A fundamental paradigm of our political economy is that government has an ethical and moral obligation to intervene when markets fail. The paradigm is central to the Market Failure Doctrine. The doctrine recognizes that rational self-interest produces undesirable externalities. It advances welfare economics on the grounds that state action is required to address suboptimal economic outcomes for a society. The debate over how and to what degree the government should intervene remains central to national budget debates. In the United States, the Biden and Trump administrations offer starkly different interpretations of the state’s role in market interventions.
Among Georgists, the Land Value Tax provides a moral and economic justification for funding public goods. Henry George argued that land values are socially created, and thus society should benefit. Roads, utilities, education, and other infrastructure, he insisted, should be financed through this collectively generated revenue. Although more than a century has passed since George’s writings were first published, we remain locked in debates about what government should fund, when it should act, and how it should respond when entire communities are suffering.
This year, these debates feel especially urgent. Across the country, the public has witnessed government failures that are impossible to ignore: FEMA’s inability to respond adequately to disasters; the elimination of hazard mitigation; and this fall’s decision to cut off food assistance.
Here in La Playa de Ponce—a coastal barrio of 19 neighborhoods and roughly 11,000 people, market failure is not an abstract concept either. It is a lived reality. For more than 10 years, sectors of the community have endured chronic flooding with contaminated sewage water, leaving residents exposed to pathogenic bacteria and dangerous environmental conditions. The smell alone cannot be described in words. The electric company’s refusal, or inability, to replace hundreds of streetlights damaged during Hurricane María has left entire streets in darkness, fueling feelings of insecurity and abandonment. Although LUMA is a privatized energy distributor, it is still responsible for serving the public good. Yet the darkness remains.
Communities can react to these failures in different ways. Sometimes the reaction is shock, disbelief, and anger, followed by resignation. Residents lament not being invited to participate in decisions made about them, not being informed, not being seen. These themes have emerged repeatedly in my conversations with neighborhood leaders. Without a clear articulation of a collective goal or vision, community leaders have noted that these moments of indignation fade, and government institutions continue to ignore the very people who need them most.
Market failures can also provoke a different reaction: cooperation. Scholars like Kropotkin, Bulmer (1984), and Dean Spade (2020) remind us that mutual aid and neighborhood solidarity often emerge most strongly in the absence of responsive institutions. These forms of cooperation are not simply charitable acts, they are survival strategies. They are political, relational, and rooted in shared commitments to one another. Mutual aid becomes both a response to state failure and a seed for collective resistance.
In La Playa, however, resilience planning frameworks threaten to reproduce entrenched governmental market failures. The resilience frameworks tend to focus on absorbing shocks or fortifying systems without addressing the deeper structural conditions that produced vulnerability. Macro-level market failures and micro-level inequalities have not been a focus in La Playa’s resilience plans. As I have argued elsewhere: resilience is not just about adapting, it is about refusing disappearance in the face of state abandonment. This is why many scholars have become skeptical of resilience planning frameworks that do not confront root causes.
Over the past few years, La Playa has produced multiple resilience plans—some generated by nonprofits, some by government. Between La Playa’s at least five distinct planning documents, we must have given voice to dozens of problems and 50 priorities. These planning documents––soon to be made public, each have different planning frameworks: nature-based solutions for co-benefits to our human settlements and the coastal ecosystem in which we reside; local economic development; energy resilience; post-disaster spending strategies; and community vulnerability and hazard mitigation assessments. Each carries value, but collectively they reveal a fragmented and incomplete approach that fails to express a unified community voice. Where should our communities begin to tackle five different sets of priorities? And what has been missed through the narrow lenses of the planning frameworks?
Missing, for instance, is a sustained focus on the social foundations of a functioning, just community. This is where social capital becomes essential. Social capital refers to the networks of relationships that mobilize shared identity, norms, trust, cooperation, and reciprocity towards common goals. Social capital produces tangible public goods, such as collective actions (community clean-ups, hazard-mitigation projects, neighborhood watch efforts, or coordinated disaster response), shared resources (tools, food, transportation, childcare, or information), improved public spaces (maintenance of parks, community gardens, public plazas, or meeting spaces), stronger institutions and community programs (formation of trusted local organizations, leadership bodies, or standing committees).
However, we cannot assume that social capital exists in a functional form within any neighborhood. In La Playa, our community leaders have witnessed community groups form around urgent needs, only to dissolve due to mistrust, interpersonal conflict, or accusations of mismanagement. These breakdowns illustrate the fragility of cooperation built on shaky relationships and unarticulated values. Cooperation is cultivated.
For this reason, when I initiated Un Nuevo Amanecer’s VIDA Costera project, the first step was to form a cohort of residents. The cohort was intentionally designed on a process grounded in social capital formation. The first step was to create space for leaders, many of whom had never collaborated despite their neighborhoods’ close proximities. I worked with the cohort to articulate a vision for caring for collective effort. Hence, we talked about our identities, values, norms, aspirations, and the conditions affecting our neighborhoods. This process laid the groundwork for shared understanding and mutual commitment that we attempt to embody through concerted collective action.
This cohort of neighborhood leaders has since April 2025 advanced VIDA Costera, a community-led planning effort using nature-based solutions, involving more than 900 public participants to date. A public forum is scheduled for January 28, 2026 [RM1] to share the results of their efforts.
The community-led resilience plan for nature-based solutions will be available at nearly the same time as two other community resilience plans: A Whole Communities Resilience Plan that comprehensively assessed vulnerabilities, exposures, and community-identified hazards; and LUCES para la Playa, an energy resilience initiative focused on neighborhood-level electricity needs. These follow on the footsteps of Ponce ReStart, a municipal plan to strengthen the local economy, and APA Recovery Concepts for La Playa, a planning framework developed with support from the American Planning Association.
The challenge now, presented this month to our cohort of neighborhood leaders, is not to produce more documents. It’s to bring them into harmony. At last night’s meeting, the cohort discussed organizing these plans into a unified set of priorities: identifying duplications, and highlighting what is missing, such as emergency planning for a pending US-Venezuelan war which implicates our Venezuela-facing Caribbean port and communities. Harmonizing the plans articulates a unified path to implementation. Some things we can do ourselves without much external assistance, such as replanting abandoned public space, cleaning up the shoreline. Others will require us to leverage in-kind expertise or buy it with funding. The point is that social capital is going to be a pivotal part of making material changes that neighbors want.
Cultivated and intentional neighborhood cooperation is perhaps a radical community strategy to confront market failures; it is a form of anarchism, in the words of Kropotkin (1907). Who better than the residents of La Playa to expose government failures and build the collective strength needed to protect our future? Our momentum is real, and the movement is already in motion.
References:
Bulmer, M. (1986). Neighbours: The work of Philip Abrams. Cambridge University Press.
Kropotkin, P. A. (1907). Mutual Aid: A Factor of Evolution (Second Edition). Heinemann. https://hdl.handle.net/2027/uc1.b5292720
Spade, D. (2020). Mutual aid: Building solidarity during this crisis (and the next). Verso. https://www.are.na/block/12085085
