Economic Development Problems: Crime in Mexico

First this from the International Herald Tribune:

“MEXICO CITY: When José hops into his Ferrari, presses his Ferragamo loafer to the floor and fills the night air with a deep roar, his bodyguards hustle into a black sport utility vehicle with their weapons at the ready, tailing their fast-moving boss through the streets.

José, a business magnate in his 30s who said he was afraid to have his full name published, makes sure his two children get the same protection. Bodyguards pick them up from school and escort them even to friends’ birthday parties — where the bodyguards meet other bodyguards, because many of the children’s classmates have similar protection.

With drug-related violence spinning out of control and kidnappings a proven money-maker for criminal gangs, members of Mexico’s upper class find themselves juggling the spoils of their status with the fear of being killed.”

Most people look at this and say “Glad I don’t live there…” but there is more to this story then just that. This is the story of developing countries. The fear of criminal action can be very burdensome on a country that is trying to develop. Mexico, where many of the cops are in the drug cartel’s pockets, there has been an increase demand for bodyguards.

These are funds that would be spent somewhere else, like we do in the United States. In the U.S., there is only a need for bodyguards for celebrities and state heads. This is because we are relatively safe and the gap between rich and poor are much smaller. If a country continually has to deal with strife and fighting, it will have a very hard time growing. People will leave the country and there will be a brain drain.

So there is more to this than just “Glad I don’t live there…” This is a developmental problem. The solution to this is possibly allowing private companies to provide security instead of police. This will get rid of the taxes in which the people are already paying and it will get rid of corruption. That is how the free market would work but other than that this is a very hard situation. It could also be a solution for countries to allow drugs to be made legally. This would get rid of the income source of these criminals because if it was legalized tomorrow it would be heavily regulated. Legitimate businessmen could then start to grow it on their own. Thus pushing the criminals out or at least making them have to work hard, which we could imagine would reduce other criminal activities.

The rest is here.

~PCCapitalist

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