Arnold Kling  

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Free to Choose Media asks,


What institutions can enable the world's poor to realize their power and achieve prosperity?

The best blog answer can win $250. The forthcoming book, From Poverty to Prosperity, by yours truly and Nick Schulz, would say that the answers are probably local rather than global. That is, the institutions that work in a particular country will depend on cultural and historical factors that are peculiar to that county.

Having said that, my number one vote would be open immigration. My sense is that it is much easier for people to move to where there are institutions that are good for them than it is to try to design and impose institutions on people. (Yes, open immigration would have to be imposed on people, too.) Truly open immigration would be the biggest game-changer of all. Of course, because of that, anyone with an ounce of conservatism would be worried about unintended consequences, and such worries are reasonable.

If you don't have a blog, feel free to put your proposals here, and I will post some of them in a subsequent entry.

Do visit the contest link. The point is to promote a PBS video featuring Hernando de Soto that will premier on October 8.


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COMMENTS (25 to date)
Arthur_500 writes:

I'm curious if anyone has looked into the system developed in Minnesota a while back to help people off welfare? In this system people signed a contract with the State. If it was determined that people needed to learn how to look for a job, have specific training, child care, and who knows what else, then a contract was signed and people were expected to do their part.
People would have to learn how to get out of bed, dress properly, and go to class/ work. The State provided food, child care assistance, medical, etc. If the person got a job they still continued to collect public funds until the contract was up.
This sounds like the only way to get the unemployeable into a working situation and I admire the thought. I wonder how it has turned out and if it has been successful.

Philo writes:

What does it mean to say, "Open immigration would have to be imposed on people"? If X wants to curtail Y's freedom in some respect, but Z (perhaps a government) forces X to allow Y freedom in this respect, is Y's freedom being "imposed on" X?

In some cases I would say 'yes', in others 'no'. The immigration case looks like a prime candidate for a 'no'.

Prakhar Goel writes:

Bring back colonialism.

Barring a few aberrations like the early Congo (note, I said EARLY. Try reading this Time article (http://www.time.com/time/printout/0,8816,866343,00.html) to see how the Belgians significantly improved the Congo), the colonial governments provided a quality of governance unseen since their loss.

The answers aren't local but the problem is: the Africans are incompetent in the art of governance (as compared to Europeans and East Asians who aren't). They weren't particularly productive before the Europeans got there and now that the Europeans have left, they are even worse (probably because modern weaponry makes killing people so easy even a thirteen-year old could do it). We now have about half a century of reliable data supporting this point.

There are some (disguised) proposals along these lines (this post (http://unqualified-reservations.blogspot.com/2009/08/from-cromer-to-romer-and-back-again.html) discusses one such proposal, also where the time article is from).

Even your suggestion of immigration is pretty much the same thing. Immigration moves Africans from the incompetent governments of their (decidedly incompetent) peers to the modern governments of the US and Europe which are run mostly by ... rich white people.

In immigration, we move the people to the government. In colonialism, we move the government to the people. The difference is that the latter can be done for entire continents while the former is limited to a few million a year at best.

Carter writes:

I'm not sure why you are entitled to give away institutions others have built and sustained. That aside, allowing the hordes to move to where the institutions are good will ruin those institutions.

As Prakhar Goel notes, colonialism would help a greater number of people. Unlike immigration, it does not damage existing countries.

fundamentalist writes:

The only thing poor people need is secure property. They will take care of the rest. Of course, secure property requires the rule of law, honest judges and police and small government so that taxes are low.

tom writes:

Could you explain to an anti-open-immigration conservative what you mean by open immigration?

Is it 'open immigration' combined with full citizenship (voting rights, rights to federal and state welfare and health insurance benefits, federal retirement progams, subsidized home ownership programs, entitlement to be educated in their home language, etc..., with absolutely no picking and choosing the best and brightest?

And what would you expect the immediate inflows to the US would be like? Where would most of the people come from? How many would come each year? When would the US hit some type of new equilibrium, and what would it look like? How would the new people affect local, state and federal democracy?

My guess would be like Christopher Caldwell's new book Reflections on the Revolution in Europe mixed with some 1900's-era NYC and Boston, replicated all across the country, and with enormous numbers coming from the poorest countries with poor skill-sets for current US life.

Can you flesh out your vision for an anti-open-immigration conservative? To me, you seem like a 'suit' on immigration and a geek on everything else.

Arnold Kling writes:

I guess one way to try open immigration would be to have every country open up immigration slots to the highest bidders. If we offer better institutions, and we don't think we can absorb very many people in a short period of time, then we could charge a really high price. People who are in really poor countries might only be able to afford to move to somewhat better countries, until they can gradually climb the ladder and earn enough to pay the entry fee here.

