Mexico InstituteMexico Institute

MORE THAN NEIGHBORS:An Overview of Mexico and U.S.–Mexico Relations

Andrew SeleeWoodrow Wilson Center

1300 Pennsylvania Ave., NWWashington, DC 20004-3027Tel 202.691.4399Fax 202.691.4076mexico@wilsoncenter.orgwww.wilsoncenter.org/mexico

The WOODROW WILSON CENTER promotes non-partisan, plural dialogue on issues of major policy concern in theUnited States and abroad. Through its Latin American Program, the Center addresses concerns of democracy, devel-opment, and security in the Western hemisphere.

The Woodrow Wilson Center started the Mexico Institute in 2003 to improve understanding, communication, andcooperation between Mexico and the United States by promoting research, public discussion, and publications onissues of mutual concern.

CO-CHAIRSMr. José Antonio Fernández

Carbajal, Chairman and CEO,FEMSA

Mr. Roger W. Wallace, Vice President, Pioneer NaturalResources

MEMBERSMr. Sergio Aguayo, Chair,

FUNDAR, and Professor, El Colegio de México

Mr. Herb Allen, Chairman and CEO, Allen and Co., LLC

Mr. Donald E. Axinn, Chairman, Donald E. AxinnCompanies

Mr. Alberto Bailleres, Chairman, Grupo BAL and ITAM

Mr. Malin Burnham, Chairman, Burnham Real Estate

Dr. Enrique Cabrero Mendoza, Director General, CIDE

Dr. Luis de la Calle, Partner, De la Calle, Madrazo, &Mancera

Dr. Roderic Ai. Camp, Professor, Claremont-McKenna College

Mr. Eduardo Cepeda, Managing Director, J.P. Morgan Chase-Mexico

Mr. Brian Dyson, Retired President, Coca-Cola &President, ChathamInternational

Ms. Maria Echaveste, President, Nueva Vista Group

Mr. Jaime El Koury, Partner, Cleary Gottlieb, New York, NY

Dr. Rafael Fernández de Castro, Director of InternationalRelations, ITAM University

Dr. Rossana Fuentes-Berain,Opinion Editor, El Universal

Mr. Donald E. Garcia, President, Pinnacle Financial Group

Amb. Antonio O. Garza, U.S. Ambassador to Mexico

Mr. Armando Garza Sada,Chairman and CEO, Versax

Mr. Neal R. Goins, President, ExxonMobil Ventures-Mexico

Dr. Bernardo González-Aréchiga, Dean, School of Public Administration,Monterrey Tec

Amb. Lawrence Harrington, Representative in Mexico, Inter-American Development Bank

Mr. Carlos Heredia, Senior Advisor on International Affairsto the Governor of Michoacán

Mr. Guillermo Jasson, Latin American Regional Head,Investment Banking, MorganStanley

Amb. James Jones, Chairman, Manatt Jones Global Strategies

Mr. Alejandro Junco, President and Publisher, Reforma and ElNorte

Hon. Jim Kolbe, SeniorTransatlantic Fellow, GermanMarshall Fund

Dr. Enrique Krauze, Director, Letras Libres

Mr. Robert Lovelace, Chairman, Capital Research Company

Dr. Lorenzo Meyer, Professor, El Colegio de México

Dr. Diana Negroponte, VisitingFellow, Brookings Institution

Mr. Fred Niehaus, Senior Vice President, Western Union

Dr. Susan Kaufman Purcell, Director, Center forHemispheric Policy, University of Miami

Amb. Jesús Reyes Heroles, Director, PEMEX

Amb. Andrés Rozental, Past President, Mexican Council onForeign Relations

Mr. Luis Rubio, President, CIDACAmb. Arturo Sarukhan, Mexican

Ambassador to the UnitedStates

Dr. Peter H. Smith, Simón Bolívar Professor, University ofCalifornia, San Diego

Dr. Luis Téllez, Secretary of Communications andTransportation

Dr. Javier Treviño, Vice President, CEMEX

Dr. Mónica Verea, Professor, National AutonomousUniversity of Mexico

Dr. Peter Ward, Professor and former Director, Mexico Center,University of Texas, Austin

MEXICO INSTITUTE ADVISORY BOARD

AB

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ABOUT THE WOODROW WILSON CENTERTABLE OF CONTENTS

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Overview

Introduction

Part I: An Overview of U.S.–Mexico Relations

The Economic RelationshipMigrationSecurityCooperation between the United States and Mexico

Part II: An Overview of Mexico’sPolitics, Economy, and Society

A Brief Political History of MexicoMexico’s Political SystemMexico’s EconomyCulture and Society in Mexico

Further Reading and Web Resources

About the Author

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Lee H. Hamilton, President and Director

BOARD OF TRUSTEES

Joseph B. Gildenhorn, ChairDavid A. Metzner, Vice Chair

PUBLIC MEMBERS:

James H. Billington, Librarian of Congress;Bruce Cole, Chair, National Endowment for theHumanities; Michael O. Leavitt, Secretary, U.S.Department of Health and Human Services;Tamala L. Longaberger, designated appointeewithin the federal government; CondoleezzaRice, Secretary, U.S. Department of State;Cristián Samper, Secretary, Smithsonian Instit-ution; Margaret Spellings, Secretary, U.S.Department of Education; Allen Weinstein,Archivist of the United States.

PRIVATE CITIZEN MEMBERS:

Robin B. Cook, Donald E. Garcia, Bruce S.Gelb, Sander R. Gerber, Charles L. Glazer,Susan Hutchison, Ignacio E. Sanchez

ABOUT THE CENTER

The Center is the living memorial of the UnitedStates of America to the nation’s twenty-eighthpresident, Woodrow Wilson. Congress estab-lished the Woodrow Wilson Center in 1968 asan international institute for advanced study,“symbolizing and strengthening the fruitful rela-tionship between the world of learning and theworld of public affairs.” The Center opened in1970 under its own board of trustees.

In all its activities the Woodrow WilsonCenter is a nonprofit, nonpartisan organiza-tion, supported financially by annual appropri-ations from Congress, and by the contributionsof foundations, corporations, and individuals.Conclusions or opinions expressed in Centerpublications and programs are those of theauthors and speakers and do not necessarilyreflect the views of the Center staff, fellows,trustees, advisory groups, or any individuals ororganizations that provide financial support tothe Center.

This publication is intended as a brief and acces-sible introduction to U.S.–Mexico relations andto Mexico’s politics, economy, and society for aU.S. audience. It is meant as a quick referenceguide for policymakers, civic leaders, business-people, journalists, students, and anyone who isnot a specialist in Mexican affairs but wants toknow something about our neighbor to thesouth and the relationship between our twocountries. The first section deals specificallywith issues in the bilateral relationship, whilethe second section provides information onMexico specifically.Whenever possible, thispublication prefers to present facts rather thantake sides in controversial arguments. Despitethat, there is an underlying argument thatguides the volume: the economies and societiesof the United States and Mexico are increasing-ly intertwined, and our two countries face chal-lenges that we can only address if we find waysof cooperating. Although each country enjoyssovereignty to act as it pleases, common senserequires us to pursue joint efforts to deal witheconomic growth and development, security,migration, and the management of shared natu-ral resources. To do this, we need to get to know

each other better and understand the challengeswe have in common. For many years, webelieved that we were “distant neighbors” whohad little need to bridge the historical, cultural,and political divides that separate us. Today, wehave an opportunity to be strategic partnerswho face common challenges creatively; inother words, to be “more than neighbors.”

This publication was made possible thanksto the research assistance of Katie Putnam andAlex Steffler. Cynthia Arnson, director of theWilson Center’s Latin American Program, andKate Brick, program associate of the Center’sMexico Institute, offered helpful commentsalong the way. The members of the MexicoInstitute Advisory Board, chaired by JoséAntonio Fernández Carbajal and Roger W.Wallace, and collaborators on key projects,including Jonathan Fox, Xóchitl Bada,Jacqueline Peschard, Jesús Silva-HerzogMárquez, Dolia Estevez, John Burstein, andHeidy Servin-Baez, have contributed immea-surably to the ideas that form the basis for thispublication. All content, however, is the soleresponsibility of the author who bears all blamefor any shortcomings.

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Mexico and the United States are more thanneighbors. They are two countries that areincreasingly interdependent. The two countriesshare a border of almost 2,000 miles, which hasgrown in importance for trade, transit, and secu-rity. Mexico is the United States’ third largesttrading partner, and second market for exports,while the U.S. represents over 75% percent ofMexico’s trade. Over nine percent of the U.S.population is of Mexican descent (includingnearly four percent born in Mexico), while tenpercent of Mexico’s population lives in theUnited States. There is hardly a person inMexico who does not have a relative in theUnited States or an American who does notknow someone from Mexico.

