Voice 1
Welcome to Spotlight. I’m Robin Basselin.
Voice 2
And I’m Ryan Geertsma. Spotlight uses a special English method of broadcasting. It is easier for people to understand, no matter where in the world they live.
Voice 3
“The land is our property. We bought it from a farmer who was willing to sell to us. Although we do not hold any legal document for the ownership, it is our property.
Voice 1
These are the words of Phillip Tesha. Tesha is coffee grower in Tanzania. He was speaking to the American television program Commanding Heights. Tesha has a problem. His family has been farming land in Tanzania for many generations. But Tesha cannot prove that he owns any of the land he farms. No one in his family has a title or any legal papers to prove it is their property. Situations like Tesha’s are common in many countries in the world. Today’s Spotlight is about this problem and a possible solution.
Voice 2
66 percent of people in the world do not have legal papers to prove they own their property or business. Without these papers, these people cannot be a part of their national economy. They cannot use their property or business to borrow money from a bank and invest to make their business better. They cannot create wealth.
Voice 1
Hernando de Soto is an economist - he is an expert in economics. He works to help people like Phillip Tesha. Hernando de Soto wants to help poor people get legal documents for their property. De Soto explained his goal.
Voice 4
“...To discover what poor people need. Then translate it into government action.”
Voice 2
Hernando de Soto began thinking about the difference between rich and poor people as a child. De Soto’s family is from South America, from Peru. But his father’s work moved the family to Switzerland. De Soto travelled through many wealthy countries in Europe. His parents also made sure he travelled back to Peru often.
Voice 1
As he travelled, De Soto compared wealthy European countries with the poverty in Peru. He wondered why one country was rich and another poor. He did not think the Europeans were more intelligent or more hard working than the Peruvians.
Voice 2
As an adult, de Soto was a successful businessman. He became wealthy. He retired at the age of 38. When he retired, he decided to study the causes of poverty. He returned to Peru. In 1980, De Soto began an organisation called the Institute for Liberty and Democracy. He decided the best way to study poor people was to listen to them. He employed a team of researchers . This team talked to poor people living in Lima, Peru. From 1981 to 1984, his group collected stories and numbers. What they discovered was amazing!
Voice 1
De Soto’s team discovered that the majority of Peru’s businesses were owned by poor people. However, these people did not have any legal papers to prove that what they owned really belonged to them.
Voice 2
De Soto and his team began to call this situation being “extra-legal”. In this term ‘extra’ means "outside" or "not included". So “extra-legal” describes people who are not protected by the law. During three years of research, de Soto’s team discovered that 90% of small industry in Peru was owned and run by people working in the extra-legal system. In his first book, The Other Path, de Soto reported his group’s findings. They saw that
Voice 5
“Peru, in fact, had become two nations - one where the legal system gave rights to a special few, and another where the majority of the Peruvian people lived and worked outside the law, and by their own local rules.”
Voice 1
People in the extra-legal economy in Peru could easily be oppressed. De Soto’s team listened to many stories with these problems.
Voice 2
One story was about a man named Eusebio. Eusebio’s family had lived on their land for many generations. One day, men came to talk to Eusebio’s family. They brought false legal papers. With these papers, the men claimed ownership of the land. It did not matter that Eusebio’s father and grandfather had farmed the land for one hundred years. Without legal papers, Eusebio’s family could not prove they owned the land they farmed. So, Eusebio’s family was forced to work for these men.
Voice 1
Eusebio’s small farm had been producing just enough for his family to live year to year. Without legal papers for his property, Eusebio could not use the property to borrow money from a bank. A loan could have helped Eusebio to buy more seed for his farm. It could have also helped him expand his farm or begin a new business. However, without these legal papers Eusebio had few choices.
Voice 2
Extra-legal people have these and many other problems. So de Soto’s team began to wonder why so many Peruvians stayed in the extra-legal system. De Soto’s team asked many questions.
Voice 1
De Soto’s team recognized that Peru had too many barriers - barriers that prevented people from getting legal papers. It would take an extra-legal person over one year to document a small business. It was just too difficult to become legal. So, de Soto’s team worked with the government to change the laws. Today, it is easier for Peru’s extra-legal people to request and receive legal documents. And after they do, they can be involved in their national economy.
Voice 2
Like thousands of other Peruvians, Eusebio got legal papers for his land because of the work of de Soto and his team. Many of the people living in Eusebio’s community also received legal papers. Now Eusebio and his children and their children will be protected. They will receive all the profits they make from their farm. And, if necessary, they can borrow money and invest to make their farm better.
Voice 1
De Soto’s ideas were very successful in Peru. Because they worked so well, many world leaders wanted to learn from de Soto’s model. De Soto’s organization now works in many countries all over the world. They estimate that together, the world’s poor people own a huge amount of extra-legal property - worth more than 9 million million [9,000,000,000,000] US dollars. If these people could invest these resources legally, many of them could find a way out of poverty.
Voice 2
One country where de Soto’s organization has worked is Tanzania. De Soto’s workers have heard Philip Tesha’s story. One day Tesha and his community may be able to get legal documents for their land. They will be able to borrow and invest. Their hard work will expand their farm.
Voice 1
In each country, de Soto’s team begins the same way. They ask questions. They listen. They see the hard work of extra-legal people. They see how many resources the poor have. At the end of his book The Mystery of Capital, de Soto writes:
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“The poor are not the problem. They are the solution.”
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