Peru's Best Export

[R. A. Hettinga]

To me, at least, the most important task of financial cryptography is to
create and transfer property rights without relying on the state at all.

Below, Hernando de Soto receives the Friedman Prize from the Cato Institute
for making the state *enforce* property rights to begin with.

Cheers,
RAH
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<http://online.wsj.com/article_print/0,,SB108079415338671377,00.html>

The Wall Street Journal

      April 1, 2004

 REVIEW & OUTLOOK


Peru's Best Export
April 1, 2004; Page A14

Today the Cato Institute will announce that its biennial $500,000 Milton
Friedman Prize for Advancing Liberty goes to Peruvian economist Hernando de
Soto. It is a fitting and timely tribute when global troubles so closely
mirror the challenges that Mr. de Soto first tackled in his native Peru.

Mr. de Soto founded the Institute for Liberty and Democracy in Lima in 1980
to understand the causes of Peruvian poverty and promote free-market ideas.
In the 1986 "The Other Path" -- written with colleagues Enrique Ghersi and
Mario Ghibellini -- he revolutionized development economics by chronicling
the realities of Lima's shantytowns at a time when Shining Path terrorism
was burgeoning. Peru's informal economies, it turned out, were already full
of enormously capable entrepreneurs. What held them back was burdensome
government regulation and a lack of property rights. There was no way for
them to move into the formal economy.

Mr. de Soto has since made it his life's work to spread the gospel of
property rights in the developing world. His 2000 "The Mystery of Capital"
advances the work done in Peru, looking at informal markets in places such
as Egypt and the Philippines. The book also traces the evolution of
property rights in the U.S., emphasizing the importance of an institutional
and legal framework that recognizes and protects the value behind an
ownership deed. Without such institutions wealth and creativity remain
untapped and growth stagnates.

The job of empowering the world's poor is far from done, especially in
Africa and the Arab street. But thanks to Mr. de Soto's efforts, much has
been added to our understanding of what is needed to unleash the
entrepreneurial spirit that exists in every human society.


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R. A. Hettinga <mailto: rah at ibuc.com>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'