The relationship between the two countries is,however, highly asymmetrical. The GDP of theUnited States is eighteen times greater than thatof Mexico and wages in the U.S. average sixtimes those in the neighboring country to thesouth. While the United States remains theworld’s lone superpower, Mexico plays a highlycautious role in world affairs. For manyMexicans the memories of a disastrous war withthe United States (1846–48), in which Mexicolost half its territory, and several subsequent inva-sions remain fresh. To a large extent, Mexicannationalism has been constructed as a reactionfirst to the fear of invasion and later to the resist-ance against undue influence from the north. Incontrast, for the United States, Mexico has oftenbeen afterthought. Americans register warm feel-ings towards the country in national surveys, butthe country is only occasionally at the center ofU.S. foreign policy considerations. WhileMexicans are apt to worry about the UnitedStates’ role in their country, Americans frequent-ly forget about their neighbor to the south.

However, these trends have been shifting. Asthe two countries become more interdependent,there are an increasing number of U.S. andMexican stakeholders in the relationship who payclose attention to issues on the other side of theborder and to cooperation between the two coun-tries. Mexicans and Americans increasingly seeeach other as strategic partners with commonissues that they need to address through greatercooperation. These issues are generally bread-and-butter issues that affect key constituencies in eachcountry: trade and economic growth; terrorismand drug trafficking; immigration; and, on theborder, environmental and health concerns.Indeed, almost all the issues on the U.S.–Mexicobilateral agenda are actually major domestic issuesin each country, which have binational dimen-sions. Although sometimes each country needs topursue its own strategies on these issues, there aremany aspects that can only be dealt with throughbilateral cooperation.

This convergence of international anddomestic agendas means that the profile of therelationship has risen considerably as policy-makers seek to deal with the internationaldimensions of these high-profile issues. It alsomeans that diplomatic relations between the twocountries are constantly influenced by domesticpolitics in each country. Every agency of the fed-eral government has some dealing with its coun-terpart in the other country and most U.S.politicians, including many governors, mayors,and state legislators, have positions on issuesvital to the relationship. Business leaders,unions, and civic organizations all have strongopinions on issues on the bilateral agenda andoften make their opinions known. It is a rela-tionship that is both intense and complex, filledwith possibilities and fraught with challenges.

THE ECONOMIC RELATIONSHIP

Mexico is one of the United States’ leadingtrade partners. Both countries are increasinglyinterdependent economically, and this interde-pendence is particularly noticeable for manyU.S. states.

Mexico is the United States’ third largest trad-ing partner (far after Canada but very closebehind China). Mexico is the second market forU.S. exports and the third source for imports tothe United States. Overall Mexico accounts for11.5% of U.S. trade and almost 13% of exports.

Several U.S. states depend heavily on Mexicoas an export market, including Texas (36.4%),Arizona (29.4%), Nebraska (22.1%), California(15.4%), and Iowa (15.3%). Twenty-two statesdepend on Mexico as either the primary or sec-

ondary destination for state exports: California,Texas, Arizona, Ohio, Georgia, Pennsylvania,Illinois, North Carolina, Kentucky, Tennessee,Rhode Island, Indiana, Wisconsin, Oklahoma,Kansas, Michigan, Arkansas, Colorado,Mississippi, South Dakota, Nebraska, and Iowa.

Trade between Mexico and the UnitedStates has increased more than three times sincethe North American Free Trade Agreement(NAFTA) was implemented in 1994.

The United States receives roughly 85% ofMexico’s exports and is the source of 51% of itsimports.

Mexico is the second source of oil for theUnited States (after Canada and narrowly aheadof Saudi Arabia) and accounted for 15.4% of allU.S. crude oil imports in 2005.

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PART I: AN OVERVIEW OF U.S.–MEXICO RELATIONS

U.S. Trade with Mexico, 1993–2006

200

150

100

50

01993 1994 1995 1996 1997 1998 2000 2001 2003 2004 2005 2006

——n—— U.S. Imports from Mexico——n—— U.S. Exports to Mexico

Source: U.S. Census Bureau, Foreign Trade Statistics.

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ion

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20021999

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Canada, 22.2%

Mexico, 12.9%

Japan, 5.7%

China, 5.3%United Kingdom, 4.4%

Other, 49.4%

Spain, 1.3%

Germany, 1.3%

Canada, 1.6%

U.S., 85.5%

Source: U.S. Census Bureau, Foreign Trade Statistics.Source: Ministry of Economy with data from Banco

de México, 2006.

Finland, 1.0%

Other, 9.3%

••••

•

•

•

•

•

U.S. foreign direct investment in Mexico hasincreased dramatically since 1990 as well.Mexican foreign direct investment in the UnitedStates has also risen noticeably over this period,especially in cement, bakery goods, glass, andother areas where major Mexican multinationalshave made entries into the U.S. market.

Several challenges for trade and investmentremain, however:• Insufficient border infrastructure slows cross-

border trade daily and interferes with planningfor just-in-time manufacturing.

• Trade disputes in trucking, sugar, high-fructosecorn syrup, and other products have slowed theimplementation of NAFTA.

• Different standards, including sanitary require-ments, packaging regulations, and subsidies inagriculture, have limited free trade of someproducts.

Moreover, trade has not solved Mexico’s devel-opment challenges as many hoped during theNAFTA negotiations.

Top Markets for U.S. Exports as Percent of Total Exports(January–December 2006)

Top Markets for Mexican Exports asPercent of Total Exports(January–December 2006)

Exports to Mexico as Percent of State Exports, 2006

PERCENTAGE

Source: U.S. Census Bureau, Foreign Trade Statistics.

STATE

Texas 36.4%

Arizona 29.4%

Nebraska 22.1%

California 15.4%

Iowa 15.3%

South Dakota 14.5%

Mississippi 14.4%

Colorado 12.8%

Arkansas 12.4%

Michigan 11.6%

Kansas 11.1%

Oklahoma 11.0%

Wisconsin 10.8%

Indiana 10.7%

Kentucky 10.4%

Tennessee 10.3%

Missouri 9.7%

Louisiana 9.3%

New Mexico 8.9%

North Carolina 8.4%

• The ratio of GDP/capita between the twocountries remains around six to one, only aslight improvement over the 1990 ratio.

• Some regions in Mexico, especially in thenorth, have seen significant growth over thepast decade; others, including most of thecountry’s south, have not.

• A lack of infrastructure and investments inhuman capital in many regions of Mexico hasinhibited growth and development. Whilestates in the north have taken part successfullyin the export-oriented economy, those of thesouth have not.

Agricultural trade is a particular focus of con-cern for poverty alleviation:

• Although only 25% of Mexicans live in ruralareas, they account for 60% of those living inextreme poverty and 44% of all migrants tothe United States.

• Increased imports of basic grains, especiallycorn, from the United States and Canadaappear to have undercut producer prices forthese products for small farmers. Many ofMexico’s small farmers fear that the full liber-alization of agricultural trade betweenMexico and the United States, set to takeplace in January 2008, will undermine theirlivelihood even further, especially the 15% ofMexico’s population who depend on cornproduction.

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15

10

5

0

Canad

a

Mex

ico

Saudi A

rabia

Venez

uela

Niger

iaIra

q

Angola

Ecuad

or

Alger

ia

Kuwait

Imports of Crude Oil into the U.S. by Country of Origin, 2005

Source: U.S. Department of Energy, available at www.eia.doe.gov.

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U.S. GDP per capita vs. Mexico GDP per capita, 1990–2005

Mexican Corn Production and Corn Imports from the U.S.

$50,000

$40,000

$30,000

$20,000

$10,000

$0 1990

7.66.7

6.0

8.9

1995 2000 2005

10

8

6

4

2

0

U.S. Dollars Ratio

n United Statesn Mexico——n—— Ratio

——n—— Mexican corn production——n—— U.S. corn plus cracked corn exports

25

20

15

10

5

0

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

Source: World Development Indicators, World Bank, 2006.

Source: John Burstein, U.S.–Mexico Agricultural Trade and Rural Poverty in Mexico, Washington: Wilson Center andFundación IDEA, 2007.

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Corn Production and Price per Ton in Mexico

14.64 16.94

18.13

18.24

18.36

18.03

17.66 17.71

17.56

20.13

19.42

20.9621.81

2.25

2.20

2.18

2.13

1.802.61

1.88 1.81

1.79

1.75

1.81

1.752.35 1.87

——n—— Volume of Corn Production (millions of tons)——n—— Price per ton of corn (thousands of 2005 pesos)

MIGRATION

Mexicans are by far and away the largestimmigrant population in the United States.

• Almost a third of all immigrants in theUnited States were born in Mexico (32%).Mexico is the source of the greatest number ofboth authorized (20%) and unauthorized(56%) migrants who come to the UnitedStates every year.

• There are almost 27 million people of Mexicandescent in the United States (9% of the U.S.population). Roughly twelve million people inthe United States were born in Mexico (3.8%).

• Since the early 1990s, Mexican immigrants areno longer concentrated in California, theSouthwest, and Illinois, but have been comingto new gateway states, including New York,North Carolina, Georgia, Nevada, andWashington, in increasing numbers.

• Historically most Mexican migration to theUnited States came from only a handful ofstates in the north and center-north of Mexico;over the past ten years, migration has increasedfrom other states, especially those in the southof Mexico.

