Teaching Comparative Government and Politics

Monday, February 25, 2013

Globalization promoting better government and politics

If Thomas Friedman, in his New York Times analysis, is right, economic globalization is pushing positive changes in Mexico's government and politics. (See his last paragraph.)

The idea that prosperity will promote democratization is a popular idea. Is this part of that? And is globalization having the same effects on China? on Russia? on Nigeria? Why or why not?

And, as a follow-up, are economic sanctions on Iran isolating that country from the beneficial results of globalization?

How Mexico Got Back in the Game

In India, people ask you about China, and, in China, people ask you about India: Which country will become the more dominant economic power in the 21st century? I now have the answer: Mexico.

Impossible, you say?… Everything you’ve read about Mexico is true: drug cartels, crime syndicates, government corruption and weak rule of law hobble the nation. But that’s half the story. The reality is that Mexico today is more like a crazy blend of the movies “No Country for Old Men” and “The Social Network.”

Mexico has signed 44 free trade agreements… more than twice as many as China and four times more than Brazil. Mexico has also greatly increased the number of engineers and skilled laborers graduating from its schools. Put all that together with massive cheap natural gas finds, and rising wage and transportation costs in China, and it is no surprise that Mexico now is taking manufacturing market share back from Asia and attracting more global investment than ever in autos, aerospace and household goods.

“Today, Mexico exports more manufactured products than the rest of Latin America put together,” The Financial Times reported…

“Twenty years ago, most Mexican companies were not global,” explained Blanca Treviño, the president and founder of Softtek, one of Mexico’s leading I.T. service providers. They focused on the domestic market and cheap labor for the U.S. “Today, we understand that we have to compete globally” and that means “becoming efficient. We have a [software] development center in Wuxi, China. But we are more efficient now in doing the same business from our center in Aguascalientes, [Mexico], than we are from our center in Wuxi.”

Mexico still has huge governance problems to fix, but what’s interesting is that, after 15 years of political paralysis, Mexico’s three major political parties have just signed “a grand bargain,” a k a “Pact for Mexico,” under the new president, Enrique Peña Nieto, to work together to fight the big energy, telecom and teacher monopolies that have held Mexico back. If they succeed, maybe Mexico will teach us something about democracy…

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Labels: economics, Mexico, politics