Monday, March 26, 2007

Chavez moves to nationalize 815,000 acres

And thus the socialist revolution proceeds apace.

Venezuela's government has seized more than 330,000 hectares (815,450 acres) of land to redistribute them under an agrarian reform programme.

President Hugo Chavez said 16 farms - which he described as large and unproductive - had been expropriated.

Taken in isolation, land seizures are not a good thing. In a stable, law-abiding society, land rights should be nearly inviolable, because the ability to acquire and keep property is one of the fundamental building blocks of wealth and thus opportunity. If land can be seized arbitrarily, then people have few rights that cannot be violated.

But the history of Latin America complicates things, because the "thou shalt not nationalize private land" commandment assumes that the land was fairly acquired in the first place. And largely, it was not. In Venezuela, 97 percent of the arable land is owned by 10 percent of the population. And that's not even the worst ratio. In neighboring Columbia, half the land is owned by 0.3 percent of the population; overall, 75 percent of the land is owned by just 2.6 percent of the population.

Those ratios did not arise from free and fair market transactions; they are relics of empire and dictatorship. So it's myopic to condemn land seizures in isolation, without addressing the extreme imbalances that underlie current land ownership.

Given a set of really bad options, a well-planned system of land reform -- one that defines "underused" land objectively and fairly compensates the current owners of the land, however they came to own it -- might be the most reasonable choice. In addition, any such program must contain a sunset provision, under which the program expires once the ownership ratio reaches a certain level, or a specified amount of land has been seized.

Of course, that assumes that Chavez' plan is either well-planned, well-run or fair -- something I'm not willing to bet money on. But in such a case it is Chavez, not land reform per se, that is the problem.

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