The goal is to weaken the monopoly power of existing governments. I consider that monopoly power the root of much evil. If North Koreans could escape their government, they would. If I could escape Montgomery County government for a much better government a few blocks from where I live, I would.

The ideal world is open immigration, and competitive government without large territorial monopoly.

Niccolo writes:

Getting rid of the drug war and pardoning all inmates facing sentences for use or trafficking.

SheetWise writes:

Mr. Kling --

The US already has policies that allow "high bidders" to enter the US (it's actually prix fixe, not an auction).

What are your feelings on open emigration? Should US citizens be able to pay their taxes up to date and leave? They can't do that now, and the penalties appear to be getting more stringent.

How does the welfare state factor into your thinking?

L. Burke Files writes:

Contest Answer:

The solution to poverty is a freedom of choice and having that opportunity to choose. There is a bi-institutional solution to poverty, the first is a rigorous education and the second is getting government out of the way.

Follow up on comments on Freedom…

Freedom of immigration is a freedom to chose under which set and system of laws one wishes to live and work.

This choice is becoming illusory with the increasing effort under which laws are applied in an extra territorial nature. One may choose to live in Europe but because ones employer does work in the US one can run afoul of US law and be fined and or criminal charged. One may work in the US but because a person in a branch office ships a prohibited item or deals with a proscribed country – and while not illegal where the branch is located – since you as an owner and or supervisor should have known and prevented this act, you are charged. Lastly if you, small nation or large nation, do not adopt laws and tax policies similar to ours, you will be excluded from the worlds financial markets. All nations are moving to a common tyrannical form of government as opposed to dis-separate forms of tyrannical government.

Please also be mindful that an attack on capital is an attack on freedom, because without freedom of capital movement one is not free to move or choose. Excessive and or poorly thought out regulations block the freedom to create prosperity and tax what initiative is left into apathy and poverty. Let us not forget corruption which in a sense is random act of tax and regulation.

SheetWise writes:

Mr. Files --

I think personal liberty was best defined by Arnold Kling in his Choice/Voice analysis. Choice being the subject, reciprocity is the topic.

What logic can be seen in the US presenting itself to the world as a haven of liberty, while at the same time it holds its own citizens hostage and demands that foreign governments comply with their interpretation of law?

If any single power is preventing people to vote with their feet -- it's the US. They do it by labor laws, entitlements, welfare, and tax subjugation.

That list makes me reluctant to use the words, and suspect when other people use the words, liberty and freedom in the same sentence as United States. Our government increasingly sees citizens as chattel -- and their freedom to leave this country is inversely related to their value.

There is something reminiscent of slavery in the governments position. The feeble and elderly were always free to leave their masters control, to relieve the master of their burden. It was only the producers -- those valued by their owners -- who had to buy their freedom.

SheetWise writes:

I'm interested in how DeSoto's theory of the dual-use of capital has been challenged by market instability.

I think the fundamental argument is sound. I think the bankers got it wrong. There was a lot of incestuous activity that created opportunity without providing information. A lot of noise, with no signal. Even a poorly regulated market would have corrected these errors.

tom writes:

Auctions for a limited number of immigration rights may be very similar in effect to tests and proof of net worth that some countries have required. That kind of immigration would be great for the US and Europe as a way to increase our pool of competent and motivated people. For different reasons (motivating capable 3rd world people to work and learn, the leave and earn) it may be very good for the immigrants' home countries.

That kind of immigration, adopted world-wide, might be one way to save the world. It would really be a global version of 'exit', so it follows your bigger view, even if most of the exiting was from the 3rd world to the 1st and 2nd as opposed to from Montgomery County to Singapore.

Still, that kind of auction is not what I think of as open immigration. To me, open immigration is "If you can get here, you are welcome to stay with all the rights of every other American". I don't think that works.

frankania writes:

Sheetwise, I don't understand what you mean about not being allowed to leave the USA. I simply sold most of my property, and left for Mexico in 1988. I have some farms here and a tourist business, and teach English. What's the big deal?

MikeP writes:

To me, open immigration is "If you can get here, you are welcome to stay with all the rights of every other American".

With the operative word being 'rights'. Not privileges. Not entitlements. Rights. Rights such as the rights to travel, reside, and labor, which supersede any government authority to abrogate them.

I don't think that works.

I think it does. It certainly worked for the first three centuries of American history.

tom writes:

MikeP, I am not sure what you mean. I think you are saying that new citizens in the U.S. today don't have a right to federal and state welfare and health insurance benefits, federal retirement progams, subsidized home ownership programs, entitlement to be educated in their home language, etc...,

They do have these rights today in America. Maybe you are a libertarian and would like for people to have nothing more than the right to life, liberty and the pursuit of happiness. But that's not how it is.

