Tim’s El Salvador Blog has a fascinating update and discussion of the famous “14 families” who supposedly rule and control El Salvador. I remember how big a deal that was during the El Salvador War in the 1980s. Today, they are now the “8 Conglomerates.”

The discussion is also important, and I half agree with each of the sides. Number one, I do think there’s such a thing as oligarchs in Latin America and while their billions do not bother me, and I make no advocacy of taking them away, they frequently are where they are due to certain privileges or rights to operate. Some oligarchs got them through government fiat. Others got them through the flawed privatizations of the 1990s, which largely transfered state owned industries into the hands of a select few businessmen, making the ordinary citizens feel robbed. And in some cases, they probably were. The big problem with these government-given privileges is that they keep others from starting businesses, whether through regulations, bureaucrats or buyoffs. That reduces choice for consumers. It also keeps jobs from forming.

Still, it’s the governments that give out these privileges and I find them primarily responsible for most of the trouble. Most of these oligarch groups got their start not because they were royalty but because they were industrious immigrants. They worked for every penny they got when no one cared about who they were. And government land “reforms” (read: confiscations) made things way way worse, destroying accumulated wealth and driving labor to the overcrowded cities and capital abroad. That’s not the oligarchs’ fault, it’s the fault of government.

When oligarchs and governments meld and don’t stay separate, then they too become involved, as culpable as the venal governments, who are by and large addicted to the oligarchs’ money – delivered either through payoffs to politicians or as some nations’ only taxpayers.

It’s a spirited discussion and well worth a look here.