Skip to content
Why change neoliberalism in Mexico?

Why change neoliberalism in Mexico?

For almost four years, the campaign for change to leave something called neoliberalism behind has been reflected in the public opinion debate. In particular, President Andrés Manuel López Obrador is the main initiator of this effort. What is neoliberalism and how has it been implemented in our country? Here are some notes:

1.— Fiscal discipline. At the end of the period, the debt hovered at 46% of GDP at that time, about 10 billion pesos. During that time, it was not possible to implement a fiscal scheme that would truly promote development, economic growth and support public finances. These were partial adjustments that did not address income, expenses and debt in a comprehensive and simultaneous manner. Today 60% of the PEA is in the informal sector and public resources are getting tighter by the day and we see a seemingly endless stream of social programs that are becoming more expensive and ineffective.

2.— Monetary discipline. The independence of Banxico was achieved, the government no longer has the money factory, the central bank is audited, we know the monetary base and the amount of international reserves online. The exchange commission, however, remains under government control in turn, the mint remains in the SHCP and the bank maintains relative independence from the US Fed.

3.— Deregulating Economic Activity. Today the procedures, permits, authorizations and offers are the same or worse than before the neoliberal period, which makes it a real viacrucis to start a business in Mexico where there is too much there is so much bureaucracy that corruption is the only thing that has grown exponentially. In our country, before a company is born to generate employment and taxes, it is not expelled by the competition, but by the government itself.

4.— Privatization of Public Companies. At the beginning of neoliberalism in 1982, there were 444 public companies. State companies included bicycle factories, cabarets, theaters, coffee, sugar, oil, gasoline, electricity, airlines, banks, etc. There are currently 32, however, there is not a single case of successful privatization. In order to justify privatization, there must be comprehensive benefits for both citizens and the government and individuals. In all cases of privatization within neoliberalism, this advance policy has not been fulfilled; conversely, monopolies and oligopolies emerged in such relevant sectors as telecommunications, banks and the energy industry. Over the years we continue with two leading TV stations, a relevant mobile phone company and four banks with 80% of the market.

Although significant progress was made in those years in the fight against poverty and representative democracy, as well as foreign trade; education remained stagnant, wealth was highly concentrated in a few families, there was no further progress in science and technology, and the state failed to fulfill its adequate role in regulating the economy .

Start investing your money in cryptocurrencies and get Free Bitcoin when you buy or sell 100$ or more if you register in Coinbase