Liberals loudly claim that free-marketeers only care about making the rich even richer. Tell that to Atlas Network.
This Washington-based organization supports or collaborates with some 475 free-market think tanks in the U.S. and 90 nations worldwide. (I have been honored to serve Atlas Network as a senior fellow since 1994.) Helping these groups advance individual liberty and limited government has given the biggest boost to those with the least.
“Atlas Network’s strategy sets the penniless on paths out of poverty for just $4.88 per person,” says its CEO, Brad Lips.
Rather than giving a poor man a fish (beyond emergencies, this too often means welfare) or teaching a man to fish (sometimes considered patronizing), Atlas Network encourages the institutions it backs to use their local knowledge to reduce government obstacles to upward mobility. The idea is to liberate low-income entrepreneurs who can build “fisheries” to feed themselves, their loved ones, and their communities.
“Since 2015, Atlas Network has invested $1,975,000 to expand economic choices in 29 countries,” Lips explains. “To date, grantees in ten of these nations have secured reforms measured by the World Bank’s Doing Business report. Every five-percentage-point increase in Doing Business lowers a country’s poverty rate (defined as living on no more than $1.90-per-day) by one percentage point. These ten victories have helped 405,000 people lift themselves from poverty. Given our investment, this equals $4.88 per person no longer poor.” Atlas Network underwrote relevant research by Doing Business founder Simeon Djankov.
These five Atlas Network grantees, among others, successfully pried government barriers from the paths of the poor:
Atlas Network encourages the institutions it backs to use their local knowledge to reduce government obstacles to upward mobility.
‐India’s Centre for Civil Society pressed to eliminate minimum-capital requirements for new businesses. This sum equaled 124 percent of per capita income in 2014. That figure is now zero.
Indian entrepreneurs face “myriad regulations that minutely control business decisions and activities,” laments CCS president Parth Shah. “The laws define the minimum distance that must be kept between two water trollies in public space. Local regulations require that the owner and driver of a cycle rickshaw must be the same person.” CCS has pleaded with New Delhi and local governments to slash this red tape. CCS’s goal, Shah says, is “fewer, simpler processes, fewer permits and licenses, fewer points of contact with the bureaucracy.”
“One of our biggest wins has come from our long fight for the rights and recognition of street vendors in the state of Rajasthan,” adds CCS’s Bhakti Patil. “It’s been a remarkable journey for CCS and for the street vendors who have so doggedly battled extortion, arbitrary regulations, and harassment in earning a living on the streets of Rajasthan.”
‐Nepal’s Samriddhi Foundation pushed its Ministry of Interior to slice new-business-registration times from 16.5 days last year to a maximum of 30 hours today. Wait times for foreign-funded businesses have dropped from several weeks to seven days.
‐The Lithuanian Free Market Institute prodded Vilnius to cut electricity-installation times from 146 days in 2014 to 85 today — an improvement of 42 percent. Construction permits that required 124 days to obtain now take 75. That’s 40 percent better.
‐Peru’s Contribuyentes por Respeto (Taxpayers for Respect) helped businesses, small and large. How? It persuaded Lima to demand tax payments quarterly, rather than monthly. This freed entrepreneurs to spend two-thirds less time on tax-filing paperwork and migraines.
‐Slovakia’s Institute of Economic and Social Studies pressured Bratislava to eliminate hidebound, Soviet-era restrictions on launching enterprises. Start-ups faced initial-equity requirements of 25,000 euros ($29,750). INESS aided a campaign to have the Ministry of Justice authorize newly available licenses for joint-stock companies. These cost just one euro ($1.19).
“The prevailing legacy of Communism led most to favor redistribution and government regulation,” INESS director Richard Durana says. “In Slovakia, discussions were led solely on an emotional basis, and any economic arguments were missing.” He adds: “There was no organization to explain to media, journalists, other professionals, and the public how the market works and the effects of government intervention on the common citizen.”
INESS now fills that gap, to the benefit of Slovaks who are climbing that country’s socioeconomic ladder.
As too many crooked officials can testify, top-down government programs too often subsidize graft, not growth. At home and abroad, as the Atlas Network confirms, removing the state’s roadblocks is a more promising and cost-effective strategy to help the humble escape to prosperity.