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Yes sir! It’s that simple. That’s what governments are there for. To keep undesirables away from us, the normal people. Poor people should be outlawed!

Sounds strange? It’s been tried before.

Chile is probably the only country on earth where you need a permit to beg. What’s more, you have to pay for it.

The military governor of the province of Tucuman in Argentina, simply loaded trucks with poor people and deported them to the nearest province. This happened during the glorious years of the last military dictatorship.

Obviously, this is a completely and utterly idiotic concept, but one that many endorse: if there is a problem, just stick your head in the ground and wait until it goes away. Or pressure the government to take it away from you.

However, some people actually go in search for solutions. The article “The Benefits of Cash Without Conditions” published today by The New York Times is a nice summary and an interesting update. Worth a read and a comment.

Of course, all the solutions being offered are based on Political Theories and not in reality. People studying these problems begin with a theory and end with causes that are described by the theory. What a surprise. There is an old saying: if the only tool you have is a hammer, every problem looks like a nail.

Then we have the latest imbecilic theories. Poor people are poor not because they don’t have money, but because they are different!

According to the Left it is a structural problem (bad health, education, transport, housing, jobs) etc. Of course, if this would be true, the Soviet Empire would have been utopic since all these structures were provided by the state. However, for some strange reason, we didn’t see mass migrations of people into the USSR. We wonder why…

According to the Right it is cultural problem (people are lazy, they lack discipline, make bad choices, etc.). Of course, if this would be true, then a dictatorship (preferably military) would be the wisest government on earth. They are all hard working, disciplined and trained to make the right decisions. However, we don’t see endless visa queues in embassies of countries with dictatorships. Must be a mistake…

Then we have the “special conditions” theory. You see, in advanced countries, most basic barriers (as described by the Left) have been overcomed. However, in really poor countries “special conditions” apply because these barriers still exist. Principally no jobs. No jobs means no income. No income means poor people are stuck in a vicious circle, forever cursed to be poor. Therefore, to break the circle they need money to start their own businesses. It’s the only way. Such a concept is, of course, idiotic. We will see why latter on. Hold on to this thought.

The article continues describing the two options to simply give money to poor people:

  • The CCT (Conditional Cash Transfer – these yanks and their acronyms….)
  • The UCT (Un-Conditional Cash Transfer)

The CCT is based on the idea that only “financially deserving” people will get money. The UCT does not, it assumes that if somebody is asking for money, they deserve it.

Studies indicate that the UCT is superior than the CCT. Presto! The “special conditions” theory has been validated! Yet another triumph for social sciences… or is it?

Of course it is not! What most Ivory Tower residents forget is that all people were poor millennia ago.  They didn’t get CCT from the pharaoh nor did Romans support social spending through UCT! Yet, those civilizations did quite well indeed!

Giving money to people does not prove the “special conditions” theory. It only proves what’s obvious to any Absolute Austro-Libertarian enthusiast. The reason why people are poor is because they do not live in truly free markets. The money that they are getting does not help to breach special condition barriers, but helps breaching conditions imposed by manipulated markets!

Simply remove the manipulation from all markets, dissolve all governments and all barriers instantaneously drop to zero. No CCT nor UCT required!

We see the skeptic look in your eyes. Fair enough. Consider this. Most citizens are geographically trapped in their countries. If they could migrate, they would. Where would they migrate? To better economic areas. Presto! Poverty decreases.

Also consider this: most people in poor countries can’t earn sufficient money by farming. Why? Because most farming operations in the civilized and advanced countries are subsidized. Remove the countries and the subsidies go away. No subsidies means commodity prices rise. Such a rise implies that farming is now economically viable even in poor countries. Presto! Poverty decreases.

There are many other examples, but two will suffice for now.

The concept that increasing jobs is the way to decrease poverty is patently stupid. All human beings trade. Trading is the very first economic activity that humans undertook and it is still the primary one. Trading, not jobs. Trading got civilization going. Trading allows for wealth accumulation and with it higher standards of living. Trading spawned the division of labour and trading fostered peace and coexistence. Not jobs. Jobs are a secondary economic skill. Jobs are a side-effect of trading.

Interestingly enough, all CCT and UCT studies show the same trend. When money is given to poor people, they tend to do better not because they get better jobs, but because they trade.

The Absolute Austro-Libertarian system is indeed the ultimate tool for increasing general wealth precisely because it fosters free trade above all. In other words, contracts rule!

Note: please see the Glossary if you are unfamiliar with certain words.



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