foner observes, and new peasantries made up of former slaves were “seen in London, as in the Caribbean, as a threat not simply to the economic well-being of the islands, but to civilization itself.” John Stuart Mill’s famous defense of peasant proprietors “did not extend to the blacks of the Caribbean; their desire to escape plantation labor and acquire land was perceived as incorrigible idleness.”</p>
<p>And so Britain’s former slave colonies put vagrancy and other laws to work and crafted taxes aimed at restricting “the freedmen’s access to land.” As Foner puts it, “Taxation has always been the state’s weapon of last resort in the effort to promote market relations within peasant societies”—that is, to force people into markets in which they were not eager to participate. In Kenya the problem was one of “dispossessing a peasantry with a preexisting stake in the soil,” but colonial legislation proved up to the task. Foner concludes that in “the Caribbean and southern and eastern Africa . . . the free market [was] conspicuous by its absence”—its workings restricted “as far as possible” in the interest of the well-off and powerful.</p>
<p>Historian Colin Bundy has studied the economic rise and political-economic fall of a class of independent African farmers in the Eastern Cape Colony and other parts of South Africa. Various Cape Location Acts (1869, 1876, and 1884) sought to lessen “the numbers of ‘idle squatters’ (i.e., rent-paying tenants economically active on their own behalf) on white-owned lands.” Such peasant farming “conferred . . . a degree of economic ‘independence’: an ability to withhold, if he so preferred, his labour from white landowners or other employers.” Further: “Both the farmer and the mine-owner perceived . . . the need to apply extra-economic pressures . . . to break down the peasant’s ‘independence,’ increase his wants, and to induce him to part more abundantly with his labour, but at no increased price.” In their view, “Africans had no right to continue as self-sufficient and independent farmers if this conflicted with white interests.”</p>
<p>Bundy observes that “Social engineering on this scale took time and effort, but the incentives were powerful.” By way of a “one man one lot” rule under the Glenn Grey Act of 1894, legislators sought to keep African farming within “certain acceptable bounds.” (Here, finally, was a use for John Locke’s famous “proviso” about leaving enough resources for others!) Evictions increased after the Anglo-Boer War (1899-1903). Rents rose (Enclosure defenders, take note), and former tenants stayed on as laborers. Tax pressure on African farmers increased. This “employers’ offensive” from 1890 to 1913 ended successfully in the South African Natives Land Act of 1913, which effectively outlawed the practices under which a particular African peasantry had shown much success.</p>
<p>One supposes, in standard libertarian fashion, that agricultural employment increased thereafter along with land values. But that was the whole point: to proletarianize independent peasants by leaving them no option but to work for wages for Boers and Brits on farms, in mines, and elsewhere. Whether more “employment” was good in itself seems unclear. We can, at least, impute the outcome back to specific political intentions and levers. So much for the colonies, then—and all this without even mentioning the two greatest monuments to England’s defense of free markets: Ireland and India.</p>
<h2>Telescopic Land Reform</h2>
<p>Colonial bureaucrats and employers saw a definite connection between small-scale landownership and independence, and resolved to cut that independence short. By now we begin to see that <a href="http://www.tinyurl.com/d3yyqu">“the subsidy of history”</a>—to use Kevin Carson’s useful term—has been very large indeed. A number of libertarians have understood the problem at hand in pretty much these terms. They have tended, however, to dwell on instances far away from our own shores, writing about land reform in Latin America, South Africa, Asia, and other places. In the mid-1970s Murray Rothbard, Roy Childs, and others addressed the matter.</p>
<p>Rothbard wrote that “free-market economists . . . go to Asia and Latin America and urge the people to adopt the free market and private property rights” while ignoring “the suppression of the genuine private property of the peasants by the exactions of quasi-feudal landlords. . . .” In this vacuum, only the local communists appeared to support “the peasants’ struggle for their property. . . .” And so libertarians “allowed themselves to become supporters of feudal landlords and land monopolists in the name of ‘private property.’”</p>
<p>Decades earlier, that very conservative German liberal economist Wilhelm Röpke wrote that German history would have gone better had Prussia undergone “a radical agrarian reform breaking up the great estates and putting peasant farms in their place.” He adds: “Influential Social Democratic leaders opposed the transformation of the great estates in Prussia into peasant holdings . . . as a ‘retrograde step.’” Röpke called for freeing Germany from “agrarian and industrial feudalism” and the ills “of proletarization, of concentration and overorganization, of the agglomeration of industrial power and the destruction of the individuality of labor. . . .” In his view, the typical proletarianized worker or clerk wanted “a small house of his own with a garden and a goat shed, an undisturbed family life without training courses, mass meetings, processions, and political flag days; dignity and pleasure in his work, an independent if modest existence. . . .”</p>
<p><em>Why Go Abroad?</em></p>
<p>For Enclosure-like pressures on small-holders closer to home, we need look no farther than states like Kentucky, where courts vigorously enforced the full feudal rigor of the “broad form deed,” thereby ensuring the strip mining of many a mountaineer out of productive existence down to the early 1990s. With the system so long stacked in favor of big landholders and bankers, well subsidized by history, one begins to understand the popularity of those New Deal programs that promoted individual home ownership.</p>
<p>Economist Michael Perelman has confirmed a direct relationship between rural labor without independent means of support and the applied politics of English classical economists. The latter preached a great gospel of “work,” mainly for others, who ought to be doing this work. Except for a narrow class of Dissenting Protestant factory owners, those most vigorously espousing this gospel were not themselves noted for doing a lot of work. Together, however, owners and economists said in effect, “Work for us, join the armed forces, or emigrate, ye doughty Angles, Saxons, Jutes, and Scots.” And emigrate they did, leaving us with an American folk wisdom in which old times in England, Scotland, and Ireland were not that great. (This folk memory may have at least as much heuristic value as latter-day econometric claims that everyone became better off in the new division of labor.)</p>
<p>And so we return to Henry George’s problem: How did Americans manage as a society to seize so much land, incur whatever moral guilt goes with the seizures, and then not bloody have any of it? The chief mechanism was precisely the political means to wealth that Oppenheimer and Nock analyzed. The reason <a href="http://www.imdb.com/title/tt0105932/">Brisco County Jr.’s</a> “Robber Barons” struck the right note is that there were such individuals. California was a laboratory case, as George well knew, of the successful primitive accumulation of land by a microscopically small class of state-made men. As with ontogeny and phylogeny, Western accumulation recapitulated Eastern accumulation. From such causes arose the famous “end” of the frontier circa 1893. But open land did not so much disappear naturally as succumb to preemption. And then, with perfect timing, the conservation movement put enormous quantities of land beyond the reach of actual settlers.</p>
<p>As for those Americans who currently own property, they typically own it after 20 or more years of bank payments. Is land so genuinely scarce that a bank must always be in the middle? This remains our central question. Certainly, nineteenth-century allocations played a lasting role, and later political interventions added to concentrated property ownership.</p>
