Statist

Only in an underdeveloped country that aspires to remain so would the head of state, seemingly with a low opportunity cost of his time, appear to receive a plane that will provide passenger air transport and boast about it as if it were a triumphant act of government unparalleled in world history.

If you think it's surreal, that's precisely what happened last July 1st, when President Sheinbaum attended the AIFA (National Air Transport Association) to celebrate the delivery of an Embraer aircraft that will be operated by the government-owned Mexicana de Aviación, the same company that López revived on a whim because, according to the fourté, the government owning an airline "makes us more sovereign."

At such a festive event, the president stated in her speech that “recovering Mexicana de Aviación is not an ideological whim, but a strategic decision,” because, according to her, “air transport is vital for defense, emergencies, national logistics, and the transportation of people (phew; thank goodness she also included this last function, because can you imagine a passenger airline that doesn't transport travelers?)”

The president also noted that "unlike private airlines that operate under a profit-driven logic, which has its reasons and makes sense, the new Mexicana has collective well-being as its main objective." She also said that "this is a company born with new principles of transparency, inclusion, efficiency, social responsibility, and a sense of nationhood, and that is provided by National Defense," and concluded: "The message to the people is that you have the right to fly." In response to this, "Brozo, the creepy clown" would say: "Come on, my boys and girls, let's all fly!"

The president's statements clearly reveal her ideological vision of the government's role in the economy. Without going to the extreme of a communist system of government ownership of all productive assets (capital, land, and, yes, labor), she is convinced that it is the government's role to produce and offer private goods, defined as those that meet two characteristics: exclusion and rivalry in consumption.

Exclusion refers to the fact that if an individual doesn't pay for the good, they can't consume it, while rivalry refers to the fact that the units consumed by an individual can't be consumed by anyone else. An example related to the statement "you have the right to fly" on a Mexicana plane: although according to the president I have the right to fly, if I don't pay for the plane ticket that grants me access to the service, I simply can't board the plane and be transported to my destination; thus, if I don't pay, I'm excluded. Regarding rivalry, the plane has a certain number of seats; if all of them are sold, even if a new passenger arrives and demands that their "right to fly" be validated, there's no way to satisfy them.

(Note: In the case of a pure public good, there is no exclusion or rivalry in consumption. Example: the light provided by a street lamp; even if I have not paid for what it costs to provide it, I can consume it, and my consumption does not exclude others from also consuming it, even simultaneously.)

Just as passenger transportation on an airline—whether Mexican or any other—is a private good, so are electricity, gasoline, gas, drinking water, medicines, passenger and freight rail transportation, postal and telegraph services, lithium, salt, and hotel and restaurant services. As you can see, all of these goods are produced and provided by the Mexican government.

In populist discourse, such as the one delivered by the president, it is always argued that the government's purpose in providing these private goods is to maximize "collective well-being," which the current ruler defines according to his or her own preferences, which, he or she assumes, reflect the preferences of the population; nothing could be further from the truth. Preferences are always individual and subjective, so when a ruler imposes his or her own preferences, it is an act of authoritarianism that, paradoxically, results in a lower level of social well-being.

Because of her statist ideology, the president fails to recognize the contradiction she finds herself in. Due to a poor definition of property rights (as the director of Mexicana stated at the ceremony, the airline now belongs to the "people"), by assigning a "social" or "collective welfare" function to government-owned companies, they will operate economically inefficiently (and perhaps even physically inefficiently, as is the case with Pemex) and, therefore, will be a permanent source of losses for taxpayers, whether or not they consume these private goods.

The Mexican state-owned sector has been, is, and will continue to be inefficient, a source of fiscal deficits and lower social welfare. Mexicana de Aviación is another example, as has been the case since its rebirth.