Posted on 06/24/2006 11:29:52 AM PDT by lauriehelds
Pro-business attitudes, a stable currency, oil wealth and NAFTA have created a booming economy complete with BMWs and skyscrapers.
MEXICO CITY - A grainy 1957 photograph shows men in typical peasants' hats running to catch a dilapidated bus near Insurgentes Avenue and Paseo de la Reforma in central Mexico City.
Today, that intersection is filled with young men and women who chat and send text messages on cellphones as they wait at subway-style stations for gleaming new buses that cruise past congested traffic in bus-only express lanes.
Blocks away, business executives with laptop bags hurry into the 55-story Torre Mayor, Latin America's tallest building, where they'll watch CNN en Español on digital screens as the elevators sweep them to their offices.
Lost in all the publicity about poor Mexican workers besieging the U.S. border in search of better-paying jobs is one fact: From Tijuana on the border with California to Merida in the Yucatán peninsula, oil-rich Mexico is booming. Inflation remains low, economic growth is steady, and salaries are rising. The Mexican government has more than $76 billion in foreign-currency reserves, the most in its history.
Mexico's annual per-capita income has more than doubled in the last decade, to more than $7,000, the highest in Latin America. The inflation rate is less than 3.5 percent per year, lower than the United States'.
Economic analysts credit the boom to high oil prices, the North American Free Trade Agreement and the pro-business policies of the current administration, led by President Vicente Fox of the National Action Party, or PAN in its Spanish initials, and of the previous three under the long-dominant Institutional Revolutionary Party, knows as PRI.
Mexico's new wealth still coexists with its familiar poverty. The eastern neighborhoods of Mexico City and the villages east of Benito Juarez International Airport are as dilapidated and poor as they were decades ago.
FALLING SHORT
Although it's impressive, Mexico's economic expansion has been far less than the country needs. Analysts say that while the economy is creating 180,000 jobs annually, the growing population demands more than 1 million, hence the huge migration to the United States.
The stark choice Mexicans face as they choose their next president on July 2 reflects the gap that remains between rich and poor.
One of the two leading candidates, Andrés Manuel López Obrador of the Party of the Democratic Revolution, is a harsh critic of the policies that many think have contributed to the booming economy. Recent polls indicate he's in a virtual tie with the PAN candidate, Felipe Calderón. The PRI's candidate, Roberto Madrazo, is running third, and few think he has much hope of winning.
Knight Ridder interviews with more than 30 voters in the past two weeks indicate those who support Calderón believe that he would maintain Fox's pro-business policies and that López Obrador wouldn't.
Mexico has joined the global economy since NAFTA took effect in 1994. Convenience stores known as Oxxos now compete with 7-Elevens, and traditional Mexican chain stores vie for customers with Wal-Mart, Costco, Home Depot and Office Max. The Torre Mayor building on Mexico City's Reforma Avenue, which opened in 2003, cost Canadian business magnate Paul Reichmann $275 million to build.
Metropolitan Monterrey, long Mexico's business heart, now boasts one of Latin America's wealthiest municipalities, San Pedro Garza Garcia, where the streets are lined with skyscrapers, shopping malls and BMW and Mercedes-Benz dealerships.
MAJOR TRANSITIONS
Places that once were little more than rural towns have become major business centers. In San Luis Potosi in central Mexico, cargo planes bearing overnight packages and freight land at the airport, and expressways connect the elegant colonial center with industrial and shopping districts. In Toluca, an hour's drive west of Mexico City, the airport now offers international flights, bypassing the chaos and congestion of the capital, and authorities plan to spend more than $50 million to expand the runways.
The country's gross domestic product has been growing at about 1.9 percent a year. That's lower than the almost 4 percent of more than six years ago, but the peso is holding steady against the dollar, and there seems to be no fear that the economy will collapse as the president's term ends, something that's happened more than once in the last 20 years.
''The economy has improved overall,'' said Cesar Castro Quiroz, an analyst at the Center for Analysis and Economic Projections for Mexico. ``We are much better off now than we were in terms of government accounts, management of the foreign debt and general economic stability, with the highest reserves in history.
``The problems that remain are in the generation of jobs and the overall annual economic growth rate.''
For many Mexicans, though, life has been getting better.
''My family and I are certainly better off today thanks to globalization and the opening up of the Mexican market,'' said Faustino Galarza, a self-employed business consultant in Mexico City who makes more than $100,000 a year, buys a new car every four years and owns property in Mexico and abroad.