<p>And what of the promotion of “easy” home ownership in recent years? It is a product of 1) the widespread delusion, in the wake of Lyndon Johnson’s and Richard Nixon’s inflationary financing of the Vietnam War, that real estate constitutes the ultimate inflation hedge, and 2) the specific dynamics of the expansionist fractional-reserve banking under new rules (“deregulation”) increasing moral hazards for bankers.</p>
<p>There is also the unhappy fact of property taxes—our chief surviving feudal due. Fail to pay those, and the state enrolls a new owner on your former property. This reduces somewhat the fact of private property in land.</p>
<h2>Independence, Republicanism, and Liberty</h2>
<p>Some classical liberals and libertarians downgrade personal independence. Better to participate in the going order and enjoy a wider array of comforts, they say. But socialists and corporate liberals can play the same game—and have for over a century. It seems to me that those libertarians who join in this refrain rather willfully misconstrue a very simple point: They hail the joys of the division of labor, the higher degree of civilization (that is, more stuff) to be gained from dependence, interdependence, and sundry trickles of income and utility down and up. But already in 1936, Southern agrarian John Crowe Ransom noticed a flaw in this reasoning, writing, “[I]ncome is not enough, and the distribution of income is not enough. If those blessings sufficed, we might as well come to collectivism at once; for that is probably the quickest way to get them.” If greater choice among consumer goods makes up for lost independence, then the case for socialism (or X) would be clinched, provided socialism (or X) could deliver the economic goods (where “X” stands for any political ideology offering us the same stuff/independence tradeoff.)</p>
<p>I doubt we are necessarily “better off” merely because of employment. We need to know more, including why particular sets of choices exist in the first place. Back in the ’60s, Selective Service used to “channel” us into the “right” occupations by threatening to draft us. Given the parameters, our choices were “free.” If it’s that easy, then we are always free, no matter the historical and institutional constraints. Similarly, “To Hell or Connaught” was a choice, and never mind that Oliver Cromwell and his army arbitrarily created this particular prisoner’s dilemma. But perhaps I have leapt from choices among goods to choices between ways of life. Why? Let us look into this.</p>
<p>What if proletarianization is not the ideal form of human life? What if a complex division of labor is merely useful or convenient, but not a moral imperative? What if most of us are hirelings, well paid or otherwise, and then we learn what that status amounts to? The post-Marxist socialist André Gorz writes, “Capitalism owes its political stability to the fact that, in return for the dispossession and growing constraints experienced at work, individuals enjoy the possibility of building an apparently growing sphere of individual autonomy outside of work.” Our interest here is the “autonomy” mentioned, which sounds like a near cousin of “independence.” The sentiment seems sound enough, and the partial convergence of Röpke and Gorz is eye-opening.</p>
<p>Now in the view of Quentin Skinner (a modern republican theorist of note), unfreedom arises both from direct, forcible coercion and from institutional arrangements that make people dependent, since the latter always contain the possibility (realized or not) of arbitrary interference and coercion. Such discussions usually center on the form of state. Utilitarian liberals like Henry Sidgwick did not care about forms. If the Sublime Porte, Tsar, or King of England leaves us substantially alone, we are “free,” and that is that. In Skinner’s view, if those worthies can on their own motion change their policy of leaving us alone, we are not free, no matter what they are doing right now. Freedom requires that we not be menaced by latent unknown powers.</p>
<p>Freedom in this sense is liberty—a shared civic or public good. Like many real public goods it is not provided by the state, indeed the state may be its chief enemy. Law and settled custom may provide this public good, and consumer goods—the people’s pottage—do not compensate for abandoning such an order, where it exists. Today, people often work long hours to buy some independence. In another time, they began with some independence, and then chose how hard to work. Now we see, perhaps, the difference between choices among economic goods and past choices between systems structuring our choices.</p>
<p>Widespread landownership long supported a kind of liberal-republican independence. Perhaps we should reexamine the nexus and ask ourselves how, in Donald Davidson’s words, we “let the freehold pass,” and whether that was really for the best.</p>
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		<title>How Free Markets Break Down Discrimination</title>
		<link>http://www.thefreemanonline.org/columns/the-pursuit-of-happiness-how-free-markets-break-down-discrimination/</link>
		<comments>http://www.thefreemanonline.org/columns/the-pursuit-of-happiness-how-free-markets-break-down-discrimination/#comments</comments>
		<pubDate>Tue, 01 Apr 2008 08:00:00 +0000</pubDate>
		<dc:creator>David R. Henderson</dc:creator>
				<category><![CDATA[Columns]]></category>
		<category><![CDATA[Pursuit of Happiness]]></category>
		<category><![CDATA[apartheid]]></category>
		<category><![CDATA[colour bar]]></category>
		<category><![CDATA[discrimination]]></category>
		<category><![CDATA[Gary Becker]]></category>
		<category><![CDATA[Mine Workers' Union]]></category>
		<category><![CDATA[minimum wage]]></category>
		<category><![CDATA[south africa]]></category>

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		<description><![CDATA[One of my favorite lines in the classic movie The Magnificent Seven comes when a traveling salesman and his partner offer to pay the local undertaker to haul a dead Indian to boot hill. The undertaker refuses. He&#8217;d like to oblige, he explains, but the townsfolk are so prejudiced against burying Indians alongside whites that [...]]]></description>
			<content:encoded><![CDATA[<p>One of my favorite lines in the classic movie <em>The Magnificent Seven</em> comes when a traveling salesman and his partner offer to pay the local undertaker to haul a dead Indian to boot hill. The undertaker refuses. He&#8217;d like to oblige, he explains, but the townsfolk are so prejudiced against burying Indians alongside whites that he can&#8217;t persuade his driver to haul the body. One of the salesmen says, “He&#8217;s prejudiced too, huh?” The undertaker replies, “Well, when it comes to a chance of getting his head blown off, he&#8217;s downright bigoted.”</p>
<p>Experience with economic freedom illustrates the opposite point: When it comes to saving their economic lives, even otherwise-prejudiced people are downright tolerant. The reason is that markets make people pay for discriminating unless they&#8217;re discriminating in favor of the productive. Moreover, governments and government officials rarely bear a cost for, and often benefit from, discriminating against unpopular people, which is why the greatest horror stories of discrimination are about governments.</p>
<p>The insight that markets break down discrimination is not new. Over 200 years ago Voltaire wrote: “Go into the London Stock Exchange. . . and you will see representatives of all nations gathered there for the service of mankind. There the Jew, the Mohammedan, and the Christian deal with each other as if they were of the same religion, and give the name of infidel only to those who go bankrupt.”</p>
<p>Voltaire was pointing out that people on the London Stock Exchange wanted so much to make money that they were willing to deal with others who had different religions and cultural backgrounds. This seems an obvious insight, but apparently it is not. How often have you heard people denounce businessmen for ruthlessly pursuing profits and, in the next breath, castigating those same businessmen for discriminating against a minority group simply because they&#8217;re a minority? Well, which is it? Are they trying to maximize profits or are they discriminating? It can&#8217;t be both.</p>
<h4>Institutionalized Discrimination</h4>
