Posts Tagged ‘Mexico’

Hugh Thomas, R.I.P.

Saturday, May 13th, 2017

British historian Hugh Thomas died May 6th, aged 85.

The best of Thomas’s many books — which ranged from The Suez Affair (1967), An Unfinished History of the World (1979) and The Conquest of Mexico (1993) to three novels — treated ideologically controversial subjects with impartiality in a sparkling style. The Spanish Civil War, published in 1961, was the first objective general study of the subject. A clandestine bestseller in Franco’s Spain, it became a colossal success after the general’s death, and helped unite Spaniards around a single historical account. It thereby made an important contribution to “reconciliation”, as Madrid acknowledged this week.

His 1,710 page Cuba: Or The Pursuit of Freedom (1998), with its wonderfully ambiguous sub-title, is equally indispensable. It locates the origin of Cuba’s turbulent modern history where it belongs: in 1762, with the English capture of Havana.

John Paul Rathbone, “Lord Thomas of Swynnerton, historian and Hispanist, 1931-2017“, Financial Times, 13 May 2017 (metered paywall).

Thomas was a member of the Labour Party until 1974, and sat as a Conservative in the House of Lords, before joining the Liberal Democrats in 1998. He is best known in the UK for his friendship with Margaret Thatcher.

Larry Summers on NAFTA

Saturday, March 25th, 2017

Harvard University economist Larry Summers (born 1954) writes that the greatest gift the United States could give China is exit from the North American Free Trade Agreement (NAFTA).

I was in Mexico Thursday seeing the Mexican president, foreign minister and finance minister and addressing a convention of bankers. The only subjects anyone is interested is the future of NAFTA and U.S. Mexican relations.

I came to Mexico from Beijing, and so I was able to report that there was no greater strategic gift the United States could give China than to abrogate NAFTA and rupture the North American community.

In narrow commercial terms right now, Mexican goods enter the United States on a preferred basis relative to Asian goods. This preference would disappear with NAFTA suspension. Furthermore about 70 percent of Mexican exports are of goods that are not finished but are inputs to further U.S. production. Anything that hurts Mexico therefore hurts us in global economic competition with China. ….

Larry Summers, “Why scrapping NAFTA would be Trump’s big gift to China“, Larry Summers Blog, 24 March 2017.

Carrier Corporation takes Trump for a ride

Thursday, December 1st, 2016

Donald Trump is taking credit for preventing nearly a thousand manufacturing jobs from moving from Indiana, where Carrier Corporation pays workers between $15 and $26 an hour, to Mexico, where it pays them about $2 or $3 an hour. But how was he able to get this great deal? Was it with sticks, or with carrots – with new taxes or with tax breaks and regulatory favours? At this juncture, it appears to be all about tax breaks and regulatory favours, without punitive taxes.

Here are details from a newspaper article in The Guardian, followed by by Bernie Sanders’ blog in the Washington Post. More information is available at each ungated link. (more…)

Trump’s pick for commerce secretary is a mercantilist!

Sunday, November 27th, 2016

Donald Trump is expected soon to confirm Wilbur Ross as commerce secretary. Mr Ross (born 1937) is a billionaire investor who specializes in leveraged buyouts and restructuring distressed businesses. I learned, reading this weekend’s Financial Times, that he is also a vocal proponent of mercantilism.

The starting point of any trade deal, Mr Ross told the FT this month, should be to ensure that each side share its estimates of the effects on its own industries and jobs. ….

It is time to focus on deals which make sense, he says. That does not include the North American Free Trade Agreement of 1994, for example, which appeared to flip America’s trade surplus with Mexico into a deficit. Nor the Trans-Pacific Partnership, a sweeping 12-nation accord that has yet to be ratified, but which Mr Trump has promised to scrap.

“One thing I disliked about [Hillary] Clinton is that there was only one trade deal she voted against — the Central American Free Trade Agreement. That’s crazy, since the only deal we have a trade surplus from was CAFTA!” he says. [Emphasis added.]

Ben McLannahan  and Laura Noonan, “Wilbur Ross tries to turn round US heartland“, Financial Times, 26 November 2016 (metered paywall).

