December 1, 2018


Lopez Obrador Spells Trouble for Mexico: His personalistic presidency threatens years of hard-won institutional gains. (Shannon K O'Neil, November 30, 2018, Bloomberg)

Over the last three decades Mexico has changed. What was once a closed commodity-driven economy is now open, globally competitive and dominated by manufacturing. A nation once known for its few haves and many have-nots has seen extreme poverty fall to 2.5 percent, infant mortality cut to a third, average lifespans rise by a decade, and the number of years children stay in school grow by half. Politically, decades of one-party rule ended in competitive if at times messy democracy.

This slow-moving transformation also embodies a bigger achievement: a shift away from informal, personalistic, and centralized power through the strengthening of institutions. Pushed by opposition politicians, civil society organizations, investigative journalists, entrepreneurs and the decisions of millions of business owners, workers, and voters, Mexico has become a place with a diverse and increasingly independent private sector, with greater transparency and access to information and incipient but growing political checks and balances.

Mexico's transformation hasn't been all good, and the good parts have been uneven. Crime, violence, and corruption (or at least public awareness of it) have surged, affecting everyday life for too many. Economic growth, access to healthcare, quality education, and jobs with benefits diverge dramatically between the north and the south: In Nuevo Leon, home to Mexico's industrial center, fewer than 2 in 10 citizens live in poverty, similar to their nearby Texan counterparts; in the South, nearly 8 in 10 face this daily economic hardship.

And the transformation remains incomplete. NAFTA helped open up Mexico to international markets, but it did little to take on the monopolies and oligopolies that drove up prices at home and made it hard for the less-connected to get ahead.  Recent structural reforms are beginning to chip away at these barriers: Financial reform has increased access to credit, telecom reform has lowered prices, energy reform has brought new finds and more stable supplies, anti-trust crusaders have taken on unfair business practices, and education reform is just beginning to better prepare Mexico's youth for 21st century jobs.

Political institutions also have a ways to go. Power still matters too much. And rule of law in particular remains weak.

Yet the Fourth Transformation doesn't look to build on this base, making the benefits, such as they are, more inclusive and widespread. Instead, it looks to roll back the institutional gains so important to Mexico's transformation, as Lopez Obrador -- a leader obsessed with his place in history -- pushes a return to the more personalistic approach of the past.

Posted by at December 1, 2018 8:55 AM