I recently watched a fun documentary on Netflix, Basketball or Nothing. The camera follows the Chinle High School basketball team as they attempt to win the Arizona State Championship. Chinle is a town smack-dab in the middle of Navajo Nation, the largest reservation in the United States. 

I started watching it because I wanted to relive my glory days as a basketball star bench warmer of my high school. But, as the documentary opened, I was intrigued by the cultural and economic realities of the town. 

Chinle is home to a little over 8,000 residents, most of which are American Indian. Out of the 8,000 people, over 49 percent of the residents live under the poverty line. There is nothing in this town, other than a few shops, some schools, a hospital, and a couple of fast food joints. Wages continue to decline. Crime, drugs, alcohol, and suicide are prevalent in these reservations relative to the rest of the United States. 

Actually, most of the reservations in the country experience similar levels of poverty and declining growth. Why do all reservations suffer? Economics can explain.

It is an institutions problem. Much of the Navajo Nation and almost all of Chinle is managed under a tribal trust. Without getting into the weeds on tribal land trusts, the big takeaway is that, virtually, private property rights do not exist.

The land is similar to a reservation, in that the Federal government protects it. Unless you are a member of the tribe, you are not allowed to reside or do anything on the land. The land is also (almost) wholly self-governed by the tribe. In the case of Chinle, the laws, schools, health system, everything, is governed by the Navajo tribe. Chinle is an agency within the Navajo government. 

Any action on the land, such as building, renovating, even taking out a mortgage, requires approval from both the tribe and the Federal government. What’s more, is that taking out a mortgage or starting a business requires collateral, which under the current arrangements of communal property, is practically impossible. 

As you can imagine, this creates a ton of roadblocks–especially for entrepreneurship.

Importantly, the only developing going on are the ones that benefit tribal leaders, in the spirit of “it will benefit the whole tribe.” When we think of what benefits tribe leaders, it helps to think of what benefits any government representative or leader. For one, more jurisdiction—more say or power over more things—is a good starting point. Secondly, being “needed” is also an excellent problem to have for a government official. No politician wants to be so unnecessary that they are forgotten.

The same thing applies to Native tribe leaders. The tribal leadership dictates and funds practically everything, via the Federal government and the Bureau of Indian Affairs.  There is no hustling and bustling of a competitive market, with different goods and services and opportunities for the community. There is no innovation or entrepreneurship. 

It’s important to mention that the institutional problems of these Native lands are a direct result of a long and harrowing history of government intervention. From President Jackson’s Indian Removal Act to the General Allotment Act of 1887 and then onto the Snyder Act of 1921 the institutional arrangements for Native Americans have been so uncertain that it is no surprise the economic conditions of these reservations. Because of this uncertainty, there is virtually no access to adequate financial services, healthcare, and education. 

Just looking at a map of Chinle, AZ, the only thing mildly exciting to do outside of school and work, is a Church’s Chicken and a Denny’s. 

It makes sense why one of the most exciting things to do in the town is to watch high school basketball. 

And, although high school basketball is fun, it is sad to witness the state of this town. I’m not sure the communal ownership of the land, guided by the tribal leaders, is all that worth it. Many Natives reluctantly leave to find opportunity elsewhere. They find themselves leaving behind their rich cultural foundations and community. However, for those who stay, many succumb to isolation and poverty. 

Private property rights, though not the only institution necessary for a flourishing individual, community, and society is one that undoubtedly promotes economic growth. My hope is for Chinle to readdress their institutional arrangements. Otherwise, to the tune of the documentary, the Chinle High School basketball team is the only hope for Chinle. 

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