Foreign Correspondent: Guatemala

The Mont Pelerin Society is alive and well and just met in Guatemala

GUATEMALA CITY—The Mont Pelerin Society is an association of believers in freedom and capitalism who got together in Switzerland after World War II to halt, through educational means, the advance of Socialism. The Society has held very few regional meetings, as most are completely international in character. This most recent meeting was called an "Ibero-American Regional Meeting", signifying that it would be held for members from the Iberian Peninsula and from America but many non-Spaniard Europeans participated—and even a South African.

The setting was Guatemala, the northernmost country of Central America and since it bears on the ultimate consequences of this reunion, a short geographical and political description is in order. The country is small, about the size of New York State, having coasts on both oceans, Mexico on its northern border and El Salvador and Honduras as its southern neighbors. It has about five million inhabitants who speak mainly Spanish and more than half of its population is Indian and illiterate. Guatemala has had a very erratic political history, going through many dictatorships, coup d'etats and constitutions. Furthermore, in 1950, a Communist president came to power and Guatemala can pride itself on being the first country in history (Chile, recently, being the second) that has been able to overthrow a Communist president (1954). This Central American nation is now nearing the expiration of its second democratic presidency and it looks—in a very broad optimistic way—as if it is on the road to becoming a stable democracy, even though Communist guerrilla warfare has not been totally eliminated.

It was in this strife-afflicted country that the Regional Meeting was held in September of 1973 to discuss, broadly, freedom. At this meeting, twelve papers were presented in three days. It was an unusually heavy load, suggested by the current President of the Society, Dr. Arthur Shenfield, who, unfortunately, was not able to attend this meeting for reasons of health.

As has been recently the case, the most popular subject for papers was the monetary situation. Three papers dealt with it. The first one, by Professor Kremmerer, was on the "Early History of the Quetzal" (the Guatemalan unit of currency). The noted Henry Hazlitt spoke about the "Future of the Dollar", and forecast a bleak future for it, and Professor Arthur Kemp of Claremont College delved into the subject much more technically when he expounded on "Gold, International Monetary Crises and the Principles of a Free Society".

Dr. George Roche, President of Rochester University and an internationally known figure in the world of academics and freedom, gave an extremely interesting and current talk on "Affirmative Action", that euphemism by which the U.S. Government blatantly favors minorities at a sacrifice of meritorious individuals. We have very little of this in Central America and I hope it is not contagious! Another current topic was brought up by Professor Pascual from Spain: that of ecology. The paper was interesting but did not show thorough researching despite much having been written on this controversial subject.

A very intellectually rewarding, albeit pessimistic, paper was the one presented by Dr. Henry Manne of Rochester University. The theme was "Capitalism: The Impossible Dream". However melodramatic the title may appear, the content of the work shows research, insight and very solid economic arguments. He reached his conclusion ("…the free system…is ultimately unattainable") on purely economic grounds, however, without relying on the ethical foundations of capitalism.

Even if the Mont Pelerin Society is a collection of defenders of freedom in different degrees, surely one cannot conceive of a Liberal (I shall be using it in the Classical sense) being in favor of progressive taxation (not to mention any taxation!). Yet, Professor Gilbert Tixier of the University of Paris, and a member of the Society, read the following paper: "Taxation in Developing Countries and Economic Growth", and I quote from it: "As we already emphasized it, direct taxations must not be too progressive and the rates should be moderate. Being in favor of economic liberalism…". And, furthermore, "The Government should help the private companies through tax concessions. Aid of this kind may take a variety of forms:…protection tariffs…" (sic). This was the most significant discrepancy from the nature of the convention. That Professor Tixier's book (from which this piece was taken) should have a foreward by Dr. Arthur Shenfield, President of the Society, is even more surprising.

There were other controversial points brought up by other speakers but aside from the one just mentioned, which is an extreme case, all can be said to be Classical Liberals. Among those nonspeakers who attended the meeting, the degrees of commitment to laissez-faire also varied.

For instance, at a delicious dinner offered by two Guatemalan hosts, Mr. and Mrs. Leonel Samayoa, I met a Mont Pelerin Society member who favored Government protectionism in the U.S. so that "foreign producers won't outsell American producers". However, I consider his case another exception, and the disturbing experience of hearing those views in a meeting of Liberals was more than offset by the pleasure of speaking with the many libertarian members of the Society. Thank goodness for some rationality at last!

Other notable participants—but not speakers—were Dr. Armen Alchian, from the Department of Economics at UCLA, Professor Hutt of South Africa (whose books in the twenties were already contradicting Keynes and predicting inflation), Augustin Navarro and Gustavo Velasco of Mexico, Professor Sam Peltzman of UCLA's and Chicago's Departments of Economics, the Reigs from Spain, Alan Reynolds (NATIONAL REVIEW and REASON magazine), the Zuloagas from Venezuela and Professor Roger Miller from the University of Washington (who impressed everyone with his "natural" hair style and fluent Spanish).

All this brings me back to the effects of these meetings. A member (I believe it was Milton Friedman) once said that he did not see much justification in preserving the Society as it had no major role anymore. I disagree. The motives which drive people (and not only members) to attend are several. Some place emphasis on the snob appeal of the "International Convention Status". Most seek the educational value, which is very laudable; but, by far, the main reason for the meeting is to find intellectual companionship, to reinforce our personal security as members of a minority and to remind ourselves that "Yes, there are others out there who think as I do." This reason had a very beneficial effect on Central America's Liberals (those that are not Liberals are not convinced by meetings like these) in that the solidarity shown gives added impetus—spiritually and financially—to the institutions that promote freedom in this country: CEES (Center for Socio-Economic Studies) and Francisco Marroquin University (more about these institutions in later reports. And in a country where freedom has been—and is in high risk of being—the forsaken alternative, this support is appreciated to a greater degree than, say, in the United States.

On the whole, the meeting was a complete success. The academic part was well planned and carried out by hosts Dr. Manuel Ayau and Ulysses Dent and "extracurricular" activities abounded,from a trip to the Mayan ruins of Tikal to a visit to the central market place, all due to the efficient and very meritorious efforts of Manual ("Muso") Ayau's charming and capable wife, Olga. I hope to see all of you in Brussels for next year's meeting.