Foreign Affairs: 100 Years
The Future of History
Can Liberal Democracy Survive the Decline of the Middle Class?
Inside his home in Chilpancingo, in Mexico’s southwestern state of Guerrero, Humberto, a soft-spoken middle-aged teacher, watched his daughter prepare a traditional posole soup. Apart from coconuts and Acapulco Gold marijuana, the dish is one of the state’s best-known commodities. Weeks had passed since 43 students from a nearby teaching school in Ayotzinapa were abducted and presumably murdered by a local drug cartel, allegedly with tacit approval from the local authorities, but the city still shook with unrest. That night, a relatively subdued protest simmered in the city center, but the smashed windows of the government offices down the road were reminders of the clashes that occurred earlier in the week.
Humberto mentors several students from the Ayotzinapa teaching school. Speaking alongside one of them that evening, he tied the tragedy to the many deep-seated problems plaguing Guerrero. When it comes to investment, security, and economic development, the state simply hasn’t been a priority for Mexico’s federal government. Its education system is massively underfunded, leaving residents woefully unprepared to succeed in Mexico’s increasingly globalized economy. And soaring crime rates have made improving public schools more difficult. “You can’t reform education when there’s this much instability,” Humberto explained. The student, who asked not to be named for fear of retribution, explained that because of this lack of policy support, students and teachers have come to ally themselves with another downtrodden group: Mexico’s poor farmers. “The vision [our] school has is showing solidarity with humble fieldworkers,” he told me. “We help farmers to harvest. The school participates.”
Guerrero is not alone in its plight. Other southern Mexican states, too, are at a vast disadvantage compared with the more developed and industrialized north—a disparity that has stoked public anger for years. Although the students’ disappearance provided the spark for waves of protests that have swept the region, the roots of the discontent lie much deeper. For President Enrique Peña Nieto, the protests are a harbinger of greater disruptions to come if he fails to recognize the structural problems that keep Mexico’s southern region mired in poverty.
Guerrero, whose name means “warrior” in Spanish, could well be Mexico’s most complicated state. It is home to some of Mexico’s most radical and militant protest movements and a teachers’ union that has sacked and burned government buildings. The state is cut off from most legal agricultural export markets, but it produces 98 percent of the heroin that Mexican cartels export to the United States. Guerrero is also home to Mexico’s most violent city, Acapulco, and in 2013 reported the highest number of murders of any state in the country. Even as northbound migration from Mexico has slowed, thousands of young people continue to spill out of Guerrero looking for safety and jobs in the United States.
Guerrero also has Mexico’s largest informal economy and the third-highest poverty rate. Seven out of every ten residents live below the poverty line, and eight out of ten work in the informal sector, running taco stands, washing windows, or relying on subsistence farming for their livelihoods. As the Mexican historian Enrique Krauze explained in a recent essay, “Guerrero has been ungovernable since the colonial times. . . . Its political history is made from plundering, coups, betrayals, excesses, ignorance, takeovers, and disagreements solved with bullets and murder.”
As Guerrero and the other southern states struggle, Mexico’s northern states have become modern export hubs thanks to proactive state and federal policies. As Jason Marczak of the Atlantic Council told me, “A lot of the manufacturing jobs are close to the U.S. border, [and] you see a divide in policy,” with northern states enjoying greater support. Guerrero and other southern states, such as Chiapas and Oaxaca, are now the least economically competitive in the country. Guerrero’s economic output accounts for just over one percent of Mexico’s GDP—less than that of Hidalgo and San Luis Potosí, two tiny states with modern industrial sectors. In 2012, San Luis Potosí’s economy grew by 6.2 percent, in contrast to Guerrero’s anemic rate of just 1.2 percent.
In no other area of public policy is the north-south divide more obvious than in agriculture. Mexico’s southern states have historically been dominated by small farms. Four out of every ten residents in Guerrero live in rural areas, and one-fifth of the economically active population works in agriculture. Between the 1930s and 1960s, the Mexican government paid attention to the south and focused on building schools, dividing up huge haciendas, and creating healthy local economies based on small farms. However, more recent administrations have left small farmers out in the cold. Government resources have been channeled to build irrigation infrastructure in the north to support big agribusinesses. Meanwhile, the solution to the troubles of smaller and poorer southern farmers was income subsidies rather than proactive policies that would raise crop yields, cultivate more profitable crops, and support the farmers’ incomes.
