Mary O’Grady on Manuel Ayau

by Don Boudreaux on September 23, 2010

in Civil Society

Monday’s Wall Street Journal featured this wonderful tribute by Mary Anastasia O’Grady to the late – and, truly, the great – Manuel “Muso” Ayau.  Here’s part of that tribute:

Americans who are discouraged by the erosion of individual rights in the U.S. could learn a lot from Ayau’s courageous journey. Rarely has one life contributed so much to the cause of overcoming tyranny simply by making a commitment to the promotion of free thought—and he did it in an environment that was exceedingly hostile to liberty.

Ayau, born in 1925, was an engineer educated in the U.S. But it was his instincts as an entrepreneur here in Guatemala that shaped his destiny as an icon for freedom. He started and ran several successful businesses, including an industrial gas company and a tile manufacturer. As he worked he became increasingly perplexed about the contradiction between the country’s entrepreneurial potential and the high number of business failures. This stirred him to begin searching for answers to Guatemala’s stubborn poverty and underdevelopment.

It was a turbulent time. Communists had set their sights on Guatemala. In 1954, their man, President Jacobo Arbenz, was overthrown. What followed was a toxic mix of military governments and a guerrilla insurgency that rained violence down on the nation.

In the midst of this turmoil came Ayau, with six like-minded Guatemalans, armed only with the desire to discover the ideas that might transform their country into a just and prosperous nation. They formed the Center of Economic and Social Studies, CEES by its Spanish initials, in November 1958. The goal, Muso wrote in a 1992 memoir about the founding of Francisco Marroquín University, “was to study and disseminate the ethical, economic and legal principles of a free society.”

Ayau and his colleagues read voraciously and debated vociferously. “All of us were self-taught in these subjects, which would come to absorb much of our time,” he recalled. Over the next half century CEES would publish over 900 pamphlets in defense of the market. Ayau’s many contributions (98) had titles like “On the Morality of Government,” “Planning: Rational or Absurd,” and “Robinson and Friday Invent the Common Market.” In October 1978 he wrote an essay in a CEES pamphlet called “Price Controls,” while Milton Friedman penned “In Defense of Dumping” in the same publication.

Those pamphlets went all over the region. Peruvian Enrique Ghersi, one of the co-authors of the 1986 best-seller “The Other Path,” says that one called “Ten Lessons for Underdevelopment” was “key to awakening in me the vocation and commitment to defend liberty.” CEES brought to Guatemala such intellectual giants as Ludwig von Mises (1964), Friedrich Hayek (1965) and Ludwig Erhard (1968).

In promoting these ideas Ayau was going up against communists, mercantilists, public-sector unions and the central planners at powerful institutions like the World Bank and the Inter-American Development Bank. But he was only warming up.

By the 1960s it was clear that the left, with all its intolerance, had captured Guatemala’s academia. So in 1971 Ayau and his fellow advocates of freedom founded UFM in a rented house with contributions from a handful of Guatemalans totaling $40,000. There were eight students in the first graduating class. Last year there were 509.

Marroquin graduates are among the most sought-after in the country because of their competence. But the school says there is something else that makes them unique: “All students regardless of discipline are taught the causes and origins of the wealth of nations.” Alleluia.

Ayau did not live to see all that he dreamt of for Guatemala, but he did witness some major changes he could feel proud of. UFM graduates had a hand in the 1993 constitutional reform to prohibit central bank lending to the government, the 1996 free-market telecommunications law, and the 2001 law that made competing currencies legal tender. A time traveler from the 1960s, when Ayau began to challenge statism while Fidel Castro was forging its ultimate expression in Cuba, might be surprised at whose ideas have best stood the test of time.

Perhaps Mr. Ghersi, who attended the celebration here, captures the Ayau contribution best with these words: It “is decisive in the history of liberty. UFM is the holy see of [classical] liberalism in Latin America; and Manuel Ayau is our pope.” RIP, Muso.

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