Movement Towards Inclusion


“The bell jar [as described by Braudel, signifying the exclusivity of the capitalist sector of society] makes capitalism a private club, open only to a privileged few, and enrages the billions standing outside looking in. This capitalist apartheid will inevitably continue until we all come to terms with the critical flaw in many countries’ legal and political systems that prevents the majority from entering the formal property system. . .

Few seem to realize that what we have here is one huge, worldwide industrial revolution: a gigantic movement away from life organized on a small scale to life organized on a large one. For better or for worse, people outside the West are fleeing self-sufficient and isolated societies in an effort to raise their standards of living by becoming interdependent in much larger markets. . .

Like computer networks, which had existed for years before anyone thought to link them, property systems become tremendously powerful when they are interconnected in a larger network. . . .

Political blindness, therefore, consists of being unaware that the growth of the extralegal sector and the breakdown of the existing legal order are ultimately due to a gigantic movement away from life organized on a small scale toward one organized in a larger context. . .

The primary problem is the delay in recognizing that most of the disorder occurring outside the West is the result of a revolutionary movement that is more full of promise than of problems.”

Hernando de Soto, The Mystery of Capital

De Soto’s insights are tantalizing: his essential message is that the poor are seeking to become a part of the larger market system, but are denied access through exclusive laws and fiscal policies. Faced with the inability to become a part of the global market, the poor then must operate within small-scale, community “extralegal” markets and negotiations. I have referred to this market activity, so visibly abundant and active within South America, as a “micro-economy,” not recognizing that this teeming market life was not necessarily included within the larger economy in a formal sense.

What I also like about De Soto’s vision is his recognition that the poor have always historically recognized the opportunities inherent in a larger market. The movement to urban centers during the Industrial Revolution is well documented, and the same movement is now occurring in developing countries daily. The poor innately recognize opportunity when they see it, and recognize that fundamentally, global markets can provide access to a wider network of capability and progress.

Of course, simply giving the poor land titles and opening up their economies to globalization does not necessitate a better life, due to the great imbalance of power and wealth in favor of developed nations and small populations within developing nations. De Soto’s simplistic diagnosis has thus been rightfully critiqued. But with corrected fiscal policy and global law, these imbalances can be addressed to become more inclusive. De Soto’s insights can very neatly be coupled with the insights provided by social entrepreneurs like Muhammad Yunus. With the tool of microcredit, the poor can be given the ability to become included within the wider market and use their properties as capital assets.

The wider the embrace of networks can become, the more powerful and effective they will be. A market that can include and embrace all of the teeming activity of the micro-economies of the poor (and thus raise them out of poverty) is a healthy and balanced market.

What I also appreciate about De Soto’s vision is his emphasis on the global movement towards interdependence. Accepting membership into a greater community is to shed a degree of self-sufficiency and isolation. There is a strong undercurrent within environmental activism as well as nationalist reactionaries towards self-sufficiency and isolationism. It is certainly important to have integrity and inner strength. But at a certain point, interdependence within greater networks provides a greater strength and resiliancy.

I can best phrase this within the context of death: when someone you are close to passes away, you can feel a humongous hole cut out from inside of you. It makes you realize just how interconnected you are with everyone else in your life, and of how illusory is the concept that you are alone and detached.

When acts of violence and terrorism are committed, they are best viewed as perverted and desperate attempts to become included into the networks that they have been excluded from. The answer, therefore, in fighting terrorism is not in utilizing weapons and occupations, but rather in fighting poverty, by seeking to include, in an effective and positive manner, the developing nations and those in extreme poverty into the global market and body politic.

It is no secret that those nations mired in extreme poverty harbor terrorists. So what should we do? Bomb them? Or seek to include them into the greater networks of which they so desperately want to become a part of and which they have been routinely denied. Isn’t the answer obvious?

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Author: manderson

I live in NYC.

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