Economy, Politics Collide in a Divided Mexico July's presidential election left the nation almost equally divided between a leftist who wants to renegotiate NAFTA to protect farmers, and a conservative who wants to encourage more free trade deals. But treaties alone aren't the only source of Mexico's economic woes.
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Economy, Politics Collide in a Divided Mexico

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Economy, Politics Collide in a Divided Mexico

Economy, Politics Collide in a Divided Mexico

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For the past week, NPR News has explored the left in Latin America. Today to conclude the series, a country where the left and right have been locked in political battle since presidential elections in early July: Mexico. The leftist presidential candidate there, Andres Manuel Lopez Obrador, lost by less than one percentage point. He claimed fraud and spent the summer demanding a full recount.

He lost again when the electoral court ruled earlier this month that the conservative candidate, Felipe Calderon, was the winner. But Lopez Obrador says he is not giving up and today is gathering his supporters in Mexico City's main square to declare himself the legitimate president.

Among the issues that have caused so much division in the electorate are trade agreements. NPR's Lourdes Garcia-Navarro takes a look at the biggest of these, NAFTA, the North American Free Trade Agreement.

LOURDES GARCIA-NAVARRO: While it may sound like a carnival, this is the sound of crisis.

(Soundbite of banging)

GARCIA-NAVARRO: Mexico's been in the midst of a political battle of titanic proportions between the left, represented by Andres Manuel Lopez Obrador, and the right, headed by Felipe Calderon.

On the streets of the capital thousands of leftists over the summer protests what they said was electoral fraud, causing gridlock. One of the demonstrators, Miguel Angel Veda, says that labels of left or right aside, there is mounting genuine frustration in Latin America with the way things have been going.

Mr. MIGUEL ANGEL VEDA (Demonstrator): (Through translator) We can't take any more. Every day there are more poor. It's harder for us in our work to get well paid. It's not possible that only the private sector and few benefit from the system.

GARCIA-NAVARRO: For over a decade now in Mexico, growth has been pretty much flat and illegal immigration has been soaring; this despite the touted benefits of the North America Free Trade Agreement, or NAFTA, which sets out preferential trade quotas with the U.S. and Canada.

In a bustling weekday market in a farming town in the state of Mexico, Oracio Sanchez(ph) hawks his fruit and vegetables.

Mr. ORACIO SANCHEZ (Vendor): (Through translator) I was never in agreement with NAFTA. The United States will always have an advantage in agriculture, and that is a disadvantage for us.

GARCIA-NAVARRO: Corn has particularly become a contentious issue. It's been a staple of the Mexican diet for thousands of years. But because of NAFTA, the U.S. can flood the Mexican market with its cheaper variety, and it does. America is the largest producer of corn in the world and it subsidizes its product, making it almost impossible for Mexican farmers to compete.

This has had a devastating effect on many parts of the Mexican countryside.

Dr. RAUL DELGADO WISE (Zacatecas University): Under this agreement, migration has grown exponentially.

GARCIA-NAVARRO: Dr. Raul Delgado Wise from Zacatecas University is an expert on NAFTA, which was implemented in the early 1990s.

Dr. WISE: In 1994, we had in the U.S. around five million Mexican-born population. And we have now nearly 11 million.

GARCIA-NAVARRO: Delgado says that other statistics show the equally stark negative effect of NAFTA on the Mexican countryside. Around 30 percent of farming jobs have been lost. But low-paying maquiladora manufacturing positions have done little to pick up the slack. There's been a mass exodus from farming states like Chiapas, where previously there had been very little migration.

Mark Weisbrot is co-director for the Washington-based Center for Policy and Economic Research.

Mr. MARK WEISBROT (Co-Director, Center for Policy and Economic Research): Clearly the results are not good. It's really nothing that anybody could point to as an economic success.

GARCIA-NAVARRO: Weisbrot argues that most free trade agreements, which he terms commercial agreements, have done more harm than good across the region.

Mr. WEISBROT: There has a been huge long-term economic growth failure in Latin America over the last 25 years. It's the worst economic growth performance that they've had for more than a century. That's why people are questioning not just these commercial agreements, but the whole set of economic reforms that have been implemented in this last quarter century.

GARCIA-NAVARRO: That has made free trade a political cause celebre. In Mexico, for example, Lopez Obrador wanted to renegotiate NAFTA to protect corn and bean farmers here. But there have been equally vociferous proponents. Calderon campaigned on a platform of opening up Mexico even further. He points out that his home state of Michoacan has become one of the biggest exporters of avocados to the U.S. under NAFTA, creating jobs. NAFTA has also boosted foreign investment here.

Eric Farnsworth is from the Council of the Americas, a group that pushes for free trade.

Mr. ERIC FARNSWORTH (Council of the Americas): Open trade is a vital part of modern economies.

GARCIA-NAVARRO: Even among free trade's fiercest critics, no one says that these agreements are solely to blame for what's happened in the region. Bad economic and monetary policies, lack of investment in key sectors, and simple bad governments are also factors in Latin America's poor performance.

Mr. FARNSWORTH: The easiest target to shoot at is trade agreements, which in fact some of the least developed countries across Latin America don't have trade agreements with the United States. It's one way for populist leaders across the region to throw off some political steam, if you will, by having an external bogeyman.

GARCIA-NAVARRO: But in most countries in Latin America at least 50 percent of the population live in some degree of poverty, this now the reality in a region which had an over 80 percent growth rate between 1960 and 1980. And in a year which has seen over a dozen elections across Latin America, inevitably politics and economics have collided.

Lourdes Garcia-Navarro, NPR News, Mexico City.

SIMON: And you'll find more stories in our series on Latin America on our Web site,

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