Curly, Moe, and Evita (cha-cha-cha!)

Craig Goodrich
Rant Magazine
November 1997

Some basic rules in politics — especially Presidential politics — never change. One of them we discussed a little last month: Promise peace and freedom, deliver more government and military flag-waving. This rule has been followed rigorously by almost every president since Woodrow Wilson. Bill Clinton, of course, is no exception; we now have troops in one hundred countries, a new record, and a major operation underway in a place known only in the "history" section of trivia games a couple of years ago. (The answer is — ta-daa! — Bosnia-Herzegovina!)

Another basic rule: When the going gets tough, the tough go abroad. What with fundraising, Paula Jones, and Whitewater all starting to bubble at once like methane in a swamp, our Nixonesque President has decided to tour Latin America.

Perhaps he will learn something there, if he keeps his new hearing aids turned up. A little more than a decade ago, Peruvian economist Hernando de Soto published a book that shook students of Latin politics right out of their wingtips. Entitled El Otro Sendero (The Other Path), it studied the shantytowns that had grown up around Lima.

De Soto discovered that a complete, functional, dynamic society was in operation there, small shops and service establishments thriving, families being raised in decent if not particularly fashionable surroundings, while the old downtown areas of the city were stagnating and crumbling.

After interviewing many of the shantytowns' residents and entrepreneurs, de Soto tried an experiment: getting a license to open a small store in downtown Lima. The result was interesting, though not particularly surprising — it took more than a year of full-time work to fill out the incredible array of applications required for all the authorizations involved, not to mention many thousands of dollars in fees (and of course mordidas — bribes).

The governmental barriers to starting a new business were essentially prohibitive for the budding entrepreneur. But since humans are an incredibly intelligent and adaptive species, they simply went to an area ignored by a government strangling in its own red tape, thus creating what de Soto called "the informal sector" of the economy. The same phenomenon was occurring around big cities all over Latin America, and indeed throughout the Third World.

(Remember that phrases like "black market", "underground economy", "money laundering", and so on don't really refer to people's actions, since these actions in themselves are quite peaceful, ordinary and unobjectionable — buying and selling goods and services. These phrases merely indicate the government's attitude towards performing them without permission from some bureaucrat.)

De Soto's study added a Latin dimension to the intellectual revolution taking place in economic thought throughout the world — a realization that government interference with free-market institutions produces stagnation, reduces growth, and perpetuates poverty.

By the mid-1980s, there had already been several wildly successful experiments in economic deregulation:

There is no particular mystery about the fundamental cause of these successes — freedom works! Human beings will solve problems in their own lives by using their unique knowledge and intelligence to address their own particular situations. They will cooperate with other human beings to establish institutions addressing common concerns. These institutions will be as varied as the situations they address, and they either will change and adapt effectively to meet new circumstances or will fade away and be replaced by different institutions, formed again by voluntary cooperation between those involved.

This view of society as a dynamic, infinitely varied and constantly changing system based on cooperative interaction between individuals is not particulary new; like many intellectual "revolutions" it is really a return to the insights of an earlier day — the Enlightenment individualism which inspired 18th-century philosophers and became known in the 19th century (as it is still known in most of the world today) as "liberalism".

Likewise, the communism, fascism, "welfare-state liberalism", and other forms of socialism that have made this century the bloodiest and most miserable in human history (despite incredible advances in productivity and technology) are a return to the feudal vision of an ignorant, undifferentiated mass of humanity ruled by a wise and privileged elite, who impose from above their expert solutions in every area of human interaction.

"Impose" — the crucial way in which a government edict differs from a cooperative, voluntary approach to some particular situation. The government says "this is the Official Solution to this Official Social Problem and if you don't do things the approved way you'll be fined or go to jail."

But there is no such thing as a "social problem". What may actually exist is a similar problem in each individual life of thousands or millions of individual human beings. These people live in different circumstances, each with unique resources, constraints, responsibilities, inclinations, and so on, and if left to themselves they will devise cooperative solutions to common problems, solutions particularly suited to the details of their existence and to the numerous intersecting communities of which they are a part.

Peron's inauguration, 1946 The single, official, one-size-fits-all government solution will not only be ineffective — because no single, rigid, legalistic prescription can possibly fit the incredible variety of different individual circumstances — but it will displace and preempt all cooperative efforts which do not fit its prescribed mold. So it will actually make the situation worse. It's like the Three Stooges trying to repair some appliance; the inevitable end is total destruction.

The great Spanish philosopher José Ortega y Gasset, watching the rise of Soviet communism and the fascism of Evita Perón's heroes Mussolini and Franco, wrote in 1929:

This is the gravest danger that to-day threatens civilisation: State intervention; the absorption by the State of all spontaneous social effort, that is to say, of spontaneous historical action, which in the long run sustains, nourishes, and impels human destinies...

The result of this tendency will be fatal. Spontaneous social action will be broken up over and over again by State intervention; no new seed will be able to fructify. Society will have to live for the State, man for the governmental machine. And as, after all, it is only a machine whose existence and maintenance depend on the vital supports around it, the State, after sucking out the very marrow of society, will be left bloodless, a skeleton, dead with that rusty death of machinery, more gruesome than the death of a living organism.

The United States is coming to resemble more and more the stereotypical "banana republic", its government simultaneously ineffective, tyrannical, self-absorbed, and ridiculous. So while Bill Clinton tours Latin America with his very own Evita on his arm, pinning medals on the leaders of the detested Latin political class, we can only hope that somehow the message of de Soto and Ortega y Gasset will be audible through the cocktail-party chatter.

But I wouldn't count on it.

Computer guru Craig Goodrich lives in a house in the woods in Elkmont, with his wife, two children, and five cats. He is the Huntsville district representative of the Libertarian Party of Alabama, a smoker, and a gun owner.