MEXICO

Party registration is a formal process, governed by law. Registration gives the legally registered party significant advantages, such as guaranteed access to state funding and to the media. The requirements for party registration are rather restrictive, and require the enrollment of at least 60,000 members, with at least 3,000 apiece in a minimum of 20 states. Alternatively, a party can show that it has at least 3,000 members in each of Mexico’s 3000 electoral districts. Even then, a party must satisfy a significant number of additional procedures before registration is complete. These include approval of its statement of principles and system of internal organization by the Federal Electoral Institute (IFE). Party recognition can also be revoked on a number of grounds, including illegal behavior and lack of electoral support. A party stands to lose its registration unless it achieves at least 2% of the vote in national elections, though this stipulation was not tightly enforced after the 2006 elections. By the same token, the IFE has an oversight unit devoted to making sure that the registered parties conform to the law. The only significant area where one might see discrimination is that independent candidates are not allowed to stand for office in national elections. There are good reasons for this provision, but it nevertheless involves some reduction in voter choice.

Media access has been a controversial subject in Mexico and the most recent law (approved in 2008) is drastic in its approach. Parties are now forbidden to advertise in the media directly. They are allocated media space by IFE, which is responsible for deciding which media slots each party is allowed (this is done according to a formula). The IFE also arranges presidential debates at election time. By the same token, there are limits on the ability of interest groups such as business organizations to advertise in a political way during election campaigns, and restrictions on government advertising during an election period. Again, IFE is the enforcing body. The central point is that the IFE, which is a professionally staffed state agency overseeing the electoral process, has far more power and responsibility than is the case in most countries. This is the result of a reaction against an earlier period of Mexican history, when the ruling party could more or less determine the outcome of elections at will. Loopholes in the law have gradually been tightened. However, these restrictions do not necessarily apply to the Internet or the blogosphere, which are beyond the control of the IFE and have become an important source of information in the urban areas of the country.

Most Mexicans enjoy the effective right to vote. Turnout rates among registered voters are broadly comparable to those in other democracies, falling around 59% in the 2006 presidential elections and around 40% to 45% in midterm congressional elections. Some provisions governing state and local elections are determined locally, and some of these may involve the possibility of bias. Even so, there is no real basis for saying that electoral exclusion is a problem. The same electoral register is used for federal and state/local elections. Voter registration requires the production of an identity card. There are good reasons for this stipulation, since multiple voting was common in the past in some parts of Mexico; however, its effect may be to dissuade some less-educated Mexicans from registering to vote. This is a problem common to most countries with relatively high rates of social marginalization, which in turn tends to produce a comparatively high share of the population lacking documentation. In 2006, Mexicans who lived in the United States or elsewhere abroad were allowed to vote in federal elections in Mexico for the first time. However, the associated regulations were complex, and deterred a significant number of expatriate Mexicans from voting.

The private funding of political parties is allowed in Mexico, but there is a stipulation (it is not yet clear how this will be interpreted) that parties must not raise more money from private sources than they get from the state. The IFE monitors donations in order to enforce this provision, and parties are required to provide documentation of their accounts. Private funding is allowed via membership payments, voluntary donations, and direct earnings by the parties themselves (through interest on bank deposits, for example). However, some people and organizations are forbidden to make contributions to political parties. These include churches, foreign organizations and publicly funded bodies. Public funding of parties is generous, so the state can impose effective sanctions in the event that the laws are breached.

