The Political Economy of Privatization in Mexico, 1983-92

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Abstract
This paper examines the economic, political and social effects associated with the unprecedented dismantling of Mexico's parastatal apparatus over the past decade. In so doing, it highlights the major economic and political arguments advanced by neoliberal enthusiasts for privatization in the region and subjects them to a critical analysis in light of the Mexican experience. The essay begins by reviewing and evaluating the highly uneven economic and social impact of the various stabilization programs implemented over the past decade. It advances the argument that the debt crisis and its aftermath became a valuable instrument for reducing the economic and political autonomy of the Mexican state, thus enabling powerful factions of the international financial and banking community to impose a growth strategy that further inserts the Mexican economy in a dependent and subordinate fashion into the global economy-a process that will be reinforced with the recent passage of NAFTA. The paper then discusses the evolution, rationale and impact of the country's privatization program: the most radical expression of the current neoliberal program. It shows, through a variety of concrete examples, how the state's withdrawal from key economic sectors has generated a massive loss of employment, compromised hard-won labor rights for all Mexican workers, generated an unprecedented concentration of economic power in key industries, such as banking and finance, attracted mostly speculative capital into the stock market and, perhaps most importantly, reduced the Mexican state's ability to foster policies that promote broad-based economic development.

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