Wednesday, August 20, 2014

Poverty: A choice

Why are some countries rich and others poor? I'll make a proclamation: Poverty of countries is their own choice. It is a choice between the power of the state and the richness of the people. Poverty is a selected situation, selected above economic freedom on purpose.

Lets think about the following: Denmark and Hong Kong are countries with very little natural resources. They need to buy from others to have something to sell to still others. Denmark buys steel and coal to produce stuff to sell. Hong Kong has more or less nothing other than manpower. These countries are among the richest the world, and in terms of economic freedom also among the freest.

Zimbabwe and South-Africa brim with natural resources and vast, fertile lands. They are poor and will remain so until the power elite release their grip. Their supporters need to drop their ambition for equality and opt for economic freedom instead.

(As it happens, equality is not a function of income or geography. The richest 10% and poorest 10% will own a similar portion of the total product, no matter how large the total product is. Therefore, enlarging the total product is the only way to better the lot of the poorest.)

Brazil and China are the middle-of-the-road countries. You can do business there, and can have access to nearly unlimited resources of both people and those from nature within the boundaries of those countires. However, you can't feel secure about anything. And Brazil, to name an example, has such a jungle of taxes and regulations that a whole army of people is needed just to cut through.

Poverty is a choice. Poor countries are poor by choice. Think about it. I will.

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