The televisual media are required to be independent at election time, because the Federal Electoral Institute exerts strong supervision over the entire electoral process. Political parties have a degree of guaranteed access to television, with limits being imposed as well, and the process is organized by the IFE. Parties are not allowed to book television air time directly. Government access to the media is also restricted during election campaigns. Outside election campaigns (the dates of which are clearly defined), the government does not control the media. Partly because of its current minority status, the government probably needs the media – particularly the television broadcasters – more than the media needs the government. However, the dominant media companies are usually more interested in business than in politics, and use their power to push for commercial rather than political goals. This situation is somewhat dependent on the current political environment. The media has been essentially pro-government in Mexico for many years, mainly because Mexico’s conservatives have consistently won national elections. There has thus been no basis for a major clash of culture or ideology. If the closely fought 2006 elections had been won by the leftist opposition party, then it is likely that government-media elections would have been tense.
Mexico’s national press is free and independent of government influence. However, investigative journalism is not effectively protected by the government, which has been unable to shelter journalists investigating on the topic of organized crime. Mexican journalists often find themselves on the front line of the war on drugs if they dare expose the links between state agents and gang members. Many of them have given up investigations on this issue. Thus, while the government has not interfered politically in the media, the Mexican state has not been capable of guaranteeing journalists’ safety as they perform their job in the areas of highest public concern.

The two main television companies, Televisa and Azteca, together enjoy access to the vast majority of Mexico’s television audience. There is some competition from cable and satellite stations, some of which are based in the United States, and a public television channel exists, though not many people watch it. Overall the Mexican television market de facto remains highly oligopolized, a situation which raises the possibility of bias with regard to political information.
The print media is much more diversified, providing outlets for a variety of different viewpoints. Radio stations tend to be somewhat light in their coverage of political events. However, electoral legislation requires television broadcasters to offer time to all registered political parties, thus exposing the public to a considerable range of different viewpoints at election time.

Mexico’s Freedom of Information Act dates from 2003. Impressionistic evidence suggests that it works reasonably well, though official responses are often slow. It is fully accepted that citizens have the right to request information from official bodies, and there is a formally nonpolitical public agency that arbitrates any disputes do with the release of information. When there are disputes, the agency has to make public its decisions and their grounds. However, given the high level of corruption in Mexico, the freedom to access government information is at least partly undermined by the corruption-induced decline in political transparency.

In principle, Mexico guarantees most civil rights via its legal and constitutional systems. The Supreme Court has a range of instruments that can be used to protect citizen rights. Among these tools is the so-called Amparo procedure, which is peculiar to Mexico and allows the courts to stay a process to which protesters object (for example, a land expropriation). Mexico has also institutionalized the role of ombudsman, whose role is to examine human rights cases. The main problems with civil rights include the following: (1) Corruption. Low-level courts are at times either corrupt or subject to influence. Police corruption is also a problem, and it is not rare for police officers to extort money from members of the public. (2) The effective immunity of the military, which the government has called out to participate actively in counternarcotics operations, and which sometimes abuses its power. In the last several years, it has been quite difficult to call the military effectively to account, though the Mexican Commission on Human Rights has tried to do so. (3) The social marginalization of large parts of Mexican society creates de facto constraints on some civil rights, such as equal opportunities with regard to education or employment.

In theory, there is a high level of political liberty in Mexico. In practice, the majority of Mexicans enjoy sufficient legal protection to enable them to participate actively in the political process. Minority groups, such as homosexuals, can press their views in public without fear. However, there is more tolerance of political difference in urban areas than in rural ones, and traditional thinking remains strong among relatively less-educated Mexicans. This means that intolerant or authoritarian politicians can enjoy some success at the subnational level. Overall, the general trend is toward greater degrees of civil liberty; but again, violence related to organized crime constrains citizens’ opportunity to articulate their demands and concerns in one of the most important areas of policy.

In theory, the state is expected to protect citizens against discrimination. In practice, there are geographical variances given the decentralized and federalist nature of the Mexican polity. Mexico has substantially increased its level of decentralization in the last two decades. Today, more public employees work at the state and municipal level than at the federal level. Government discrimination, mainly on grounds of ethnic appearance and social status, does exist in places, but is in general more of a local than a national phenomenon. That said, people of Indian background do face discrimination in some parts of Mexico, and state institutions have not always been effective in dealing with the problem. Mexico’s business and political elites still come almost exclusively from mainly European backgrounds.

