Potential

The letter of Jourdon Anderson to his former master prods me to write down the thoughts on potential that have bumped around in my brain for many years. I, like Ta-Nehisi Coates who provided the link, was so astonished by the letter that I found it slightly suspicious at first. Just too amazingly brilliant and subtle to be authored by some anonymous person lost in the sands of history. Of potential ghost writers, Mark Twain was the first to come to mind, but I could easily imagine this being written by Frederick Douglass, or Lincoln, or William Lloyd Garrison, or... But, of course it is genuine, and it is a stark reminder of something I already knew, but do not hold in my mind every day (but probably should).

Great swaths of human brilliance have always been, and still are, lost to us and our posterity by the scourges of poverty, oppression, disease, famine, and war. Is is not certain that somewhere a brilliant poet just died of malaria in the Sahel? Or that a great mathematician lived his or her whole life eking out a bare subsistence on a Chinese farm 500 years ago? Or that an astonishing musical prodigy died from a tooth infection in the Amazon last century?

How many of these people have lived and died, unnoticed and unrealized? How many Einsteins, Douglasses, Lincolns, Euclids, Baryshnikovs, Darwins, Beethovens, Leonardos, and Michelangelos have toiled away their lives in obscurity, scratching and clawing each day for their very survival?

On the one hand, the question is obviously rhetorical, an exercise, essentially, in metaphysical speculation. But in another sense, I think not. We know that, in fact, desperate poverty has been the default state for the great mass of humanity, for almost all of our history. It is only within the last few hundred years that our knowledge, our science, technology, and, crucially, our social and economic institutions, have combined to begin to change this, to alter that default state and to produce the mere possibility for people to achieve their potential. So, I would say the question can actually be answered, not with precision, but nevertheless with accuracy:

How many? Almost all of them.

Mystery of Capital Rides On...

A well-written article at TCS by Peter Schaefer about unlocking the “dead capital” of the developing world, and what a huge opportunity it could be for everyone. I like just about everything he has to say, although I am curious as to why the name Hernando De Soto never comes up. (Answer: ah, I see, he does link to De Soto’s book, as I just did.) At any rate, my one quibble is with the assertion that (mostly) all the developing world needs (I’m paraphrasing and simplifying) is “America’s original blueprint”. That is, the work of the framers at the end of the 18th century, who, in his view, set up everything so well that our economy evolved into its potent, modern form as a matter of course, flowing inexorably from the framers’ genius. I would argue that it is a bit bigger than that. The true construction of America’s prosperity and freedom both started earlier and ended later than the era of the framing itself. To take them backwards, De Soto points out how the process of squatting, followed by formalized property rights, played out over a couple of centuries. This is something that Schaefer seems to acknowledge at certain points, but that gets lost in the simple assertion of the framers as the fount of all this goodness. The framers did some good work, but to the extent that this pattern is the root of modern wealth, it is as much a cultural phenomenon as a political one, or even more so. The framers recognized and helped formalize some of this approach, but the cultural values that gave birth to it before the framing, and perpetuated it afterwards, are really the key.

Property rights, and the securing thereof, are indeed key, but there is a crucial, fascinating, and paradoxical twist. A modern economy clearly relies, in part, on stable and secure property rights, but they cannot be entirely rigid and fixed! If they were, then they formalization process itself would never really work! If you respect the property rights of the wealthy landowners who nominally “own” all this land being squatted upon, then you can’t formalize the squatters’ rights. Indeed one “critique” I read of De Soto’s policy prescriptions suggested that his ideas made things worse because some official landowners go in and forcibly evict squatters when they see formalization coming. I put “critique” in scare quotes because I don’t think much of this line of criticism. Allowing the wealthy, “official” title holders to evict the squatters is absolutely ass backwards of the De Soto plan. You can’t say that an approach that does the exact opposite of the intended plan is the fault of the plan. You have to deal with the rich landowners up front, in whatever manner will work. I’d say in general you’re best advised to buy them off. Use the foreign aid money to do it. Most of the foreign aid to the poorest countries gets skimmed off and goes to the wealthy already, and this way you’d at least get some tangible return on the investment!