Tom Patterson

Flat Earth Society

Posted on August 29, 2006 | Author: Tom Patterson
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Dolores Huerta's economic policies misguided, Mexico should embrace capitalism

Labor activist Dolores Huerta was criticized earlier this year for telling students at a Tucson high school that "Republicans hate Latinos." But that wasn't even the worst of her speech.
Huerta praised Venezuelan President Hugo Chavez for providing free health care for the poor and chided the U.S. government for not being more like Chavez. If Huerta really wants to help young Latinos, she could do better than filling their heads with losing economic theories.

Wealth doesn't come from government handouts. Wealth is created by people who use personal effort and capital to create value in goods and services produced. Entrepreneurs flourish where government is honest, property rights are protected and the rule of law is honored.

Mexico's agricultural system is an example of how that country stays poor. In 1917 privately held farms were expropriated and given in small plots to farmers who were members of communally owned collectives. The land could not be sold, rented or used to collateralize debt. Unsurprisingly, these farms were unproductive despite government subsidies.    

A 1992 constitutional amendment gave property rights to farmers, but Mexico's famously corrupt bureaucracy has effectively blocked the reform. By 2002 only 1 percent of the land had been privatized.   

A government that supports free enterprise and capitalism could do much to rescue Mexico from grinding poverty and massive outflows of citizens. Successful economies aren't built by "compassionate" governments with centralized power and redistributionist policies. Hopefully, Mexico's new president, Felipe Calderon, gets the message.

Tom Patterson is chairman of the Goldwater Institute, a former state senator and emergency room physician. A longer version of this article originally appeared in the East Valley Tribune.

Key Links:

-Institute for Liberty and Democracy: Country Diagnosis, Mexico
-Cato Institute: "Bringing Capitalism to the Masses"

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