Mexico’s central government mostly acts predictably on the basis of legal norms. This is true of the majority of state governments and municipal authorities as well, although some local and state governments do act in defiance of legal predictability. It is important to note that Mexico is in the process of changing – albeit slowly – from a society governed largely through the exercise of personal discretion to one based more on legal norms. This process is uneven, and has been seriously hampered by the increasing violence associated with the war on drugs. Thus, the rule of law is definitely in the process of strengthening in most areas, but the war on drugs has also led to a state of extreme legal uncertainty with regard to one of the most pressing problems of Mexican society. With more than 20,000 killings associated with the drug trade in the last several years, one cannot speak of Mexico as a country effectively governed by the rule of law.
Moreover, there are still areas in which bureaucratic regulation is insufficient or simply ignored. The law is also sometimes vague and unspecific. For example, Mexico’s federal system has led to many disputes over which levels of government are responsible for what tasks. These differences are resolved by the Supreme Court, but there are inevitable delays in the process.

Mexico’s Supreme Court is a serious and respected body. It has had to resolve complex issues such as abortion rights and homosexual marriage, and has done so in ways that have been widely regarded as legitimate. It plays an important and complex role in resolving jurisdictional disputes involving federal, state and local governments. If asked to judge the nation’s judicial system solely on the basis of the Supreme Court, a very high mark would be warranted. However, lower courts do not generally perform to such a high standard, and are sometimes capable of being corrupted. In a number of subnational states, one has the impression that the judicial process is often controlled by the executive.

The Supreme Court is composed of judges nominated for a 15-year period. The president proposes three names, two of which are approved by a majority of at least two-thirds of the Senate. This means that nominations require the support of more than one political party. Once they are in office, there are few grounds on which judges can be removed. Since the current system came into force in 1995, there have been no major disputes over the appointment of judges to the Supreme Court.

Corruption in the form of outright theft from the federal government is probably on the decline, due to the formalization of official procedures. There are significant institutional mechanisms that make this kind of corruption more difficult, as well as a growing practice of investigative journalism – though the latter’s ability to scrutinize organized crime and its links to the public sphere is under serious threat. There is more likely to be corruption at the state and municipal level, where scrutiny is less keen, and understanding of the law is more limited. This is particularly true of the less-developed states, mostly in the south of Mexico, where high levels of social inequality and marginalization have to be considered as breeding grounds for corruption. There is also significant corruption within the state oil company, PEMEX, with the worst problems centering on procurement and the occasional theft of oil for resale. While the current government has attempted to modernize the state-owned company, it has not been able to win approval for the reforms in the National Congress, where these reforms remain highly ideologically charged. The worst corruption is undoubtedly drug related. Hundreds of millions of dollars, perhaps even billions, are spent by drug dealers in bribing politicians, police, judges and the military. Formal procedures do not work well here, since what is happening is not exactly theft from the government but a system of payoffs to officials to look the other way. Documentary evidence is rarely available.
Small-scale corruption by traffic police and local judges is also endemic, with disproportionate effect on the poor. The money extorted by routine corruption may be small in scale, but the practice is pervasive and falls hardest on those least able to pay.

On the positive side, the general quality of macroeconomic management in Mexico is good. There is a considerable wealth of technical expertise in the finance ministry and the central bank. The authorities were severely tested by the onset of recession in 2008. Mexico was vulnerable because of its close relationship with the United States, its declining oil production and its vulnerability to swine flu. Drug-related crime helped further mute the tourist industry. Nevertheless, the authorities retained effective control of the economic situation, and the economy is now recovering. Also positive is the fact that the authorities have a clear understanding of the necessity of making the Mexican economy more efficient. What holds things back is a mixture of inertia and the historical weakness of the Mexican state. The cost of doing business in Mexico remains relatively high by OECD standards. The authorities are aware of the problem, and have attempted reform in various enterprise-related sectors such as the attempt to attract foreign investment (ProMexico was set up in 2007 to do precisely this), and by enacting a more adequate system of taxation. Competition policy has become somewhat more effective since the passage of a new law in 2006, and the creation of a new state agency, Cofeco, to enforce it. In April 2010, Calderón announced a plan to tighten competition policy further. Unfortunately, organized crime and the related legal insecurity have acted as barriers to investment in the regions most affected. Moreover, illegal money laundering from drug-related activities has channeled huge financial resources into the formal economy, thereby blurring the frontiers between illegal and legal economic activities.