Mr Ross does not use the term, but this is mercantilism, pure and simple. For those unfamiliar with the doctrine, here is a succinct definition, from Wikipedia:

Mercantilism includes a national economic policy aimed at accumulating monetary reserves through a positive balance of trade, especially of finished goods. …. High tariffs, especially on manufactured goods, are an almost universal feature of mercantilist policy.

Much of Adam Smith’s Wealth of Nations (1776) is an attack on mercantilism. Nearly all modern economists accept Smith’s dictum “Consumption is the sole end of all production; and the interest of the producer ought to be attended to, only so far as it may be necessary for promoting that of the consumer”.

An important quirk of protection, an earlier FT article notes, is its adverse effect on exports (and smaller effect on imports) because of changes in the exchange rate.

Janet Yellen, the Fed chair, and the president-elect are cut from different cloths but both have expressed concern about the impact of dollar strength on US companies ….

The quandary for Mr Trump is this, said [Deutsche Bank’s Alan] Ruskin. A tilt to protectionism may help the trade balance by suppressing imports but “it would be damning” if an overly strong dollar ended up hurting exporters and boosting imports.

Roger Blitz, “Donald Trump and the dangerous allure of a strong dollar“, Financial Times, 25 November 2016 (metered paywall).

For more on the relationship between trade balances and “competitiveness”, I recommend one of Paul Krugman’s best essays, written long ago, without jargon. Spoiler alert: No relationship exists.

Most people who use the term “competitiveness” do so without a second thought. It seems obvious to them that the analogy between a country and a corporation is reasonable and that to ask whether the United States is competitive in the world market is no different in principle from asking whether General Motors is competitive in the North American minivan market.

In fact, however, trying to define the competitiveness of a nation is much more problematic than defining that of a corporation. The bottom line for a corporation is literally its bottom line: if a corporation cannot afford to pay its workers, suppliers, and bondholders, it will go out of business. So when we say that a corporation is uncompetitive, we mean that its market position is unsustainable — that unless it improves its performance, it will cease to exist. Countries, on the other hand, do not go out of business. ….

One might suppose, naively, that the bottom line of a national economy is simply its trade balance, that competitiveness can be measured by the ability of a country to sell more abroad than it buys. But in both theory and practice a trade surplus may be a sign of national weakness, a deficit a sign of strength. For example, Mexico was forced to run huge trade surpluses in the 1980s in order to pay the interest on its foreign debt since international investors refused to lend it any more money; it began to run large trade deficits after 1990 as foreign investors recovered confidence and began to pour in new funds. Would anyone want to describe Mexico as a highly competitive nation during the debt crisis era or describe what has happened since 1990 as a loss in competitiveness?

Paul Krugman, “Competitiveness: A Dangerous Obsession“, Foreign Affairs, 73:2 (March/April 1994), pp. 30-31.

Here is a link to an ungated version of the paper.

genocide in California?

Sunday, May 29th, 2016

University of Virginia historian Alan Taylor reminds us of the cruelty and suffering native peoples endured at the hands of European ‘immigrants’. The Spanish were famously cruel, but California natives suffered even more after 1846, when the United States annexed vast tracts of Mexican land, justified by the doctrine of ‘Manifest Destiny’. (more…)

Central American refugees

Saturday, March 12th, 2016

The plight of Syrian refugees in Europe, though serious, has blinded us to the plight of refugees from Central America, who are reaching the US border from Guatemala, El Salvador and Honduras at the rate of more than one thousand a day. Óscar Martínez, a young Salvadoran journalist, has covered the story for more than a decade.

Jude Webber, Mexico and Central America correspondent for the Financial Times, reviews a recent book by Martínez on this subject.

The book is a series of extended essays based on his reporting for El Faro, an award-winning Salvadoran online newspaper, and the unflinching cameos it paints offer a chilling portrait of corruption, unimaginable brutality and impunity.