Several factors drive Mexican migration:• Poverty in Mexico, especially the lack of

opportunities in the agricultural sector.• The growing demand for unskilled labor in

the United States as the U.S. populationgrows older and more educated.

• The difference in wages between the twocountries.

• The existence of established family and com-munity networks that allow migrants to arrivein the United States with people known tothem.

1990 1992 1994 1996 1998 2000 2002 2004Source: Fundación IDEA, based on OECD, Agricultural and Fisheries Policies in Mexico, 2006.

2.02

14.25

18.46

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Mexican-Born Population in U.S. and as Percent of Foreign-Born Population, 2006

12000

10000

8000

6000

4000

2000

01850 1870 1890 1910 1930 1950 1970 1990 2000 2004

35

30

25

20

15

10

5

0

32%11,970,000

(2006 CPS-Adjusted)

Thousands of Migrants

Mexicans as Percent of Foreign-Born

Source: Jeffrey Passel, Unauthorized Migrants: Numbers and Characteristics, Washington, D.C., Pew Hispanic Center, June 14, 2005 with data from the 2004 Current Population Survey.

U.S. Population of Mexican Origin (U.S. Census, 2005 figures)

14.52%

9.29%

3.80%

15.00%

12.00%

9.00%

6.00%

3.00%

0.00%Percent of U.S. Population

Source: U.S. Department of Commerce, Economics and Statistics Administration, U.S. Census Bureau.

n U.S. Hispanic Populationn U.S. Population of Mexican Originn Mexico-Born Population in the U.S.

n Populationn Percent of Foreign Born

The framework of U.S. immigration law haslargely remained the same since 1965. However,both the economy and the demographics of theUnited States have changed over the past fourdecades. The U.S. economy needs both high-skilled and low-skilled immigrant workers toremain competitive and to have enough workerswho continue to pay into Social Security andMedicare as the U.S. population grows older.Nonetheless, there are currently very few chan-nels for immigration to the United States forwork-related reasons under current law.1

• Almost two-thirds of all new legal permanentresidents in the United States last year (64%,2006) obtained residency through family ties;only 13% did so through employment-relatedadjustments.

• The unauthorized immigrant population inthe United States has grown to close to 12 mil-lion people.

• Over half of unauthorized immigrants (57%)are believed to be Mexican.

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Hawaii is located 2,400miles southwest ofmainland U.S.

Alaska is located 750 miles northeast of mainland U.S. and borders Canada

Puerto Rico islocated 1,000miles southeastof mainland U.S.

Source: Elizabeth Grieco, “The Foreign Born from Mexico in the United States,” Migration Policy Institute, October 2003

The Foreign Born from Mexico in the United States As Percentage of Total Country Population, 2000

1. For an analysis of possible ways to reform the U.S. immigration system, see Task Force on Immigration and America’s Future, SpencerAbraham and Lee H. Hamilton, co-chairs, Migration Policy Institute, Manhattan Institute, and Woodrow Wilson Center, 2006. The summary of the report and background materials are available at www.migrationpolicy.org.

LEGENDForeign born from Mexico as percentage of total country population

n 0.0 to 1.3n 1.4 to 3.2n 3.3 to 9.2n 9.3 to 19.9n 20.0 to 37.1

U.S. average 3.3%

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Persons Obtaining Legal Permanent Resident Status by Class of Admission(Fiscal Year 2006) Total of 1,266,264

Unauthorized Immigrants in U.S. by Country of Origin

45%

24%

9%

6%

4%

57%

18%

17%

13%

4%

3%n Immediate relatives of U.S. citizens (580,483)n Family-sponsored preferences (222,229)n Refugees and asylees (216,454)n Employment-based preferences (159,081)n Diversity (44,471)n Other (43,546)

n Mexico- 57% 5.9 million

n Other Latin America- 24% 2.5 million

n Asia- 9% 1.0 million

n Europe & Canada- 6% .6 million

n Africa & Other- 4% .4 million

Source: Jeffrey Passel, Unauthorized Migrants: Numbers and Characteristics, Washington, D.C., Pew Hispanic Center, June 14, 2005 with data from the 2004 Current Population Survey.

Source: Immigration Statistics and Publications, U.S. Department of Homeland Security, 2006.

The Mexican government position onmigration has shifted in recent years. For manyyears, the Mexican government showed limitedinterest in the issues. However, past PresidentVicente Fox actively sought to recognize thecontribution of migrants to Mexico and to pur-sue, at least initially, a bilateral migration agree-ment with the U.S. government. The failure toreach a bilateral migration agreement led to agradual shift in emphasis, however, to a greaterfocus on how the Mexican government can cre-ate opportunities in Mexico. The currentadministration of President Felipe Calderón, inparticular, has placed an emphasis on how tocreate jobs in Mexico, enhance border security,and protect Mexican citizens living abroad.Since roughly half of Mexicans have relatives inthe United States, this issue remains a highlysensitive one.

Mexican immigrants themselves oftenbecame deeply engaged in their new home com-munities in the United States and also remainconnected to their communities of origin:• Remittances from Mexican migrants now top

$23 billion per year and help sustain manylocal communities in Mexico’s poorest regions.

• Funds raised by migrant organizations alsohelp develop local communities. OneMexican government program, known as“Three for One” provides matching fundsfrom the federal, state, and local govern-ments to any investments made by migrantorganizations in the infrastructure of theircommunities of origin.

• Mexican migrants are also deeply engaged ineducational, religious, and civic activities intheir home communities in the UnitedStates.2

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2. See Xóchitl Bada, Jonathan Fox, and Andrew Selee, eds., Invisible No More: Mexican Migrant Civic and Political Participation in the UnitedStates, Washington, DC: Woodrow Wilson Center and University of California, 2006.

$23,054

$20,035

$16,613

$13,396

2006200520042003

$25,000

$20,000

$15,000

$10,000

$5,000

$0

Source: INEGI, Estadísticas Económicas, with data from Banco de México.

Remittances to Mexico, 2003–2006

SECURITY

Security remains a key issue on the U.S.–Mexicoagenda and produces one of the most difficultshared challenges. Mexico is a key transship-ment point for narcotics being transportedfrom South America and a producer of some ille-gal drugs that are consumed in the United States:• Roughly 90% of all cocaine from South

America passes through Mexico.• Mexico is the leading foreign producer of both

marijuana and methamphetamines importedto the U.S. (the U.S., however, produces moreof both).

• Mexico is also the second supplier of heroine tothe U.S. market (although it accounts for onlya very small percentage of worldwide heroineproduction).

• While cocaine is handled primarily by severallarge cartels, other narcotics are sometimesmanaged by smaller operations.3

At the same time, U.S. consumption,arms, and cash fuel the drug trade:• U.S. consumption is, of course, the principal

reason why drug trafficking exists. Consum-ption has remained steady in the UnitedStates since the late 1980s and efforts toaddress this are severely deficient. Drug con-sumption has also increased in Mexico inrecent years.

• U.S. arms dealers supply a majority ofweapons smuggled into Mexico to be used bydrug traffickers.

• Many of the chemical inputs for metham-phetamines are either produced in the U.S.or shipped through U.S. ports to Mexico.

• U.S. financial institutions are used to launderthe proceeds from drug trafficking that sus-tain the cartels.

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ns 3. For further information, see United States Department of State, Bureau for International Narcotics and Law Enforcement Affairs, InternationalNarcotics Control Strategy Report, Volume I, Drug and Chemical Control, March 2007.

Percent of U.S. Population Consuming Drugs in Past Thirty days and in Past Year, 1990–2001

1990 1993 1996 1998 1999 2000 2001

15

12

9

6

3

——n—— Past year——n—— Past 30 days

Source: Drug Use Trends, The White House Office of National Drug Control Policy (ONDCP) Information Clearinghouse,October 2002, available at http://www.whitehousedrugpolicy.gov/publications/factsht/druguse/.

Cooperation in fighting drug trafficking hasincreased dramatically in recent years:• The Fox administration (2000–2006) had

close working relations with the UnitedStates in trying to dismantle the drug cartels.Significant advances were made in intelli-gence sharing and joint strategies to fightdrug trafficking.

• Since taking office, President FelipeCalderón has made his top priority the fightagainst organized crime. He has launchedseveral high-profile law enforcement opera-tions against the drug cartels, using jointefforts by the military and police.

• Civic organizations have raised concerns

about the possibility of human rights abusesagainst civilians during these operations andexpressed concern that extensive armyinvolvement in law enforcement operationscould have negative effects on already weakcivilian oversight of the military.

• Extraditions of narcotics traffickers haveincreased dramatically. In late 2005 theMexican Supreme Court overturned an exist-ing prohibition on extraditing fugitives whocould face the death penalty or life in prison.As a result, extraditions increased from 41 in2005 to 63 in 2006. Another 150 non-Mexicans were deported to face drug chargesin the United States during 2006.

