Article 12 and the indigenous poor
Some time ago, fairly recently, one of our more prominent local economists, Mr. Stephens, alluded to our constitutional land alienation clause (Article 12) in a somewhat conspiratorial context. If I understood Mr. Stephens correctly, he sort of intimated that Article 12–an alleged “protection”–might actually be working to keep our indigenous poor down.
Article 12 champions would naturally object, of course, claiming that the land alienation clause was established with the best of intentions–foremost of which was to protect the local people from being disenfranchised on their own land. The idea, back then, was to protect our indigenous peoples from being hoodwinked by unscrupulous foreign investors. Our Covenant negotiators and founding fathers certainly did not want our indigenous peoples to go the way of the Native Americans.
Well, that was the intention, anyway. The practical results–the reality–could actually be somewhat different. As with most government programs, good intentions do not always translate into good results. Article 12 may well be another case in point, particularly when the local economy is as depressed as the Democrats must have been the day they fully realized that George W. Bush would be America’s next president.
When the economy was booming and Japanese investment was pouring in like there was no such thing as “realistic return on investment,” Article 12 did not pose a problem. “Investors”–reckless speculators, really–were quite happy to plunk down millions of dollars for a maximum 55-year lease. A lot of land-holding indigenous folks struck it rich. The real estate market was inflated.
But when the economy began to falter, real estate values quickly followed. This is when our indigenous poor got hit. Not having much in the way of stocks, bonds, cash or other assets, and with debts piling on, many of them were probably forced to sell the only thing they had: the family land.
Except that they could not actually “sell” their own land–their own private property. Because of Article 12 land alienation restrictions, they had to settle for a lease instead, which is not as profitable as an outright sell, particularly in an overly distressed CNMI economy.
To make matters worse, Article 12 uncertainties did scare away foreign investors, who were never able to “buy” in the first place, and who became even less able the moment Asia’s economies began to tank. In other words, due to Article 12 and a faltering regional economy, our land-holding indigenous poor essentially face a highly illiquid real estate market.
If a poor indigenous person desperately had to generate some cash, they probably only have their land to sell. Only they cannot really “sell.” The only people who could actually “buy” are a limited supply of wealthy indigenous folks, which should keep the price down and the poor continually ripped off until they have finally run out of land to sell and homesteads have been exhausted.
Strictly a personal view. Charles Reyes Jr. is a regular columnist of Saipan Tribune. Mr. Reyes may be reached at charlesraves@hotmail.com
