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Unequal Partners

Unequal Partners: The United States and Mexico

Sidney Weintraub
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    Unequal Partners
    Book Description:

    Since Mexico's defeat in the Mexican-American War of the 1840s, the United States has continued to dominate Mexico economically, militarily, and politically. This long history of asymmetry has created a Mexican distaste for "American arrogance," and an American vision of Mexico as its "backyard." The imbalance has damaged political negotiations, trade pacts, and capital flows, as suspicions and protectionism have undermined diplomacy. Despite these events, the two nations remain joined at the hip: more than 80 percent of Mexico's exports are to the United States, and the majority of foreign investment in Mexico comes from America.InUnequal Partners,Sidney Weintraub examines the current relationship of Mexico and the United States as one of sustained dependence and dominance. The chapters examine the consequences of this imbalance in six major policy areas: trade; investment and finance; narcotics; energy; migration; and the border. The book begins in 1954 when the Mexican "growth miracle" was at its apex, and proceeds to the present. Special attention is paid to the post-1982 debt crisis era, when Mexico began a more outward-looking trade policy.As this study reveals, Mexico has often been its own worst enemy in foreign relations. Over the past thirty years, the country has been plagued by debt, currency fluctuations, tax collection problems, political corruption, and state-controlled business monopolies that block foreign investment and importation. These factors have created an environment of instability, damaged outside perceptions, and weakened Mexico's bargaining position.Weintraub considers future policy changes that would help Mexico to level the playing field. Improving the education system, he argues, will benefit nearly every other activity and institution, and opening the oil market to private investment and technology will help develop deep-water drilling and revitalize this significant export commodity. In foreign relations, Mexico must be assertive-as it has been in easing U.S. restrictions on goods traded through NAFTA, and demanding U.S. aid to fight drug cartels-not passive, as it currently is on U.S. anti-immigration policy and the proposed border wall. Perhaps most importantly, the study points to the deeper development of policies that are proactive and outward looking.

    eISBN: 978-0-8229-7369-0
    Subjects: History, Political Science

Table of Contents

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  1. Prologue
    (pp. ix-xii)

    Mexico fascinates me, and over the past thirty years I have written much about the country. My intention in this book is to ponder on the deepest aspect of the Mexico–United States relationship: that of a dependent-dominant attitude that has long colored official behavior of the respective governments. The official conduct is a reflection of the thinking of much of the two countries’ populations. There have been constant changes in the behavior of Mexico and the United States toward each other over the years, but the dependency-dominance attitude has retained much power.

    A ubiquitous word used by scholars who...

  2. Chapter One Introduction: Mexico’s Political Economy
    (pp. 1-24)

    This book examines the repercussions of the dependent-dominant relationship between Mexico and the United States. “Repercussions” refer to the shaping of policy initiatives by either country, the initial responses by the other country, how outcomes have been determined and with what consequences. On a larger canvas the dependency-dominance outlook of the two countries have shaped the attitudes and behavior not only of governments, but also of the populations of each country toward the other. The character of the two governments as they interact with each other has been permeated by this sense of dependence on one side and dominance on...

  3. Chapter Two Trade: From Closure to Opening
    (pp. 25-44)

    Mexico, during the first ten years of the twentieth century, was preoccupied with the enormous violence of the Revolution of 1910, and after that with the uncertainty of the country’s political structure. The event that attracted most attention to Mexico in the 1930s was the expropriation of foreign oil companies in 1938. During the great depression of the 1930s, Latin American countries had to largely fend for themselves because U.S. imports from them declined sharply, as did the prices of their key commodities. Consequently, Latin American countries lacked the funds to import what they needed. Mexico fared better than most...

  4. Chapter Three Foreign Direct Investment and Finance: From Resistance to Welcome
    (pp. 45-63)

    Mexico’s policy on seeking, or even tolerating, foreign direct investment (FDI) went hand-in-hand with the country’s policy on trade. Taken together, they were the basis for the development-from-within philosophy practiced during the import-substitution years before 1982. It is possible to accept FDI for industrial development and then protect these foreign-owned activities from external competition. There was much of this in the automobile industry before NAFTA, for example, but allowing extensive foreign dominance in what can be called the commanding heights of Mexican manufacturing would have been inconsistent with the nationalism that accompanied import-substituting industrialization (ISI). Mexico, in the ISI years,...

  5. Chapter Four Narcotics: Effect of Profits from U.S. Consumption
    (pp. 64-81)

    U.S. efforts to curtail drug use have both internal and external venues—a “war on drugs” at home and pressure on foreign countries to curtail their production of field crops (such as coca, opium poppies, and marijuana) and laboratory preparations (such as methamphetamine) and to employ their military and police to interdict narcotics before they enter the United States. The costs, both monetary and personal, are enormous in both countries. These policies have been in effect for decades, and questions have been raised about their effectiveness for all this time. Reports issued by the U.S. and Mexican governments describe many...

  6. Chapter Five Energy: The Oil Is Ours
    (pp. 82-97)

    Mexico’s nationalist sentiment is more profound on oil than on any other issue. This nationalism has its ideological base in the expropriation of the assets of foreign oil companies under President Lázaro Cárdenas in 1938. The circumstances surrounding Cárdenas’s action—the refusal of the oil companies to heed legal orders—added to the nationalistic fervor. The event is a part of Mexican history that all children learn about in school. The 1917 constitution states that Mexico has direct dominion over its natural resources—a major reason why the population gives special attention to government ownership of oil. This reality can...

  7. Chapter Six Migration: A Consequence of Inequality
    (pp. 98-115)

    The estimate of the U.S. Census Bureau is that there are about twelve million people in the United States who were born in Mexico. This represents a fifteen-fold increase since 1970.¹ The Mexican-born population in the United States now amounts to more than 10 percent of the Mexican population in Mexico. Among developed countries of the Organization for Economic Cooperation and Development, the United States is truly an immigration country—with immigrants not only from Mexico. In 2005 more than thirty-eight million foreign-born, about 13 percent of the total population, lived in the United States. In absolute numbers Germany was...

  8. Chapter Seven The Border: A Phenomenon of Its Own
    (pp. 116-130)

    There are close to one million legal border crossings daily between Mexico and the United States, which is more than between any other two countries.¹ About five million cargo trucks cross from Mexico each year into the zone where their cargo must be reloaded onto U.S. trucks.² Many people with green cards (legal residents of the United States) live in Mexico and cross the border repeatedly to work in the United States; others come to shop, for health care, and for family visits. In addition to the legal crossings from Mexico into the United States, there has been a steady...

  9. Chapter Eight Findings: Changing Traditional Practices
    (pp. 131-140)

    As one examines the elements that went into the bilateral policymaking regarding the issues discussed throughout this book, it is clear that Mexico has historically behaved in a dependent fashion with the United States as the dominant nation. Dependence has produced defensive behavior on the part of Mexico. On trade policy Mexico adopted import-substituting industrialization (ISI) in large part to minimize the influence of the “hegemon to the north” (Carlos Salinas’s words), and long shunned direct negotiation with the United States. On foreign direct investment (FDI) the pattern was to limit and regulate the extent of foreign (mostly U.S.) equity...