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Source: Stratfor

Mexico

Baja California Sonora

Sinaloa

Chihuahua

NuevoLeon

Tamaulipas

Veracruz

Coahuila

Durango

Jalisco

Michoacan

Tabasco

Guerrero

ACAPULCO •

NUEVO LAREDO •

MEXICO CITYH

Oaxaca Chiapas

Quintana Roo

Nayarit

•

•

•

•

n Tijuana Carteln Sinaloa Federation Cartelsn Gulf Carteln Territories in Dispute

• In January 2007, the new Calderón administra-tion deported 15 top cartel leaders who werewanted in the United States, representing thehighest level series of deportations to date. Thisappears to mark a new interest by the Calderónadministration in extraditing high-level crimi-nals to face prosecution in the United Statesrather than holding them in Mexican jails.4

• The Mexican government in 2007 decided toban all cold medicines that use seu-dophedamines, because these can be used formethamphetamines.

However, most analysts agree that the only way tocombat drug trafficking in Mexico in the long-term will be address consumption and reformsto the police and justice system:5

• A reduction in consumption in the UnitedStates would be the most effective way to com-bat drug trafficking. As long as demand remainshigh, cartels will continue to thrive.

• Police capabilities in Mexico need to be signifi-cantly upgraded. The current use of the militaryis only a stop-gap to reestablish order, but long-term strategies to address organized crime willrequire a larger and more effective federal policeforce, increased investigative capabilities in statepolice forces, greater accountability of police atall levels, and better coordination among feder-al, state, and local police forces.

• Mexico needs to reform its justice system dra-matically to ensure effective prosecution ofcriminals and protection of the innocent.Proposals for reforms include oral trials, theconstitutional recognition of the standard of

innocence until proven guilty, professional stan-dards for lawyers and judges, and the implemen-tation of a professional public defender system.

• Although most of these measures will requirechanges within one country or the other—addressing consumption in the United Statesand addressing judicial and police reform inMexico—these efforts also provide opportuni-ties for bilateral cooperation. There are alreadysuccessful examples of bilateral cooperation topromote justice reform. Any security agendashould contemplate both demand-reductionand institutional reform.

Cooperation against potential terrorist threatshas also increased since 9/11:• The U.S. and Mexican governments have

worked closely together to upgrade Mexico’scapabilities to screen passports of people enter-ing Mexico from third countries and checkthem against the U.S. terrorist watch list.

• The U.S. and Mexican governments haveworked together to screen passenger lists onflights between the two countries.

• In 2002 the two governments signed the SmartBorder Agreement (parallel to the similarlynamed agreement between the U.S. andCanada) to provide for a more secure borderwhile facilitating the movement of people andgoods. The Smart Border Agreement hashelped increase the number of secure transitdocuments for frequent border crossers,improved sharing of intelligence on potentialterrorist threats, and helped improve screeningof third-party travelers.6

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4. State Department, International Narcotics Control Strategy Report.5. For proposals on how to reform the police and justice systems in Mexico, see Wayne A. Cornelius and David A. Shirk, editors, Reforming the

Administration of Justice in Mexico, South Bend, IN: University of Notre Dame Press, 2007 and, in Spanish, www.juiciosorales.org. 6. See Deborah Meyers, Does Smarter Lead to Safer? An Analysis of the Smart Border Accords with Canada and Mexico, Washington, DC: Migration

Policy Institute, 2003.

• There are several additional forms of coordina-tion between the two governments on security,including several working groups set up withinthe framework of the Security and ProsperityPartnership.

COOPERATION BETWEEN THE

UNITED STATES AND MEXICO

The U.S.–Mexico relationship is unlike almostany other relationship the United States haswith another country (except, perhaps, withCanada). Although the U.S. State Departmentand Mexican Foreign Affairs Ministry play animportant role in charting a course for the offi-cial government-to-government relationship,almost every agency in both governments dealsto some extent directly with its counterpartacross the border. In addition, dozens of stateand local governments as well as civic organi-zations, business associations, and other non-

governmental groups deal with issues in thebinational relationship and often work closelywith counterparts across the border.

Coordination between the ExecutiveBranches of the Two Countries: The MexicanEmbassy in Washington is the country’s largestanywhere and it has a network of 46 consulatesacross the United States. The U.S. Embassy inMexico is one of the largest the U.S. governmenthas anywhere and almost every major federalgovernment agency has a representative there.

Several mechanisms exist to provide conti-nuity to issues on the bilateral agenda. TheBinational Commission (BNC), started in1981, is a yearly meeting among cabinet secre-taries and key agencies between the two coun-tries. The Security and Prosperity Partnership,an initiative of the U.S., Mexican, andCanadian governments launched in 2005,brings agencies of the three governments

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Smart Border Agreement: U.S.–Mexico Border Partnership Action Plan, March 2002

Secure Infrastructure Secure Flow of People Secure Flow of Goods

Long Term Planning Pre-Cleared TravelersPublic/Private-SectorCooperation

Relief of Bottlenecks Advanced Passenger InformationElectronic Exchange of Information

Infrastructure Protection NAFTA Travel Secure In-Transit Shipments

Harmonize Port of EntryOperations

Safe borders and deterrence of alien smuggling

Technology Sharing

Demonstration Projects Visa Policy Consultations Secure Railways

Cross-Border Cooperation Joint Training Combating Fraud

Financing projects at the border

Compatible Databases Contraband Interdiction

Screening of Third-CountryNationals

Source: White House (http://www.whitehouse.gov/infocus/usmxborder/22points.html)

together regularly to discuss key economic andsecurity issues and includes occasional sum-mits among the heads of state of the threecountries. Both of these mechanisms serve toprovide structure to the range of cooperativeefforts carried out on a daily basis by agenciesin the two (and often three) countries.

In addition, almost every agency of bothgovernments has some dealing with the othercountry. Cabinet secretaries from both coun-tries visit each other frequently. There are par-ticularly strong relations of coordinationbetween the U.S. Department of HomelandSecurity and Mexico’s Interior Ministry andbetween the U.S. Department of Justice andMexico’s Attorney General’s Office (PGR).

Despite this level of ongoing communica-tion, U.S. foreign assistance to Mexico to sup-port both social development and law enforce-ment has actually dropped in recent years.

Relations between the Two Congresses:From the 1920s until 1997 a single party dom-inated Mexican political life and controlledboth the presidency and the Congress. As aresult, Congress was largely subordinate to theexecutive branch and played little role in for-eign policy. Since 1997, however, the MexicanSenate and Chamber of Deputies have becomeimportant players in foreign policy decisionsand in the relationship with the United States.

The U.S.–Mexico Interparliamentary Groupis the main formal linkage between the

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U.S. Foreign Assistance to Mexico, FY2002–FY2008

80

70

60

50

40

30

20

10

02002 2003 2004 2005 2006 2007 2008

Mill

ion

s o

f U

.S. D

olla

rs

Fiscal Year

131 1 1 1 1 0.008 0.39

28

42

70

7773

76

51

45

3034 33 35

2017

3942

39 40

3128

Source: U.S. Department of StateNAS - Narcotics Affairs Section; USAID - U.S. Agency for International Development; ODC - Office of Defense Coordination

——n——Total——n—— NAS——n——USAID——n——ODC

Congresses of the two countries and has existedsince 1960. However, numerous informal link-ages exist among Members of Congress andSenators of the two countries, and key commit-tees of the two Congresses weigh in frequentlyon matters that affect the other country.

State and Local Governments: There arealmost 13 million people in both countrieswho live in towns, counties, and municipalitiesat the shared border, and over 78 million wholive in border states. As a result, border gover-nors from both countries gather every year forthe Border Governors’ Conference and mayors

from border communities meet occasionally aswell. In addition to this, mayors and governorsin neighboring towns across the border oftenhave intense working relationships to resolveeveryday issues, from planning economicdevelopment strategies to tracking stolen cars.Some partnerships, such as the Arizona-SonoraCommission, started in 1959, and the rela-tionship between Tijuana and San Diego, havedeep roots; others are more tenuous.

Increasingly governors and mayors fromoutside the border region are also involved inbilateral issues and visit each other’s country.

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XLVI United States–Mexico Interparliamentary Group

U.S. Participants Mexican Participants

Senate

Sen. Chris Dodd (D-CT) Sen. Manlio Fabio Beltrones Rivera (PRI)

Sen. John Cornyn (R-TX) Sen. Ricardo García Cervantes (PAN)

Sen. Gustavo Madero Muñoz (PAN)

Sen. Adriana González Carrillo (PAN)

Sen. Rosario Green Macías (PRI)

Sen. Eloy Cantú Segovia (PRI)

Sen. Tomás Torres Mercado (PRD)

Sen. Ludivina Menchaca Castellanos (PVEM)

Sen. José Luis Lobato Campos (Convergencia)

Sen. Josefina Cota Cota (PT)

House of Representatives/Chamber of Deputies

Congressman Ed Pastor (D-AZ) Dip. Antonio Valladolid Rodríguez (PAN)

Congresswoman Linda Sanchez (D-CA) Dip. Cruz Pérez Cuéllar (PAN)

Congressman Bob Filner (D-CA) Dip. José Jacques Medina (PRD)

Congressman Silvestre Reyes (D-TX) Dip. Raymundo Cárdenas Hernández (PRD)

Congresswoman Hilda Solis (D-CA) Dip. Enrique Serrano Escobar (PRI)

Congressman Ciro Rodriguez (D-TX) Dip. Edmundo Ramírez (PRI)

Congresswoman Gabrielle Giffords (D-AZ) Dip. Erika Larregui (PVEM)

Congressman David Dreier (R-CA) Dip. José Luis Varela Lagunas (Convergencia)

Congressman Jerry Weller (R-IL) Dip. Rodolfo Solis Parga (PT)

Congressman Luis Fortuño (R-PR) Dip. Irma Piñeyro Arias (NA)

Congressman Connie Mack (R-FL) Dip. Armando García Méndez (ASD)

Congressman Michael McCaul (R-TX)

Sometimes this interest stems from the desireto attract investment or open new markets forlocal products. In other cases, U.S. governorsand mayors are responding to the interest oftheir constituents of Mexican origin, andMexican governors and mayors are visitingcommunities in the United States where theirconstituents have relatives.

