Benevolent government regulation?

Lest we think all regulation is bad, look at unregulated Baja California.

Baja should be a tourist magnet: it has 2,000 miles of warm coastline, dry to subtropical weather, and rich and unusual flora, fauna and natural beauty. It is adjacent to California, one of the most prosperous places on the planet.

Yet outside of Tijuana and Cabo San Lucas, the whole peninsula sits impoverished and abandoned. Why? Too little regulation. Property rights are weak, so property doesn’t stay bought, leaving little incentive to develop. Government builds almost no infrastructure, so there’s little water (despite a huge, mostly untapped acquifer) or electricity. Bandits occasionally run amok for lack of adequate policing.

The environment is being trashed. Inside Baja’s national park, spraypaint graffiti covers boulders for mile after mile. Trash litters fields. Truckers perform roadside oil changes by simply draining engines directly onto the ground, leaving toxic black slicks at turnouts. Outside the national park, it’s worse.

Now imagine what would happen if the U.S. bought Baja, subdivided and resold it to developers, and used the proceeds to build infrastructure. A property gold rush, coincident with environmental cleanup. Why? Regulation — of property rights, civil order, environment, and much more.

Chew on this before you check “Libertarian” on your next voter registration card. A little bit of carefully designed, universally applied regulation is much better than none.

One Response to “Benevolent government regulation?”

  1. Neoliberalism’s confusion « Mitchelldom Says:

    [...] a dramatic illustration, consider the difference in the fortunes of California and Baja California. The latter fails for lack of a regulatory structure (mainly property rights, environmental law and [...]