<p>Think about the most notorious examples of racism, and the odds are high that you will think of a government implementing it and private citizens, out of the profit motive, opposing it. Take South Africa&#8217;s apartheid. Please. The apartheid regime and the “colour bar” that preceded it illustrate both points. From the early 1920s to the early 1990s, the South African government put barriers in the way of employers&#8217; hiring black people for the plum jobs, especially, early on, in mining. In other words, the government officially enforced discrimination. Among the strongest opponents of this discrimination and the strongest advocates of tolerance were white employers. They hated that the government prevented them from hiring qualified black people to work in mines and elsewhere. Interestingly also, among the strongest supporters of the colour bar and, later, apartheid were white labor unions.</p>
<p>Indeed, something happened under the colour bar in 1923 that is so striking that the story should be told by parents everywhere to their children and talked about incessantly in coffeehouses. It was a strike by members of the powerful white Mine Workers&#8217; Union, who were protesting white mine owners&#8217; plans to hire less-expensive black workers. The 12-word banner that they proudly carried through the streets read, “Workers of the world unite, and fight for a white South Africa.” This Karl-Marx-meets-David-Duke slogan is further evidence of the connection between government power (socialism is the ultimate in government power) and racial discrimination. Interestingly, the union received support for this strike from its allies in the South African Labour Party (SALP), formed in 1908 with the explicit goal of achieving privilege for white workers. The SALP was modeled intentionally on the British Labour Party, an avowedly socialist party.</p>
<p>And if you think something like that would never happen in the United States, then consider the origins of the minimum-wage law. The main proponents of the minimum wage were northern unions that wanted to harm their lower-wage southern competition, many of whom were black. This goal animated unions as recently as the 1950s. At a 1957 hearing on increasing the minimum wage, a northern U.S. Senator who favored the increase stated: “Of course, having on the market a rather large source of cheap labor depresses wages outside of that group, too—the wages of the white worker who has to compete. And when an employer can substitute a colored worker at a lower wage—and there are, as you pointed out, these hundreds of thousands looking for decent work—it affects the whole wage structure of an area, doesn&#8217;t it?”</p>
<p>Who was the senator? Here&#8217;s a hint: just four years later he was the President. His name: John F. Kennedy.</p>
<h4>Paying for Discrimination</h4>
<p>That markets break down discrimination is such an important finding that the economist who first showed it in a rigorous model, Gary Becker, earned the Nobel Prize, in part, for that work. In his book <em>The Economics of Discrimination</em>, Becker pointed out that free markets make discriminators pay for discriminating because they give up opportunities to work with productive people. That doesn&#8217;t mean, he noted, that people in a free market will never discriminate; the most extreme racists and bigots will often be willing to pay the price for discriminating. But pay they will.</p>
<p>Becker&#8217;s book pointed out that the wage differential between black and white workers of a given ability and experience level is a measure of the remaining discrimination against black workers; the larger the differential, other things equal, the more discrimination black workers face. This insight has been abused two ways in discrimination lawsuits in the United States. The statistical abuse is to assume that the whole wage differential between blacks and whites is due to discrimination rather than to other factors that the researcher has failed to measure. Yet, as virtually every economist who studies wage data will admit, you can never account for all factors, especially those that you can&#8217;t observe. You can&#8217;t know someone&#8217;s earnings simply by knowing that person&#8217;s age, experience, union affiliation, and education. Many people are the same age as Bill Gates and are similar in all other respects, but none of them has close to his level of wealth.</p>
<p>The second abuse of Becker&#8217;s insight is an even more fundamental breach of justice. Workers who feel discriminated against sometimes sue their employers, often seeking compensation. What they fail to recognize is that these employers, who actually hired blacks and other minorities, are helping to eliminate discrimination. To the extent that lower wages are due to discrimination, they are caused by those not hiring people in the discriminated-against group. But haven&#8217;t we all heard of the minister who blames those present for the low turnout?</p>
<p>It should be noted, though, that the U.S. economy is not free but hampered by many anticompetitive government interventions, such as licensing. Yet competition is the key to minimizing discrimination. Thus those who oppose bigotry could do no better than to work to eliminate all such interventions.</p>
<p>More fundamentally, though, people should be free to discriminate. Freedom includes freedom of association, the freedom to choose whom you work for and whom you hire. Employees are free to discriminate against employers for any reason they wish; employers should have the same freedom. Let&#8217;s have markets, not governments, punish those who exercise their prejudices.</p>
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		<title>Scapegoating Gun Owners in South Africa</title>
		<link>http://www.thefreemanonline.org/featured/scapegoating-gun-owners-in-south-africa/</link>
		<comments>http://www.thefreemanonline.org/featured/scapegoating-gun-owners-in-south-africa/#comments</comments>
		<pubDate>Fri, 01 Feb 2002 08:00:00 +0000</pubDate>
		<dc:creator>James Peron</dc:creator>
				<category><![CDATA[Featured]]></category>
		<category><![CDATA[African National Congress]]></category>
		<category><![CDATA[ANC]]></category>
		<category><![CDATA[Firearms Control Act]]></category>
		<category><![CDATA[gun ownership]]></category>
		<category><![CDATA[legal gun owners]]></category>
		<category><![CDATA[rape]]></category>
		<category><![CDATA[SACP]]></category>
		<category><![CDATA[south africa]]></category>
		<category><![CDATA[South African Communist Party]]></category>
		<category><![CDATA[Umkhonto we Sizwe]]></category>
		<category><![CDATA[unintended consequences]]></category>
		<category><![CDATA[violent crime]]></category>

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		<description><![CDATA[A small neighborhood grocery store had just opened for business. Without warning five armed men entered and started shooting randomly. Agostino De Andrade was hit by a bullet, but he managed to draw his gun and fire back. Store manager Nelson De Freitas drew his .45 pistol. He said: &#8220;Three men were shooting my boss. [...]]]></description>
			<content:encoded><![CDATA[<p>A small neighborhood grocery store had just opened for business. Without warning five armed men entered and started shooting randomly. Agostino De Andrade was hit by a bullet, but he managed to draw his gun and fire back. Store manager Nelson De Freitas drew his .45 pistol. He said: &#8220;Three men were shooting my boss. They saw me and began to fire at me, so I emptied my pistol at them.&#8221; Witnesses say that one shopper and another store employee also pulled guns and fired at the murderous gang. Finding themselves suddenly, and unexpectedly, outgunned the criminals fled for their getaway vehicle. De Freitas and some customers chased them. Another customer just pulling up to the shop was also armed and joined the battle. De Andrade&#8217;s wife, Maria, told the press: &#8220;When I heard the commotion I ran out with my gun. But before I could do anything a customer took it and began shooting at the car.&#8221; De Freitas reloaded his weapon and continued firing. A gas-station owner from across the road pulled out his gun and fired at the gang as well.</p>
<p>In five minutes the shootout was over. But three members of the gang were dead. Police said that one of them had at least 17 bullets in him. Two of the surviving gang members fled the scene but one, who was wounded, was easily captured by citizens who had pursued him.</p>
<p>Not far away, and only a few weeks later, two thugs met a similar fate. It was early evening and George Myburg (not his real name) was standing on his front lawn. A couple of friends had just pulled up to visit him. But as they were getting out of the car, two armed men approached them. One gunman was screaming in a crazed manner to the other: &#8220;Shoot him. Kill him.&#8221; Another visitor at the house was standing just a few yards away when this happened. He pulled his pistol, aimed, and fired. He killed one and critically wounded the other. In three minutes it was over.</p>