The North American Development Bank In 1994 the two federal governments estab-lished, in a side agreement to NAFTA, aNorth American Development Bank to fundenvironmental projects within a narrowradius of the border. Legislation in bothcountries in 2004 expanded the mandate to

projects within 300 km miles of the borderon the Mexican side. It left the geographiclimit in the United States unchanged at 100km. To date 88 projects worth over $865 mil-lion have been funded, mostly dealing withwater, wastewater, solid waste, and air quali-ty.7 Roughly 60% of the projects funded arein Mexican border communities and 40% inU.S. border communities.

Some analysts have suggested that the twogovernments should expand the mandate ofthe NADBank beyond the immediate borderregion and allow infrastructure and produc-tive projects as well as environmental ones.This is a highly contentious issue and unlike-ly to advance unless the current level of fund-

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Population of the Border States and Border Counties or Municipalities UnitedStates and Mexico, 2000

State Counties/Municipalities

United States (44 counties)

Arizona 5,130,6321 1,159,908

California 33,871,648 2,956,194

New Mexico 1,819,046 312,200

Texas 20,851,820 2,125,464

Border Area 61,673,146 6,553,766

Mexico (80 Municipalities)

Baja California 2,487,367 2,487,367

Chihuahua 3,052,907 1,363,959

Coahuila 2,298,070 387,922

Nuevo León 3,834,141 116,556

Sonora 2,216,969 607,508

Tamaulipas 2,753,222 1,387,549

Border Area 16,642,676 6,350,861

United States-Mexico Border Area 78,315,822 12,904,627

Source: United States Census Bureau: State and County QuickFacts; Instituto Nacional de Estadística, Geografía y Informática(INEGI), XII Censo General de Población y Vivienda 2000.

7. Date from the most recent Annual Report of the North American Development Bank, available on its website www.nadbank.org.

ing for border environmental projects is sus-tained since many border communities relyon access to funds to upgrade their systems.However, the NADBank is the only existingbinational government effort to promotedevelopment, even within a highly limitedmandate, and so the prospect of using it morebroadly to promote economic development,especially in migrant-sending communities, isfrequently floated.

Educational and Cultural Exchange: Formany years Mexicans have come to the United

States for undergraduate and especially graduateeducation and U.S. citizens have spent semestersabroad in Mexico. There are also thousands ofAmericans who travel to Mexico for shorter peri-ods to study Spanish, and teachers, artists, andscholars who spend periods in each other’s coun-try for professional development, research, andcultural exchange. There are several programsthat facilitate these exchanges, including, mostlysignificantly, the joint Fulbright-Garcia Roblesprogram funded by the two governmentsthrough Comexus. However, these efforts have

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Recent Border Governors Conferences

Source: Office of the Governor of Texas, Texas Border & Mexican Affairs

Site of Recent Border Governors Conferences

2006 XXIV Border Governors Conference Austin, Texas

2005 XXIII Border Governors Conference Torreón, Coahuila

2004 XXII Border Governors Conference Santa Fe, New Mexico

2003 XXI Border Governors Conference Chihuahua, Chihuahua

2002 XX Border Governors Conference Phoenix, Arizona

2001 XIX Border Governors Conference Tampico, Tamaulipas

2000 XVIII Border Governors Conference Sacramento, California

Projects with North American Development Bank Approved Financing by Type

Total of 88 Projects (as of March 31, 2006)

n Water and Wastewater Sector- 63% (55 projects)n Water Conservation Sector- 23% (20 projects)n Solid Waste Sector- 11% (10 projects)n Air Quality Sector- 3% (3 projects)

63%

23%

3%

11%

Source: North American Development Bank, Annual Report 2006.

never received more than scant attention withinthe bilateral relationship. Today Mexico ranksseventh among countries sending students to theUnited States, with 13,063 in 2005, while it isthe sixth destination for U.S. students, with only9,244 in 2005. Universities and private founda-tions have generated new initiatives for exchange,but the two governments have not increasedtheir investment in the Fulbright program, theflagship for bilateral cooperation, since 1995.

Non-Governmental Organizations: A num-ber of civic organizations maintain close tiesacross the border. This is especially true ofmigrant-led organizations, such as hometownassociations and migrant federations, which areoften involved in development projects in bothMexico and the United States. A summit in 2007in Michoacán, organized by the NationalAssociation of Latin American and CaribbeanCommunities, brought together hundreds ofthese organizations to discuss their political rolein both the United States and Mexico.8 Similarly,many border organizations maintain close work-ing relationships, including environmentalorganizations. Business organizations and laborunions also weigh in on binational issues of con-cern to them. Churches, both Catholic andProtestant, often maintain close relationshipsacross the border as well.

Media across the Border: The media inboth countries pay attention to what happensin the other country; however, there are impor-tant asymmetries. The Mexican media pays agreat deal of attention to what happens in theUnited States but has few resources for in-depthcoverage. Only the national wire service,Notimex, the two principal television networks,

and a handful of major newspapers and maga-zines (including Reforma, El Universal, LaJornada, and Proceso) have reporters in theUnited States. Most of these reporters are con-centrated in Washington, DC, although a fewmedia companies have reporters in New York,Los Angeles, or other cities (or use localstringers). The U.S. media pay far less attentionto Mexico but overall devote more resources.Associated Press, CNN, NPR, and severalnewspapers (New York Times, Washington Post,Dallas Morning News, Los Angeles Times, LaOpinión, Chicago Tribune, Houston Chronicle,Wall Street Journal, and others) have majorbureaus in Mexico, some with more than onereporter. Unlike most Mexican reporters theyoften have budgets to travel around the countryand do investigative reporting. However, themajor U.S. television networks (other thanCNN) maintain a limited presence on theground in Mexico except when there is a break-ing story. It is worth noting that the media inboth countries tend to have relatively limitedcoverage of the U.S.–Mexico border despite thegrowing importance of this region for bothcountries.

Public Opinion: Citizens of both countriesregister warm feelings for the other; however,Americans tend to pay minimal attention toMexico while Mexicans are circumspect in theirrelations with their neighbors to the North.Public opinion surveys suggest that Mexicansoften distrust the intentions of their neighbors tothe north and are highly nationalistic, but theyare also highly pragmatic in their desire for coop-eration on specific issues. Americans have over-whelmingly positive views of Mexico, but do not

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8. See information on the Latin American Migrant Community Summit, available at http://www.cumbredemigrantes.org.

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Origin of International Students in the U.S.,* 1999/2000 vs. 2004/2005

80,000

70,000

60,000

50,000

40,000

30,000

20,000

10,000

0

35,000

30,000

25,000

20,000

15,000

10,000

5,000

0

India

China

Republic

of Kore

aJa

pan

Canad

a

Taiw

an

Mex

ico

Turk

ey

Germ

any

Thailan

d

n 1999/2000n 2005/2006

n 1999/2000n 2004/2005

* At both undergraduate and graduate levelSource: Open Doors, Institute of Internation Education, 2006.

Origin of International Students in the U.S.,* 1990/2000 vs. 2004/2005

Italy

Spain

Fran

ce

Australi

a

Mex

ico

Germ

any

China

Irelan

d

Costa R

ica

United

Kingdom

* At both undergraduate and graduate levelSource: Open Doors, Institute of Internation Education, 2006.

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Foreign Policy Goals (Mexico)Promote Mexican exports

Protect the interests of Mexicans abroad

Combat international drug trafficking

Protect our borders

Attract foreign investment to Mexico

Combat international terrorism

Prevent the spread of nuclear weapons

Strengthen the UN

Promote and defend human rights

Help to bring democracy to other countries

78

73

70

68

67

65

65

59

56

55

53

47

Percentages reflect those respondents who said that each goal should be a major foreign policy objective of their country.

Protect American jobs

Prevent the spread of nuclear weapons

Combat international terrorism

Secure energy supplies

Promote economic growth

Control and reduce illegal migration

Keep a superior military power

Improve the global environment

Combat world hunger

Strengthen the UN

Promote and defend human rights

Help less developed countries

Help to bring democracy to other countries

76

74

72

72

62

58

55

54

48

40

28

22

17

Percentages reflect those respondents who said that each goal should be a major foreign policy objective of their country.

