<Our discussion was as long as I could manage, and fascinating. He volunteered that Mexico would always be poor as long as the police were corrupt. Not just the politicians, but the cop on the beat.

As long as that cop can confiscate wealth, can keep some people poor, can incarcerate others who irritate him/her, there is no chance.

For an economy to work, it needs to be fair and every one needs to trust it.



Very true. The proper purpose of a government, which includes the cops, is the protection of individual and property rights under a system of objective laws. The sanctity and enforcement of contracts, the protection of property rights, the punishment of crime and fraud, among other functions, are all required to make a free-market system work.

When the government actively works against this, or is corrupt (often the case in a mixed economy), a truly capitalist system becomes impossible, or worse, a corrupt distortion of a market system which uses armed force rather than market forces to move money around. This problem is common in many nations, including our own.