Take the story of Grecia, a migrant sold as a prostitute to Los Zetas, the brutal Mexican drug cartel. A tattoo of a butterfly on a branch forming a “Z” brands her as their property. As she told a Salvadoran court after her release, return home and the arrest of one of the men who trafficked and repeatedly raped her, she made no attempt to escape after seeing what happened to another captive, Sonia, who had been freed after relatives paid a ransom. Sonia reported her captors to Mexican officials, but they handed her back to the traffickers, who clubbed her with a baseball bat and “because she wouldn’t die, they lit her on fire”, reducing her to “burned, hairless meat”.

The court’s verdict? The trafficker was acquitted; Grecia was ruled to have contradicted herself. ….

Martínez tells his readers: “I want you to understand what thousands of Central Americans are forced to live through. Then you can understand why they keep coming, and will continue to come.”

Jude Webber, “‘A History of Violence: Living and Dying in Central America’, by Óscar Martínez“, Financial Times, 12 March 2016 (metered paywall).

The book, published just four days ago by Verso Books, most likely is a translation from Spanish of Los migrantes que no importan (Editorial Icaria, 2010).


Cuban dissidents, Arizona and Hamilton!

Sunday, December 20th, 2015

This is my recommended podcast of the week. The one-hour show begins with an interview of the Cuban journalist Miriam Leiva, widow of economist Oscar Espinosa (1940-2013). If you don’t listen to anything else, don’t miss this part. The next segment is a follow-up of an FT column on Arizona’s increasingly warm welcome of visitors from Mexico. The third and final segment is a review of the Broadway musical “Hamilton!”.

FT blogs and podcasts are not metered – downloads do not count against limits imposed on those without subscriptions to FT — but free registration is required.

Here is a guide to each segment of this week’s Alphachat.

[4:02] The story of a dissident Cuban economist

Taped in Havana, Cuba, I spoke with the Cuban journalist and dissident Miriam Leiva about the life of her late husband, Oscar Espinosa Chepe. He was an economist with an irrepressible instinct to tell the truth to a regime that didn’t much want to hear it, and he was repeatedly punished for it throughout his life.

In 2003, Chepe was one of 75 Cubans arrested and given long prison sentences in what is known as the Black Spring. Already suffering from liver disease, he was interrogated and treated brutally. When finally released on health grounds after eighteen months, he went right back to telling the truth. I loved this interview more than any other I hosted in 2015.

A free travel zone for Mexicans to shop in Arizona

You might have heard that the US is yet again having a heated national debate on immigration, especially now that the race for the Republican nomination is well underway. But the FT’s national US editor Gary Silverman traveled to Arizona, where Mexicans can [enter the state with a border-crossing card] …. We play some interviews from Gary’s trip and then talk to him in the studio.


Shannon and I gush about the hip-hop Broadway musical that depicts the life of US founding father Alexander Hamilton, the country’s first Treasury secretary who was killed in a duel by Vice President Aaron Burr.

Cardiff Garcia, “Alphachat: the life of a dissident Cuban economist; a Mexico-US free travel zone; ‘Hamilton’!“, FT Alphaville podcast, 19 December 2015.

Arizona welcomes Mexicans

Sunday, December 20th, 2015

Arizona, a solidly ‘red’ (Republican) American state, is enacting policies to attract more Mexican visitors. This contrasts sharply with the promise of presidential candidate Donald Trump to build a high, sturdy wall along the US-Mexico border.

Arizonan movers and shakers have started to think that bringing in more Mexicans is a good way to stimulate growth. To make people from south of the border feel more welcome, county planning organisations, municipal officials and business leaders are lining up behind a proposal to transform their entire state into a “free-travel zone” for millions of better-off Mexicans with the money and wherewithal to qualify for a travel document that is widely used in the south-west, but little known elsewhere — a border-crossing card, or BCC. ….

BCC holders are currently allowed to go 75 miles into Arizona, which takes them as far as Tucson, the state’s second-largest city. But Arizona officials are seeking a change in federal rules that would allow these people to roam across the [entire] state, hoping that if the visitors travel further, they will stay longer and spend more money at malls, restaurants and tourist attractions.

The desired Mexicans are a far cry from the “murderers” and “rapists” of Mr Trump’s stump speeches. They can afford the $160 fee and offer the proof of employment and family ties back home that are required for a BCC, which is good for 10 years and enables Mexicans to remain in the US for up to 30 days at a time. To stay longer or travel further, they need more documentation.