Source: Guadalupe González and Susan Minushkin, editors, Mexico and the World 2006, Mexico City: Centro deInvestigación y Docencia Económicas and Comexi, 2006, p. 49.

Control the flow of undocumented foreigners into Mexico

Improve the standard of living in less developed countries

Foreign Policy Goals (U.S.)

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U.S. Government Contributions to the U.S.–Mexico Fulbright Program (in Millions of Dollars)

3.5

3.0

2.5

2.0

1.5

1.0

0.5

0.0

FY91

FY92

FY93

FY94

FY95

FY96

FY97

FY98

FY99

FY00

FY01

FY02

FY03

FY04

FY05

FY06

FY07

...

n Core Grantn Teacher Exchange

* In FY 02, the U.S. Government made a special contribution of $1,169,910.Source: Comexus

A BRIEF POLITICAL HISTORY OF MEXICO

Mexico’s politics have undergone a dramatictransition from a one-party dominant systemthat prevailed from the late 1920s until 2000 toa highly competitive multiparty system. Thisgradual transition, which took most of the1990s, has left Mexico stronger and betterpoised to face the future, but also created newchallenges as Mexican political leaders learn togovern in a pluralistic society and address thechallenges of development and growth.

From One-Party Rule to Democracy: For 71years Mexico was governed by a single party, theInstitutional Revolutionary Party (PRI), whichwas formed in the aftermath of the ten-year civilwar known as the Mexican Revolution(1910–20). Formed in 1929, the party broughttogether most of the different sides that hadfought in the war and helped forestall furtherarmed conflict. While other parties were stillallowed, the PRI won all presidential electionsfrom its creation in 1929 through the 1990s,maintained an overwhelming majority in theCongress (until 1997), and controlled all gover-norships (until 1989) and most municipalities.It did so through a mixture of fraud, intimida-tion, and effective politics.

The single-party system proved useful in sev-eral ways: it avoided another civil war, subjectedthe military to civilian authority, and shared thewealth of a growing economy among competinglocal leaders. Mexico avoided the frequent coupsand military dictatorships that took place inother countries in the region and achieved adegree of economic growth (especially from the1940s through the 1960s). However, this stabil-ity came at the price of political freedom, pro-duced a great deal of corruption among leadersof the PRI, and allowed for selective violence

against opposition leaders. By the early 1980s, asMexico’s economy went into a tailspin, opposi-tion to the single-party system had grown.

The PRI responded at first by allowing theopposition parties to win elections at a locallevel. In 1988 a strong challenge in the presiden-tial elections from a left-wing candidate, whohad split from the official party, almost toppledthe PRI. As opposition leaders won local elec-tions and seats in the Congress and the Mexicangovernment became more sensitive to worldopinion (especially during the NAFTA negotia-tions), election rules were changed to ensureincreasingly freer and fairer elections. By 1997opposition parties had won a majority of seats inthe Congress and the mayor’s office in MexicoCity; in 2000, an opposition candidate, VicenteFox, won election as Mexico’s first President notfrom the PRI since the 1920s.

Vicente Fox (2000 –2006): Vicente Fox, aformer governor, won election as a candidatefrom the right-of-center National Action Party(PAN) thanks to a mix of his own charisma,modern campaign techniques, and growing cit-izen frustration with the PRI. As President, hefaced a divided political landscape where theformerly all-powerful PRI and the left-of-cen-ter Democratic Revolutionary Party (PRD)dominated Congress and ran most state andlocal governments. Although Fox maintainedvery high popularity throughout his six-yearterm, he was unable to make many inroads inpolicy that required congressional approval.His hopes to pass a major tax reform thatwould raise Mexico’s public sector revenuefloundered in his first year, and he had littlesuccess in efforts to reform the energy sector,overhaul the public pension system, changelabor laws, or implement a new regime for 23

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PART II: AN OVERVIEW OF MEXICO’S POLITICS, ECONOMY, AND SOCIETY

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Presidential Elections by Percent of the Vote Received, 1964–2006

100%

80%

60%

40%

20%

0%

100%

80%

60%

40%

20%

0%

1964 1970 1976 1982 1988 1994 2000 2006

87.8%

11.0%

84.4%

92.8%

71.6%

51.2%

17.0%

30.9%

50.6%

42.5%

16.6%

35.9%

35.3%

22.2%

36.1%26.9%

17.2%

16.4%

3.7%

14.0%

0.0%

——n—— PRI——n—— PAN——n—— PRD/left*

Source: Instituto Federal Electoral, 2006

Composition of the Chamber of Deputies, 1982–2006

1982 1985 1988 1991 1994 1997 2000 2003 2006

Note: In 1988, the size of the Chamber was increased from 400 to 500 deputies. The PRD was founded in 1989; percent-ages for the “left” in previous years refer to an aggregate of several parties on the left that later joined the PRD.

Source: Cámara de Diputados, 2006

n PRIn PANn PRD/left*n Others

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n PRIn PANn PRD/left*

Mexicans Governors by Party, 1980–2007

Municipal Mayors by Party, 1984–2004

1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006

31 31 31 31 31 31 31 31 31

30

1 1 2 3 3 3 4 41 3 4 5 5 6 6 6 6 67

6

67

9 99 9 9 9

88

3029

28 28 2827 27

25

23

21

1817 17 17 17 17

18 18

35

30

25

20

15

10

5

0

100%

80%

60%

40%

20%

0%1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006

Source: CIDAC, “Elecciones municipales, 1980–2004,” available at www.cidac.org., and Sergio Aguayo Quezada, AlmanaqueMexicano, Mexico City: Aguilar, 2007, with data from Instituto Nacional para el Federalismo y el Desarrollo Municipal, 2006.

n PRIn PANn PRDn Others

indigenous rights. His one major legislativereform was a transparency law to allow citizens’access to most public documents (similar to theU.S. Freedom of Information Act), a significantachievement after decades of authoritarian rule.He also succeeded in increasing federal socialprograms gradually, especially the cash-transferprogram Oportunidades, which doubled its cov-erage to almost one in four Mexican house-holds by the end of his term.

2006 Elections: Close and Disputed:President Fox’s inability to get legislationthrough Congress was often contrasted withthe successes of the Mayor of Mexico City,Andrés Manuel López Obrador, whose six-yearterm coincided with Fox’s. López Obrador ofthe left-leaning PRD, succeeded in creating apension program for seniors and improving thecapital city’s infrastructure. President Foxunsuccessfully sought the mayor’s impeach-ment on charges of disobeying a court order, a

highly unpopular move that increased themayor’s popularity even further. It was hardlysurprising when López Obrador became hisparty’s presidential nominee for the 2006 elec-tions and the leading candidate in all earlypolls. In Fox’s PAN, Felipe Calderón, a 42-yearold former Congressman and party leader, wonthe party’s presidential nomination in a surprisecome-from-behind primary election victory.Largely unknown outside the party, Calderónwas seen as a long-shot to win the presidencybut gained support throughout the monthsprior to the election, while López Obrador’ssupport weakened.

Official results indicate that Calderón wonthe election by just over a half percentage point,roughly 233,000 votes. López Obrador claimedelectoral fraud and demanded a recount. Theelectoral court conducted a partial recount,which produced no significant change inresults, and ruled that Calderón had won the

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2006 Presidential Election States by Party

nPANnPRD

Sonora

Chihuahua

Cohuila

Durango

Zacatecas

NuevoLeón

Tamulipas

San Luis Potosí

Querétero

Hidalgo

VeracruzTlaxcala

Oazaca

Yucatán

Chiapas

Sinaloa

•

••

••

•• •

•

•

•

Tabasco

Campeche

Quintana Roo

Distrito FederalMorelos

Guerrero Puebla

••

•

••

•

México

Michoacán

JaliscoGuanajuato

Colima

Aguascalientes

Baja California Sur

Baja California

Navarit

•

•

election. López Obrador refused to recognizethe election results without a full recount andformed his own parallel government.

The Calderón Administration and PoliticsToday (2006–Present): Felipe Calderónbecame President on December 1, 2006. Hefaces a Congress where his party holds 41% ofthe seats, with the possibility of building occa-sional coalitions with the once powerful PRIand several smaller parties to pass legislation.The PRD, the largest opposition party, controlsslightly less than a third of seats (together withits two coalition partners) and is willing tonegotiate on specific issues, but significant ten-sions remain over different interpretations ofthe election results.

Mexico today faces several challenges. Mostpolitical actors agree on the nature of thesechallenges but frequently differ on the rightsolutions to address them or the priority theyshould be given:• Fiscal policy: Mexico collects only 11% of

GDP in taxes, one of the lowest rates in thehemisphere. This is supplemented by oil rev-enues, but the total, roughly 19% of GDP, isstill very low compared to other countries inthe region. Most political leaders agree thatthe government will have to raise additionalrevenue in order to reduce poverty, improveeducation, and address crime.

• Reducing Poverty: Around half of all Mexicanslive in poverty and almost a fifth live inextreme poverty, according to official figures.Political leaders differ on how best toapproach this, but all agree that there is anurgent need to generate employment,improve access to credit, support rural pro-ducers, invest in infrastructure, and ensuresocial safety nets for the poorest citizens.

