More on Defending de Soto


Kerry Howley blogged here the other day about the attack on Hernando de Soto from John Gravois over at Slate. Today at TechCentralStation, the Competitive Enterprise Institute's Ivan Osorio also comes to de Soto's defense.

The piece is worth reading in its entirety, and mostly expands on the observation that:

Gravois accuses de Soto of selling this elite—gathered at powwows like the World Economic Forum in Davos, Switzerland—an economic snake oil panacea….That snake oil is "one solution—individual property titles—for all kinds of poor people in all different kinds of poor places," by which "dead assets are turned—voila!—into live capital."

This is a gross distortion of de Soto's ideas. To say that something is necessary is not to say that it is also sufficient.

Regarding one particular sin Gravois tosses at De Soto's feet, Osorio writes:

Forced evictions, like those [Gravois] cites in Phnom Penh, are not the result of titling, but of a lack of security in those titles due to a lack of rule of law. No system of private property worthy of the name involves private parties "buying squatter-occupied state land from various government officials," much less while those officials "pocket the money, thus looting the land both from the state and from the poor." To say that such monstrosities are honestly "inspired by de Soto's work"—even when those countries' ruling authorities say they are—is like placing the blame for sectarian violence on entire religions rather than on a few fanatics' twisted interpretations.
Gravois also misrepresents de Soto by suggesting that, for de Soto, animating "dead capital" is everything. Yet land titles animate something else—incentives, which Gravois doesn't even mention, even though de Soto has articulated the incentive value of property as clearly as is possible.

Blogger Conflict of Interest alert: I once worked at CEI, and Ivan is an old friend. For that matter, I often enjoy reading both Slate and TechCentralStation, so you can see exactly how conflicted my interests got in composing this entry.