1. Political and Economic Change in Mexico
Neil Davey

2. Overview 1519-1821: Spanish Colonialism
1821: Independence and 1824: 1st Constitution
: Second Mexican Empire - Habsburg Monarchy (France)
: Porfirio Diaz’s Dictatorship
: Mexican Revolution
1929: Formation of the PRI
: Lazaro Cardenas Presidency
1983-Present: Neoliberal Reform

3. Pre-Colonial Mexico 200-900: Classic Era, 900-1520: Post-Classic
Height of Mexican Civilization
Mayas in Yucatan and Aztecs in Tenochtitlan

4. Causes of Colonization
Desire to spread Christianity
To gain personal wealth (gold/silver)
To find new trading routes and partners
Political expansion of the Spanish Empire
Overpowering natives was not too difficult

5. 1519-1821: Spanish Colonialism
Hernan Cortes set sail in 1519
Captured Tenochtitlan in 1521
Rule by viceroy under Spain; little autonomy
Conversion to Catholicism
Haciendas given to Spanish colonists
Mestizaje: racial mixing
Strict racial hierarchy and
great inequality
Silver mines fueled
Spanish economy

6. 1810-1821: Mexican War of Independence
Napoleon invaded Spain
Priest Miguel Hidalgo began independence movement with liberals, peasants, and mestizos
Post-war period marked by instability
Elite conservatives vs. liberals
Monarchy or democracy?

7. Post-war Independence
36 presidents between 1833 and 1855
Difficulty obtaining legitimacy
Rise in military control due to instability
Treaty of Guadalupe Hidalgo: US control of ~50% of Mexican lands after Mexican-American war in 1848
The French invaded in 1864
Maximilian von Hapsburg was emperor
Liberals removed French by 1867

8. 1876-1911: Porfiriato Era Political Change
Porfirio Diaz became dictator in 1876 after staging a coup d’etat and defeating Emperor Maximilian
As President of Mexico, ruled 34 years
Authoritarian rule; cracked down on opposition
Strict control of the army
Instability came to an end temporarily
Increased US dependency

9. 1876-1911: Porfiriato Era Economic Change
Diaz was a proponent of modernization
Promoted industrialization and foreign investment
Foreign investment in Mexican mining sector
Cientificos: technocratic advisors to Diaz
The poor lived on a very low standard because of huge focus on commerce
Peasants were impoverished
Great inequality resulted
Led to the Mexican Revolution

10. 1910-1920: Mexican Revolution Elite Mexicans wanted to overthrow Diaz
Francisco Madero called for revolution
Caudillos: Military strongmen
Emiliano Zapata led rebels in the South
Pancho Villa led rebels in the North
Diaz steps down in 1911; Madero is president
Victoriano Huerta overthrows Madero in a plot organized by US ambassador Henry Lane Wilson
Huerta forms a military dictatorship, the US is
upset, and bloodshed continues

11. End of the Revolution
Huerta is replaced by Venustiano Carranza in 1914, who rules until 1920
1917: Constitution of Mexico established democratic political institutions
Cristeros Rebellion: Conflicts with Catholic Church in the 1920s
Partido revolucionario
institucional (PRI)
is formed in 1929

12. 1934-1940: The Cardenas Sexenio Political Change
Lazaro Cardenas was a PRI president
Sexenio (six year term) with big changes: state corporatism
Presidency became much stronger; primary institution of the government
Patron-clientelism ensued as labor and peasant organizations were sponsored by the gov’t
System of one-party rule by the PRI was accentuated

13. 1934-1940: The Cardenas Sexenio Economic Change
Sexenio that significantly transformed the Mexican economy: import substitution industrialization
Huge focus on domestic workers
Nationalization of industry (PEMEX)
Investment in public works
Support of the peasantry through redistribution of land from landlords to peasants

14. Import Substitution Industrialization
Replacing foreign imports with increased domestic production
Reduction of foreign dependency by increasing tariffs
Protects national industries
Mexicanization – devotion to Mexico without attempting to appease foreign nations

15. Russia, China, and Mexico
Does the Mexican Revolution sound familiar?
All 3 revolutions characterized by violent and sudden changes
Russia (1917), China (1911), and Mexico (1910) all transformed from authoritarian rule to “one-party” state
Socialist ideals followed revolutions (Communist Party, Cardenas economic policy)
Mexico did liberalize and democratize more

16. Pendulum Theory
Miguel Aleman, president after Cardenas, rejected socialist reforms and encouraged foreign investment
Next president shifted back to Cardenas-style reforms
Modernization vs. dependency
Tecnicos: Educated business leaders who took control of the PRI in 1970s

17. Mexican Miracle and Crisis
Sustained economic growth and minimal inflation during PRI years
PRI dominated all politics during this time
1968 Olympics massacre and 1985 Mexico City Earthquake showed PRI weaknesses
1982 and 1994 economic crises
Partido de la Revolucion
Democratica (PRD) was
formed in 1989

18. Modern Reforms Liberalization in economy, free
trade, and increased foreign investment
Globalization: Mexico began to integrate into global economy; signed North American Free Trade Agreement (NAFTA) on Jan. 1st, 1994
Neoliberalism: free markets, privatization, limited government involvement since 1983
Formation of Federal Electoral Institute (IFE) in 1990 to ensure fair elections
Election of 2000: Won by Vicente Fox (PRD), first non-PRI president in seven decades

19. Political Crisis of 1994 President Carlos Salinas’ term ends in 1994
PRI candidate Luis Colosio is assassinated
Ernesto Zedillo is handpicked by Salinas and wins 1994 election
Zapatista Army of National Liberation: revolutionary leftist group based in Chiapas, Mexico’s southernmost state
Zapatistas against neoliberal
reforms and economic
globalization

20. Economic Crisis of 1994
Government finances of past two decades, low oil prices, and hyperinflation
Attempt by Zedillo to increase exports
Sudden devaluation of the peso in December 1994
The Chiapas Rebellion worried investors
Larger risk premium on Mexican assets
Peso crashed as a result of the floating exchange rate

21. Current Statistics Gini Index (World Bank, 2012): PPP: $1.748 USD
11th largest economy in the world (Iran and Nigeria are smaller)
GDP growth: 3.6% and Inflation: 3.9%
GDP by sector: 3.9% Agriculture, 32.6% Industry, 63.5% Services
Primary export partner: US (78%) UK
Iran
Russia
China
Mexico
Nigeria
34.0
38.3
40.1
47.0
48.3
48.8