Yoked by Debt, Mexicans Find a Voice : Economy: Hit by crushing financial burdens, middle-class citizens flock to a group fighting business-as-usual government.
What would you do if the annual interest rate on your mortgage leapt to 144% overnight? Or if the interest on your credit card debts rose to 180%?
You might start by singing the blues. Or if you’re Mexican, you might sing “El Barzn,” a classic tale of debt oppression. The folk song, named after the leather strap that binds the ox to the plow, tells the story of a peasant farmer who rents land and buys goods from his landlord at prices that ensure his debt will never be paid off. The harder he works, the more he owes.
Mexicans had new reason to sing “El Barzn” after the peso crashed in December 1994. Mortgage and credit card payments went through the roof; many in the debtor class joined a civic organization that defends their rights. It’s called, appropriately, El Barzn.
Unlike the tragic peasant hero of the song, however, most of El Barzn’s 1 million members are middle-class and indebted to banks, not to landlords. But like feudal serfs, they know what it means to be under the yoke of debt.
Because of the national economic crisis, many are unable even to make payments on their debts. In 1995, Mexico’s gross domestic product dropped by almost 7% and 2 million Mexicans lost their jobs, raising the number of unemployed to a staggering 12 million. Eight million members of the middle class fell into poverty, for a total of 48 million poor--44% of the population.
Today, next to the armed Zapatista guerrillas, El Barzn is the government’s fiercest opponent, frequently employing civil disobedience.
When Barzn members are evicted from their homes, fellow members break back inside and put everything back the way it was. When the government spends billions bailing out banks and investors--but not producers and consumers--El Barzn protests at the stock exchange.
The Mexican people are tired of the rosy predictions that everything will get better once bankers and investors start turning huge profits once again. They are tired of hearing the assurances of political leaders in the U.S. and Mexico that the economy is “essentially sound” while everything they own is auctioned off or confiscated by the banks.
The Mexican government has done nothing to rectify the causes of peso crash and its only plan for national development is to restrict economic growth and return to business as usual: more money for bankers and investors, more evictions for the middle-class.
The problem is that the debt Mexico owes to the U.S., the International Monetary Fund, the World Bank, private banks and investors as it currently stands is unpayable. So is the debt that Mexicans owe to their government: The total amount of overdue debts is 240 billion pesos, yet only 50 billion pesos are in circulation.
To reduce poverty and get Mexico growing again, action must be taken to stimulate production. Debts must be renegotiated in a way that creates conditions for people to pay back loans without falling into poverty.
For its part, the U.S. should realize that it too is affected by Mexico’s economic crisis. Since the peso crash, the U.S. has spent millions of dollars on stepped-up border patrols to prevent Mexican immigrants from entering the U.S. to work. And without a middle class to sell their products to, companies that export to Mexico have had to lay off workers or shut down altogether. Americans would benefit if the U.S. government encouraged Mexico to use bailout money not simply to reimburse investors but to invest in production and jobs.
In the absence of a North American version of El Barzn to protest the use of public money to pay for the mistakes of the wealthy, chances that the U.S. will change course are slim. For this reason, “El Barzn” the song is a powerful allegory for the Mexican debt crisis and the disastrous economic policies that led to the crash of the peso. “The barzn is broken but the plow keeps going,” the refrain goes.
