Chávez's socialism offers hope to many Latin Americans
John Hughes's Nov. 9 column "Chávez's socialism won't help Latin America, free trade will" offers much criticism of Venezuelan president Hugo Chávez but zero ideas on how so-called "free trade" with the US will help develop Latin American economies.
If NAFTA is any indicator, our free trade agreements with Latin America are an enormous failure.
Since NAFTA's inception in 1994, the Mexican peso has devalued from about 3 to 11 pesos on the dollar; many American jobs have been outsourced for cheaper labor to the south; and hundreds of thousands of Mexicans have illegally crossed our borders in search of labor that theoretically was supposed to have been created in Mexico. (Will CAFTA be more of the same?)
Such counterproductive results are exactly what allow the socialist alternatives that Mr. Chávez offers to resound among the vast poor of Latin America. Chávez may well be a "troublemaker" for the US, but for many poor Latin Americans he encompasses something President Bush does not: hope for change.
I was left stunned by the Nov. 8 Opinion piece, "Smart products can save the planet." I believe the concept of social capitalism is nothing more than a myth promoted by consultants and lobbyists to push for smaller government.
Anyone with even a cursory understanding of economics knows that the sole purpose of a corporation is to return value to its shareholders. Quite frequently, social considerations come into play in delivering that maximum value. However, such consideration is a fortunate bonus when it happens, and it certainly does not reflect a change in this underlying purpose.
The Toyota Prius - the chief example used to show the results of social capitalism - certainly is a welcome addition to North American roads. However, it doesn't make Toyota a more evolved company that puts social ideals above shareholder value at times; it's simply a smart company capitalizing on a niche market of customers willing to pay a premium.
The danger in blurring this distinction is that regulation and good governance could be viewed as less urgent than they actually are. Toyota's Prius is a start toward more socially responsible production, but it's also a tiny drop in the bucket and by no means implies that "social capitalists" are going to solve our problems if only we give them room to work.
It is shameful that a piece that was so transparently an advertisement was published free of charge.
In his Nov. 10 editorial cartoon, Clay Bennett shows an oil-company executive sitting smugly in front of charts showing that "audacity" and "temerity" are rising along with profits.
Is it audacious to risk billions of dollars annually to explore for oil? Is it temerity to enjoy high profits in some years, knowing that other years will bring losses?
The truly audacious (and greedy) ones are the politicians who demagogue this issue. After all, since 1980 oil companies have paid taxes of $2.2 trillion (in 2004 dollars) - an amount more than three times higher than the profits these companies earned during the same period.
Donald J. Boudreaux
Chairman, Department of Economics George Mason University
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