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Overcoming the Metabolic Rift in Mexico

David Barkin is a professor at the Metropolitan University in Mexico City and an emeritus member of the National Research Council and the Academy of Sciences in Mexico. In 2016 he received the “International Prize for Studies in Poverty” from the International Council of Social Sciences for his proposal “Food Sovereignty as a Strategy for Poverty Reduction”. His latest book was published in August 2018,From Protest to Proposal: 50 years imagining and building the future.

In July 2020, the US-Mexico-Canada Agreement came into effect formally. However, Mexico has a long-standing trade surplus with the United States, and unequal interdependence has also brought adverse effects to the domestic industrial development in Mexico. There are disputes between the two in labor rights, agricultural products trade, and environmental standards. In response to these questions, the Center conducted an exclusive interview with Professor David Barkin on Mexico’s economic dependence on the United States, hoping to understand his answers to questions about how the Mexican authorities can gradually get rid of their dependence on the United States, whether China has prospects for in-depth cooperation with Mexico, and what the local people of Mexico can do to ensure the sustainable development of the regional economy.

David Barkin Confronting Dependency: Overcoming the Metabolic Rift in Mexico

The dilemma facing Mexico at the present time with regard to its economic and political relations with North America (both Canada and the United States) is the historical reshaping of the political and productive structures that leaves little room for maneuver. The latest “free trade” agreement is just another example of this increasing integration of the productive structures. The question of whether and how to reduce the increasing dependence requires an historical and political analysis of the antecedents of the present situation.

During the first half-century following the Mexican Revolution, Mexico embarked upon a serious strategy of self-centered development, privileging the agricultural sector in a first instance and then locally based light manufacturing, supported by state investment in heavy industrial projects that were considered fundamental for creating the basis for further development. Without going into the details of this process, and the contradictions it created, suffice it to say that the result was an outstanding record of sustained economic growth during about 35 years that was dubbed “The Mexican Miracle”, leading to an average annual rate of economic growth of about 6 percent, a feat virtually unmatched in the capitalist world up to that time or subsequently.

Accompanying this process was an overall improvement in living standards and a gradual increase in the country’s ability to satisfy its own basic needs. With the accelerated implementation of the agrarian reform, initiated during the presidency of Lazaro Cardenas (1934-1940), agricultural production rose steadily, leading to palpable improvements in food availability and a gradual increase in food supplies for the urban areas. Facilitating this dynamic was the rapid installation of an elementary school system and basis health facilities. With the outbreak of World War II, local industrial development was encouraged along with a rapid increase in employment opportunities, creating the basis for an incipient urbanization. A permissive inward-oriented economic policy –dubbed “stabilizing development” –agenda helped equilibrate the diverse sectors.

This model created its own internal tensions and contradictions; labor’s share of national income rose from about one-quarter to more than two-thirds of the total. Inevitably, the traditional elites and the rising domestic industrial class began their own political and economic strategies to stem this tide, attempting a dramatic “coup d’etat” that the well-entrenched political class was able to fend off with a series of dramatic measures, including support from economic interests in the United States. However, the opposition did not cease its onslaught and a “quiet” palace coup took place some years later, setting the stage for more than three decades of neoliberal economic management, heeling to the dictates of the “Washington Consensus” that crept over much of Latin America, following the bloody armed takeover in Chile in 1973, establishing General A. Pinochet as dictator.

The signing of the North American Free Trade Agreement (NAFTA) ushered in a new period of intense subjugation of Mexico to the dictates of corporate controlled price systems and legal institutions that further deepened the country’s economic and political dependency. During more than three decades, administrative regulations and constitutional amendments were promulgated to facilitate foreign investment, reduce environmental regulations and enforcement, debilitate small-scale farming for the domestic market, and hollow out protections for workers. Privatization of public sector enterprises was accompanied by wholesale opening up of access to concessions for exploitation of every imaginable type of the country’s extraordinary natural heritage.

Anticipating the popular sentiment against this heightening rape of the country’s endowment, the neoliberal regime signed a renewal of the NAFTA, now called T-MEC (Spanish acronym). The new ‘agreement’ created new levels of intromission in the domestic sphere, most notably being the new regulations for the operation of the automobile industry and the opening up of manufacturing plants to supervised competitive elections for union representation, that directly challenged control of the workplace by an entrenched and corrupt labor bureaucracy; the changes that opened the elections of which labor union would represent workers in large manufacturing plants rapidly began to lead to important changes, that hopefully will improve wages and working conditions across the country.

With this historical background, and the election of a new administration in 2018 that is working to reverse as much of the heritage of neoliberal governance, the question of confronting Mexico’s heightened dependency on the United States has assumed new dimensions. One the one hand, the present Mexican administration is attempting to develop a more self-centered basis for managing its resources and strengthening its state-owned enterprises, most notably the petroleum company (PEMEX) and the electricity company (CFE) that has considerable generating capacity and controls the nation’s transmission system. Both of these enterprises were weakened in previous administrations by granting private sector groups (mostly international) concessions for exploration, production, and in some cases, direct sales to local customers, at a considerable cost to the nation and consumers. These contracts are now being questioned because they offer little benefit to the communities on whose lands the production takes place or virtually no responsibility for the environmental damages they have been occasioning while offering considerable profits to the participating investors and their partners.

Further complicating the panorama, are the mining concessions, that currently cover about one-half of the national territory. These concessions are particularly contentious because a legal reform enacted in 2013 gives them priority access to water resources for their activities, over and above the demand from communities in the area and for environmental management. These companies have a notorious record for the environmental damages they occasion and their treatment of workers.

