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Aboriginals need roadmap for success, not ideology

By Joseph Quesnel
web posted July 11, 2011

Is it necessarily ‘right wing’ to recognize the role of the free market in elevating populations out of poverty?

The charge was made against the author upon delivering a presentation in early May at the Debating Aboriginal Policy conference held at Mount Royal University in Calgary.

The issue was whether land claims settlements could address Native welfare dependency. The answer was a tentative yes, not as a blanket endorsement but with provisos. If land claims monies go towards wise investments, it is possible, as evidenced by Ngai Tahu, a Maori tribe on the South Island of New Zealand, where land claims settlements are invested in good ventures. Also, I argued land claims can fight poverty. Some land claims involve transferring reserve land title from the Crown to the Native government, which can use it to create a full property rights system.

However, these ideas are based on accepting the free market, which my opponent rejected.

Accepting the reality of the success of free markets is not really a right wing argument, but a mainstream acceptance of reality.

A new report by the Washington, D.C.-based Brookings Institution presents empirical proof for the most die hard Marxist. The report, called Poverty in Numbers: The Changing State of Global Poverty from 2005 to 2015, pointed out nearly half a billion people escaped living at or below the poverty threshold of US $1.25-a-day between 2005 and 2010. The change –driven by economic growth –has even called into question whether we have already reached the United Nations Millennium Development Goal to halve world poverty. The report projects, another 300 million people will escape poverty over the next four years.

The main drivers are China, India, and Brazil. By 2040, China will likely raise its per capita income to $85,000, double the forecast for the European Union.

It is undisputable that these countries raised so many out of poverty by embracing free market economics, which includes secure property rights and the rule of law, under an export-driven, low wage economy. 

One wonders how many more real-world experiments we need to show to the diehard collectivists before they concede facts. Hong Kong beside China before it opened its economy. North Korea beside the South.

So, why start with the premise free markets cannot work for First Nations?

Admittedly, my preferences are for societies with a free market and limited government, but those views have the added bonus of being ideas that produce the greatest good for the greatest number in societies they have been attempted.

In the real world, the debate is between welfare capitalism and laissez-faire capitalism, not socialism versus capitalism. In the Scandinavian countries, state ownership of industry is being dismantled. Despite a robust welfare state, their economies are private sector-driven and property is private. The International Property Rights Index, a measure of 129 countries, ranks Sweden and Finland at the top in terms of physical and intellectual property rights protection.

One may argue, as anti-capitalists do, socialism has just not been done right. It is a common argument, but one wonders how many real world experimental failures in different parts of the world and with different cultures are required to conclude the underlying ideas are unsound?

We have a real world experiment here. We know from Statistics Canada data that Natives living in the free-market dominated Canadian mainstream (cities) do better than those living on reserves where the mainstream market is not allowed to function and land is held by government.

My hunch is the debate that has been resolved around the world (i.e. that government ownership of the economy does not work and closing oneself from the economy is bad) has not permeated Aboriginal discourse because academics and activists involved are ideologically opposed to capitalism despite evidence. They mythologize Natives as communally-oriented and want to keep Aboriginals from the dreaded free market. Sadly, they would rather see Natives held back than admit political and intellectual failure.

One can debate how an indigenous property system could work, without denying the reality that capitalism works. One is not a ‘free market fundamentalist’ in acknowledging facts.

Some insist traditional indigenous economies can save First Nations. While hunting, fishing, and trapping can supplement incomes and diets, it is naïve to think they can generate the capital necessary to sustain modern First Nations.

Both Quebec and Ontario have announced strategies for developing their indigenous-populated northern regions.

It is essential we provide booming Aboriginal populations with the tools they need to capitalize on property. They need a roadmap to succeed, not discredited ideology. ESR

Joseph Quesnel is a policy analyst with the Frontier Centre for Public Policy where he writes about Aboriginal and property rights issues.

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