The most important problem in Mexico’s labor economy is the differentiation of the labor market into so-called formal and informal sectors. The second category consists of companies that are not legally registered for taxation or national insurance, and largely escape both the advantages and disadvantages of legal regulation. By OECD standards, the size of the informal sector is quite large. Mexican labor law is still based on Article 123 of the constitution, as well as the1931 labor law. The law is corporatist in inspiration, and in some important respects anachronistic given Mexico’s past of corporatist authoritarianism and its more market-oriented present. The problem is that the legal framework is highly prescriptive in some irrelevant ways, while procedures are slow and bureaucratic and capable of being undermined – for example, by employers’ establishment of company-based unions. Moreover, the law offers benefits only to workers in a part of the formal sector, a minority of the workforce as a whole. It also strengthens union membership (at least on paper) via its closed-shop provisions. In principle, recognized unions can effectively dismiss workers by taking away their union card. This does not happen often, but is still a legacy of the corporatist ancien regime. The overall effect of this situation is to raise employers’ cost of doing business without necessarily protecting the rights of workers. For example, an employer – including the government – can simply declare an enterprise bankrupt, dismiss the employees and resume operations with a different and smaller workforce. Something of the kind happened with Mexico’s Light and Power company in 2008. Suggestions that NAFTA regulations might be adapted to offer more protections to labor have so far come to nothing. President Calderón recently promised to propose a new labor law aimed at increasing the flexibility of employment practices, making it easier to set up new businesses and integrate the informal sector of the economy more closely with formal firms. However, there remains the problem that the government is in a minority in the National Congress, and opposition parties are likely to try to block the reform.

Enterprise policy is in a state of transition. In 2007 the state export bank, Bancomext, was replaced with Promexico, which has a wider remit, including the attraction of foreign investment. Abstracting from the current recession, it does seem that the share of investment in GDP, as well as the productivity of investment, is on a slowly improving trajectory as a consequence of the structural reforms of the last decades. Promexico is influenced by the Chilean government’s successful Fundacion ProChile. The aim of ProMexico is to seek out opportunities to bring foreign direct investment into Mexico, as well as encouraging business opportunities more generally, and the institution can engage in public-private sector partnerships with this in mind. It is too early to say whether this new organization will be successful, but it corresponds more to the international “best practices” of other export-oriented economies. President Calderón has also redefined the role of foreign embassies, asking them to focus more on trade and business affairs as part of an overall push to push Mexico’s foreign policy more toward economic issues. It is also worth noting that a significant part of Mexico’s enterprise policy is in the hands of the states rather than the federal government. Competition for investment between states is gradually making Mexico more competitive, and can be traced back to decentralizing reforms aimed at giving Mexican states a more market-oriented federal structure. Some states are quite dynamic, though not all of them are, and interstate competition is hampered by the structural disadvantages faced by several poorer states especially in the southern part of the country. Mexico still lags behind its main Asian competitors with respect to enterprise policy.

The single greatest weakness of the Mexican economy is the cultural reluctance of most Mexicans to pay taxes. The result is that the public sector is short of the resources necessary to tackle the challenge of social fragmentation effectively. If it were not for Mexico’s oil export income, the country’s position would be even worse. Calderón was able to legislate what looked like a major tax reform in 2007, but at least initially this has not brought about much of an improvement in tax collection. The recession started in 2008, and has made the issue even more difficult. A large part of the problem is that the indirect tax base is relatively narrow, with a large informal economy and many exemptions from VAT. These exemptions encourage corruption, which can involve businesses misstating the sources of their sales in order to make it look as though more turnover is exempt from taxation than is actually the case. Another problem is that the vast majority of taxes are collected by the federal government while states and municipal governments do most of the spending; subnational units’ fiscal autonomy thus remains weak. Admittedly this spending is largely controlled, but it remains the case that state governments have every incentive to lobby the central government for more money rather than seeking to raise more revenues directly. Effective control of public spending has so far prevented the development of macroeconomic imbalances, but over time the demand of a growing population for enhanced health and education spending will put the budget under more pressure. On the competitiveness issue, it can at least be said that non-oil tax revenues are not oppressively high, and that they do not present a barrier to enterprise. Indeed, most scholars of fiscal policy not belonging to the neoliberal school would regard tax rates as unrealistically low.

