Dicembre 23, 2015

The Transition in Mexico

The Transition in Mexico

The health of Mexican democracy is under menace. Just a quick look at the regional Latinobarómetro’s database on satisfaction with democracy shows that Mexico is in its lowest historical levels of popular support to democracy. Despite many institutional changes and transformations in the last three decades, it does not seem that the reformism during the period of the Mexican transition era has fulfilled the expectations of the population.

 

Then, if support to democracy is an expression of the political legitimacy, what are the shortages of the Mexican transition? To answer this question we look at some issues that could be at the hearth of poor satisfaction with democracy, like the outcomes of some major policy areas related to welfare and the management of public resources. In order to contextualize the articles presented in this special issue, let us stop briefly on some historical aspects of the Mexican political and economic transition.

Briefly said, the last three decades of Mexican politics have passed through the end of an autoritian one-party rule and the building of a new democratic regime. There is a consensus among public comentators and scholars concerning the so called transition in Mexico. That is, the period of the political democratization can be visibly followed since the 1977 electoral reform (which incorporated a proportional representation formula for the 25% of the Chamber of Deputies) until 2000, when the opposition achieved the first party rotation of the federal executive branch during long seven decades. In this period, electoral reforms were the recurrent batlefield of political struggles between the government and the emerging opposition. Simultaneously, economic crisis in the 70s and 80s resulted in a series of contradictory decisions that aired divisions between two political groups inside the hegemonic political coalition. The need to define a new development model for the country resulted in the clash of two main groups, which eventually resulted in the ascendancy of the (neo) liberal technocrats over the so-called nationalistic groups. The clash between two national projects is a central aspect in the Mexican transition, especially with reference to the current social and economic model and its outcomes. Thus, in the final period of the former regime, two major interrelated transformations gained attention in the public agenda: democratization and market-economy reforms.

 

The long process to develop the still disfunctional Mexican democracy had also a paralell process in the economic arena. Liberalization and deregulation replaced a relatively closed economy. As if this were not enough, the Mexican economy faced the debt crises of the 1970s and 1980s. This forced the government into a heavely restructuration of the economy with the IMF and World Bank.

 

Structural adjustment programs caused higher levels of unemployment, a growing informal sector and a sharply fall in salaries, mainly reflected in the minimum wage. Within the same context, in 1986, Mexico both entered the General Agreement on Tariffs and Trade (GATT) and officially moved towards an export-led-growth model and a liberalization of the economy with fast privatizations and deregulations. Mexico, which until the debt crises was one of the fastest growing economies with a distinctive development policy of fast industrialization and structural protection of national enterprises, opened to the world in the hope of long term fast growth. Something that has yet to come.

 

By the 1990s, the Mexican economy continued opening to the world with the signature of the North American Free Trade Agreement (NAFTA). In this way, it gained access to the US market in 1994. Since the implementation of NAFTA, the Mexican economy has an average growth rate rounding the 2.6% per annum. It has become stagnating since the economic policies have persistently failed to develop the inner market. The economic policy has limped too long on the external sector, and relied heavely on oil revenues traped in a resource curse, instead of progressive taxation, failing, eventually, to achieve higher growth rates.  Furthermore, because of a policy trap, the stagnating economy has caused profound inequalities, with half of the population on poverty and a growing elite that has captured the State in different degrees, securing monopoly rents and influencing policies that enhance their economic wellbeing at the expense of the society.

 

Taking into consideration the length of those two major transformations and at a decisive juncture – fiftheen years after the first presidential alternation in politics, it is important to offer a  snapshot of Mexican transition’s structural challenges.  Thanks to a multilayered analysis in areas like social policy, economic growth, security policy, the description of the current context of anti-corruption reform and the historical role of the Left during the democratization period, we expect to describe the trajectories of today’s debates in Mexico. 

 

As such the democratic transition in Mexico is a twofold process. Liberalization of the economy and political transformation. As Mexican democracy has failed to meet expectations, the economic policies have continusously failed to generate widespread prosperity. In our country, the political and the economical are deeply connected. An unaccountable democracy is as disfunctional as an economy affected by strong monopolistic power. Eventually, they work for a small number of people, not for the many.

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About Diego Castaneda

Diego Castaneda

Diego is an economist and economic historian, he received an MSc in Economic History from the University of Lund and a BSc. in Economics and International Development from the University of London under the academic direction of the London School of Economics. He has served as a consultant for the UNDP, as an advisor in economic development in the Mexican Senate of the Republic and is a regular contributor to different Mexican newspapers and magazines. His research interests are Latin American and global income and wealth inequality from a historical and contemporary perspective, long term economic growth and energy transitions.

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About Bolívar Portugal

Bolívar Portugal

Bolívar Portugal is a Political and Social Sciences PhD candidate at Universitat Pompeu Fabra. He holds an LL.M. degree on Administrative Law and Regulation (2011, Instituto Tecnológico Autónomo de México).Currently he collaborates as assistance profesor at Pompeu Fabra. His research agenda and interest are related to comparative politics of regulation, focusing his work on the Mexican regulatory regime.

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