Another area in which the new administration is attempting to assert its independence from past experience is in the agroindustrial sector. It began by proposing a ban on the use of genetically modified seeds for food crops, given the problems of gene contamination and human health effects that have been demonstrated by researchers in Mexico and elsewhere. Related to this proposal, is a gradual prohibition of the use of glyphosate as an agricultural chemical –to be phased in over a three-year period – for its effects on human health and groundwater and aquifer contamination. These measures are provoking strong reactions by a number of transnational corporations who are mobilizing diplomatic pressures from their home governments to try to persuade the Mexican government to reverse course.

Mexico’s dependency on the U.S. economy, however, is not simply the result of policy decisions at the governmental level. The very famous lament by the Mexican president, whose despotic reign of more than 30 years ushered in the Mexican Revolution in 1910, “Poor Mexico: So far from God, so close to the United States!”, seems as worrisome today as it was at the turn of the XX century. Powerful, entrenched interests in both countries have worked for decades to establish a productive structure that systematically drained working people from the traditional sectors that produced the products supplying Mexicans with their basic needs, undermining the country’s sovereignty.

After the end of WW II, and the gradual end of the “bracero” program that allowed workers unrestricted access to employment in the north, a “border assembly” or maquiladora program was created and formalized in 1965, facilitating the establishment of firms for virtually tax-free operations. This single program virtually reshaped Mexico’s economic and social geography, creating dozens of “boom towns” where literally millions of workers, primarily from the poorest regions in the country, were recruited for poorly paid employment in dreadful working conditions. Other manufacturing industries also took advantage of the proximity, notably automobile assembly plants and later the aerospace industry, cementing their advantage with the creation of the NAFTA in 1994.

The opening of the border to trade also led to an accelerated increase in the importation of consumer products that deepened Mexico’s dependency the United States while generating additional problems. Mexico had already become the world’s second largest per capita consumer of Coca Cola and other carbonated beverages. Within a decade, Mexico was transformed into the country with the second highest rate of Type-2 diabetes, occasioned by a dramatic increase in obesity; childhood diabetes became even more serious, with Mexico ranking first, worldwide, in this preventable disease.

While burgeoning imports were causing numerous health problems, commercial production of fruits and vegetables for export were also increasing rapidly. Although the trade statistics reported dramatic increases in the commercial surplus with the United States, they covered over the profound environmental and social disruptions that were upending the country. Aquifers were being drained, leading to a widespread problem of arsenic poisoning, as geologic mineral deposits were brought to the surface. Fruit and vegetable production were uprooting natural forests and upsetting delicate environmental equilibria throughout the northern part of the country. Even the highly cherished Mexican beverage – tequila – was caught up in this frenzy: large swaths of delicate desert landscapes were transformed into new mono-cropped terrains producing large profits for the foreign consortia that acquired the historically locally owned distilleries, with dreadful consequences for endemic flora and fauna and the impoverishment of the small-scale producers that previously supplied the Mexican producers.

Political integration, then, is not simply a process of generating trade surpluses. It has brought with it a dramatic reshaping of the country’s economic and political topography. While there is increased dependence on imported foods and foreign investment, there has been an important unraveling of traditional social networks and a gradual monetarization of the political process – throughout the country, local leadership is being sold to the highest bidder. Accompanying this proliferation of corruption is the insidious spread of organized crime, which is accelerating processes of social disintegration in important areas of the country and sowing violence in its wake.

This is the panorama in which the reformist administration of Andres Manuel Lopez Obrador was elected by a landslide. There was – and continues to be – widespread hope that his “Fourth [revolutionary] Transformation” would be able to reverse these tendencies. His slogan of “first the poorest” and his commitment to confront directly corruption within the system continue to be rallying cries for people hoping for greater national “sovereignty” and a reversal of the trends of increasing economic inequality and personal impunity.

Is there room for negotiations with other political forces to reinforce this political program? Can renewed ties with other Latin American countries and deeper trade relations with China help reduce this increased dependency? Certainly, there are important political and intellectual groups operating to counteract the very decided efforts of the international capitalist community that is intensifying its political assault against the present government. The manifestations in Mexico of this international struggle are quite apparent and will require skillful negotiations to prevent it from imposing a heavy toll on the Mexican people.

Fortunately, there are important social and political forces actively working to create a different political model that can provide a bulwark in the face of these political struggles. In Mexico’s diverse social and cultural landscape, these groups are active in virtually every part of the country, rural and urban, and engage people from many settings. The social and solidarity economy has become increasingly vibrant in recent years, leading to the proliferation of local initiatives for producing and distributing products that are locally made and respond directly to the particular features of each locality; these activities are supported by the emergence of local currencies that are managed by the community groups, further deepening the social and economic relationships among the participants. Their vitality in urban and peri-urban areas has contributed to building links between diverse communities, many of whom are becoming effective promoters of the emerging concept of “prosumer”, that is, groups of people whose interactions as both producers and consumers further tightens the density of the social networks of which they are a part.

In the rural areas, there is a long history of peoples working to forge community organizations constructing alternatives to the prevailing development model. With about 68 indigenous languages, spoken by millions of people in hundreds of ethic groups, there has been a blossoming of new forms of local governance and greater stridency in demands for autonomous self-governance and defense of their territories. Alliances among these communities are consolidating into regional and national networks for promoting their projects and providing mutual support. The resulting constellation of forces is generating a dynamic that effectively counteracts the increasing dependency on foreign goods, characteristic of the national economy.

While these decentralized social and political forces cannot offer an effective counterweight to the international pressures that are creating greater dependency on a national scale, they do represent an important dynamic that is palpably improving the quality of life for people in the participating communities. This process also provides concrete evidence of the possibilities for creating new forms of social and productive organization that contribute to more sustainable forms of environmental management, reversing the metabolic rifts that are threaten the very possibility for societies to co-exist with the Planet.

Editors: Xu Houkun,Xue Zhiyu,Wang Xuetong




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