<p>Last June Heinrich Nel, a slight and shy 15-year-old stayed home ill while his family went to church. The last thing his father had told him before leaving was to remember that a revolver was in the cupboard next to the bed in his parent&#8217;s room. Heinrich was sleeping on his parents&#8217; bed when he heard the family dachshund barking wildly. Looking out the window, the boy saw four men wearing balaclavas. Two were carrying guns, one of which was an AK-47. The boy called his grandmother next door to warn her. But before he could do anything else the men grabbed him violently twisting his arms behind his back. The boy fought back, pushed his attacker away, grabbed the pistol, and began firing.</p>
<p>Taken by surprise the four men fled the bedroom with the boy following firing repeatedly at them. Heinrich had been trained in the use of guns starting when he was seven. The boy fled to his grandmother&#8217;s, and the attackers made off for parts unknown. Heinrich&#8217;s father, a former policeman, said: &#8220;He&#8217;s my hero. I am so proud of him. This was our worst nightmare but we never thought it would really happen.&#8221;</p>
<h4>Crime Explosion</h4>
<p>These incidents are not particularly unusual-at least not for South Africa, where all three took place. An explosion of violent crime, since the African National Congress (ANC) took power, has resulted in hundreds of South Africans walking the streets armed.</p>
<p>For the reporting year 1975-76 there were 6,000 murders in South Africa. By 1985 the total had risen to 8,959. By 1995 it had almost tripled to 25,782. Since then the number of murders has hovered around 25,000 per year. Twenty-five years ago the number of rapes stood around 15,000 per year. Now it averages around 50,000. During the same period robberies went from about 38,000 to 150,000. In the Johannesburg area about one in four homes is burglarized over a one-year period. In 1998 alone there were almost 800 attacks on farms and 134 farmers were murdered.<a href="http://www.fee.org/vnews.php?nid=5360#1"><sup>1</sup></a> For over a year the government put a moratorium on crime statistics, arguing that the methods used to collect them lead to errors. When the moratorium was lifted the new statistics showed that while a few categories of crime declined, the total number of serious crimes had in fact increased.</p>
<p>Many South Africans see gun ownership as their only option. The centralized national police force has become a toothless tiger. Mismanagement and corruption have taken their toll. Officers are being hired to meet racial quotas, but many of them cannot read, write, or even drive a patrol vehicle. Many simply do not turn up for work at all. In Johannesburg there are 94 police officers absent on any average day. The metropolitan area, with over 2.5 million people, only has 3,410 police officers to cover all shifts. The <em>Mail &amp; Guardian</em> reported that during a 17-month period 340 officers were charged with helping prisoners escape; 195 with armed robbery; over 7,000 with assault; 306 with corruption; 291 with fraud; 332 with murder; 16 with operating a brothel; 149 with rape; 171 with robbery; 1,550 with theft; and 130 with stealing cars. These charges alone amount to over 10 percent of the active police force.<a href="http://www.fee.org/vnews.php?nid=5360#2"><sup>2</sup></a></p>
<p>Another reason for the explosion of crime is that crime does pay, at least in South Africa. In 1997 there were 13,011 car hijackings. But there were only 1,099 prosecutions and only 209 convictions. Less than 2 percent of car hijackings lead to conviction. Some 85 percent of murderers are never convicted, and the same is true for 93 percent of all rapists.<a href="http://www.fee.org/vnews.php?nid=5360#3"><sup>3</sup></a></p>
<p>So how does the South African government intend to battle crime? By cracking down on the private ownership of firearms. New legislation has made it significantly more difficult for individuals to legally own firearms. Of course, the legislation has no effect on the illegal ownership of any weapons by criminals, including the state&#8217;s &#8220;lost&#8221; fully automatic weapons.</p>
<p>One argument for the crackdown is that criminals steal guns from private citizens. But the National Firearms Forum (NFF) contends that less than 1 percent of privately held guns are stolen in any one year. It says that government documents indicate that 200,000 government-owned weapons have gone missing. A spokesman for the Department of Safety and Security admitted that from 1990 to 1999, 14,636 firearms issued to police officers were stolen or lost. The NFF notes that &#8220;the government&#8217;s own security services have been a far greater source of stolen firearms than the private sector.&#8221; The NFF also argues that only one out of 200 armed offenses is committed with a licensed gun, clearly indicating that the legal ownership of firearms is not the source of weapons for criminals. A study commissioned by Gun-Free South Africa, specifically to show negligence of firearms owners, failed to produce any evidence of negligence.<a href="http://www.fee.org/vnews.php?nid=5360#4"><sup>4</sup></a></p>
<p>According to &#8220;South Africa Survey 1999-2000,&#8221; a total of 29,550 weapons were stolen with 2,420 of them recovered. That&#8217;s one gun stolen per 1,373 people. The government admits that 1,802 weapons were stolen from police officers, a rate 22 times higher than among civilians, or one gun per 60 officers.</p>
<p>Armed criminal attacks have become a daily occurrence. If privately owned weapons are not being used, where did all the guns come from? One possible source, which the ANC government is quick to ignore, is its own party structure. For years the ANC, in a joint effort with the South African Communist Party (SACP), engaged in an &#8220;armed struggle&#8221; to overthrow the apartheid government. During that period the armed wing of the ANC and SACP, Umkhonto we Sizwe, smuggled in tens of thousands of firearms&#8211;weapons that for obvious reasons were never licensed. A favorite weapon in the ANC underground was the Soviet built AK-47, which has been regularly used for bank robberies and cash-in-transit heists. Former Umkhonto guerrilla Colin Chauke turned out to be one of the kingpins in the heist gangs. He was also the ANC councilor for Winterveldt, Pretoria. When arrested he had 1.4 million Rand in cash. After his arrest he &#8220;walked&#8221; out of prison but was later seen at a birthday party for a member of the Cabinet.</p>
<p>Yet the government has implied that the rise in crime levels is somehow attributed to legal gun ownership. Contrary to government belief, massive increases in crime levels did not follow massive increases in gun ownership. No evidence has been presented showing gun ownership behind the crime wave. But there is plenty of other evidence that shows other causes: such as police corruption and inefficiency, and low conviction rates. Alex Holmes, NNF chairman, has pointed out: &#8220;By world standards South Africa has a relatively low ratio of firearm ownership. Lower than every major European country and far lower than countries such as Canada, Australia and New Zealand. Canada, for instance has five times as many firearms per capita as South Africa.&#8221;</p>
<p>Holmes points out that neighboring Swaziland has an almost complete ban on gun ownership yet the murder rate there is 20 percent higher than in South Africa. The fact is that legally owned firearms are almost never used in the commission of crime. Yet the new legislation only targets legal owners of guns. M.E. George, chairman of the Parliamentary Portfolio Committee, which held hearings on the Firearms Control Bill, admitted that there was no point in making laws for criminals. This despite denials by Minister of Safety and Security Steve Tschwete that the new law did not target licensed firearm owners.</p>
<h4>Firearms Control Act</h4>