Following a major economic crisis in 1982, caused mainly by uncontrolled public spending, Mexican authorities worked hard to achieve macroeconomic stability. Despite – or perhaps because of – another serious crisis in 1994 – 1995, it can be said that this policy effort eventually succeeded. As recently as 2007, Mexico’s fiscal sustainability looked strong. Then came a series of issues – swine flu, declining oil production and the general world recession – which hurt the Mexican economy badly. In 2008, Mexico went to the IMF for help amid fears of a collapsing peso. The result was a serious Mexican recession. Very recently, though, investor confidence has returned. Mexico now has an abundant amount of foreign exchange reserves. In the first few months of 2010, the peso increased in value against the dollar, and there is every sign that macroeconomic stability in Mexico is currently stronger than in some countries of the European Union. Despite some continuing vulnerabilities, Mexico’s macroeconomic policy appears successful.

The quality of health care varies widely in Mexico. Private, self-financed health care is limited for the most part to middle-class and upper-class Mexicans. This group encompasses about 13% of the total population, but receives about 33% of all hospital beds. A larger minority of around one-third of the population (most of whom work in the formal sector) can access health care through state-run occupational and contributory insurance schemes such as the Mexican Social Security Institute (Instituto Mexicano del Seguro Social, IMSS) and the State Employees’ Social Security and Social Services Institute (Instituto de Seguridad y Servicios Sociales de los Trabajadores del Estado, ISSSTE). These are based on automatic contributions for workers in the formal sector, and in practice work reasonably well, although with some variation across different parts of the country. The system has been decentralized to the state level. In order to extend the insurance principle, the government has set up the so-called Popular Insurance (Seguro Popular) program, which is open to contributors on a voluntary basis, with means-tested contributions from citizens supplemented by substantial government subsidies in order to encourage membership. The government is aiming at virtually full coverage by the end of 2010, but this is optimistic. It is doubtful that there would be enough capacity to provide the vast majority of Mexicans with health care even if financial problems did not limit access, which is the case. The law does entitle Mexicans who have not contributed to an insurance program to have access to such health care as is available. There are some health facilities available to the poor, though they are undercapitalized and often hard to reach for those Mexicans who live in rural areas. Overall, health care spending accounts for a relatively small proportion of GDP due in part to Mexico’s relatively young population. Pressures on health facilities are likely to increase over time as the average age of the population increases.

Mexico is a very unequal society with serious problems of poverty and social inequality. There was a slight reduction in extreme poverty in Mexico during the 2000 – 2006 period, due in part to better targeting of government help (though this remains very limited in quantitative terms) and in part to the growth in remittances from Mexicans working in the United States. However, the recession has reversed this latter trend, at least for the time being. Official figures show a significant increase in poverty between 2006 and 2009, and remittance income has been falling. The governmental Oportuindades program, which replaced largely untargeted food subsidies, was designed to provide help to the poorest individuals, but with this help targeted to recipient behavior. It has been internationally praised. There has also been some experimentation, in Mexico City and some other cities, with a general old-age pension system. This has proved popular, and may be extended to other states, but it is very expensive. Meanwhile, at the other end of the scale, there has been considerable oligopolization of the economy. Low taxes and weak competition policies have further enhanced the concentration of wealth.

