Dean Baker comments on Mexico, highlighting the inability of the American press to comprehend the damage our imperial economic policies have had on Latin American countries. We want these countries to run their economies for to benefit us (and their own elite), and we will resort to violence if necessary (as in the case of Colombia).
Trade Brings Riches, but Not to Mexico's Poor
by Mary Jordon and Kevin Sullivan
The Washington Post, March 22, 2003, Page A10
This article reports on the fact that the percentage of
Mexicans who live below the poverty line has not changed
in the last 20 years. The article characterizes this fact as
a "paradox," noting the large expansion of trade during
this period.
There is nothing paradoxical about this situation. Data
from the World Bank show that Mexico's economy has
stagnated since 1980, with per capita GDP growth
averaging less than 0.5 percent annually. By comparison,
per capita GDP growth averaged 3.9 percent annually in
the two decades from 1960 to 1980. Given the sharp
slowing of growth associated with Mexico' policies of the
last two decades, it should not be a surprise that there
has been no reduction in the poverty rate.
At several points the article refers to trade as though it
were a measure of prosperity. There is no direct link
between trade and prosperity, just as there is no direct
link between a firm's sales and its profits. While rising
sales usually are associated with rising profits, a firm
may increase sales by selling its products at below cost.
In this case, rising sales would be associated with
losses. Similarly, Mexico's growing trade in the last two
decades has been associated with stagnation, not
healthy growth.
At one point the article asserts that the economic policies
implemented over the last two decades were "intended to
create prosperity for all." It is not clear that this was the
intention. Many of the people who designed and
implemented these policies managed to get very rich as a
result, while the country as a whole suffered. It is possible
that the outcome is exactly what was intended, with
those in power implementing policies that were designed
for their own benefit. The article presents no evidence that
this was not the case. |