<p>Under the Firearms Control Act legal gun owners are allowed to own only one handgun for self-defense. Firearms above that limit, unless dedicated for sporting purposes, have to be disposed of within 60 days or handed over to the state for destruction without compensation. Under the new law all current firearm licenses will remain valid for only five more years. After that anyone wishing to continue owning a firearm will be required to obtain a &#8220;competency certificate,&#8221; valid for five years only, from an accredited training organization. Competency will include firearms handling as well as knowledge of the law. A need for self-defense or sport must be shown. Self-defense licenses are valid for two years only, and sportsmen, hunters, and collectors must belong to an accredited club or organization. All accredited organizations will be required to forward details of members and their activities to the Central Firearms Registry.</p>
<p>Although the new Act provides for licensing for self-defense, implementation of the clause is left up to police officials. Already it is becoming clear that government is using its discretionary powers under the law to deny license applications. According to the opposition Democratic Party (DP), about one-third of all applications are turned down, many for illegal reasons. According to the DP, applicants were rejected on the basis of gender, age, marital status, and economic circumstance. One applicant&#8217;s refusal said: &#8220;The applicant mentioned that she is married and would therefore have a husband for protection who could be a firearm owner. Applicant mentioned that she is afraid of high crime rate, but it doesn&#8217;t seem that she have [sic] experienced problems in the past, or was a victim of any crime.&#8221; Another refusal said: &#8220;Applicant is illiterate . . . has no telephone number.&#8221; And another: &#8220;Being single the applicant has no dependents to protect and no property for that matter. The life of this applicant is not at risk at any time and his motivation does not convince the decision officer.&#8221;<a href="http://www.fee.org/vnews.php?nid=5360#5"><sup>5</sup></a></p>
<p>Even the government admitted that the new act was badly written and has ordered several rewrites. One criticism was that a gun owner would need a permit for his gun, but if he took the gun apart for cleaning he would need a permit for each separate piece and would not be permitted to make even minor repairs or improvements.</p>
<p>DP Member of Parliament Douglas Gibson has pointed out that guns currently legally owned will have to be disposed of or handed over to the state. Some estimates put the number of these &#8220;excess&#8221; firearms at 500,000 for the first year. Realistically the number is probably larger. There are approximately 1.9 million licensed gun owners in South Africa who currently hold licenses for 3.5 million firearms. Limiting ownership to one gun per license holder would mean that that there are probably 1.6 million excess firearms.</p>
<p>Many legal gun owners, who are almost never involved in criminal activities, will get rid of their &#8220;excess&#8221; guns any way they can before the ban comes into effect, especially since confiscation by the state is without compensation. Gibson asks: &#8220;Will this not increase the pool of illegal firearms and flood the market with cheap weapons, making them more accessible and the victims of crime more vulnerable?&#8221;</p>
<p>The new law also states that any person would be &#8220;presumed guilty&#8221; of illegally possessing a firearm if he is in a vehicle with other people in which a firearm is found. A driver of a car is also in violation of the law if any passenger in his car is carrying an unlicensed firearm. A similar fate awaits any property owner if even a single cartridge is found anywhere on his property. And even licensed firearms owners will face ten years in prison and loss without compensation of all their firearms for simply leaving their licenses at home.</p>
<p>Toward the end of July, the South African police orchestrated a series of raids on the homes of licensed firearms owners. Captain Ntabiseng Mazibuko said the raids were conducted to see if gun owners were adhering to the new &#8220;rules and regulations.&#8221; The police claim that &#8220;Every gun owner has a responsibility to keep his or her gun in a safe, secure place.&#8221; Captain Mazibuko says: &#8220;Police can actually confiscate your gun if they feel that it is kept in an unsafe place.&#8221;<a href="http://www.fee.org/vnews.php?nid=5360#6"><sup>6</sup></a></p>
<p>In keeping with government policy, the new legislation also confers unspecified powers on the government. This bill says: &#8220;The Minister may by notice in the Gazette, from time to time, make regulations for all or any of the following purposes: -to provide for any other matter that the Minister may consider expedient to promote the purposes of this Act.&#8221; In other words the new firearms act gives the South African government the power to do anything it wishes provided it helps promote gun control and confiscation. And unlike legislation, the new regulations will not have to be debated or open to public input.</p>
<p>Finally, the Firearms Control Bill creates &#8220;gun free&#8221; zones where weapon ownership would be illegal. Churches, schools, hospitals, bars, and shebeens (illegal bars) were proposed right away for this category. But now government officials are talking about adding entire neighborhoods to the list&#8211;particularly black townships with high crime rates.</p>
<p>The new legislation was drafted by a private nongovernmental organization, the Institute for Security Studies (ISS). The ISS drafted the legislation with funds supplied by the British government. According to Minister Tshwete additional funds for the drafting were supplied by the U.N. Office for Drug Control and Crime Prevention as well as the U.N. Development Program.</p>
<p>The South African Law Commission has also recommended a victim-compensation policy that targets gun owners. Because of the high rape levels in the country, the commission first suggested 2,000 Rand in compensation to anyone reporting that she has been raped. The government naively assumes that reported rapes will remain steady and thus the compensation will cost some 98 million Rand. Any first-year economics student would tell you that reported rapes will, in fact, increase massively especially since, according to the last census, well over 2 million South Africans have incomes below 6,000 Rand per year. And since that census, unemployment has been rising by about 100,000 per year.</p>
<p>The compensation plan is to be financed by taxing ammunition and guns at higher rates. Yet studies in the United States, according to Douglas Laycock, show &#8220;That there is no evidence that hunters or gun enthusiasts are disproportionately prone to rape. One study found no correlation between reported incidents of rape and the number of hunting licenses issued in a jurisdiction; another study found statistically significant negative correlations after controlling for population. A third study found no correlation between rape and the number of subscriptions to gun and hunting magazines. A fourth study found no correlation between gun ownership and attitudes toward feminism. Guns are used in only 9 percent of all rapes and attempts, and it is a reasonable guess that nearly all of these are handguns.&#8221;<a href="http://www.fee.org/vnews.php?nid=5360#7"><sup>7</sup></a> Under this compensation plan gun owners are being targeted to pay for crimes they are not likely to commit.</p>
<p>There is, in fact, reason to believe that making it more expensive to own guns, thus limiting gun ownership, will lead to higher rape rates as a consequence. One major rape study done by Brandeis University found that woman who forcibly resist rape are far less likely to be raped than women who use nonforceful responses. The authors of the study said: &#8220;Such nonforceful verbal, sex-stereotypical responses (e.g., begging, pleading, and reasoning) following violent physical attacks might thus coincide with how many rapists want a woman to act.&#8221;<a href="http://www.fee.org/vnews.php?nid=5360#8"><sup>8</sup></a></p>
<p>John Lott&#8217;s study of crime, &#8220;More Guns, Less Crime,&#8221; shows that as states legalize the carrying of concealed weapons, crime rates, including that of rape, decreased significantly.<a href="http://www.fee.org/vnews.php?nid=5360#9"><sup>9</sup></a> In a study published in the <em>Journal of Legal Studies</em>, Lott and David Mustard looked at crime data from all 3,054 U.S. counties from 1977-92. When a county changed gun-control laws so that officials were required to issue gun licenses on request, thus making gun ownership much easier, all major crimes declined. Rape declined in these counties by 5.2 percent. The study showed that if less-restrictive gun laws had been passed in all the counties, there would have been 1,414 fewer murders, 4,177 fewer rapes, 11,898 fewer robberies, and 60,363 fewer aggravated assaults.<a href="http://www.fee.org/vnews.php?nid=5360#10"><sup>10</sup></a></p>
