What Egyptians Need

By:  Walter E. Williams
07/17/2013
       
What Egyptians Need

What Egyptian citizens must recognize is that political liberty thrives best where there's a large measure of economic liberty.

The Egyptian people are not the problem; it's the environment they're forced to live in. Why is it that Egyptians do well in the U.S. but not Egypt? We could make the same observation about Nigerians, Cambodians, Jamaicans and many other people who leave their homeland and immigrate to the U.S. For example, Indians in India suffer great poverty. But that's not true of Indians who immigrate to the U.S. They manage to start more Silicon Valley companies than any other immigrant group, and they do the same in Massachusetts, Texas, Florida, New York and New Jersey.

According to various reports, about 50 percent of Egypt's 83 million people live on or below the $2-per-day poverty line set by the World Bank. Overall, unemployment is 13 percent, and among youths, it's 25 percent. Those are the official numbers. The true rates are estimated to be twice as high.

Much of Egypt's economic problems are directly related to government intervention and control, which have resulted in weak institutions so vital for prosperity. As Hernando de Soto, president of Peru's Institute for Liberty and Democracy, wrote in his Wall Street Journal article titled "Egypt's Economic Apartheid" (Feb. 3, 2011), more than 90 percent of Egyptians hold their property without legal title. De Soto said: "Without clear legal title to their assets and real estate, in short, these entrepreneurs own what I have called 'dead capital' — property that cannot be leveraged as collateral for loans, to obtain investment capital, or as security for long-term contractual deals. And so the majority of these Egyptian enterprises remain small and relatively poor."

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