Gary Silverman, “US-Mexico border: Arizona’s open door“, The Big Read, Financial Times, 18 December 2015 (metered paywall).

FT BCC 2015

painting the slums of Mexico

Friday, August 28th, 2015

A remarkable experiment is taking place near Mexico City, with the help of federal government funding. Local residents and artists have transformed Las Palmitas, a barrio in crime-ridden Pachuca, into a mega-mural of bright colours.

[T]he community-building efforts sparked by the mural project … have helped foster a new sense of civic pride and peaceful cohabitation. The Germen Crew [in charge of the work] spent months getting to know residents before the painting began, attending town meetings to discuss colours and workshops for children. ….

In Las Palmitas, officials say the programme, of which the mega-mural is part, led to a 79 per cent drop in the crime rate in the first half of this year, compared with levels in 2012. They see such grassroots campaigns as vital in a country struggling with rampant drug cartel-related violence and crime, Indeed, Mexico has thousands of barrios just as depressing and in need of rehabilitation. ….

[There is now] a queue of demands from cities to get the Palmitas treatment, including crime-torn Acapulco, Ciudad Juárez on the US border and Toluca, Ixtapaluca and Ecatepec in the troubled State of Mexico.

Jude Webber, “Mexico neighbourhood paints over troubles“, Financial Times, 27 August 2015 (metered paywall).

See also this ungated article in The Guardian.

For more ungated articles and images, google “Las Palmitas Pachuca Mexico”

Germen Crew paints Palmitas neighborhood...In the Las Palmitas barrio of Pachuca, Hidalgo, Mexico, a rehabilitation project has decorated a poor, marginal hillside community and at the same time helped its residents reconstruct the social fabric of their divided neighborhood.The graffiti artists of the Germen Crew, in conjunction with the Mexican Interior Ministry's Prevention and Citizen Participation division, has painted a radiant mural using a palette of 190 colors and the facades of the houses as their canvas. Antonio CerÛn, a neighborhood resident who was hired by the Germen Crew, works painting a wall.

Germen Crew paints Palmitas neighbourhood . . . In the Las Palmitas barrio of Pachuca, Hidalgo, Mexico, a rehabilitation project has decorated a poor, marginal hillside community and at the same time helped its residents reconstruct the social fabric of their divided neighbourhood. The graffiti artists of the Germen Crew, in conjunction with the Mexican Interior Ministry's Prevention and Citizen Participation division, has painted a radiant mural using a palette of 190 colours and the façades of the houses as their canvas. Vista of the Las Palmitas neighbourhood.

institutional and economic reforms in Brazil and Mexico

Friday, August 21st, 2015

FT columnist John Paul Rathbone uses Brazil and Mexico as case studies to argue that economic reforms cannot bear fruit in a climate of corruption, insecurity and lawlessness.

While Mexico is far ahead of Brazil in the World Bank’s ease of doing business survey (at 39th position, ahead of Chile and Israel, versus 120th for Brazil), the opposite is true on the rule of law. Mexico, for example, ranks 103rd on Transparency International’s corruption perceptions index, worse than China, while Brazil at 69th position is level-pegged with Italy and Greece.

Mexico’s institutional rot seems to extend from top to bottom. The president has suffered a series of conflict of interest scandals involving his wife and finance minister. Journalists who report on disappearances and drug-fuelled violence, such as the presumed murder of 43 students last year, are themselves killed. This week, more than 500 intellectuals slammed Mexico’s “censorship by bullet”. While in Brazil criminals are being jailed, in Mexico drug lords can escape from high-security prisons through tunnels built into their cells’ showers. The government response to outcries after each shameful incident? Muted embarrassment and a business-as-usual attitude emphasising economic reform over the rule-of-law problems that are Mexico’s biggest concern.

What Mexico’s presidential palace does not seem to realise is that insecurity and lawlessness also have financial implications.

John Paul Rathbone, “Brazil cleans up its act, so should Mexico“, Financial Times, 21 August 2015 (metered paywall).