In Big Business, Only the Facade Changes
The many changes that Mexico has undergone in recent years have affected all sectors of society, but not in the same fashion. The business community has experienced several transformations, reacting with remarkable resiliency in some regards and resistance in others. The contrast between change and continuity is perhaps the distinctive sign of how business leaders have responded to the dramatic shift in power, clout and status unleashed by the economic maelstrom.
From the the beginning of Mexican industrialization during World War II through the debt crisis in 1982, the power players of business were oriented toward the domestic market and economy. Protected, subsidized, incestuously related to the state, the emerging manufacturing sector, together with agribusiness and banking, developed a cozy relationship with the government, with its high officials and influential families and with the international community (mainly the United States). There were occasional frictions, sometimes conflicts over ideological matters and economic policy, but this was the golden age of the Mexican political system and its business associates.
In the economic crisis of the 1980s and the subsequent trade liberalization, all of this began to shift. The traditional, inward-oriented industrialists, bankers and growers started losing money, stature and influence; the export sector surfaced and became significant. Glass, ceramics, beer and fruit and vegetable producers, auto parts manufacturers, some textile and garment makers became exporters and slowly left the internal market business community behind.
In many cases, the families in the front office were the same as before; the names on the new corporate rosters were impressively similar to those of the past. But the nature of their activities was different: They were less protected (but not unprotected), less subsidized (but not entirely on their own), less dependent on the state (though the umbilical cord certainly was not severed) and much more attuned to the imperatives of international competition.
The gain for the country was considerable, but not without disadvantages: The more modern, competitive and outward-looking magnates and firms were strong and becoming solidly grounded in world markets but increasingly decoupled from the domestic Mexican economy. The most extreme example is the auto industry: Exports are soaring, but internal sales, which collapsed with the peso in 1994-95, have yet to recover to 1981 levels.
The “new” businessmen are more and more indifferent to the actual performance or indicators of the Mexican economy; they sell abroad, borrow and raise capital abroad, get their accounts tabulated abroad, insure themselves abroad and, every now and then, live and die abroad. It is perhaps this lack of immersion in the trials and tribulations of Mexican life that has made it possible for the business community to retain many of its traditional features in other areas. Even the younger, more entrepreneurial and internationally inclined newcomers to Mexican industry, banking and agriculture reproduce many of the less pleasant attributes of their predecessors, partly because so far they have escaped the forces of change at work in society and politics.
Two indicators of the lag are worth mentioning: the enduring presence of corruption in business’ relationship with government, and the ambiguous attitude of most of the business community toward politics in general. By now it seems like a cliche: The Salinas administration, which was largely responsible for the trade opening and the above-mentioned shift within the business community, also took traditional graft and incest between business and government to new heights. In the privatization process, in highway building, in trade perks and influence-peddling, in outright bribes, loans and insider trading, the Salinas regime went further than any of its predecessors since Miguel Aleman in the 1940s.
The situation has improved recently, as scandal, social outrage and a greater emphasis on transparency and honesty under the current administration have made it more difficult to pull off dirty tricks than before. But it remains to be seen whether the business sector’s mentality and habits have truly changed, and whether it now understands that in the long term, corruption is bad not only for business, but also for values.
Also left to the future is the question of when--or whether--the new business community will finally get involved in politics, and not just in lobbying the government for favors, or squabbling with it over ideological issues, ranging from the merits of Hayekian economics to sex education in public schools. As is understandable and perfectly predictable, the Mexican business community is largely conservative on political, economic and social issues. Theproblem lies in the unwillingness of the private sector to defend its positions openly in the political arena by explicitly supporting some parties or candidates and working against others.
To a considerable extent, the business community continues to act as if PRI rule were eternal, as if the opposition--right or left--is never to be in charge. One of the main reasons that the PRI’s chief rivals, the right-of-center PAN and the left-of-center PRD, seem sadly and surprisingly unprepared to govern Mexico lies in their lack of contact, interaction and debate with the kingpins of the country’s industrial and financial establishment.
Until business participates fully in the development of democracy, it is doubtful that Mexico will see the hoped-for cultural diversity and political pluralism that the nation sorely needs. Mexican society and the nation’s political spectrum have evolved over the past several years. Everyone today recognizes that the country requires a vigorous, progressive and competitive business sector for the nation as a whole to move forward.
In strictly economic terms, Mexico has begun to acquire many of the elements of such a business community; from other perspectives--politics, corruption, culture--this is not yet the case. The beginning of a new century and millennium would be an excellent time to get started.
