A trip to the other third world

Living in Latin America, you get used to a sort of background assumption that affairs in the U.S. and Canada, while maybe going through a rough patch here and there, are fundamentally better than they are in the South. People look with envy on the idea of discount stores, endless freeways, clear title to your home — they might not know all the details, but there’s a general idea that if you work hard, you can get ahead.

I’m visiting the States and keep getting reminded of how false these ideas are. This story deserves to be read widely, especially by the U.S. residents (and members of the House of Representatives) who presume to tell Latin Americans about how their countries would be able to develop if only they respected private property, punished wrongdoers and gave people a secure way to save money.

Long story short: the Florida courts have committed to “clearing” a bunch of backlogged foreclosure cases, many of which are tainted by fraud at some point in the mortgage process. Rather than putting the onus on the banks to prove that they deserve to seize the home, the courts are basically assuming that foreclosures are valid, and seizing homes from their owners. This is the story of one woman who has made her payments every month, and is about to lose her home — because the payments were going to a crook, who stole the money. She was defended by lousy lawyers, and mistreated by the courts.

Miami Herald, take it away:

All she wanted was $50,000 from the equity in her house to help pay the bills while looking for a job in nursing. What Imogene Hall got was a brutal lesson in the sometimes shady ways of the mortgage industry.

It’s a lesson learned by untold numbers of homeowners in Florida, epicenter of the foreclosure crisis gripping the nation.

“Everywhere I turn, someone else is scamming me,” said Hall, a 49-year-old Jamaican immigrant who stands to lose her Miami Gardens home the Monday after Thanksgiving. “All I do is work hard, and I get surrounded by thieves.”

A review of court records found evidence of misconduct at nearly every stage of Hall’s experience….

Seriously, worth a read.


8 thoughts on “A trip to the other third world

  1. sapitosetty Post author

    Yes certainly! To be clear: I wasn’t singling out Ileana RL because she was Republican, as the mortgage SNAFU has been a very bipartisan project. Rather because she is a big private property advocate, and she is the woman’s representative in Congress.

    1. Lucia

      Let me try to understand — do you not believe that stronger private property rights would be helpful in Latin America?

      1. sapitosetty Post author

        Lucia – I have no beliefs about that. I think predictable rules are much more important than any particular regime of property rights. Governments attacking propoerty rights have done all sorts of abusive things in Cuba and Venezuela. Meanwhile slavery persists around the region — the most extreme example of property rights. I don’t think it makes sense to make blanket statements like the one in your question. And my opinions or beliefs about Latin America shouldn’t matter much — I’m a resident and a reporter that covers the region, not a citizen who has to live with the consequences of government action forever.

        I am, however, a U.S. citizen, and I can see from this story that among those who demand more property rights in Latin America, such as this woman’s representative, there is a willful disinterest in property rights there at home.

  2. Juan Cristobal

    Setty, way to skirt around a very simple issue. Yes, all other things equal, promoting property rights is better than attacking them. I honestly don’t see the gray area here.

    Upholding property rights does not protect you from having problems, it simply provides you with the hope that they can sort themselves out.

    1. sapitosetty Post author

      Emancipation of slaves is an attack on property rights. City zoning rules are an attack on property rights. Vehicle license requirements. Endangered species protection. Mine safety rules. So you want to push me for an opinion? Sure: Latin America could use more restrictions on property rights.

      But I know what you two are really asking. You want to know if I approve of Venezuela President Hugo Chavez’s expropriations. I am not going to opine on whether they are the best thing for the country. I think Venezuelans are doing a good job of opining on that. I can say that concern about the government kept me from investing there, whether in a home or business.

      But when you raise concerns about “property rights” as a general category you are missing the point. People with property in Venezuela can and do have many rights they would lack in the USA — to kill migratory birds, reroute streams, build without permits, employ prostitutes. The problem isn’t property rights, it’s a general absence of the rule of law.

      1. Kepler

        Good post, Setty.

        This obsession in Venezuela’s upper middle class about private property rights – specially for things they do have – above absolutely any other right is one of the main thing that keeps up where we are.
        We are a feudal country, by all means, with one group looking at the US as the source of every evil and the other looking at it (or at Europe, albeit less often since the XX century) as the source of all goodness on Earth but for arepa and beaches.

        And it turns out private property is very relative even there

  3. Kepler

    and reality means free trade and property rights do not regulate themselves and things do not get automatically sorted out just if leftist dictators disappear and we bring about “freedom”.

    If we in America (from Canada to Chile) were a bit more sceptical towards any dogma, we would be doing better and perhaps taking more sustainable measures for all of us.

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