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Market Solutions in Mexico: Challenging the Myth of “Government Can”

University students in Mexico are raising questions that portend changes to come in their country: “If the government is so great, why don’t we have security, an efficient court system or reliable roads? Why do we face such trouble and instability?” Economist and Institute for Humane Studies economics program officer Mario Villarreal-Diaz understands the significance of the rising doubt that the central government can and should play primary problem-solver and hold citizens’ unswerving loyalty. Raised and educated in Monterrey, Mexico, Mario was steeped in his country’s authority-trusting culture. “Government failures are often blamed on insufficient funds or the wrong politician in power,” Mario explained to me. “People still tend to believe that the government can solve complex societal problems.” In fact, they often view the central government as the sole actor empowered to tackle widespread problems with security, infrastructure and health care. Questioning the Status Quo This past month, Mario delivered lectures on “Perspectives of Collective Action,” explaining cooperation among individuals, to students at The Public Policy Graduate School at Monterrey Tech in Monterrey, Mexico. Mario’s talks offered an alternative to the default “government can” approach to policy. “How can individuals and societies solve problems of collective action?” Mario asks. By and large, these students have not encountered the idea that central government is not the only (or even a good) answer. What are the alternatives? In this Learn Liberty video, Chapman University professor Tom Bell describes how individuals can coordinate action and achieve a common purpose, without central planning: Mario hopes that his lectures left students considering the possibility that public policy is not simply a set of technical challenges aimed at carrying out the government’s orders. Government-free Developments in Mexico Students in Mexico don’t need to look far to find non-governmental solutions to entrenched issues. “Who is in charge of milk distribution?” asks Mario, offering a daily example, “Why does it work without a central authority’s involvement?” Moving onto tougher topics, the same principles apply. Just look at the Center of Citizen Integration in Monterrey, a non-profit citizen-driven network that aggregates and disseminates critical information to individuals and appropriate organizations, applies public pressure to the government, and promotes efficient solutions to complex security, health and infrastructure issues. The spontaneously ordered organization started with family members and friends coordinating on Twitter in order to avoid hot spots of violence in the city. When information was important, it would go viral, spreading rapidly with little transaction cost. The Center has since grown with the help of private sector seed money, and it has started to address issues ranging from pot holes and trash collection to police corruption and mental health care. Mario acknowledges that the power of markets to solve problems can be counterintuitive. Nobody possesses the absolute knowledge or capability to solve complex coordination problems; individuals have limited knowledge and drive to pursue their own interests. It is natural to think that if “nobody is in charge,” we’re headed for chaos. In reality, with a foundation of property rights and a functional price system, cooperation can take off and lead to greater human flourishing. It may feel like a leap of faith to move from government dependence into the kind of free space that invites individual initiative and responsibility, but history provides evidence that greater freedom actually leads to greater security. Mario, for one, is convinced that greater freedom will transform his home country for the better—and students in Mexico are beginning to agree.
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