An Australian tourist has died hiking in the Peruvian Andes, prompting the British consulate to call for stricter trekking laws. One must ask: is this a tragedy requiring government intervention, or a case of risk inherent in an unregulated wilderness?
Let us examine the facts. The victim, a 28-year-old woman, collapsed from altitude sickness on the Salkantay Trek, a popular route to Machu Picchu. Her death is undoubtedly heartbreaking for her family. But does it justify a crackdown by authorities? The consulate will argue that lax safety standards are to blame. Yet thousands hike these trails annually without incident. The death rate is minuscule.
The call for regulation is a classic bureaucratic reflex. Governments love to control. They see a tragedy and think, "If we had more rules, this wouldn't happen." It is a fallacy. More rules mean higher costs for tour operators, fewer choices for hikers, and a proliferation of paperwork over liberty. In the City, we know the cost of over-regulation: it stifles enterprise and creates barriers for the little guy.
Consider the economic angle. Peru’s trekking industry is a lifeline for local communities. Stricter laws would require guides, oxygen tanks, medical checks, and permits. Who pays? The tourist. This raises the price of adventure, making it exclusive to the wealthy. The poor local porter loses work. The free market, however, allows individuals to assess risk and choose their level of safety. Some want a fully supported expedition; others prefer a rugged solo hike. Both should be allowed.
Moreover, the British consulate’s involvement is curious. Are they spending taxpayer money to lobby a foreign government to pass laws that will primarily affect British tourists? A more efficient approach would be to provide better information and let the market respond. Tour operators offering higher safety standards will attract risk-averse customers. Those who prefer danger will find cheaper options. This is efficient allocation of resources.
Let us not forget the classic moral hazard. If the state guarantees safety, people take more risks. They assume the government will rescue them from their own foolishness. But the Andes are not a managed theme park. They are a wild and unpredictable environment. The only way to eliminate risk is to ban hiking entirely. That is the logic of the regulator, but it is the logic of a nanny state.
Inflation of government power is like inflation in an economy: it erodes the value of freedom. Every new rule is a tax on choice. The Peruvian government should resist this pressure. They should allow the market to develop safety standards through competition and reputation. The Australian government should focus on informing its citizens, not policing the world.
The tragedy of one tourist does not justify a regulatory monument. It is a call for personal responsibility. As investors know, you cannot eliminate risk. You can only price it. Let the hikers decide how much they are willing to pay for safety. That is the bottom line.
