Sunday, June 6, 2004

The only problem with free-marketers, according to Leon M. Louw, is that they are lousy at marketing.

“The one thing socialists always do better than capitalists is sell themselves and their ideas,” said Mr. Louw, who runs the Free Market Foundation of Southern Africa in Sandton, South Africa. “The ivory-tower left, the antiglobalization crowd has always been better at networking, at promising big results, even when they never deliver.”

Networking was the order of the day when Mr. Louw and representatives from more than a dozen pro-market, pro-liberty think tanks from around the globe gathered in Washington last month.

All had been the recipients of awards and “action grants” from the Fairfax-based Atlas Economic Research Foundation, founded in 1981 to promote the work of fledgling global think tanks supporting private-property rights, limited government, the rule of law, and market economics.

Winners of the four major Templeton Freedom Prizes for Excellence in Promoting Liberty — for market-oriented poverty programs; for ethics and values; for social entrepreneurship; and for student outreach — received $10,000 awards, and second-place winners in each category received $5,000.

Among those honored this year: a pro-market think tank in Lithuania; an Ontario, Canada, institute promoting school-choice programs; a Mexican think tank that studies the economic costs of corruption; and a private research group in China that tracks deregulatory reforms adopted by the country’s provincial governments.

Alejandro A. Chafuen, president and chief executive officer at Atlas, noted that “more people have been lifted out of poverty in the last two decades in China and India than at any time in human history.”

“And it was the free market — not any government program — that was directly responsible,” he said.

Atlas works with about 300 think tanks in 67 countries, providing financial and administrative support to many of the research groups in their struggling early years.

A foundation established by British mutual-fund pioneer John Templeton helps fund the annual awards. Using private contributions and a matching grant from the foundation, the program plans to hand out about $1.25 million in grants and prizes from now to 2007.

Martin Chren, founder of the F.A. Hayek Foundation in Bratislava, Slovakia, said the recognition and the contacts he obtained through the Atlas program were invaluable as his institute pushed free-market policies in the years after the collapse of communism in Eastern Europe. Mr. Chren worked not only with U.S. and Western European scholars, but also with new research institutes in other newly independent Eastern European countries.

“When we started in 1991, even the concept of private property was suspect for a lot of Slovakians,” Mr. Chren said. “It was a battle just to get people to even consider our ideas.”

Pro-market ideas — spurred in part by a visit from U.S. antitax crusader and publisher Steve Forbes — have triumphed spectacularly in Slovakia.

A reformist government has passed measures that American economic conservatives still only dream about, including a low, single tax rate; Chilean-style personal pension accounts in which workers can invest; and the complete elimination of estate taxes, gift taxes, and the double taxation of corporate dividends.

Low taxes and lower labor costs have made Slovakia a magnet for foreign investment in the region, Mr. Chren said.

German manufacturing giant Siemens AG and automakers such as Volkswagen, Toyota and Kia Motors have opened major operations there. Mr. Chren even worried that Slovakia’s recent accession to the rules-heavy European Union — popularly seen as a triumph of the country’s foreign policy — actually could set Slovakia back.

Virginia Gentles of the Fraser Institute, based in Ontario, works in one of the world’s wealthiest countries. But her driving cause — school choice — has generated opposition from Canada’s powerful educational establishment and entrenched teachers unions.

Miss Gentles is program director for the institute’s Children First program, which was awarded a Templeton Prize for social entrepreneurship for establishing the first privately funded school-voucher program in Canada.

She said the program seeks to infuse the public education system with the values of the private market, turning parents into customers who can demand better schools and more qualified teachers.

Children First’s tiny pilot program offered to pay up to 50 percent of the private-school tuition for 150 low-income children in Ontario trapped in substandard public schools.

“We like to think we are helping the less-advantaged and improving education for all Canadians, but it is a hugely controversial idea for Canada,” Miss Gentles said. “We step on a lot of powerful toes.”

Despite the opposition, Children First officials say they receive thousands of applications annually for the 150 slots.

Aurelio F. Concheso is president of the 20-year-old Center for the Dissemination of Economic Information in Caracas, Venezuela, known popularly by its Spanish acronym, CEDICE.

Mr. Concheso said free-market principles are under attack in his country from the populist government of President Hugo Chavez. Center-left governments also have come to power in recent months in several neighboring states.

Mr. Chavez, who faces a recall vote this summer, has been in virtual open warfare with his country’s business community.

The Templeton grant “means a lot to us, because it is a time of struggle for our ideas across the region, not just in Venezuela, but in Brazil and Argentina as well,” Mr. Concheso said.

Mr. Concheso said one program on which his foundation has focused is the economic education of Venezuelan journalists.

“In the beginning, we were a voice crying in the wilderness,” Mr. Concheso recalled. “We had to translate a lot of the classical, libertarian literature into Spanish because no one had bothered to do it before. We made a lot of progress in the battle of ideas, but, unfortunately, many of the protectionist policies we fought are coming back under Chavez.”

At a National Press Club reception last month, Mr. Concheso and Mr. Louw engaged in some impromptu intellectual cross-pollination, discussing whether the private ownership of South Africa’s vast gold mines could serve as a model for the reform of Venezuela’s state-owned oil fields.

Mr. Louw, whose think tank was a sharp critic of racial separation in the years before the apartheid system was dismantled, said that despite criticism from the left it was the free-market activists who were the true champions of the poor and disenfranchised.

“Even in Washington, a lot of people don’t seem to get it,” he said. “Our work for greater economic freedom in South Africa puts us on the side of the poor, the peasant farmer, the unlicensed taxi drivers.”

“It isn’t the rich or big business that is hurt by high taxes. They have all sorts of ways to get around paying them. We sometimes think in South Africa that in the developed world, the fault lines are all wrong in this debate.”

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