Historia del Neoliberalismo en México - Carlos Salinas de Gortari (18/07/2024)

The Neoliberal Era in Mexico: Carlos Salinas de Gortari's Presidency

Overview of Neoliberal Policies

• The presidency of Carlos Salinas de Gortari marked a golden era for neoliberalism in Mexico, building on public policies initiated by Miguel de la Madrid and aligning with international organizations' directives.

• Salinas's government rigorously applied neoliberal models, resulting in the privatization of 390 state-owned enterprises (63% of existing ones), often leading to their mismanagement and bankruptcy by private owners.

Economic Changes and Trade Agreements

• During Salinas's term, workers' wages deteriorated while a small elite close to the government amassed wealth without restraint.

• The Mexican economy transitioned from a closed system to an open one, engaging in international trade through the North American Free Trade Agreement (NAFTA), which exposed local producers to unequal competition.

Political Context and Legitimacy Issues

• Carlos Salinas assumed the presidency on December 1, 1988, amidst allegations of electoral fraud and significant public protests.

• To bolster his image and authority, Salinas orchestrated high-profile actions such as the arrest of corrupt union leader Joaquín Hernández Galicia ("La Quina"), purportedly due to political motivations against his candidacy.

Alliances and Reforms

• Recognizing his need for political allies, Salinas negotiated support from the National Action Party (PAN) and the Catholic Church by offering favorable measures that aligned with their interests.

• A constitutional reform was enacted that recognized religious groups' legal status, reversing restrictions imposed by the 1917 Constitution regarding clerical power.

Ideological Shifts and Social Programs

• Revolutionary ideals like social justice were overshadowed by emerging values centered around democracy, rule of law, and individual freedoms during this period.

• The liberal democracy narrative praised entrepreneurial spirit and financial deregulation while promoting globalization as beneficial for Mexico’s future.

Cultural Campaigns and Electoral Reforms

• Carlos Salinas effectively utilized intellectual support to launch a cultural campaign endorsing neoliberal policies aimed at elevating Mexico's global standing.

• In response to electoral legitimacy concerns, reforms led to establishing an independent Federal Electoral Institute (IFE), enhancing electoral processes alongside creating a National Human Rights Commission.

Transitioning Welfare Models

• Under Salinas’s administration, there was a shift from welfare state principles towards what he termed "social liberalism," aiming to address pressing societal needs while promoting infrastructure development.

• He framed social liberalism as essential for achieving national goals like sovereignty and justice while justifying governmental changes under this new doctrine.

Social Assistance Initiatives

• The National Solidarity Program emerged as a key initiative providing extensive assistance including basic services like water supply, housing construction, education support for impoverished children, thus becoming an effective electoral tool for PRI.

Cárdenas and the Struggle for Democracy

The Political Landscape Post-1988

• Cárdenas faced challenges in maintaining positions, emphasizing the importance of legal struggle, mobilization, dialogue, negotiation, and social activism as pillars of democracy.

• Discontent with official election results led to clashes between PRD protesters and law enforcement, marking a violent transition to democracy from 1988 to 1994 that resulted in numerous journalist deaths.

Economic Crisis Under Salinas

• Carlos Salinas took office amid significant political and economic crises; inflation exceeded 50%, and public debt surpassed $100 billion, consuming 6% of the government budget.

• To combat inflation and stabilize the economy, Salinas adhered strictly to International Monetary Fund guidelines while forming pacts with business elites and labor leaders.

Consequences of Neoliberal Policies

• Despite efforts to reduce inflation through these pacts, there was an increase in tariffs and taxes alongside negative impacts on wages.

• Salinas intensified privatization programs initiated by de la Madrid, transferring state-owned enterprises like oil, electricity, telecommunications, highways, airlines, chemicals, steel industries to private hands.

Criticism of Privatization Efforts

• Over 80% of state enterprises were dismantled during early neoliberal administrations; this privatization process faced criticism for lack of transparency and favoritism towards certain business groups.

• Many privatizations failed; several new tycoons ended up imprisoned or evading justice while poverty and inequality surged.

Banking Sector Reforms

• The banking sector was privatized rapidly under Salinas's administration; within two years, 18 major banks were sold off without adequate professional management oversight.

• New bank owners often lacked experience; many acquisitions involved complex financial arrangements that led to unsustainable debts.

Impact on Rural Communities

• The privatized banking system eventually collapsed requiring a costly government bailout (FOBAPROA), burdening future generations with debt despite having no involvement in the initial failures.

Neoliberal Economic Policies in Mexico

Introduction to Neoliberalism under Salinas

• The neoliberal agenda of President Carlos Salinas included commercial liberalization, aligning with George Bush's initiative to create a competitive trade bloc against the European Economic Community.

• This led to the establishment of the North American Free Trade Agreement (NAFTA), which came into effect on January 1, 1994, aiming to adapt Mexico's economy.

Economic Adjustments and Consequences

• Salinas accelerated tariff reductions and eased regulations on technology and foreign investment, allowing up to 100% foreign capital participation in many sectors.

• While this attracted significant foreign investment focused on exports, it resulted in a doubling of imports and an increasing trade deficit, adversely affecting local producers.

Social Impact of Neoliberal Policies

• Many small and medium-sized Mexican producers were unable to compete with larger foreign companies, leading to widespread business closures and increased poverty.

• Despite initial optimism about economic recovery, social unrest grew as indigenous groups protested against neoliberal policies and NAFTA.

Zapatista Uprising and Political Turmoil

• On the same day NAFTA took effect, the Zapatista Army of National Liberation (EZLN) rose up in Chiapas, symbolizing resistance against neoliberalism.

• The government's attempt to suppress this uprising was met with significant public support for the Zapatistas, forcing negotiations amid national and international media attention.

Assassination of Colosio and Aftermath

• The political landscape worsened after PRI candidate Luis Donaldo Colosio was assassinated on March 23, 1994. Ernesto Cedillo became his successor amidst fears of escalating violence.

• By the end of Salinas' term, confidence in neoliberal policies waned as economic instability began to surface.

Decline of Neoliberalism in Mexico

• Following Salinas' presidency, a severe economic crisis erupted similar to those experienced in previous decades.

• Criticism arose regarding Salinas’ focus on inflation control over sustainable growth; he faced accusations related to corruption that tarnished his legacy.

Conclusion: Legacy of Neoliberal Policies

• The aftermath saw a decline in investor confidence as capital flight began; Salinas' vision for modernizing Mexico ultimately unraveled.