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Haiti: Yearning for a Free Market Economy

By: Ryan Hildebrand - Jul 12, 2013, 9:31 am

The only time most people hear about Haiti is during one of its numerous disasters, be they natural or political. After each instance, foreign aid pours into the island nation from various sources, and then more silence, until the next upheaval. Something is obviously wrong if the pattern consistently repeats itself over centuries, and I propose that it is the intervention of foreign governments (along with a corrupt home government), in particular (but not exclusively) the United States, which leaves Haiti in a beggared state.

Since its inception as a “free black republic,” Haiti has been burdened with debts, starting with France, the country from which Haiti broke away. This is a sad state of affairs for a country that was once the richest colony in the Western Hemisphere. Add to that an unfair advantage through corporatist policies in the United States’ agriculture policy, and a country like Haiti will struggle to trade and succeed in a market economy.

Consider this video for its insights into Haitian history, albeit with confused promotion of mercantilism.

Because the country must rely heavily on either subsistence farming or foreign imports (with strings attached), it has a huge hurdle to overcome in economic development. Locals cut down trees for charcoal or lumber (and some quick money), but the overall environmental quality has declined.

Deforestation in HaitiAt best, temporary emergency aid and charity via non-governmental organizations gives a short respite to the endemic poverty, leaving the people literally begging for jobs. Such eagerness begs another question, though — why isn’t private investment taking up the slack? I see this as a failure of central planning and overall lack of stability in governance.

For example, why would any foreign agribusinesses be willing to invest time or effort in a country that is flooded with cheap, heavily-subsidized American farm products? As a wealth-losing proposition, it makes no economic sense. So, instead, short-term cash infusions and “food aid” are utilized as a stop gap, further impoverishing Haiti with foreign debt.

To add insult to injury, Haiti had nearly paid off all of its debt or had it forgiven prior to the earthquake of 2010, which put the country back in arrears with foreign aid agencies, such as the United States Agency for International Development (USAID). The cronyist, kleptocratic elite have raided the national coffers for this aid money time-and-again and treated the populace as their personal servants, if not outright slaves.

For Haiti to have a turn-around, two things must occur: the elimination of any vestiges of the previous embezzling regimes, and a true, free, and open market. Only through natural, steady, and organic growth and private investment in a politically stable country will greater prosperity occur in Haiti. The people of Haiti already have a culture of informal insurance and charity, and there is a small but visible inventor class; the government only needs to not over-regulate or jury-rig central planning — thus allowing the manifestation of the productive energy of the country’s people.

Ryan Hildebrand Ryan Hildebrand

Dr. Ryan Hildebrand is a college instructor in New Orleans, Louisiana, and co-host of The Neo and Wim Show. You can follow his personal blog, NOLA City Blues, and his Twitter @NOLACityBlues. Read more of his featured PanAm Post column, "Self-Ownership."