Happy Independence Day, Mexico

Your leaders have served you poorly.

Andrew Winning / Reuters

Americans celebrate Mexican heritage on Cinco de Mayo, but Mexicans themselves chose September 16 as their national day.

On September 16, 1810, the priest of a small town near Guanajuato summoned his followers to revolt against the colonial government of Spain. This incident is conventionally regarded as the opening of the long war that eventually brought independence to Mexico in 1821.

National histories are usually shot through with myth, and Mexico’s perhaps more than most. The uprising of September 16 rapidly ended in tragic failure, brutally suppressed by royalist troops. Independence arrived a decade later only after the government back in Madrid adopted reforms too liberal for the liking of the victorious counter-revolutionary elite in Mexico. The local upper class then switched sides, establishing Mexico as an authoritarian Catholic empire under the most successful of the generals who had defeated the insurgents of 1810.

Imagine that the British had sent George Washington, John Adams, and Thomas Jefferson to a firing squad in 1777. Imagine that it had been Benedict Arnold who achieved American independence, pronouncing himself Emperor Benedict I, banning all religions except the Church of England, and concentrating land ownership in the hands of a few grand Tory families—and you have some idea of the Mexican outcome in 1821.

Paradoxes like that run through Mexican history, and into Mexico’s present.

Is modern Mexico a successful or unsuccessful country?

Success: Mexico ranks as the world’s 15th-largest economy. Mexico’s output of around $9,000 per person ranks about on par with Romania and Turkey, a little ahead of Brazil—and well ahead of China’s $7,900.

Success: Mexico transitioned to multiparty democracy in the mid-1990s. Elections since 1996 have been generally regarded as free and fair—and the Mexican voting process in many ways superior to that of the United States, overseen by an agency whose political independence is internationally acclaimed.

Success: Net migration to the United States has slowed and even reversed. Between 2009 and 2014, more Mexicans returned home from the United States than left Mexico for the United States.

Unsuccessful: While Mexico is not a poor country, Mexicans remain poor people. Nearly half the population lives below Mexico’s poverty line. Even middle-income Mexican families spend more than 40 percent of their incomes on food, beverages, and tobacco, about the same proportion as American families on average spent on similar goods in 1900. Barely one-third of adults aged 25-64 have completed high school; even literacy is not universal.

Unsuccessful: Mexican politicians may now be elected, but extrajudicial killings and disappearances are terrifyingly common. There are many places where the line between local authorities and criminal gangs is blurry, to the extent it exists at all. 103 journalists were murdered and 25 disappeared between 2000 and late 2015. Some 90 percent of crimes against journalists go unpunished.

Unsuccessful: Mexico’s economy has stagnated since 1980. Real GDP per worker still remains below the peak level set that year. Narrowing opportunities at home have sent Mexican workers into exile: Some 10 million people have emigrated from Mexico since 1980, almost all to the United States, more than half of them illegally.

Real GDP per working-age person in Mexico

The question of why Mexico has not done better remains ferociously controversial. Marxist ideology remains a living presence in the Spanish-speaking world. For non-Marxists, however, the explanation should run more or less as follows:

Mexico grew fast between 1950 and 1980 for the same reasons many Southern European countries grew fast over those same years: a migration of rural people to cities and towns, where they found more productive work. There the parallel stops. Spain and Italy opened their economies to trade and investment. They stepped on the escalator of continuing productivity improvement and therefore income growth. Mexico, by contrast, remained a much more closed and regulated economy, burdened by disincentives against innovation and investment. The migration of rural labor to the cities conferred only a one-time bump, rather than setting in motion the kind of growth we see in advanced economies. Sooner or later, even the most rural economy runs out of peasants. As the flow of people from rural areas to the cities slowed after 1980, Mexico’s growth stalled.

Even when Mexico finally did open up, it continued to protect supposedly strategic industries like energy and telecommunications. Overcharges by the country’s telecommunications monopoly are estimated to cost 2 percent of Mexico’s total economic output. That monopoly earns profits almost double those of its U.S. and Canadian counterparts. Unsurprisingly, the monopoly’s owner, Carlos Slim, ranks among the world’s richest men. The Mexican state-dominated energy industry also remains staggeringly inefficient, paralyzed by privileged labor unions and starved of investment by a Mexican government that demanded the energy monopoly Pemex pay its profits into the national treasury, rather than use them to maintain fields and modernize equipment.

At the same time, Mexico failed to invest adequately in education and skills. Mexico has almost the very lowest enrollment in secondary education of any of the 35 countries of the Organization for Economic Cooperation and Development: 53 percent of people aged 15-19. Only Colombia and China score lower. Mexican teachers’ unions are famously committed to protecting members’ sinecures regardless of student performance, and they’re epically corrupt. In 2013, Mexican authorities arrested the head of the teachers’ union on charges of misusing $200 million of union money. Tim Johnson of McClatchy reported at the time:

Some of the money was wired to accounts in Switzerland, [the attorney general] said, while other funds were used on plastic surgery. Some $2.1 million was spent at the Neiman Marcus store in San Diego, Calif.

