I do not know much about Hernando De Soto but I can bet he lives a life of tokenization. Market fundamentalists have found the most mobilizable and legitimizing figure possible in him. How nicely he escapes critiques of privilege. At this point, however, my précis will cease to speculate on the place of De Soto in the polemical world of pundits and their detractors. I will focus on The Mystery of Capital and how he is actually the one creating a mystery and at the same time skipping some hurdles at which most market fundamentalists stumble. Without butchering the meat of his argument, I can safely say that his prescription for the problems of wealth disparity and underdevelopment is paperwork. What the West has that the rest of the world does not is a bureaucratic “representational process” that gives people confidence in the worth of material possessions, without which they are in effect, “dead capital” (pg. 6).

This book starts with the question, (or statement) Why Capitalism Triumphs In the West and Fails Elsewhere. What does that mean? Are we to assume capitalism has triumphed already? Or that it is in the process of triumphing and will eventually totally triumph? And triumph against whom? Quickly it is apparent that what he means to ask is, “why is the West wealthy and the rest of the world poor?” Tis a worthy question. And De Soto tells us that the answer is not simple. We can appreciate that economics are not always told in one lesson. Yet the real question he asks is still a little different. We are not going to learn about the relationships and interdependent among all parts of the world. It is not going to be an argument that explains the poverty of the Global South as a historical process of exploitation and accumulation. The real question, if De Soto were to be explicit is, what does the West have that the rest of the world does not which make it so that there are disparities?

There is a history of racialized discourse surrounding that question and the audience for which this book is intended is wary to fall into that trap. Assuming the benevolence of American empire and the superiority of capitalism, what could possibly be the explanation for national failure? For good reason we are well primed to stay away from essentialist explanations that look to race to explain economic disparity. De Soto knows this and knows that many justifications of capitalism employ racism to wash away stains in its logic. He calms our worries with the statement that people of the Global South are not “helplessly trapped in obsolete ways, and are not the uncritical prisoners of the dysfunctional cultures” (pg. 5). It also helps that he is Peruvian and not another white guy. We, educated middle class people of the West, need not feel guilty as we choose to be persuaded by this book.

Now, we can finally examine De Soto the magician. Poof! Now you see it, now you don’t. One page 7 De Soto talks about the great fortune of the world’s poor but how it is so unfortunately invisible. The poor people are secretly and quietly saving untold amounts of money that never counts as capital. Titles, deeds, and documents for this fortune are what separate impoverished people from establishing their own land of endless opportunity. With that move De Soto, like magic, solves the problem of poverty. When he says “only the west has the conversion process to transform the invisible to visible” (pg. 7) he never stops to ask why people of the global south and their ways of life are not seen by capitalists. He never stops to consider the agency of sight. Who has the power to see, to recognize, and to confer legitimacy is a colonial relationship he simply ignores. I could spend forever writing about how the West actually dismantled the representational process of the countless colonized cultures. I could talk about how implementing western-type bureaucracies of ownership has stolen so much from poor people and their nations. I could talk about how false and oppressive the notions of development and modernization, which he mobilizes are. But ignoring these issues is what makes his argument so compelling. He promises to dispel the mystery and skip ahead in a productive way.

While De Soto claims to illuminate the mystery of capital he actually constructs the term capitalism is a way that is very mysterious and misleading. He uses words he refuses to explain and define. How does capitalism work? What are privatization and foreign direct investments? How about free trade? Tariffs? Stabilizing currencies? They are all lumped under capitalism and capitalism equals good. De Soto takes for granted their role and effect in support of his side of the political debate. He ignores how problematic they are. Capitalism does not need to be explained in this book. It acts as an essential force of civilization and societies must makes adjustments to accommodate its logic. Of course their some negative effects but those are only more symptoms of not making the necessary adjustments.

Asaf Shalev

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