Are San Diego and Tijuana Worthy Partners?

Let's return to a fundamental question. When social and economic inequalities are so great, as they are across this border, is it realistic to think that there can be a meaningful cross-border partnership of any kind?

This is a real issue. People may choose out of politeness not to talk about it, but the suspicion is almost always there in the background: Isn't Tijuana too poor and corrupt to be a worthy partner with San Diego? Isn't San Diego too wealthy and prejudiced to be a worthy partner with Tijuana?

The Devil should be given his due, but not more than his due. The differences that matter - the ones that have gotten in the way of an effective partnership in the past - have been substantial, but they are not eternal. In fact, they have been rapidly diminishing.

When Mexico was a one-party centralized state with a protectionist economic policy and an anti-U.S. chip on its shoulder, meaningful partnerships at the border were unlikely. But all that has changed dramatically in the past ten years as Mexico has peacefully opened up its economy and democratized its political system.

These reforms are just beginning to bear fruit in terms of major opportunities for collaboration at our border, including projects discussed in the March issue of San Diego Dialogue Report for a binational aqueduct and a cross-border international terminal at Tijuana's airport. So this would be just the wrong time to give up hope.

But one great obstacle to partnership does remain. For decades, Mexico has been unable to provide its citizens and local governments with long-term, low interest credit. It may not be obvious, but most of what San Diegans find troubling about Tijuana - the poverty, corruption, and poor urban planning - is a direct consequence of this absence of credit.

Think about it. After World War II, U.S. cities developed roads and highways, water and sewer systems, libraries, parks, and many other urban amenities with the aid of a marvelous system of tax-free municipal bonds. Similarly, the post-war, suburb-creating housing market was a creature of the 25-year, low interest mortgage. Small business and entrepreneurship flourished because of government-financed small business loans. And low-interest student loans made a college education possible for the sons and daughters of millions of working class families.

In other words, the American middle class in the post-war era was very largely created by easy credit.

But Mexico has had none of this. Tijuana is still largely a city built on cash. Without low interest loans for housing, education or business, hard-working families cannot easily better their condition. Without long-term municipal bonds, city government cannot easily plan for the long-term or provide the urban amenities that would give residents the sense of an improving quality of life. Under such conditions, the temptations of corruption are very great. What is surprising is how often they are refused.

This, too, is changing. A robust credit economy is coming to Mexico, another fruit of the democratic reforms that ended 70 years of one-party rule. A regime that maintained its power by bestowing endless political favors had no real interest in a system of easy credit, which sets people free to advance by their own hard work and wit. The result was a system of begging, not one of independently flourishing cities and citizens.

But that regime is gone. Thus the prospects for genuine cross-border partnerships have never looked brighter.