In Praise of Hernando De Soto

Last Wednesday and Thursday, the Rockefeller Center welcomed Hernando De Soto as its Class of 1930 Fellow. He gave a public lecture, visited a class, and met with several groups of students and faculty. Here is how I introduced him at the public lecture:

In remarks delivered at the Rockefeller Center’s dedication in September 1983, Rodman Rockefeller noted that his father was interested in the "conversion of intellectual excellence to the realities of public life," and he charged the center to promote this same vision to Dartmouth students. This is a challenge that we take seriously at the Center, and we rise to that challenge today as we open our fall term public programming by welcoming Hernando de Soto as the Class of 1930 Fellow.

In 1980, Mr. de Soto returned to his native Peru after a successful career in Europe, armed with a question: What makes some countries rich and other countries poor? And it was the research that he and his think tank (the Institute for Liberty and Democracy) conducted to answer this question that has ultimately transformed the developing world.

In Peru, de Soto observed an energetic and industrious people relegated to poverty by a legal system that marginalized and excluded them from his nation’s formal economy. "They have houses but not titles; crops but not deeds; businesses but not statutes of incorporation." It was not the lack of entrepreneurial energy, or even the lack of assets, that made them poor. It was their confinement to an extralegal status. Overhaul that legal system, and you will provide an opportunity for a whole nation to lift itself out of poverty.

This revolutionary concept—that the lack of formal property rights was a key source of poverty in poor countries—has become Hernando de Soto’s life’s work. His writings and his advocacy embody a liberal and expansive view of humanity—that the capacity to meaningfully improve one’s lot in life is widely and broadly distributed. He has traveled the globe to help governments take the steps necessary to permit economic freedom to flourish.

His work has not gone unnoticed. As just a few of his accolades, in 1999, Time magazine chose de Soto as one of the five leading Latin American innovators of the century. Forbes magazine highlighted him as one of 15 innovators "who will re-invent your future." The Economist magazine identified his Institute for Liberty and Democracy as one of the top two think tanks in the world. His two books, The Other Path,and The Mystery of Capital,are becoming the guidebooks to legal reform in pursuit of economic development around the world.

Hernando de Soto should be an inspiration to us all. He shows that someone who researches carefully, who writes clearly, who speaks thoughtfully, who advocates passionately, who works tirelessly—such a person can make a difference. There is no one more concretely engaged in the "realities of public life" than he. For a man whose time is so precious, we are delighted to have him with us this evening.

He is quite simply one of the most remarkable people that I have ever met.

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