Advancing a Free Society

Un-American Reservations

Thursday, February 24, 2011

By Terry Anderson and Dominic Parker

Since the publication of Adam Smith’s "The Wealth of Nations" economists have struggled to find the causes of economic growth. Though the complete development recipe remains elusive, nearly all economists agree that two ingredients are crucial—secure property rights and a stable rule of law.

The importance of these ingredients is no more apparent than on American Indian reservations, which are islands of poverty in a sea of prosperity. Despite billions of dollars generated by casinos on some reservations, per-capita income for American Indians living on reservations remains low. According to the 1999 census, reservation Indians earned $7,846 per capita compared to $14,267 for Indians living off reservations and to $21,587 for all U.S. citizens. The Crow Creek Reservation in South Dakota had the lowest per capita income at $4,043 and the Isabella Reservation in Michigan had the highest at $17,436.

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