As President Obama and his cohorts struggle over what to do now with their socialist health-care plan in response to the Democratic defeat in Massachusetts, now would be a good time to point out one of the biggest reasons for the enormous death toll in Haiti — socialism. Yes, I am referring to the economic philosophy of American liberals — the people who purport to love the poor but whose economic policies condemn the poor to destitution and even death.
As George Mason University economics professor Walter Williams points out in his excellent column “Haiti’s Avoidable Death Toll,” Haiti is an extremely poor country in terms of wealth. Thus, when the earthquake hit, the country’s dilapidated buildings quickly crumbled, and people lacked the necessary equipment, machinery, and medical services that could have saved many more lives.
Compare Haiti’s plight to the United States. By and large, buildings here are much more able to withstand earthquakes. Moreover, highly trained personnel with heavy equipment are able to quickly move into the affected area and save more people.
Why? Why is Haiti so poor while the United States is so rich? That’s a critically important question, one that liberals answer incorrectly. They say that people are poor because other people are wealthy. Thus, the key to ending poverty, they claim, is for the government to use its monopoly of force to take from the rich and give the money to the poor.
There is one big problem, however, with this socialist concept: It doesn’t work. Government intervention in economic affairs actually makes society poorer. In fact, it is the root cause of poverty, not the solution to poverty. It is this notion that has ensured that the masses of humanity have remained mired in poverty throughout most of history.
Consider my hometown of Laredo, Texas, compared to its sister city on the Mexican side of the Rio Grande, Nuevo Laredo. In actuality, Laredo and Nuevo Laredo constitute one big city that has a river running through it, much like San Antonio or Austin, which have rivers running through them.
Yet, the standards of living of Laredo and Nuevo Laredo are dramatically different. As poor as Laredo is, the people living there have a remarkably higher standard of living than the people living in Nuevo Laredo.
How can this be, given that it’s one big metropolitan area?
The reason is that there has always been significantly more government involvement in economic affairs in Mexico than there has been in the United States. In other words, despite the massive taxation, welfare-statism, and regulation that have afflicted the United States during the past several decades, it is nothing compared to the Mexican government’s socialist, interventionist, and mercantilist economic policies that have afflicted Mexico during its entire existence.
And that’s the problem with Haiti. Like so many other Latin American countries, the government taxes, loots, plunders, and confiscates wealth and regulates and controls economic activity. In doing so, it prevents wealth from accumulating. It keeps people poor.
What is the key to the creation of a wealthy society? Capital. Capital enables people to be more productive. More productivity means higher profits and higher wages. How does capital come into existence? Through savings? When people save a portion of their incomes, they put the money into banks, when are then able to lend it out to businesses that are financing the purchase of equipment, which makes workers more productive. It is a process by which everyone’s interests coincide — those of the employer, the employee, and the consumer.
(See “The Keys to Economic Development: A Speech to the People of Brazil” by Jacob G. Hornberger.
Thus, the key to a wealthier society is precisely the opposite from that advocated by liberals. Socialism is not the solution to poverty, as liberals claim. Socialism destroys wealth and ensures that people will remain mired in poverty.
The creation of wealth depends on economic enterprise being freed from the dead hand of the state. People need to separate the economy and the state just as our American ancestors separated church and state. That’s what a genuine “free market” is all about. That’s the key to a wealthier — and safer — society.