<p>South Africa&#8217;s assault on gun ownership is a boon to criminals. Gun owners are being penalized because the government has decided that legal and only legal gun ownership should be radically reduced. And all this is being done by the African National Congress, a party that came into power largely as the result of protracted armed struggle that it carried out against the previous government.</p>
<hr /><em><a href="mailto:peron@gonet.co.za?subject=Feb. 2002 IOL">Jim Peron</a> is executive director of the Institute for Liberal Values in Johannesburg, South Africa. </em></p>
<ol>
<li><a name="1"></a>All crime statistics come from various editions of &#8220;South Africa Survey,&#8221; published yearly by the South African Institute of Race Relations. The &#8220;Survey&#8221; is the bible of statistics on all aspects of life in South Africa.</li>
<li><a name="2"></a>Jim Peron, Die, the Beloved Country? (Johannesburg: Amagi Books, 1999), pp. 95-112.</li>
<li><a name="3"></a>&#8220;South Africa Survey, 1997-1998,&#8221; pp. 23-53.</li>
<li><a name="4"></a>Antony Altbeker, &#8220;Are South Africans Responsible Firearm Owners?&#8221; Policing Programme, Graduate School of Public and Development Management, University of Witwatersrand, commissioned by Gun-Free South Africa.</li>
<li><a name="5"></a>Hugo Hagen, &#8220;Broadside Fired at Gun License Abuse,&#8221; The Citizen, August 1, 2001, p. 9.</li>
<li><a name="6"></a>Carol Hills, &#8220;Row as Police Raid Gun Owners,&#8221; The Citizen, August 2, 2001, p. 1.</li>
<li><a name="7"></a>Quoted in Mary Zeiss Strange&#8217;s &#8220;Arms and the Woman: A Feminist Reappraisal,&#8221; in David Kopel, ed., Guns: Who Should Have Them? (Amherst, N.Y.: Prometheus Books, 1995), pp. 22-23.</li>
<li><a name="8"></a>Sarah E. Ullman and Raymond A. Knight, &#8220;Fighting Back: Women&#8217;s Resistance to Rape,&#8221; Journal of Interpersonal Violence, March 1992, p. 33, quoted by Strange.</li>
<li><a name="9"></a>John R. Lott, Jr., More Guns, Less Crime (Chicago: University of Chicago Press, 1998), p. 137.</li>
<li><a name="10"></a>John R. Lott, Jr., and David B. Mustard, &#8220;Crime, Deterrence and Right-to-Carry Concealed Handguns,&#8221; Journal of Legal Studies 26 (1997), p.1.</li>
</ol>
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		<title>The Sorry Record of Foreign Aid in Africa</title>
		<link>http://www.thefreemanonline.org/featured/the-sorry-record-of-foreign-aid-in-africa/</link>
		<comments>http://www.thefreemanonline.org/featured/the-sorry-record-of-foreign-aid-in-africa/#comments</comments>
		<pubDate>Wed, 01 Aug 2001 08:00:00 +0000</pubDate>
		<dc:creator>James Peron</dc:creator>
				<category><![CDATA[Featured]]></category>
		<category><![CDATA[Africa]]></category>
		<category><![CDATA[artificial nation-states]]></category>
		<category><![CDATA[colonialism]]></category>
		<category><![CDATA[debt forgiveness]]></category>
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		<category><![CDATA[Ethiopia]]></category>
		<category><![CDATA[foreign aid]]></category>
		<category><![CDATA[government-to-government aid]]></category>
		<category><![CDATA[imperialism]]></category>
		<category><![CDATA[interventionism]]></category>
		<category><![CDATA[Marxist autocratic regimes]]></category>
		<category><![CDATA[Mengistu Haile Mariam]]></category>
		<category><![CDATA[Millennium Africa Recovery Program]]></category>
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		<category><![CDATA[Robert Mugabe]]></category>
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		<description><![CDATA[For almost half a century the countries of Africa have been awash in aid. Hundreds of billions of dollars have been given to African governments. More billions were lent to these same governments. Countless tons of food have inundated the continent, and swarms of consultants, experts, and administrators have descended to solve Africa's problems.]]></description>
			<content:encoded><![CDATA[<p>For almost half a century the countries of Africa have been awash in aid. Hundreds of billions of dollars have been given to African governments. More billions were lent to these same governments. Countless tons of food have inundated the continent, and swarms of consultants, experts, and administrators have descended to solve Africa&#8217;s problems. Yet the state of development in Africa is no better today than it was when all this started. Per capita income, for most of Africa, is either stagnant or declining.</p>
<p>Just a few years ago a World Bank report admitted that 75 percent of their African agricultural projects were failures.<a href="#1"><sup>1</sup></a> Other aid agencies weren&#8217;t any luckier. Operation Mils Mopti in Mali was supposed to increase grain production but the government imposed “official” prices on the grain and had to force farmers into selling their crops at these below-market rates. As a result grain production fell by 80 percent.<a href="#2"><sup>2</sup></a> In Senegal $4 million was spent to increase cattle production in the Bakel region. But in the end only 882 additional cattle were being reared there.<a href="#3"><sup>3</sup></a></p>
<p>In Northern Kenya, Norwegian aid agencies built a fish-freezing plant to help employ the Turkana people. But after completion it was discovered that the plant required more power than was available in the entire region.<a href="#4"><sup>4</sup></a> In another aid fiasco, $10 million was spent in Tanzania to build a cashew-processing plant. The plant had a capacity three times greater than the country&#8217;s entire cashew production, and the costs were so high that it was cheaper to process the cashews in India instead.<a href="#5"><sup>5</sup></a></p>
<p>In South Africa over $2 million donated by the European Union was used to stage an “AIDS awareness” play, Sarafina II. While the funds provided a luxury bus for cast and crew, they did little to educate the public about AIDS. AIDS experts condemned the play as a waste of money—it consumed 20 percent of South Africa&#8217;s entire AIDS budget—and said it contained inaccurate information as well. A heavily promoted showing of the play in Soweto was attended by fewer than 100 people. The play was pulled but the funds were never recouped. The EU insists that none of its funds were used on the project, but then-Minister of Health Nkosazama Zuma disputes that.<a href="#6"><sup>6</sup></a></p>
<p>Debacles such as these are almost benign. But foreign aid is also being used in patently destructive, and sometimes genocidal, ways. The Marxist dictatorship of Ethiopia&#8217;s Mengistu Haile Mariam was a major recipient of donor funds, a portion of which was used to forcibly resettle large segments of the population. One Ethiopian official said: “It is our duty to move the peasants if they are too stupid to move by themselves.”<a href="#7"><sup>7</sup></a> Donor funds, earmarked for famine relief, were instead used to buy trucks for the resettlement scheme. Relief aid was also intentionally kept away from some of the most severely affected areas because it suited Mengistu&#8217;s regime to starve its opponents. Relief ships were held for ransom and charged $50.50 per ton for permission to unload their aid, some of which was confiscated to feed the army. The <em>New York Times</em> reported that aid officials believed that Mengistu&#8217;s regime sold some of the food aid on the world market to finance the purchase of arms.<a href="#8"><sup>8</sup></a></p>
<p>But Ethiopia is not the exception. The Congo also sold donated food supplies and used the funds to purchase an arms factory from Italy.<a href="#9"><sup>9</sup></a> The more peaceful Mauritius took donated rice, which it insisted be of high quality, and diverted it to tourist hotels.<a href="#10"><sup>10</sup></a></p>
<p>Donated money is just as likely to go astray. President Mobutu of Zaire managed to build a fortune in his Swiss bank account that was estimated as high as $10 billion.<a href="#11"><sup>11</sup></a> Kenyan human-rights activist Makau Wa Mutua lamented: “Since independence in Africa, government has been seen as the personal fiefdom a leader uses to accumulate wealth for himself, his family, his clan. He cannot be subjected to criticism by anyone, and everything he says is final.”<a href="#12"><sup>12</sup></a></p>