Also, we haven't had 3 centuries of open immigration. There was a big chunk of the 20th century with very limited immigration. And before that, immigrants weren't coming to a regime where any citizen--new or old--had broad rights to government benefits that we have today.

MikeP writes:

I'm saying there is no obligation of the US to provide immigrants citizenship or any of the privileges or entitlements recently granted to legal immigrants. But the US is obligated not to abrogate migrants' inalienable individual rights -- something it does continually with restrictive immigration laws.

But that's not how it is.

The borders aren't open either.

Also, we haven't had 3 centuries of open immigration.

1607-1917.

SheetWise writes:

"Sheetwise, I don't understand what you mean about not being allowed to leave the USA. I simply sold most of my property, and left for Mexico in 1988. I have some farms here and a tourist business, and teach English. What's the big deal?"

I was talking about actually "opting out" --

Here's an interesting perspective from the Department of State.

Here's from the view of the IRS.

SheetWise writes:

I didn't realize I was on probation.

Nevertheless, I think my previous comment lacked the proper tag line:

"Welcome to the Hotel California."

[Note from the editor--You weren't on probation. The irs.gov url you linked to turned out to be deemed a spammer with the usually-accurate anti-spam service we use, so your comment was temporarily held in our limbo area. Type II errors sometimes happen. Sorry about that! Your humorous tag line is appreciated.--Econlib Ed.]

SheetWise writes:

Econlib Ed. --

Thank you for your kind words -- and I offer apologies for any errors I made, of either type. I should have understood that any url ending in .gov would require some vetting.

I would also like to compliment you on your impeccable sense of humor.

Hi, Sheetwise.

'Sno problem. You made no errors. The only errors came from our end. Because we rely on some url/spam-vetting software to stave off several hundred spam comments every few hours, sometimes links or keywords in legitimate comments occasion delays. Thanks for your patience and sense of humor! Carry on.

Lauren

L. Burke Files writes:

Sheetwise you and I have been on the same page for a long time.

I stated my point as a general view of what should be, not what exists.

And in fact the situation is even worse than your post.

To expatriate you have all of your taxes current and file the necessary paperwork. Once you leave the US you must file 10 years of tax returns and file an FBAR form. That right you have left the US and you still have to pay US taxes for 10 years. The US has made its citizens residents in a debtor prison that we cannot get free of for ten years. Also failure to file and FBAR is automatic penalty of $10,000 plus a percentage of the account. You can choose not to do this paperwork, but if you do I certainly would not cross a US border again.

The government is also looking to block renewals of passports if you have not filed tax returns. Think of all of the US citizens overseas that have not filed because they owned no taxes – whoops! Think of all of the – I hate this expression “ anchor babies" that go back to Somewherestan and than try to use their US passport – whoops.

The extra territorial reach of the US government is breathtaking and other countries are catching up, now about 25 countries are taxing the earnings of their citizens based on citizenship not territoriality of income.

With all of the Socialist countries scrambling for revenue it is going to get worse for the next set of years not better.

phineas writes:

The lameness of all the proposals above re-inforces my view that there aren't any institutional solutions to poverty, beyond the ones already in play. For the most part, poverty is a state of mind. The main things already in play are mass education and mass media.

Several hundred spam comments every few hours -- I had no idea.

Hi, phineas.

Several hundred every few hours is an estimate of what we'd be seeing if I didn't engage in some defensive measures, like completely banning some IP addresses. Happily, what actually gets through the bans to then get trapped by our spam filter is less, typically varying from 30-150 spam comments daily, counting both EconLog and EconTalk. Last week was a very heavy spam week, till I banned a bunch more IP addresses and closed down comments on a few threads that were being heavily hit. This weekend's not so bad, either because the spammers are taking a break or because I've stymied them for a couple of days. A never-ending battle.

I know it's frustrating for legitimate commenters when their comments get caught for an hour or more for no apparent reason. However, most of the regex tricks I've put in place trap hundreds--and in some cases thousands--of spam comments for every accidental legitimate comment that gets held up. I will say, though, that my dullest daily task is checking through the spam for legitimate comments!

SheetWise writes:

Lauren --

We now have a name and persona attached to what is generally an unrecognized effort. Let me be the first to thank you for the work you do, and to acknowledge the happiness that everyone contributing to these discussions brings to my life. If there's a tip jar -- send a link ;)

Burke --

We've been down this road before, and I know you're addressing it again (I know where you are!). We all need to discuss how to disseminate this information and keep the discussion alive without making it a partisan issue. I'm fairly certain that the average citizen has no idea what is going on behind open doors.

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