- The Mystery of Missing Information. In the 3rd world, there are many assets/ resources that have not been “monetized” or documented/ legalized as “economic assets”. Hence, they are dead capital and their utilities are not maximized. Further, most developing countries do not have legally enforceable transactions on property rights. The West has invested time, resources, intellect, even wars to establish this property rights system. Lastly, there are so many obstacles to legality. He cited the
, where it takes 168 steps/13-25 years to formalize informal urban property. Philippines
- The Mystery of Capital. Capital facilitates transactions. The West maximizes capital by the property rights system. It (a) fixes the economic potential of assets, (b) integrates dispersed information into one system, (c) makes people accountable, (d) makes assets fungible, (e) networks people, and, (f) protects transactions. All these facilitate business, investment, etc.
- The Mystery of Political Awareness. The history of the economic development of the West is filled with extra legalities, underground economy, migration to cities, rapid, unsustainable urbanization, etc. The elite used the law to protect their interests. But emerging property rights raised expectations while the informal/underground sector, along with the urban problems forced the elite to make laws to meet the rising expectations of the populace. They had to respond to the sea of change. Increasing economic activities engender change and somehow redistributes power.
- The Missing Lessons of US History. In studying American history,
observed that it was in the same situation that many 3rd world countries are in today. However, when Americans as a society recognized and integrated extralegal property rights, this paved the way for the expansion of the de Soto market economy and production of capital. US
- The Mystery of Legal Failure. The cost of being legal determines whether people remain in the informal/underground sector. Thus, the State should make being legal attractive. Bad legal and administrative systems undermine established property systems as evidenced in the developing world. “Law is the instrument that fixes and realizes capital. In the West, the law is less concerned with representing the physical reality of buildings or real estate than with providing a process or rules that will allow society extract potential surplus value from those assets. Property is not the assets themselves but a consensus between people as to how those assets should be held, used, and exchanged” (de Soto 2001:157).
- “The situation and potential of the poor need to be better documented
- All people are capable of saving.
- What the poor are missing are the legally integrated property systems that can convert their work and savings into capital
- Civil disobedience and the mafias of today are not marginal but the result of people marching by the billions from life organized on a small scale to life on a big scale.
- In this context, the poor are not the problem but the solution.
- Implementing a property system that creates capital is a political challenge because it involves getting in touch with people, grasping the social contract, and overhauling the legal system” (p. 227).
Filipinos know all of these already, but
In the years since
The main contribution of
Thus, my question on HT is whether Philippine society has the institutions to implement it. That is why I like to hark on how social movements such as GK or those promoting direct cash transfers/ basic income guarantee can help HT.
HT requires legislation as written by the SS. How do we get Congress to legislate something that will dilute their power?
Attending to economic issues entails social/cultural work.