Economic Development in Indian Country : Will Capitalism or Socialism Succeed?

American Indians are the poorest group of people in the United States. The 300 Indian reservations located in the lower 48 states suffer from very high rates of poverty, unemployment, and substandard housing. This Article examines why this is so. The economic history of American Indians demonstrates clearly that Native cultures created and protected private property rights and encouraged Indian individuals to support themselves through private enterprise. What happened to cause the centrally planned reservation economies that exist today and why are they dominated by federal and tribal governmental jobs and programs? This Article examines the interactions between the federal government and tribal governments for the past 200 years and argues that these governments need to break away from the paradigm that only governments can develop and operate economic activities on reservations. Tribes and the U.S. need to encourage and support Indian entrepreneurship and the creation and operation of private businesses in Indian Country. Tribes need to create functioning economies on their reservations made up of a wide variety of small private businesses so that more jobs and more businesses can be created