Attitudes toward family structures are in the process of changing, but more rapidly in the case of upper- and middle-class women than for their poorer counterparts. In wealthier families, it is quite normal for women to seek highly paid employment and to avail themselves of private sources of nursery education as well as maids. As a result, many professional people, such as university professors, are women. Poorer Mexicans tend to have larger families and face fewer opportunities for women in the labor market. Old-fashioned “macho” and conservative Catholic attitudes are slowly dying, but there is an inertial effect from the past that makes it harder for lower-class women to progress. Many labor-based institutions tend to be based for traditional reasons around the concept of the working man. Lower-class women are more active in family businesses and in the informal sector of the economy, where incomes tend to be lower. Women are further handicapped by weak law enforcement, because they can be vulnerable to various kinds of abuse without being able to rely on the protection of the laws.
Some of what might be called official Mexico is broadly supportive of women’s rights. The recent political reform requires registered political parties to have a quota of women included as a part of their election slates. Other issues are more contentious, particularly ones that involve the Catholic Church. The Federal District has recently officially legalized abortion (a decision so far upheld by the Supreme Court despite many challenges), although this remains illegal in the majority of Mexican states.

Mexico underwent a major pension reform that took effect about a decade ago, moving the existing system of contributory pensions for workers in the formal sector from a pay-as-you-go system to a defined-benefit system operated by government-approved financial agencies called Afores. (The new system was limited to new entrants, while those who were already retired continued to receive state pensions). The objectives of this reform were to raise the domestic savings ratio, to find a means of covering an elderly population that is growing rapidly, and to broaden coverage so as to help poorer Mexicans. The new system has been working reasonably well, although the pension funds have come under pressure to buy government bonds and help cover the public deficit arising from the recession. In 2009, the majority of Afores funds were actually invested in government bonds. Some Mexican states have in recent years introduced noncontributory old-age pensions based on universal eligibility. The amounts are quite small and involve more of a topping up than anything else. The general system seems fiscally sustainable, though in some rare cases, separately negotiated public sector pension systems do raise issues of sustainability. This is clearest in the case of the state oil company PEMEX.

For most Mexicans, the issue of migration has to do with emigration rather than immigration. There is an overriding policy of trying to help Mexican migrants residing in the United States to the extent permitted by U.S. law. However, there is some traffic going the other way. A considerable number of retired U.S. citizens now live in Mexico. These people mostly have their own financial means, and contribute to the local economy in the more tourist-friendly parts of Mexico. They are generally welcomed. Integration at this level is not really an issue. This cannot really be said of the Central American migrants into Mexico, many of whom use Mexico as a transit point while they attempt to reach the United States. Mexicans do not treat their own undocumented migrants at all well. The problem is not so much official discrimination, but rather the general inadequacy of ordinary law enforcement, which denies to undocumented immigrants the most basic civil protections and leaves them prey to extortionists of one kind or another.

Mexico is in an unusual situation in security terms. It has no meaningful defense against the United States, while its southern neighbor Guatemala poses no real security threat. It is true that Guatemala was briefly seen as a security threat to Mexico in the 1980s, but nobody thinks of this as a problem today. The most serious dangers to Mexico involve the spilling over of Mexico’s internal problems in a way that might involve the United States. The murder of several U.S. consular officials and their wives in March 2010 raised this issue in very direct form. However, the United States government has responded, as expected, by seeking to support and strengthen the Mexican government rather than attempting to exploit weakness.