Authorities arrested Gordillo, 68, when she arrived near Mexico City on private jet from San Diego. Gordillo maintains a $1.6 million home in La Jolla, a San Diego suburb.

How can this be tolerated? This is the master key to Mexico’s disappointing performance: the historic weakness of Mexican institutions. Just one example: Mexico is a dry country that cannot afford to waste water. Yet close to 40 percent of the Mexico City water supply is lost to leaky pipes.

Mexican institutions fail for many reasons. Corruption heads the list. In a 2013 survey by Transparency International, 60 percent of Mexicans admitted that a member of their family had bribed a police officer, and more than 50 percent said that a family member had paid a bribe to a court official. The same organization ranks Mexico 95th out of 167 in its 2015 global corruption perceptions list. No comparably affluent country outside the former Soviet bloc ranks so high. (Turkey, for comparison’s sake, ranks 66th; Brazil, 76th.)

Mexico’s president Enrique Peña Nieto is widely acclaimed as a modern-minded reformer. Yet he has been caught at the center of a baffling scandal about his living arrangements. His wife, a former soap opera actress, has enjoyed the use of houses owned government contractors: A $7-million mansion in a posh Mexico City suburb and an apartment in Key Biscayne, Florida. Exactly how—and on what terms—the first lady acquired the homes has never been clear. She claimed to have “bought” them, but they remained registered to the contractors, who also seem to have paid the taxes on them. She then claimed to have “returned” them, which raised questions whether she had ever paid anything in the first place. A federal investigation cleared the Peña Nietos of any wrongdoing—but the comptroller in charge is a long-time crony of Peña Nieto’s. Meanwhile, the journalist who brought the property dealings to light has been fired from her job at a Mexican media conglomerate and is being sued.

Unlike the United States and Canada, settler societies built after the original inhabitants were displaced and expelled, in Mexico the European newcomers formed a thin elite atop a subjugated and exploited native population. The antagonistic relationship between conquered and conqueror still shapes the interactions of state and society. Even now, Mexico remains a society of rulers and ruled. Agencies of the state, notably the police and army, deploy violence with impunity. In 2014, Mexican judges received 2,400 complaints of torture in police custody. These complaints might or might not be valid: We’ll never know, since they are almost never investigated. Confessions allegedly based on coerced testimony are regularly accepted by Mexican courts. Only since 2014 have allegations of army abuses against civilians been required to be heard by civilian courts.

True, Mexico is fighting a deadly drug war. “Civilian” in the Mexican context does not necessarily mean “innocent civilian.” The 122 million people of Mexico suffer more homicides than the 320 million people of the United States—and something around half of them are attributed by local media to organized crime. Yet it’s also by no means clear that police and army violence is used more against criminals than it is in their service. The double escapes from maximum-security prisons of the famous El Chapo were not works of derring-do, but paid for by bribery. The relations between many officials and other gangsters are equally cozy.

These arrangements disgust many Mexicans, of course. And this leads to the final explanation of Mexico’s failure to transition to fully developed status: easy exit to the United States for the disgruntled. Emigration has been a political strategy for the Mexican state, as well as an economic strategy for the Mexican people. When Donald Trump opened his now-famous comments on Mexican immigrants with the words, “When Mexico sends its people …” he was touching upon an important truth.

Most countries that experience large-scale emigration perceive it as a huge problem. When Sweden sent almost one-fifth of its people to the United States before the First World War, the Swedish state saw a national crisis. It convened a commission to investigate the population loss and recommend ways to persuade Swedes to stay at home. The modern Swedish welfare state had its origins in the commission’s researches.

Mexico has seen no such effort. To the contrary, Mexican authorities have actively encouraged out-migration as a substitute for the jobs and opportunities they cannot provide at home. In the 1986 words of Doris Meissner, who would serve as director of the Immigration and Naturalization Service under President Bill Clinton, Mexico’s “government declines to discuss bilateral approaches [to control immigration], supposedly to avoid impinging on U.S. sovereignty. Spanning at least a decade, a succession of migration consultative mechanisms, technical information exchange groups and joint committees has failed to produce cracks in that armor. Mexico's Realpolitik is to perpetuate the status quo. The migration safety valve compensates for widespread underemployment more fully and efficiently than any other system within reach.” American leaders have also often quietly fretted that more effective immigration controls on the U.S. side of the border could plunge Mexico into revolutionary upheaval.

Revolution looks less likely in Mexico today than it did even a generation ago. Mexico is an aging country. The median age in Mexico, already 28, will reach 42 by 2050. The worst threat for the future of the country is less upheaval than lost opportunity. As the world moves from industrial economy to knowledge economy, the transition from poor to rich seems to be getting more difficult. What South Korea and Chile did, China and Mexico seem increasingly unlikely to do. Mexicans are emigrating less, not so much because they are finding more opportunity at home—but because they face more difficulty getting ahead in an American economy that demands more skills and higher qualifications.

Independence is a concept that has resonated powerfully in Mexico since 1810. “Poor Mexico: so far from God, so close to the United States” is a national witticism based on hard experience. But the independence most relevant to modern Mexico on this September 16 is not independence from another country, but from the mistakes of the past and the callous aloofness of its leadership class.