<p>Zimbabwe&#8217;s Robert Mugabe is notorious for his extravagant shopping trips to Harrod&#8217;s even if he has to confiscate planes from the national airlines to take them.<a href="#13"><sup>13</sup></a> Mugabe&#8217;s regime has used systematic violence in attempts to stay in power. And according to the Johannesburg Star, his thugs have “looted” aid to help finance their attacks. Some $1 million is supposedly at stake. Asger Pilegaard, the EU delegation head in Zimbabwe, has demanded an investigation saying: “We cannot accept that the humanitarian aid financed by European taxpayers is not arriving to the people for whom it was originally intended.”<a href="#14"><sup>14</sup></a></p>
<p>And while hungry faces are used on posters and in media reports to sell the virtues of foreign aid, it is the hungry who rarely see any of the funds. Poverty may be used to justify the programs, but the aid is almost always given in the form of government-to-government transfers. And once the aid is in the hands of the state it is used for purposes conducive to the ruling regime&#8217;s own purposes.</p>
<p>Since moving to black-majority rule in 1980 Zimbabwe has regularly received financial aid to promote “land reform.” For 20 years the government used these funds to buy up land, which when “reformed” typically ended up in the hands of the ruling party&#8217;s elite. Land that was actually redistributed was turned into communal farms and given to peasants who didn&#8217;t have the know-how to run them. Many of the farms were pillaged for any saleable items and then deserted. About one-fourth of the communal farms are so unproductive that they require food aid just to prevent the farmers themselves from starving.<a href="#15"><sup>15</sup></a></p>
<h4>European Support</h4>
<p>Marxist autocratic regimes were often heavily financed by European governments—especially when those governments were in the hands of left-of-center parties. Italian journalist Wolfgang Achter reported that the Italian Socialist Party gave heavy financial backing to Somalia&#8217;s Marxist government of warlord Siad Barre, who used the funds to obtain arms and military advisers.<a href="#16"><sup>16</sup></a> Journalist Michael Maren reports that for ten years before the 1992 famine, Somalia was the “largest recipient of aid in sub-Saharan Africa,” but that most of the funds were “lost in the corrupt maze of the Somali government&#8217;s nepotistic bureaucracy.”<a href="#17"><sup>17</sup></a> Italy alone sent over $1 billion to fund projects in Somalia from 1981 to 1990 even though the regime was murdering its opponents. No wonder the New African Yearbook called Somalia “the Graveyard of Aid.”<a href="#18"><sup>18</sup></a></p>
<p>The <em>New York Times</em> reported that when President Julius Nyerere of Tanzania announced a radical Marxist program, “many Western aid donors, particularly in Scandinavia, gave enthusiastic backing to this socialist experiment, pouring an estimated $10 billion into Tanzania over 20 years.”<a href="#19"><sup>19</sup></a> Swedish economist Sven Rydenfelt wrote: “A decade of socialist agricultural policy had been sufficient to destroy the socioecological system.”<a href="#20"><sup>20</sup></a> The World Bank says that from 1965 to 1988 the Tanzanian economy shrank on average 0.5 percent each year and that personal consumption dropped by 43 percent.<a href="#21"><sup>21</sup></a></p>
<p>The Marxist regime of Samora Machel in Mozambique similarly destroyed that country&#8217;s agricultural output through price controls.<a href="#22"><sup>22</sup></a> But that was just one African nation among many that used this policy—all with the same disastrous results. Professor D. Gale Johnson, in testimony before a U.S. House Subcommittee, said that during the 1950s and 1960s per capita African food production remained relatively constant, but dropped dramatically beginning in the 1970s. “The decline in per capita food production was not due to a lack of resources,” said Johnson, “but to many factors that were primarily political in nature.”<a href="#23"><sup>23</sup></a></p>
<p>Most of the problems that African nations face today are self-inflicted. Africa is the last major bastion of heavily regulated markets. This has lead to stagnancy and decline. The continent itself is rich in resources, but the incentive to produce has been destroyed by government policies. The West is quite aware of this, but is too timid to do very much about it, and the aid bureaucracy keeps on delivering funds no matter how bad things get. Mengistu continued to receive aid while intentionally starving thousands and thousands of his citizens to death.<a href="#24"><sup>24</sup></a> Mugabe slaughtered thousands of opponents in the Matabeleland region of Zimbabwe, but aid continued unabated.<a href="#25"><sup>25</sup></a> Even when General Sani Abacha&#8217;s military regime in Nigeria, in the face of world opinion, executed human-rights activist Ken Saro-Wiwa, virtually nothing happened. Various Western governments protested by withdrawing their diplomats, but within a few months they were all back in place. The World Bank has admitted that “almost all” loans are fully disbursed to recipient nations “even if policy conditions are not met.”<a href="#26"><sup>26</sup></a> In a 1986 report it said that there was no evidence to show significant movement toward freer markets due to aid donations or policy restrictions.<a href="#27"><sup>27</sup></a></p>
<p>Various critics have repeatedly pointed out that foreign aid not only doesn&#8217;t encourage reform but often stifles it. Development economist Peter Bauer has said there is an inherent bias of government-to-government aid toward state control and politicization. “Foreign aid,” he argues, “has contributed substantially to the politicization of life in the Third World. It augments the resources of government compared to the private sector, and the criteria of allocation tend to favor government trying to establish state controls.”<a href="#28"><sup>28</sup></a></p>
<h4>Precolonial Period</h4>
<p>Prior to colonialization Africa had no such thing as the nation-state. It was a collection of hundreds and hundreds of distinct tribal cultures, many of which had long histories of antagonism toward one another. The European colonies merged these diverse tribes into the modern nation-state, which, as long as the central government was controlled by “neutral” Europeans, kept the conflicts to a minimum. But when European intellectuals abandoned colonialist theories for a Marxist-Leninist theory of imperialism, the Europeans pulled out almost overnight.</p>
<p>What they left behind was a series of artificial nation-states, which now exacerbated age-old tribal conflicts as each group attempted to grab the reins of power before their enemies could.</p>
<p>Meanwhile Europe decided to play the role of financial benefactor and poured aid into Africa. With aid as the primary source of economic power, the role of the state was increased relative to civil society and private industry. All this funding made statist solutions to problems all the more appealing since they could be financed with further grants. Bauer has noted that one result of that process was that the best and brightest in African countries were drawn to the state, like moths to the flame, instead of into private development.</p>
<p>Even when aid does reach the consumer it often comes at a high price for local producers. It is typically forgotten that most of the recipient countries have local industries and farms that often cannot survive the influx of “free” goods. The late economist David Osterfeld argued: “Aid has in many places actually destroyed the possibility for sustained economic growth by driving local producers, especially farmers, out of business.”<a href="#29"><sup>29</sup></a> Somali Abdirahman Osman Raghemade made the same point regarding medical aid: “Look into drug donations and how they destroyed our developing health system. We once had so many pharmacies here.</p>
<p>Pharmacists knew their jobs. Now there are people handing out drugs who are not trained because of the donated drugs from the international community that are so cheap.”<a href="#30"><sup>30</sup></a> A priest in Tanzania reported that farmers in his region simply stopped producing food because of the availability of free donated food.<a href="#31"><sup>31</sup></a> Osterfeld pointed out that a study of the U.N. World Food Program&#8217;s response to 84 emergencies showed “that it took an average of 196 days to respond” and that the European Economic Community took an average of 400 days. Osterfeld quotes agricultural expert Dennis Avery as saying that aid was “too late to relieve hunger but in time to depress prices for local farmers who tried their best to respond.”<a href="#32"><sup>32</sup></a></p>
