From: Phil Osborn (philosborn2001@yahoo.com)
Date: Mon May 27 2002 - 01:06:42 MDT
I said on Sun May 26 2002 - 01:32:15 MDT:
"For a kid, let's say in Central Africa, let's say
there is a local network node that his village can
access. The local school teachers might sponsor the
first kids like they guide promising kids to
scholarships today. I suspect that the kind of local
support and infrastructure that makes the micro-loans
system work would also be employed here. The point
would be to find the most promising kids first, assess
how to get them the means to education or whatever
else they needed in capital to bootstrap past the
local bottlenecks such as impoverished parents, form a
trust in their names, make sure the parents or
guardians were totally involved and committed, etc.,
and publish the news on the net, seeking investors.
The parents might be - probably would be - among the
initial Trustees, but, as with the micro-loans
program, spreading the responsibility might be more
conducive to stability and percieved lower risk by
shareholders."
Actually, afterwards it occurred to me that in a
closely knit village, it might be possible to have
other structures employing the same Trust framework.
Not only kids, but also adults, and even the entire
village (or tribe?) might find it reasonable to form a
Trust, so that the joint assets could be used to
attract capitalization.
In the late '70's, I had the idea of doing this in
Belize via a land trust, and I saved my money, bought
cameras and studied the country from the available
sources at CSULB library. I also knew people that
either lived in Belize or had spent extended time
there, and I subscribed to various mailed news sources
from Belize.
My plan was to travel to Belize, photograph everything
in sight, talk to the locals and then come back to
Orange County and convince local wealthy libertarians
to start the ball rolling. The basic financial
structure was a trust, with the major asset being
land. Land was very cheap in Belize at that point -
typically $10 or $12 per acre of unimproved jungle, as
the Brits had granted independence and the Guatamalens
were making noises about invading over the mountains
and retaking the land that they considered Britain to
have stolen from them centuries ago.
I judged that Maggie Thatcher would never in a million
years let Guatamala sieze a member of the
CommonWealth. I figured on buying a bunch of land via
agents in Belize (foreignors being barred from owning
land), and then using the profits from the rise back
to $100 per acre to finance creation of the Trust.
The Trust would solicit natives to sell their land to
it in exchange for trust shares, with stipulations
allowing for continued use of the land until it was
needed, etc. Once the Trust had some sizeable blocks
of land in areas such as the coast, which has some of
the best beaches on the Caribbean, then it would
approach developers with offers of long-term leases,
the idea being to drain the swamps, etc., and build
resorts. Ultimately, the goal would be to have most
of the land and most of the population of Belize in
the Trust.
The Trust, being owned and run largely by the natives
and resting its value on land and long-term
synergistic development (fouling ones own nest doesn't
make business sense, and when your nest is the whole
country ...) , could be "trusted" not to cut deals
that would screw them, as is common in 3rd World
countries when foreign capital comes in and pays off
the local Jeffes. I.e., everyone would profit, the
local endemic tropical diseases would be eradicated,
and the wealthy retirees who flock to Mexico or
Florida would have somewhere else to go. I discussed
this with one of the libertarian investment gurus
(Doug Casey) years later and was told that he had been
working on something extremely similar. Don't know
what happened to his project.
So, what happened with my Belize scheme? Well, the
Faukland's war proved me correct about Maggie, and the
land prices in Belize jumped back to $100 per acre as
I predicted, and years later various foreign
developers came in and started building huge resorts -
but not as part of any land trust, and I gather that
the locals have not benefited all that much.
Meanwhile, I got tied up for the critical year where I
had the window to make it work by completely false and
trumped up charges - all later dismissed (with the
court record reading "defendent exonerated") - brought
by the Long Beach police in response to my putting on
a very disturbing (to the local authorities, anyway)
tax protest on April 15th.
(A week later, April 22nd, they arrested me for
"Loitering With Children," basing their accusations
upon park attendants who observed me taking pictures
with various cameras during period when children were
present. The cameras, of course, were the ones I was
planning to take to Belize, and I was carefully
checking them out, calibrating my light meters, etc.
I had an attorney pick up my film from the drug store
to serve as court evidence. There were no children in
most of the shots - just trees and foliage - and never
centrally in any shot, and certainly not in any
position or state of dress likely to arouse prurient
interest.)
When everything is going too well, assume that bad
luck will follow.
Anyway, we've been seeing a rapid progression of
moving financial vehicles down to the local, small
business or individual level as our information
handling systems have gotten better and smarter. Day
Trading, for example. Things like Letters of Credit
used to be used only by large export companies. Now
they are available to any small company.
The micro-loans program is the furthest this has been
pushed so far, I think, but there is no reason why,
especially using the net, that the barriers of
distance, time, language, corrupt goverments, etc.,
that have all contributed to an insurmountable
overhead of risk to making small investments in places
like Africa, couldn't be surmounted, and highly
profitable investment vehicles employed to capitalize
the local resources, especially people.
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