• Energy policy: Mexico is the world’s fifthlargest producer of oil but its existing reservesare dropping quickly and the state-run oilcompany has limited capacity in exploration.To maintain competitiveness in energy,Mexico will need to find ways to promotemore effective exploration, extraction, andrefining of oil and gas. There is an ongoingdebate on whether to allow private invest-ment in some sectors of the oil industry.

• Regulatory and Labor Reform: Both the privatesector and labor are dominated by monopo-lies and oligopolies left over from the periodof one party rule. Better regulations are need-ed to promote both competition in the pri-vate sector and the creation of a modern labormovement.

• Rule of Law: Mexico’s police and judiciaryhave a limited capacity to deal with the chal-lenges they face. Mexico has a confusing mazeof federal, state, and municipal police forces,with low wages, limited investigative capacity,anachronistic rules that govern jurisdictionalauthority, and perverse incentives to violatecitizens’ basic rights to extract confessions.The court system is plagued by inefficiency, alack of autonomy (except for the SupremeCourt), and the lack of standards for the pre-sumption of innocence.

• Political Reform: With the transition from aone party system to a multiparty democracy,many political rules and institutions need tobe updated. These include the rules that setthe relationship among the federal, state, andmunicipal governments; the rules that governrelations between the legislative and executivebranch; procedures for the budget process;and even state and municipal electoral rulesand institutions. 27

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MEXICO’S POLITICAL SYSTEM

Mexico, like the United States, has a federalsystem. It includes the federal government, 31states, 2,416 municipalities, and one large fed-eral district where the capital of Mexico City islocated. The federal government itself hasthree branches (executive, legislative, and judi-ciary), modeled on the U.S. system, along withseveral autonomous federal agencies.

The Presidency: The President is electedfor a six-year term, with no possibility ofreelection, through direct popular vote. Aslong as Mexico was ruled by a single party, thePresident appeared to be all powerful: hecould remove governors at will, select candi-dates for Congress, and pass almost any legis-lation he wanted. With the advent of multi-party democracy, the President still remainsthe most important single decision-maker inthe federal government, but his powers are

roughly similar to that of the U.S. Presidentand he must negotiate any policies thatrequire legislation with Congress.

The Congress: The Congress has twochambers, the Senate and the Chamber ofDeputies. Senators are elected for a six yearterm and Deputies for a three year term.Neither can be reelected to a consecutive term.Congress had little power as long as a singleparty ruled Mexico and Members of Congressowed their candidacies to the President.However, since 1997 no single party controlsCongress and the legislature has becomeincreasingly influential in setting policy.

The Congress still has a very limited insti-tutional structure, with comparatively fewprofessional staff or research capabilities. Sinceno reelection is allowed for any elected posi-tion in Mexico, it is not uncommon for acareer politician to serve in Congress, rise to

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Mexican Senate by Party andNumber of Seats Held, 2006–2009

PRI, 33

PRI, 108

PAN, 52PAN, 206

Panal, 1

Panal, 9Green Party, 6 Green Party, 15

PRD, 26

PRD, 127

Convergencia, 5 Alternativa, 6PT, 5

•• • • PT, 11

•

Convergencia, 17

•••••

Source: Senado, 2006 Source: Cámara de Diputados, 2006

Mexican Chamber of Deputies byParty and Number of Seats Held,2006–2009

Others, 1

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Mexican Cabinet OfficialsFrancisco Javier Ramírez Acuña Secretariat of the Interior (SEGOB)

Patricia Espinosa Cantellano Secretariat of Foreign Affairs (SRE)

Agustín Carstens Carstens Finance and Public Credit Secretariat (SHCP)

General Guillermo Galván Galván Secretariat of National Defense (SEDENA)

Admiral Mariano Francisco Saynez Mendoza Secretariat of the Navy (SEMAR)

Eduardo Sojo Garza-Aldape Economy Secretariat (SE)

María Beatriz Zavala Peniche Secretariat of Social Development (SEDESOL)

Eduardo Medina-Mora Icaza Attorney General’s Office (PGR)

Genaro García Luna Secretariat of Public Safety (SPP)

Germán Martínez Cazares Department of Civil Service (SFP)

Luis Téllez Kuenzler Communications and Transport Secretary (SCT)

Javier Lozano Alarcón Secretariat of Labor and Social Security (STPS)

Juan Rafael Elvira Quesada Secretariat of the Environment and Natural Resources (SEMARNAT)

Georgina Kessel Martínez Secretariat of Energy (SENER)

Alberto Cárdenas JimenezSecretariat of Agriculture, Livestock, Rural Development, Fisheriesand Food (SAGARPA)

Josefina Vázquez Mota Secretariat of Public Education (SEP)

José Ángel Córdoba Villalobos Secretariat of Health (SSA)

Rodolfo Elizondo Torres Secretariat of Tourism (SECTUR)

Abelardo Escobar Prieto Secretariat of Agrarian Reform (SRA)

General Jesús Javier Castillo Cabrera Chief of Presidential Staff (EMP)

Carlos Gutiérrez Ruiz National Housing Commission

Sergio Vela Martínez National Council for Culture and the Arts (CONACULTA)

Maximiliano Cortázar Lara Media and Communications Director

Gerardo Ruiz Mateos General Coordination of Cabinets and Special Projects

Juan Francisco Molinar Horcasitas Mexican Social Security Institute

Jesús Reyes-Heroles González Garza Petróleos Mexicanos (PEMEX)

Miguel Ángel Yunes Linares Institute of State Workers, Social Security and Services

Alfredo Elías Ayub Federal Electricity Commission (CFE)

Jorge Gutiérrez Vera Luz y Fuerza del Centro

Alonso García Tamés National Bank of Public Works and Services (BANOBRAS)

Mario Martín Laborín Gómez Banco Nacional de Comercio Exterior (BANCOMEXT)

Enrique de la Madrid Cordero Rural financing department

José Luis Luege Tamargo National Water Commission (CNA)

Miguel Gómez-Mont Urueta National Fund for the Promotion of Tourism (FONATUR)

María Cecilia Landerreche Gómez Morín DIF

Ignacio Loyola Vera PROFEPA

Víctor Manuel Borrás Setién Institute of the National Housing Fund for Workers (INFONAVIT)

Gilberto Calvillo Vives National Institute of Statistics, Geography and Informatics (INEGI)

Luis Héctor Álvarez Álvarez National Commission for the Development of Indigenous Peoples

Carlos Manuel Hermosillo Goytortua National Sports Commission (CONADE)

Ernesto Velasco León Airports and Auxiliary Services (ASA)

Juan Camilo Mouriño Terrazo Head of the President’s Office

Cesar Nava Vazquez Private Secretary

Alejandra Sota Mirafuentes General Coordination of Public Opinion and Image

Daniel Francisco Cabeza de Vaca Hernández President`s Legal Counsel

Dionisio Pérez-Jácome Friscione Coordination of Advisers

Patricia Flores Elizondo General Administration Coordinator

Antonio Morales de la Peña Federal Consumers Bureau (PROFECO)

Source: http://www.presidencia.gob.mx/en/cabinet/ Note: Accurate as of September 2007.

be Governor of his or her state, and thenreturn to Congress again; or be a CabinetSecretary and then a Member of Congress. Asa result, those Senators and Deputies whohave held significant other positions in gov-ernment or within their parties tend to holdthe most influence in Congress, while the resthave much less influence.

Currently the PAN (Calderón’s party) is thelargest party in the Congress with just over40% of the seats. The left-of-center PRD isthe second largest party and forms a bloc withthe smaller Workers’ (PT) and Convergencia(PC) Parties. The PRI, which ruled Mexicofor 71 years, now has only a fifth of the seats,but it has maintained considerable influenceby becoming the deciding vote on key issues.Several smaller parties also have seats andoccasionally succeed in exerting influence onspecific issues.

The Judicial System: Mexico’s SupremeCourt, with eleven justices, is the highestcourt in the land. After years of subservienceto the President, during the period of one-

party rule, it has gradually established itself asan independent arbiter of constitutional lawand gained considerable credibility. Not so forthe country’s remaining courts. The Mexicanlegal system was constructed for an authoritar-ian system and retains many of the sameambiguities it has for decades. Most courtdecisions can be stayed by judicial orders inother courts, with low standards of proof, andmost citizens express limited confidence in thecourts, other than the Supreme Court. Mexicohas both federal courts and state courts withseparate jurisdiction.

Several states have been innovating in waysto improve the justice system, includingallowing oral arguments for the first time,providing legal services in indigenous lan-guages, and hiring public defenders.However, judicial reform remains one ofMexico’s most important future challenges.

