Land does not equal wealth

2018-09-05 06:01

DOCTORS are the hardest people in the world to control.

When governments attempt to control the lives of doctors, they find it’s not an easy task. If they tax them too highly, doctors leave. If the state attempts to make them involuntary servants of the government, again, they leave.

It’s hard for governments to control the lives of doctors because physicians are highly skilled in a field where there is great demand. Harass a doctor in one country and he or she will easily move to another.

The physicians’ earnings are directly tied to the knowledge in their heads, so they take their earning potential with them wherever they go. The state may confiscate their offices, stethoscopes and examination rooms, but it can’t confiscate their knowledge.

Because doctors’ skills are widely sought after, many countries are eager to welcome them. So policies that harass doctors redistribute medical care to countries where they will not be harassed.

With farmers it’s a different matter. Farmers must work with land to prosper.

They are tied to the soil. The many stories in novels and films about how farmers are linked to their lands make farming sound romantic, but, in reality, it means that farmers are easily controlled or destroyed by governments.

A physician can be a physician anywhere. A farmer has to have land. The physician easily relocates. The farmer doesn’t.

Many people found it odd that in Zimbabwe, Robert Mugabe’s regime did its best to force a skilled workforce onto the land. The new farms its policy created were not successful. In fact, food production decreased and hunger increased. It didn’t make the nation any richer. It didn’t improve the life of poor people; on virtually all levels, people were worse off.

I suspect the reason the Zimbabwean government forced people onto the land was because it made it easier for the state to control them.

Of course, apologists for the regime will have other excuses.

Some argue it was done to make people more prosperous. They ignore the fact that prosperity didn’t increase as a result but rather declined.

They also ignore other obvious facts. The wealthiest places in the world aren’t farming regions but big cities. If you look at the bustling Kowloon district of Hong Kong, you’ll see prosperity but very few people who own land.

It wouldn’t do them much good if they did. There are 43 033 people per square kilometre there. Give them all an equal share of the land and they wouldn’t own very much.

Manhattan is one of the wealthiest spots on Earth. Divide the land there up equally and you’d have to split one square kilometre of land between 25 850 people.

In wealthy Singapore you’d split that same amount of land between 5 516 people. There is really no correlation between land ownership and wealth. Many rich people are land poor and many poor people are land rich.

This also means you aren’t likely to increase the wellbeing of the poor through the redistribution of land, especially if you remove productive farmers and replace them with less-productive ones. All that will do is reduce food supplies, increase food costs and harm the poor.

If you want to improve the lot of the poor, more knowledge, not more land, is the answer.

The wealthy of the world often own only a small plot of land where they live. And in the richest places of the world, they might not even own that.

Very few rich people in Manhattan own land, and if they do, it’s a tiny share of the land on which their apartment building is located. Many simply rent accommodation.

When a government proposes policies to make people reliant on land ownership, they are not increasing the wealth of people. These policies won’t make people more prosperous. But they will mean that people are more easily controlled.

So, while many governments around the world say they do these things for the former reason, the reality is they often do it for the latter.

— Free Market Foundation.

• James Peron is the president of the Moorfield Storey Institute and author of several books, including Exploding Population Myths and The Liberal Tide.


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