The internal security situation in Mexico is bad and getting worse. The main security threats are twofold:
(1) Insurgency: There have been minor insurgent events at various times since the Zapatista rising of 1994, but these have not amounted to much. (The Zapatistas were more of a political phenomenon than a military threat). There has been some speculation that some insurgent group may be planning some kind of dramatic event later in 2010, which is the 100th anniversary of the Mexican Revolution and the 200th of Mexico’s initial declaration of independence from Spain. Insurgency is not so much a current threat as a potential one.
(2) Crime, particularly drugs: In 2007, President Calderón declared a war on drugs, but it must be said the drugs currently seem to be winning. Mexico is a major stop in the transportation of cocaine from South America to the United States, and there is significant drug production in Mexico as well. The result has been to bring billions of dollars into Mexico that are used to finance drug gangs, buy sophisticated weapons (which can be imported from the United States), and bribe politicians, police and judges. Calderón has tried to use the military as a front-line force in this battle, but this has led both to problems of human rights abuses and to corruption within the military. Meanwhile, the leaders of the drug gangs can afford to pay their armed guards more than the Mexican state can afford to pay its police and private soldiers.
Official judicial institutions such as the courts are not capable of dealing with drug issues, due to a lack of resources. Police organization has also been hindered by the overlapping jurisdictions of federal and municipal police forces. The army, though more respected, is capable of human rights abuses. Mexican authorities point out that drug-related violence tends to be high profile, due to the organized criminals’ objective of intimidating their enemies. This makes things seem even worse than they are. In fact, per capita homicide rates in Mexico are lower than in Brazil, Colombia and Venezuela. It is also the case that other countries aside from Mexico have experienced difficulties in controlling the drugs trade. However, the fact remains that Mexico is becoming globally notorious for its organized criminal violence.

Mexico does have an awareness of environmental policy. It has signed up to the Kyoto agreement, and explicitly addresses the issue of sustainable development in its 2007 – 2012 development plan. The Mexican national environmental agency has a fairly sophisticated understanding of the major issues. Calderón himself has made protection of the environment one of his government’s priorities, and may be leading public opinion at this point. However, Mexico has some real environmental problems. There is a rural population under economic pressure, and soil erosion is a real problem. Mexico City is very large, and has potential problems with air quality –though it must be said that the more extreme forecasts made a generation ago have not been borne out. The provision of clean water to Mexico City is a problem, and there is a small proportion of rural Mexico that lacks access to clean water altogether. It can also be difficult for the authorities to provide sufficient financial resources to invest sufficiently in the supply of clean water. Even though a regime of charging for water is in place, it is often difficult to collect on bills, and there are political pressures keeping water prices low (sometimes too low). There has been some attempt to privatize the provision of water supply, with mixed results. Moreover, in more general terms, there are issues of enforcement and jurisdiction that create problems. Municipalities have been given some environmental responsibilities as part of a process of decentralization, but without sufficient training at the municipal level. Inspection regimes therefore vary in quality depending on the locality. It is also difficult to regulate powerful state companies such as PEMEX.

National spending on research and development since 2005 has been very low. One consequence of Mexico’s economic oligopolization has been severe polarization, in which a very large number of “micro” firms have little or no institutionalized access to state R&D spending, while large and efficient firms undertake their own research and development spending. There is at last growing awareness of this problem within Mexico itself.

There has been considerable evidence of improvement in education policy, but the country is starting from a low base. The overwhelming majority of Mexican children attend primary school at least, and enrollment in secondary education is also expanding. Public spending on education as a proportion of GDP has been rising. There is near-universal literacy. At the other end of the scale, there has also been an expansion in the quality and quantity of university education, which is no longer the province of a small minority. A small minority, albeit a growing one, does study abroad at postgraduate level. There is a private education system that sits side by side with the state system. The quality of private education is generally good, but only a minority can afford it for their own children despite some availability of scholarships. As far as the state school system is concerned, one significant problem is the all-embracing unionization of Mexico’s teachers. Mexico’s teaching union is probably the most powerful syndical organization in Mexico. The effect of this is to make teacher performance rather variable, as there is no effective system of assessment or merit-based promotion. Unionization also means that teachers’ pay absorbs a comparatively high proportion of the education budget – in fact, teachers’ pay has increased quite a lot in recent years on a real basis. However, there is a high student-teacher ratio in Mexican state schools, which seems to translate into poor teaching performance. When international tests on the comparative performance of schoolchildren are carried out, Mexico tends to score rather low. Higher education has improved a lot under the influence of globalization. Good Mexican graduates now fit easily into postgraduate training programs at European or U.S. universities (which was not the case a generation ago), though many of those who study abroad have already had the benefit of some private education within Mexico itself.