Hernando de Soto: Winner of the 2004 Milton Friedman Prize

Hernando de SotoThe Cato Institute today announced that the winner of the second biennial Milton Friedman Prize for Advancing Liberty is internationally recognized economist and property rights activist Hernando de Soto.

The prize and its accompanying $500,000 cash award will be presented to de Soto May 6 in San Francisco. Named after Nobel laureate Milton Friedman, the prize is awarded every other year to an individual who has made a significant contribution to advancing human freedom. The first Friedman Prize went to the late British economist Peter Bauer in 2002.

Upon hearing that he had been chosen as the second recipient of the prize, de Soto said: "Receiving the Milton Friedman Prize for Advancing Liberty is an enormous honor for me and my associates who worked, and in some cases died, for the cause of liberty. We are moved by the recognition and by the fact that the award comes from the prestigious Cato Institute that we have long admired."

Beginning in his native Peru, de Soto has focused on a revolutionary concept that is having repercussions throughout the world's poor countries: the lack of formal property rights as the source of poverty in poor countries. His decades of pioneering work, for presidents and in the streets on behalf of property rights for the poor, have led to global acclaim.

As de Soto explained in his 1986 book The Other Path, these de facto owners were locked out of the formal, legal economy--and that was the root of the problem. "They have houses but not titles; crops but not deeds; businesses but not statutes of incorporation," he wrote.

De Soto now travels throughout the world, meeting with current and future heads of state. Mexican president Vicente Fox seeks out de Soto for counsel. He has inspired a far-reaching Egyptian government initiative. Philippine presidents Joseph Estrada and Gloria Arroyo have both asked for de Soto’s help.

He has won support from many political leaders, from former president Bill Clinton to former British Prime minister Margaret Thatcher. Impressed, World Bank president James Wolfensohn took de Soto with him to Russia, where he met with President Vladimir Putin.

In 1980, de Soto founded the Institute for Liberty and Democracy, which has conducted breakthrough research on the lack of property rights and has prodded many governments to consider change. For his work on behalf of the poor, the Peruvian Marxist terrorist organization Shining Path launched two assassination attempts on his life. The Shining Path is history, but de Soto continues to help governments and inspire the poor to look ahead to economic freedom and prosperity.

"Hernando de Soto embodies what the Milton Friedman Prize for Advancing Liberty is all about," says Cato Institute president Edward Crane. "In his books he has made new and important contributions to our understanding of liberty. And he has worked with dedication and effectiveness to bring liberty about, on the ground, in places where it is most needed. Everyone talks about helping the world's poor. This is a man who figured out how to do it. His work exemplifies the spirit and practice of liberty."

Friedman agreed in 2001 to lend his name to the award. In a statement about the award, he said: "Those of us who were fortunate enough to live and be raised in a reasonably free society tend to underestimate the importance of freedom. We tend to take it for granted. It has made us in the West more complacent, so having a prize emphasizing liberty is extremely important."

Hundreds of nominations were received from around the world, and the winner was chosen from 10 finalists by an international selection committee. The committee consists of Anne Applebaum, editorial board, the Washington Post; John Blundell, general director, The Institute of Economic Affairs; Edward H. Crane, president, Cato Institute; Gurcharan Das, author of India Unbound; Rose D. Friedman, co-founder, Milton and Rose D. Friedman Foundation for School Choice; Andrei N. Illarionov, economic adviser to Russian president Vladimir Putin; José Piñera, president, International Center for Pension Reform; Frederick W. Smith, chairman and CEO, FedEx Corporation; and Fareed Zakaria, editor, Newsweek International.