Underlying Causes of Poverty — Living Apart from the Rule of Law

“Democracy is slightly positively correlated with economic growth. So democracy’s a good thing. You know what’s more positively correlated with economic growth? Rule of law. Even in dictatorships that had strong rule of law, we see firms working in a predictable environment where there’s recourse to people who have stolen from them. Therefore, they decide to innovate." Michael Fairbanks

Immaterial Injustices in Slum Areas

We focus a lot on the material differences between the so-called "rich" and the so-called "poor." We are inundated with news of the growing income gap and our brothers and sisters in the developing world are all-too-often defined by how many dollars a day they have in their pockets. But the real gaps, the real injustices, are the immaterial ones below the surface.

San Isidro is a wealthy district inside of Buenos Aires. Inside this rich neighborhood lies one of the poorest slums in Argentina, a shantytown called La Cava. In this clip from the PovertyCure DVD Series, we meet young Argentinian economist and city councilman Marcos Hilding Ohlsson, who is actively working to address key issues affecting the disenfranchised. “It’s an interesting case because it’s a place where there’s no rule of law,” says Hilding Ohlsson in his interview with PovertyCure. “Policemen don’t go inside of it. There’s no taxes. People don’t even pay for their electricity. And so it’s a place where they live apart from the rule of law.”


What does it mean to “live apart from the rule of law?”

It means you can’t legally start a business. It means that you have no place to call your own. It means if someone steals from you, attacks you, or wrongs you or your family, you have no recourse whatsoever, no matter how heinous the crime. Yesterday, a friend and I were discussing our respective experiences in Haiti. She specializes in working with trauma victims and has been overwhelmed by how terrifyingly commonplace atrocious acts like child rape are in the slums and tent cities, while the Haitian police and U.N. soldiers stand ineffectively (perhaps even disinterested) around the perimeter. Indeed, governments around the world have decided that it’s easier to quarantine the poor than it is to provide a functional justice system for them. Hilding Ohlsson expounds on the situation in La Cava:

A few years ago there’s some really high crime rates in the area, the whole of San Isidro, and many people blamed it, that many of the crimes came from people inside La Cava. So the government decided to put policemen, but they put policemen on the borders of La Cava; they are part of the army that is just outside of La Cava, and they go around the streets but they don’t go inside. And it is a sort of wall that they put, because it’s a way of protecting people that live outside La Cava from people that live inside it, but they won’t protect the people that live inside it. They are the ones that actually suffer the most insecurity of all, because most of the people that live inside of it are people that are hard working and they want to have a better life and they want to develop and they try to get their kids to school and they’re really struggling to have a better life.

In what we might call the “development community,” we see a lot of energy directed at serving the marginalized in slums like La Cava, but too often we dedicate a disproportionate amount of resources toward meeting mere material needs like food, water, housing, solar panels, and microloans. These are important, to be sure, but if we are not committing just as much if not more of our time to the immaterial, underlying root causes of underdevelopment, then we run the risk of spending all our precious resources on unsustainable projects and possibly even contributing to the very problem we are trying to solve.

Here are a couple links if you'd like learn more about this critical issue:

Jan 312013
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