And they didn't even say thanks to the USA for taking in their jobless underclass who send their hard earned money back to their families in Mexico. Que lastima.
Lots of nouveau riche anecdotes, just two number tell the story:
Number of jobs created: 180,000 (population approx. 100mm)
GDP growth: 1.9%
Mexico's economy is barely operating.
They should have a lot of money since all their underprivledged are all up here sucking on our system.
The Mexican government is an organized crime syndicate.
Capitalism can enrich the poor; socialism can impoverish the rich.
One of the few positives of us having taken so many Mexican refugees, is that many of them return to Mexico with American ideals of freedom, a good work ethic and a desire for more equity and a freer, less corrupt, marketplace.
Mexico is under pressure from returning Mexicans with money, that have been Americanized.
Wasn't Susan Sarandon down there recently crying the blues that we (as in the USA taxpayers) need to fund schools for Mexico to help them become more educated and get better paying jobs?
ping
The ONLY reason Mexico is doing so well is because of us!! We take their poverty stricken peasants and allow them to send all of their money back to Mexico!! We are getting screwed in the process!
"The Mexican government is an organized crime syndicate."
So is ours, at all levels.
That's glib.
Mexico has every natural advantage a country could ever want: location, resources, a rich cultural mix, a population with ambition and not adverse to hard work. It's one thing, and one thing alone that prevents Mexico from being successful, and that's corruption. It's corruption on a scale you wouldn't believe unless you've been there; it's corruption that even puts other Latin countries to shame. It's not only government, and the legal system, it's almost every walk of life. Not only will the police will steal the wheels off your car and sell them back to you, but sidewalks crumble, walls flake apart, lumber cracks; you buy a bottle of Asprin at a drug store and you have to check it to see if it's been opened or looted. Everyone cheats everyone down there.
Corruption destroys their chances.
Hard to argue against your point.
Meanwhile on American street corners more and more men, in typical homeless garb, sit with tin cups as the litter skitters in the gutter, and the breeze sends little puffs of dust up around them.
Sounds like you've been there!
Que barbaridad!
So is ours, at all levels.
On the whole, I think our organized crime syndicate is a tad better than Mexico's.
Of Mexico's annual GDP, only 24% of it is the size of its national debt (if that way of expressing it makes sense). In the USA (where our debt has grown over 50% in the past half a decade), it's over 70%:
http://www.publicdebt.treas.gov/opd/opdpenny.htm
Is Mexico's economy really barely functional? Inflation's lower than ours, it has free trade pacts with far more countries than we do, and the majority of its inhabitants are under age 30. In the USA, most are over age 40. And we're plagued with entitlement programs that hopefully won't continue to spread down there. Social security's increasing emergence is actually a major campaign issue down there. Hopefully they won't go down that FDR road during their July 2nd elections (in which there's virtually no incumbency).
Encouragingly enough, Mexico just passed a new anti-monopoly law which http://www.cfc.gob.mx (analogous to the FTC) wants to enforce pretty vigorously, so that foreign investment will return. It would help if we keep the immigration pressure on Mexico as the lack of a safety valve into the USA breadbasket emboldens and empowers reformers there to push through reforms despite the oligarchs' massive media campaign. A major problem is that labor unions can still block traffic in protest, without repercussions. That needs to be banned. And foreign investment is unlike to return as long as Mexico continues to have such RACIST, anti-gringo immigration laws too:
http://www.directory.com.mx/immigration
Meanwhile, Mexico needs to reign in the oligarchs, especially Carlos Slim...a telecom monopolist with 94% of land-based local phone lines, 80% of cellphone accounts and somewhere around there in terms of Mexico's pathetic 3 million internet access accounts. Slim's also Forbes' 3rd wealthiest on Earth. He has a lot of advantages that reformers have a tough time combatting.
There's also Azcarraga, the 37 year old owner of Televisa (which has at least 70% of broadcast viewership). His company's about to buy Univision here in the USA so watch out.... Additionally there's TV Azteca owner Salinas Pliego whose misdeeds got his company banned from the NYSE about a year ago.
July 2nd's elections will have an impact. Hopefully the Communist Lopez Obrador won't win. He's currently narrowly favored. How 'bout if we keep up the immigration pressure while it can make a real difference down there for our fellow conservatives in Mexico who are trying to fix the place and make it more like the USA?
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