Trickle Down Despair: Lessons From a Peruvian Hospital Bed

In his famous encounter with Joe the Plumber, President Obama announced: "It's not that I want to punish your success. ... I think when you spread the wealth around, it's good for everybody."

Regrettably, the ash heap of history is littered with the disciples of this ideological gospel. Who pays the ultimate price for such foolish dogma? What can we learn from dark paths others have dared? I witnessed the effects of this cruel story with my own eyes.

General Juan Velasco Alvarado deposed the democratically elected president of Peru, Fernando Belaunde, in a military coup on October 3, 1968. His power secured, he famously proclaimed:

Campesino, el dueño nunca mas va a comer de tu pobreza.

Peasant, the landlord will never again eat from your poverty.

Proclaiming justice for the poor, he went on an unbridled nationalization spree of Peru's private mines, oil fields, and fisheries. Price controls were instituted to eliminate "unfair" competition. Predictably, foreign capital fled the ever-encroaching rules and regulations. As internal investment faded, political dissent increased -- until it was silenced in prison. Velasco's spending didn't end until he too was finally deposed in 1975, though his destructive policies were not reversed until the 1990s. What were the effects of his utopian vision of socialism on the very people he purported to "save"?

An investment strike and crushing deterioration of the tax base left the country unable to maintain its infrastructure. In a vain attempt to parry the monster of inflation, Peru did what all socialists do -- it minted three different currencies between 1985 and 1991. Incredibly, one "New Sol" in 1991 equaled 1,000,000,000 Old Sols of 1985 -- a devaluation of a billion in a span of 10 years.

I arrived in Peru in the middle of this madness in March 1986. We landed at the airport in Lima late at night -- under curfew. Socialist third-world countries have a distinct smell about them -- the toxic fusion of raw sewage drifting in the streets mixed with the stench of corruption and festering oppression of a people long forsaken by their government. On the way to our hotel, soldiers stopped our bus and checked our passports with machine guns in hand. They seized one of our Peruvian companions. We never heard from him again.

My first days were spent in a small fishing village on the desert coast in northern Peru. Naked children looking for food picked through mountains of trash along the glass-strewn streets while skirting pools of filth. A fortunate few chased flattened soccer balls; others played with balls of knotted rags. I moved into an adobe house with bars on the windows and doors, surrounded by thick, cinder block walls. Broken glass was embedded into the mortar on top of the wall -- to keep the thieves at bay. We tied an old sock to the single water faucet in the home to strain the big black chunks from the gray water. We had to empty the sock every day. We were lucky; on most days we had running water for up to two hours -- other days, not. The water smelled distressingly similar to the sewage which pooled in the streets. We bathed with bowls of gray water. Living conditions were abysmal.

Three days after arriving, my head started pounding -- the first symptom of typhoid fever.