John Kay: Rent-Seeking Lessons from Mubarak to Louis XIV

John Kay is a British business economist.

We will never know how much Hosni Mubarak might have stolen. One so-called expert has even put the wealth of the deposed president of Egypt and his family at more than $40bn, which would make him one of the world’s richest men, alongside Carlos Slim, Bill Gates and Warren Buffett. Other estimates are much smaller but they still place him among the world’s billionaires.

Whatever the true extent of the Mubarak family fortune, it stands in stark contrast to the lot of most Egyptians. Gross domestic product per capita in Egypt is a mere $2,500. In western Europe and North America GDP per capita is about $40,000, yet the capacities of Egypt’s intellectual and entrepreneurial elite are the rival of any state in the world.

The real damage imposed by men such as Mr Mubarak is not the money they might have stolen. The tragedy is that the system that enables them to steal it destroys opportunities for others to generate wealth – not only for themselves but for the whole population...