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Hernando
de Soto delivers
2004-2005 Frank Porter Graham Lecture
 Economist
Hernando de Soto sees property rights as solution to global
poverty
Peruvian economist Hernando de Soto has the ear of heads
of state across the political spectrum as well as impoverished
farmers and black-market street vendors around the world.
This fall, he came to the University of North Carolina at
Chapel Hill to discuss his internationally lauded policies
advocating property rights for the poor as a solution to global
poverty.
De Soto presented the Frank Porter Graham Lecture,
sponsored by the James M. Johnston Center for Undergraduate
Excellence in the College of Arts and Sciences, on October
26, 2004. A finalist for the Nobel Prize in Economics in 2002,
de Soto is the president and founder of the Institute for
Liberty and Democracy in Lima. The Economist magazine called
it one of the two most important think-tanks in the world.
Through the institute, de Soto works with leaders and workers
in developing nations and emerging democracies to enact institutional
reforms that give the poor access to formal property rights
and capital. He meets with heads of state and trudges through
the streets and fields to talk with black-market traders,
factory workers and sharecroppers in Asia, Latin America and
the Middle East.
In his best-selling books The Other Path (1986) and
The Mystery of Capital: Why Capitalism Triumphs in the
West and Fails Everywhere Else (2001), de Soto argues
that free enterprise policies have not grabbed hold in developing
nations because their leaders have failed to put into place
a comprehensive and inclusive property system. The overwhelming
majority of citizens may wish to participate in a free market,
but without access to property law they cannot access bank
loans and are forced to operate outside the law.
"They have houses, but not titles; crops, but not deeds;
businesses, but not statutes of incorporation," says
de Soto, whose books have been translated in 20 languages.
The amount of "dead capital" in untitled assets
worldwide is at least $9.3 trillion, he says, a sum that dwarfs
the total amount of foreign aid given by developed nations
to poor nations in the past three decades.
Founded in 1980, de Soto's institute is credited for developing
legal property systems that have moved hundreds of thousands
of businesses and real estate holdings from the underground
economy into the economic mainstream, and revolutionized the
way world leaders address enduring poverty.
In Peru alone, de Soto oversaw some 400 initiatives, laws
and regulations that modernized and stabilized the nation's
economy between 1988 and 1995. His reforms gave property titles
to more than 1.2 million families, and brought into the legal
system some 380,000 firms that previously operated in the
black market.
De Soto has won praise from Margaret Thatcher and Koffi Annan.
Bill Clinton called de Soto "the world's greatest living
economist" and Jack Kemp said he deserved to win the
2004 Nobel Peace Prize.
Time Magazine hailed de Soto earlier this year as one
of the "100 most influential people in the world."
The Cato Institute awarded him the 2004 Milton Friedman Prize
for Advancing Liberty, for making a significant contribution
to advancing human freedom. Forbes magazine called
him one of 15 innovators "who will re-invent your future."
Calling do Soto, "the poor man's capitalist," the
New York Times magazine said that, to the leaders of poor
countries, "de Soto's economic gospel is one of the most
hopeful things they have heard in years." (July 1,2001)
De Soto's many honors include The Freedom Prize (Switzerland),
The Fisher Prize (United Kingdom), the CARE Humanitarian Award
(Canada), and The Goldwater Award, The Templeton Freedom Prize,
and The Adam Smith Award from the Association of Private Enterprise
Education (USA).
The Frank Porter Graham lecture series
honors the late U.S. Senator and president of the University
of North Carolina, who was a champion of freedom, democracy,
and the disadvantaged.
"Hernando de Soto's work embodies the ideals that were
so critically important to Frank Porter Graham," said
Dr. Randi Davenport, Executive Director of the James M. Johnston
Center for Undergraduate Excellence in the College of Arts
and Sciences, which sponsors the lecture. "We could not
imagine anyone better suited to launch a lecture series intended
to advance our understanding of poverty and its sufferers."
The Frank Porter Graham Lecturer Series is made possible
by the gift of Taylor McMillan '60. Additional support for
the 2004 lecture was provided by the General
Alumni Association.
A complete listing of all events at the Johnston Center for
Undergraduate Excellence is available at our Event
Calendar.
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