We as greater New Smjyrna Beach residents are proud of the community activism as shown by the examples of Matthew Thurmairer, of Habitat for Humanity, not only here, but abroad.
Like many others, Thurmairer is trying his best to help the suffering victims of the terrible earthquate that ravaged Haiti and he should be applauded.
But sending money, is not necessarily the cure-all. Though in an emergency like this, evey penny counts. The question then becomes, for how long?
Americans everywhere are angered and perplexed by the fact that they have sent billions of their tax dollars to foreign countries over the years without any visible economic progress or gratitude shown by the receiving country. There are good reasons for these results.
First of all, if a country is in need of economic aid the reason is always that they have internal conditions that make economic progress difficult such as high taxes, suffocating regulations, unsound currency, weak or no protection of property rights and blocks to foreign trade.
Some countries suffer greatly in all these categories all at one time.
Haiti is the poorest country in the western hemisphere. The reasons for this poverty stem from a terrible government that inflicts high taxes onerous regulation, rampant inflation and lack of legal property rights on the population.
There can be no doubt that after the earthquake disaster, tens of millions of dollars of economic aid will flow into Haiti . Tragically, all of this aid will have very little impact on the life of the average Haitian. The above mentioned considerations will negate most of the generous, heartfelt efforts and good will of the helping people around the world.
So we ask the question: What can really be done economically to help these people?
The one thing that we can do to help Haiti is to eliminate all tariffs on goods from Haiti and goods exported to Haiti .
This will help them build their economy with their own efforts. Not only does foreign economic aid not address these fundamental problems, but it makes them worse by propping up the lousy government that is inflicting these conditions on the people in the first place. It makes it unnecessary for them to reform their rotten ways. So if the people in these countries resent us there is actually a logical, well founded reason for their resentment.
This phenomenon has prompted some critics to say with a lot of truth that foreign aid is a transfer of wealth from the poor and middle classes in rich countries to the rich in poor countries.
People point to the Marshall plan as a shining example of foreign economic aid helping down and out countries. However, if you take a close look at the German Economic miracle (Wirtschaftwunder), you will see that an ideal condition was created in Germany that included low taxes, few regulations and sound money.
As a result, the German economy grew at double digit rates until they ruined it by recreating a welfare state with high taxes and onerous regulations. The Marshall plan aid may have helped in some small way but it was the near perfect free market economic conditions that allowed the Germans to grow their own economy. Other countries including England received more aid than Germany without any great economic miracles.