Moreover, the government’s existing agricultural subsidies disproportionally benefit large farms in the north as part of the broader state strategy of industrial development and export growth. As Jonathan Fox from American University told me, these subsidies “are concentrated among the top 200 or 300 thousand farmers . . . out of the millions of farmers in Mexico.” The two sectors employ vastly different shares of the overall work force. Around three million farmers work on small-plot farms, compared with a few thousand employed at industrial-scale agribusinesses. This explains why government farming subsidies amount to more than $3,000 per capita in northern states such as Sinaloa, Sonora, and Tamaulipas—about six times more than the per capita payouts in Chiapas, Guerrero, and Oaxaca.
This lack of government attention is also echoed in education policy. A fifth of Guerrero’s schools have no electricity, and almost eight out of every ten lack Internet access. The student teachers in Ayotzinapa have adopted militant tactics in part because they see their state’s rural communities as being chronically underserved by state and federal agencies. The situation in Guerrero’s rural schools mirrors the situation in the fields.
Although the Peña Nieto government has announced plans to invest in rural schools and promised to boost economic growth in Guerrero, it has so far done little to bridge the north-south divide. During his first two years in office, Peña Nieto has labored to promote a modern image of Mexico at home and abroad, launching reforms in the energy and telecommunications sectors and courting new foreign investment. But all the while, he avoided dealing with the problems in Guerrero head-on. And even though Peña Nieto was quick to fly to Guerrero to show his support for residents affected by Tropical Storm Manuel in 2013, it took him more than two months to visit Guerrero in the aftermath of the students’ disappearance.
Spurred by the crisis, Peña Nieto has outlined his policy response to problems in Guerrero and other high-crime areas on November 27. The initiatives he proposed center on security but also include plans to pave roads and create special economic zones in the south. None of these proposals, however, are likely to have a game-changing impact on the existing geographic disparity.
Reversing Guerrero’s downward spiral would be a massive political undertaking, and improving security and law enforcement would represent just the first step. Revising long-standing agricultural policies must also be part of the solution. Moreover, the government should stop mistaking its acclaimed social assistance program Prospera for an alternative to proactive rural development measures. Despite the success of cash transfers in alleviating extreme poverty, they do little to create new sources of productive employment and don’t address the underlying structural forces perpetuating misery in Mexico’s rural areas. As Selee explained, the federal government has generally not known how to approach Guerrero, preferring “to manage rather than solve the problems in the state.” But recent displays of public anger might be a sign that this passive approach is no longer a viable solution.
Examples of other countries show that setting Guerrero and other southern states on the path toward sustainable growth is possible with sufficient commitment. One case in point is Chile, which has encouraged rural economic productivity by teaming up government officials and agricultural experts with private sector farmers to diversify production, plant new crops, and help growers access new export markets. So far, however, Mexico has taken the easier road by focusing its resources on industrial development in the north. This strategy has paid off to an extent: rural residents fleeing poverty in places such as Guerrero have provided ample cheap labor to northern industries, helping to keep the prices of Mexican goods low enough to compete with China’s.
But as Mexico shifts to higher value-added production, this model is increasingly obsolete. More and more, Mexico’s factories rely on trained technicians and high-tech assembly lines rather than simple production processes utilizing cheap labor. And as northern Mexico’s economy evolves, Guerrero and the rest of southern Mexico remain caught in a public policy vacuum, fueling frustration.
Speaking in his kitchen, the Chilpancingo teacher Humberto told me that he had little hope that the government would be willing to invest time and money to help his state. As he watched his daughter ladle spoonfuls of simmering soup from three different pots on the stove, Humberto smiled wryly. “We have red, white, and green posole,” he said. “That’s the only way we are patriotic.”