<h4>Double Standard</h4>
<p>While foreign aid may on the whole be destructive to Africa, that does not mean the West is powerless to help impoverished Africans. But before it can accomplish any good in the region it will have to abandon its double standard. Westerners are terrified of criticizing a black-ruled country lest they be called racist.</p>
<p>Ghanaian economist George Ayittey complained: “White rulers in South Africa could be condemned, but not black African leaders guilty of the same political crimes.”<a href="#33"><sup>33</sup></a> Only when African governments are treated on the same moral basis as all other governments will reform and development be possible.</p>
<p>Some have called for the forgiveness of African debts. This would not be a bad thing, but it is quite useless if debt forgiveness is followed by more loans and aid as demanded by many African governments. It has probably reached the stage where debt repayment is impossible anyway. The economies of most African countries cannot produce enough to pay the debts, and never will as long as the same disastrous economic policies are continued.</p>
<p>Neither should the West be taken in by South Africa&#8217;s President Mbeki and his MAP (Millennium Africa Recovery Program). Mbeki speaks of development and trade—not aid—but then makes clear that he actually expects the West to continue pumping billions in aid into Africa. He wants this aid to come officially without conditions. Considering how “conditional” aid has been spent in the past, the idea of “unconditional” aid in the future is actually frightening. Mbeki&#8217;s plan also calls for the money to be spent regionally and not nationally. Mbeki clearly sees himself as the primary conduit through which aid will flow.</p>
<p>For some time the African National Congress government in South Africa has been looking to create what appears to be an African hegemony controlled by South Africa—the invasion of Lesotho recently by South Africa was one indication of that desire. And Mbeki has spent billions to purchase massive amounts of sophisticated weaponry for the express purpose of intervening in the rest of Africa.</p>
<p>Mbeki also told the World Economic Forum in Davos, Switzerland, that MAP aid would be used “to strengthen the capacity” of African states that he believes are too weak. Instead he envisions a continent-wide system of centralized planning run by strong national governments. He promises that Africa will rein in the dictators, yet Mbeki himself gave tacit support to the violence engineered by Mugabe&#8217;s regime in Zimbabwe.<a href="#34"><sup>34</sup></a> Mbeki&#8217;s objective is the last thing Africa needs, and this plan is another reason to end Western aid and loans.</p>
<p>What would be far more beneficial to African development would be the lowering of trade barriers. But African farmers will never be able to compete in the world market as long as Europe, for instance, continues to shower subsidies on their own spoiled farmers. Various protectionist groups in the United States, like the trade unions, are pushing for international treaties that include costly “environmental” and “labor” provisions for developing countries. While they cry crocodile tears about the environment and the state of working conditions for the poor of the Third World, they actually seem to be trying to limit competition from those same people. The net result will be a loss of jobs in poor countries in favor of highly paid unionized labor in the rich nations.</p>
<p>The inescapable fact is that African governments are destroying their own economies—often with aid from the West. And these same governments simply refuse to listen to advice given by non-Africans. Aid will continue to be misspent and good advice will continue to be ignored until the African leaders learn, on their own, what results come from their interventions. The only option for the West is one of benign neglect. Bring the consultants, experts, and advisers home and end the aid and the loans.</p>
<p>Trade barriers should be dismantled and African business permitted to compete as it can. One good business contract is worth more to Africa than a thousand consultants, and one new factory has more value than a hundred million dollars of aid. In the end, Africa will have to solve its own problems.</p>
<hr />
<h4>Notes</h4>
<ol>
<li><a name="1"></a> Graham Hancock, <em>The Lords of Poverty</em> (New York: Atlantic Monthly Press, 1989), p. 145.</li>
<li><a name="2"></a> James Bovard, “The Continuing Failure of Foreign Aid,” <em>Cato Policy Analysis 65</em>, January 31, 1986; <a href="http://www.cato.org/pubs/pas/pa065.html">www.cato.org/pubs/pas/pa065.html</a></li>
<li><a name="3"></a> Ibid.</li>
<li><a name="4"></a> Jennifer Whitaker, <em>How Can Africa Survive?</em> (New York: Harper &amp; Row, 1988), p. 75.</li>
<li><a name="5"></a> Whitaker, p. 76.</li>
<li><a name="6"></a> Jim Peron, <em>Die the Beloved Country?</em> (Johannesburg: Amagi Books, 1999), pp. 58–61.</li>
<li><a name="7"></a> Jim Peron, <em>Exploding Population Myths</em> (Chicago: Heartland Institute, 1995), p. 61.</li>
<li><a name="8"></a> <em>New York Times</em>, March 21, 1984, cited in Bovard. Also see David Osterfeld, <em>Prosperity versus Planning</em> (New York: Oxford University Press, 1992), p. 143.</li>
<li><a name="9"></a> Agency for International Development, Semiannual Report of the Inspector General, March 31, 1984, p. 32.</li>
<li><a name="10"></a> <em>Wall Street Journal</em>, July 2, 1984, cited in Bovard.</li>
<li><a name="11"></a> George B. N. Ayittey, <em>Africa in Chaos</em> (New York: St. Martin&#8217;s Press, 1998), p. 24.</li>
<li><a name="12"></a> <em>Washington Post</em>, September 9, 1991, A20, quoted in Ayittey, p. 33.</li>
<li><a name="13"></a> Andy Melone and Andrew Meldrum, “Battered Mugabe hits back as verdict looms,” <em>Guardian Limited</em> (UK), June 25, 2000, <a href="http://www.observer.co.uk/international/story/0,6903,336202,00.html">http://www.observer.co.uk/international/story/0,6903,336202,00.html</a>.</li>
<li><a name="14"></a> Grace Mutandwa, “Veterans invade textile plant in Bulawayo,” <em>The Star</em>, April 26, 2001, p. 5.</li>
<li><a name="15"></a> Jim Peron, <em>Zimbabwe: The Death of a Dream</em> (Johannesburg: Amagi Books, 2000), pp. 47–74.</li>
<li><a name="16"></a> <em>Washington Post</em>, January 24, 1993, C3, cited in Ayittey p. 54.</li>
<li><a name="17"></a> Michael Maren, <em>The Road to Hell: The Ravaging Effects of Foreign Aid and International Charity</em> (New York: The Free Press, 1997), quoted in Ayittey, p. 52.</li>
<li><a name="18"></a> Ayittey, pp. 52–53.</li>
<li><a name="19"></a> <em>New York Times</em>, October 24, 1990, p.A8, quoted in George B. N. Ayittey, <em>Africa Betrayed</em> (New York: St. Martin&#8217;s Press, 1993), p. 282.</li>
<li><a name="20"></a> Sven Rydenfelt, <em>A Pattern for Failure</em> (New York: Harcourt, Brace, Jovanovich, 1983), p. 121.</li>
<li><a name="21"></a> Ibid.</li>
<li><a name="22"></a> Bovard.</li>
<li><a name="23"></a> D. Gale Johnson, “World Food and Agriculture,” in Herman Kahn and Julian Simon, eds., <em>The Resourceful Earth</em> (London: Basil Blackwell, 1984), p. 73.</li>
<li><a name="24"></a> Peron, <em>Exploding Population Myths</em>, pp. 57–65.</li>
<li><a name="25"></a> Peron, <em>Zimbabwe</em>, pp. 13–14.</li>
<li><a name="26"></a> James Bovard, “The World Bank vs. the World&#8217;s Poor,” <em>Cato Policy Analysis 92</em>, September 28, 1987, <a href="http://www.cato.org/pubs/pas/pa092.html">www.cato.org/pubs/pas/pa092.html</a>.</li>
<li><a name="27"></a> Ibid.</li>
<li><a name="28"></a> Peter Bauer, “Western Guilt and Third World Poverty,” in Karl Brunner, ed., <em>The First World and the Third World</em> (Rochester, N.Y.: University of Rochester Policy Center, 1978), p. 162.</li>
<li><a name="29"></a> Osterfeld, p. 142.</li>
<li><a name="30"></a> Maren, p. 166.</li>
<li><a name="31"></a> Bovard, “The Continuing Failure of Foreign Aid.”</li>
<li><a name="32"></a> Osterfeld, p. 148.</li>
<li><a name="33"></a> Ayittey, <em>Africa Betrayed</em>, p. 279.</li>
<li><a name="34"></a> Peron, <em>Zimbabwe</em>, pp. 99–116.</li>
</ol>
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