Economics: Breaking the Vicious Cycle through Education

Haiti is among the thirty poorest countries in the world, falling in the category of nations whose per capita GDP is less than $2,000 a year.  According to Daron Acemoglu and James A. Robinson, authors of Why Nations Fail: The Origins of Power, Prosperity, and Poverty, Haiti’s problem most likely lies in its inability to create inclusive political and economic institutions.  Haiti, with over 70% of its population politically and economically marginalized, is trapped in what Acemoglu and Robinson call a vicious economic cycle.

Robinson and Acemoglu are confident that Haiti’s general failure in education is at the base of the poor country’s problems. Skipping any semblance of nuance, they point out that countries like Haiti, where a large fraction of the population has no means of attending school, have little to no chance of breaking out of poverty. Indeed, less than five percent of Haitians finish high school and less than two percent make it through university.

Louverture Cleary School (LCS), a tuition free boarding school located just outside of Port-au-Prince, owned and operated by The Haitian Project (THP), is working to counter Haiti’s debilitating economic situation by using education as a catalyst for change. For the past two years, Philo students (students in their final year of secondary education) at LCS have taken a college level economics class using N. Gregory Mankiw’s textbook, The Principles of Economics. The course provides them with the intellectual and practical tools they need to begin to confront some of their country’s most daunting issues.

 “The problems facing Haiti are real, and the study of economics provides rational, viable, and sustainable solutions,” said Kristin Soukup, THP Volunteer and LCS’ current economics teacher. LCS’ Philo students have quickly learned the value of economics for their futures, and have begun to change the way they look at the problems facing Haiti. For Philo students Djim Guerrier and Santiana Noelizaire, there are three big problems facing Haiti, “our dependency on importation, our electricity, and our education system.” Their economics class has not only enabled them to see the problems clearly, but also think of ways to solve them.

“We have learned that when domestic prices are higher than the world prices, the quantity of importation increases. It is why we import more than we export in Haiti. We need to solve this problem,” Djim stated. Djim believes that, in order for progress to be made, changes must start at the institutional level. “The government plays a big role. They can regulate trade in two ways. They can directly discourage imports or encourage exports. For example, Haiti imports a lot of rice. The government can regulate how much rice comes in through tariffs, which will also make the market more competitive, and encourage local producers to produce more rice to meet the new demand. It will help the local companies compete,” Djim explained.  

The Philo economics students are now seeing the most basic of principles, like taxation, in a new light. Santiana has developed a better-informed understanding of how taxes can improve Haitian institutions. “Before the class, I thought taxes were just used to make buyers pay more, but I now know that taxes help develop a country.” Santiana is well aware of the current culture surrounding taxes in Haiti, and she believes that a change here will make all the difference. “People in Haiti do not pay taxes. We don’t have many resources, and the ones we do have, we use for free. If we enforce taxes, the government will have the money to provide better infrastructure, education, and health. ”

The problems surrounding the lack of taxation in Haiti have far reaching effects, from the country’s energy crisis to its inability to provide basic societal necessities. “There are a lot of people who do not pay for electricity, they steal it,” Djim said matter-of-factly. Djim and Santiana believe that, in conjunction with enforcing laws against stealing electricity, levying modest energy taxes on the general public to subsidize the cost of producing energy will drastically improve the situation.

“If people knew how important taxes were, we could have a better country—sure there are drawbacks to taxing, but the positives outweigh the negatives. With taxes, the government can provide a lot of necessary public services.”

For both Djim and Santiana, this change must come from the ground up, starting with reforming Haiti’s public education system. “Public education cannot continue like this; it is a real problem,” said Djim. But, for Djim and Santiana, there is still hope. They know what education, especially the study of economics, can produce, and believe that they can help break the vicious cycle. “The problems are not impossible,” Djim said resolutely, “they can be solved. We are the future of Haiti and we can use what we have learned to better allocate our resources, maximize our efficiency, and change Haiti. Economics has shown me this.”

For Deacon Patrick Moynihan, Head of LCS, the importance of teaching economics in Haiti is clear, “After theology—economics is the most important science to study because the two things that impact everyone are God and the market.”