Chapter 6: Another Round of Tequila? Interpreting the Costs and Benefits of Emerging Finance Capitalism in Mexico
The decisive political turn to market-oriented strategies of development following the 1982 debt crisis in Mexico led to persistent economic instability and further financial crisis in 1994–95. The impact of Mexico’s ‘Tequila’ crisis necessitated a massive internationally financed state-led rescue of the banks – if a finance-led neoliberal trajectory was not to be abandoned and if the growing centrality of financial capital to development was to be preserved. Subsequently, state and government elites further restructured state, bank, and labor relations to favor the needs of financial capital, particularly foreign capital. The benefits accrued to financial capital have not come without social costs and complications. Following a period of relative financial stability in Mexico in recent years, the US sub-prime crisis revealed new sources of financial instability from outside the banking sector. Much as in 1995, the form the resolution took, while differing in its specific content, was premised on Mexican society absorbing the costs of financial accumulation risk taking. In this chapter I argue that the response to the current crisis signifies the consolidation of nearly three decades of neoliberal and finance-led restructuring of state, bank, and labor relations in Mexico as emerging finance capitalism. This current phase of capital accumulation represents the fusion of the interests of domestic and foreign financial capital in the Mexican state apparatus as the institutionalized priorities and overarching social logic guiding the actions of state and government elites, often to the detriment of labor. I develop this argument in five sections. Section 6.1 looks...
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