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Thursday, June 5, 2008

Revelations

Collectivism was causing famine just as surely as fields lay fallow when there is no expectation of reaping your harvest. However, some nations are catching on. If they lease the land allowing those who work in the fields to benefit from surplus, surpluses increase and more food becomes available.
Now using food for fuel (subsidized by the same central planners as collectivists) is threatening to again cause famine especially in the poorest nations in the world.
When will we learn? Its 'human nature' and 'markets' that cannot be duplicated by the hubris of mere mortals attempting to plan economies differently. Read more about it here:

http://www.economist.com/specialreports/displaystory.cfm?story_id=11041589
"Vietnam's agricultural miracle was achieved by a simple but powerful device: the invisible hand of Adam Smith's free market. Having snatched the land from the people in the disastrous collectivisation, the government gave it back to them (evenly shared among households) on longish leases, starting in the late 1980s. This was similar to China's agricultural reforms around the same time, which also greatly reduced poverty by giving small farmers exclusive rights to work their plots. However, in China the freehold of the land remains vested in local collectives, without a clear indication of who represents them. That allows unscrupulous local officials to sell land to developers from under the feet of farmers. In Vietnam the freehold remains with the central government, so such problems are rarer."
"Creating large-scale and equitable land ownership—one of the biggest privatisations yet seen—was one of several steps that freed Vietnamese farmers to conquer the world, explains Vo Tri Thanh of the Central Institute for Economic Management in Hanoi. Another was the stabilisation of the economy in the mid-1980s, bringing inflation down from a hair-raising 1,000% or so. A third was the gradual liberalisation of farm prices. Also important, says Mr Thanh, was Vietnam's increasingly open trade policy."
"None of this would have happened had Vietnam not had fertile soil and plentiful rains, with large tracts of coastal plain and river deltas ideal for cultivation. But Vietnam's experience shows that economics is as important as geography for agricultural success. One reason why the remaining pockets of poverty in Vietnam are concentrated in the forested highlands is that the market-based agricultural reforms have been slowest to reach those parts. Some of the country's diverse ethnic minorities depend on foraging in the forests and until fairly recently were regarded by the authorities as wreckers rather than guardians of the woodlands. In truth, say academics, plantation owners migrating from the lowlands have been more of a threat to the trees. The solution, being worked on rather slowly, is to give minority communities patches of forest to tend."

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