In his article “The Origins of Power, Prosperity, and Poverty” Daron Acemoglu (2012) brings to our attention that presently in our world, there is a very steep fall in income per capita. Daron explains to us that many nations, today and in the past, operate under extractive political institutions. This essentially harms a nation for any potential economic growth that could come about in the future. The reason I say this is due to the fact that extractive political institutions do not create a fair opportunity for a nation to show off their abilities to prosper in the economy. Extractive political institutions are created to give the power to very few people, who in turn design, maintain, and benefit from these extractive institutions. An example of how extractive institutions were created was given to us by Daren. In this example, he tells us about Juan Diaz de Solis. Juan is a Spaniard and was responsible for putting together a crew of 70 mean to colonize the southern tip of South America in 1516. When Juan and his men had arrived to Argentina and Uruguay, they had a clear model they wanted to accomplish. This model was to find gold and silver and to capture and make slaves out of the Indians. However, the Indians who occupied the area were very small in size making it hard to capture and enslave them. Another downfall about these Indians they tried enslaving was they did not have a hierarchy set up, which essentially would make it difficult to make them work. The Spaniards learned very quickly that with very scarce Indians to have work for them, life was not easy and they began to die off. This led to the remaining men to move up the land to what is now known as Paraguay. There, the crew encountered more Indians, who in fact had a hierarchy established. The crew went ahead and took over this hierarchy, and enslaved the Indians that they had encountered when coming across this land. This type of institution was not the only one being created. These forced labor institutions not only made the Indians work, but it also made them buy what these conquistadors wanted them to buy, thus not promoting economic growth in the slightest bit. Another example was presented in the article. This example was very similar as to the first one, except in this example, a radical strategy was devised when the other two strategies failed. This group of men had also came to land that they believed they could find gold and enslave Indians to work for them. However, as in the previous example, the Indians were not willing to work in order to provide food for these new settlers. This led the settlers to starve, leaving them with no choice than to create a new plan. The second plan was to bring lower class men and women from their homeland over to work for them. This brought problems with the lower class people due to the fact it was hard from keeping these men and women from running away or participating in outside trade. This system was enforced for years but it ultimately led to a third strategy being implemented. This third strategy main basis was to offer economic incentives to settlers. They were given a grant of land and it was then their responsibility to work it in exchange for secure property rights. A year after this strategy was implemented; the lower class men and women were then given political rights which would allow them to move up the totem pole in society. From these two examples, there is one thing that stands out more than others; Inclusive economic institutions are not just more conducive to economic growths, but they also support and are supported by inclusive political institutions. These institutions are able to gain prosperity while distributing power widely, instead of in a select few hands as extractive political institutions do. We now can realize that the cause of differences between South and North America is due to the differences in economic and political institutions each country had established long ago. Since the Spanish mainly focused on extractive institutions, this led to very small, if any, economic growth. However, on the contrary, since the English were not able to set up these extractive institutions and they began inclusive institutions, this was able to allow the United States to have much more promising opportunities for years to come. As Daren stated in this article “you can’t succeed economically if you don’t get your politics right.” That statement is very evident when referring to the previous two examples discussed. The first examples politics were not on track to prosper and ultimately it failed and we now see the effects of that today. However, North America was able to establish their politics before worrying about gaining wealth. This led to what we see now, the divergence between North and South America. North America continues to prosper while South America continues to try and fix their dismal institutions.