State and Local Governments: Under theone-party system, state and local governmentsoperated largely as extensions of the federalgovernment with few resources or real pow-ers. Since the mid-1990s, however, state andlocal governments have gained resources,functions, and powers and now representaround a third of all public expenditures.Most education and healthcare has beendecentralized to state governments, andmunicipalities are responsible for most basiccity and county services. States and munici-palities remain dependent on federal transfersfor a majority of their budgets. While someargue for giving them more power of taxa-tion, others worry that the vast economicinequalities would mean that poorer statesand municipalities would be unable to raisesufficient tax revenue.30

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Chief JusticeGuillermo I. Ortiz Mayagoitia

Justices

Mariano Azuela Güitrón

José de Jesús Gudiño Pelayo

Juan N. Silva Meza

Olga María del Carmen Sánchez Cordero deGarcía Villegas

José Ramón Cossío Díaz

Margarita Beatriz Luna Ramos

Sergio Armando Valls Hernández

Genaro David Góngora Pimentel

Sergio Salvador Aguirre Anguiano

José Fernando Franco González Sala

Composition of the Supreme Court

State governors are becoming increasinglyinfluential actors in national politics and theirassociation, the National Governors’ Congress(CONAGO), has become a force to reckonwith in national political decisions, includingin debates on fiscal, education, and energyreform.

The growing strength of state and local gov-ernments contrasts with important institutionalweaknesses that they face. Most state and munic-ipal police forces are highly ineffective and somehave been subject to cooption by organizedcrime; transparency in budgeting is often defi-cient and funds can be subject to misuse; andelectoral laws for municipalities are archaic andprivilege local powerholders over real democraticcompetition. However, even with these deficien-cies, many state and local governments are alsoincreasingly becoming sites of experimentationin judicial and police reform, social policy, andeconomic development.

MEXICO’S ECONOMY

Brief Historical Overview: Mexico’s economyhas gradually become one of the most open inLatin America with sustained growth in recentyears. However, roughly half the populationstill lives in poverty and inequality appears tobe increasing.

From the 1950s to the 1970s, Mexico’s econ-omy grew robustly, averaging over 7% annualgrowth, on average, during the same period asthe United States’ post-war economic expansion.During this period, Mexico followed a policy ofImport-Substituting Industrialization (ISI) withhigh tariffs for imported goods and governmentsupport for domestic industries. However,despite overall growth, the country experiencedrepeated economic crises, often linked with thetransfer of power between Presidents. In 1982, aparticularly sharp economic crisis took place,driven by the drop in world oil prices and the risein international interest rates. Mexico declared a

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Public Spending by Level of Government, 1983–2003

100%

80%

60%

40%

20%

0% 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 2000 2001 2002 2003

Per

cen

t o

f al

l Pu

blic

Exp

end

itu

res

——n—— Federal Government——n—— State Government——n—— Municipalities——n—— Federal District

1999

Source: Author’s calculation from INEGI public finance statistics.

moratorium on its debt payments. Although thegovernment eventually reached agreements withmajor lenders and the IMF, the economyremained in crisis throughout most of the1980s, with a significant deepening of poverty.

In 1990, then President of Mexico, CarlosSalinas de Gortari, hoping to stabilize theMexican economy by attracting foreign invest-ment, approached then U.S. President GeorgeH.W. Bush about signing a free trade agree-ment, similar to the one the U.S. had just com-pleted with Canada. The Bush administration,in search of new economically-based policies inthe hemisphere to respond to the realities of thepost-Cold War world, agreed. The Canadiansjoined as well. The North American Free TradeAgreement (NAFTA) was negotiated through-out 1990–92, signed by the three countries in

1992, and took effect on January 1, 1994. TheNAFTA negotiations initially helped jumpstarteconomic growth in Mexico, but insufficientregulation and poor management led to a severefinancial crisis in 1994–95. The country beganto recover after 1997 with slow but sustainedgrowth over the subsequent years.

Poverty and Inequality: Mexico is one ofLatin America’s more unequal countries with zipcodes as wealthy as parts of the United Statesand others as poor as Haiti. While it boasts sev-eral highly successful multinational corpora-tions (e.g. Cemex, Femsa, Telmex, Vitro, GrupoBAL) that compete globally and six citizens onthe list of Forbes 200 wealthiest people world-wide (including the world’s wealthiest person,Carlos Slim), almost half of the population livesin or near poverty according to official statistics.

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7

6

5

4

3

2

1

0

-1

-2

-3

-4

-5

-6

-7

-8

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

An

nu

al P

erce

nt

Ch

ang

e

Year

——n—— GDP Growth——n—— GDP/Capita Growth

Growth in GDP and GDP/Capita, 1990–2004

Source: World Development Indicators, World Bank, 2006.

There are important regional and state-to-state differences, however. GDP per capita inMexico’s five wealthiest states, mostly in thenorth, is three times that in the five pooreststates, mostly in the south. The north ofMexico, which has long-standing economicties to the United States, and fairly goodinfrastructure, has been able to take advan-tage of many of the opportunities created byNAFTA. The south, with limited infrastruc-ture and less access to education, as well as alarge number of people who live off of subsis-tence or near-subsistence agriculture, hasbeen largely unable to participate in the eco-nomic opening. Moreover, the agriculturalchapter of NAFTA, which allowed for impor-tation of more heavily subsidized U.S. cornand beans, appears to have undermined fur-ther the farm economy in the south while

stimulating export-oriented farming in thenorth. It was perhaps not surprising thatPresident Calderón won almost all of thenorthern states of Mexico, which were anx-ious to continue his predecessors’ policies ofmarket opening, while almost all of thesouthern states voted for López Obrador, whopromised more active state intervention inthe economy.

One of the government’s most effectivesocial policies has been Oportunidades, a cash-transfer program for the country’s pooresthouseholds. Families that qualify receivemonthly payments for their minor childrenon condition that they remain in school and participate in regular medical check-ups. The program, originally started in 1995as Progresa, was extended from rural to urban areas under the Fox administration.

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Percent of Mexicans Living in Poverty and Extreme Poverty, 2000–2005

60%

50%

40%

30%

20%

10%

0% 2000 2004 2005

24.2

29.5

53.7%

47.0% 47.8%

29.7 29.2

17.3 18.6

nPovertynExtreme poverty

Source: Secretaria de Desarrollo Social , 2006.

Oportunidades now covers five million house-holds, almost a quarter of all Mexican fami-lies. Similar programs have now been startedin Brazil, Sri Lanka, and several other coun-tries, based on the success of the Mexicanmodel. The program is credited with reduc-ing extreme poverty in Mexico considerably.However, it is no substitute for generatingemployment opportunities or stimulatinginvestment in productive activities.

Education: Education indicators inMexico have improved noticeably in recentyears, rising from 7.45 years of education in1974 to over 9.45 years in 2004. However,these numbers are still low and only 14% ofthe population completes college. Resistancefrom the teacher’s union, which has strongties to political power, as well as inertias in34

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Mexico Poverty Headcount-2002

Poverty Headcount-2002

n 27.9%n 37.6%n 53%n 68.4%n 75.9%

Data from “Poverty in Mexico: Conditions, Trends, and Government Strategy” World Bank Poverty Assessment, 2004

10

8

6

4

2

0 1974

7.458.4

9.15 9.45

1984 1994 2004

Source: OECD Education Database

nAverage Years of Formal Schooling

Average Number of Years of Successfully Completed Formal Education, 25–34 year olds

the system and limited funding, have pre-vented more successful outcomes in the edu-cational system.

Telecommunications: Many Mexicanindustries remain dominated by only a hand-ful of companies. This is perhaps most evi-dent in the telecommunications industrywhere there are only two private televisionstations (Televisa and TV Azteca) and in tele-phones, where a single company (Telmex)controls almost all of the market. In 2006 theMexican Congress passed a law to regulateradio and television that appeared to consoli-date the control of the two private networks;however, a 2007 Supreme Court decisionmay overturn some elements of this law.

Energy: Mexico is the world’s fifth largestoil producer and the second largest supplierto the United States (after Canada). However,the country’s production has been unable tokeep pace with demand, and it is now a net

importer of both gasoline and natural gas.Since the Mexican government expropriatedall energy production and marketing fromprivate companies in the 1930s, these func-tions have remained a monopoly of Mexico’sgovernment-controlled oil company, Pemex.Both the Fox and Calderón administrationshave been interested in encouraging privateinvestment in some aspects of oil exploration,without giving up overall control; however,this remains a highly controversial issue, witha vast majority of Mexicans opposing signifi-cant private investment.

Revenues from Pemex also supply over athird of the federal budget. Most experts rec-ognize that Pemex’s contribution to the gov-ernment’s operating expenses have oftencome at the expense of needed reinvestmentin the company itself. Taking advantage ofhigh oil prices, the Mexican Congress passedlegislation in 2006 to allow for greater rein- 35

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Tax Revenue as a Percent of GDP in Mexico: Oil vs. Non-Oil Revenue 1993–2004

20

15

10

5

0

Oil Revenue,

6.5%

Oil Revenue,

7.9%

Non-oil tax revenue,

10.6%

Oil Revenue,

7.8%

Non-oil tax revenue,

11.2%

Non-oil tax revenue,

10.2%

Total: 16.7%

Total: 18.5% Total: 19.0%

Source: Secretaría de Hacienda y Crédito Público, 2005; Organization for Economic Cooperation and Development, 2005.

1993–1996 1997–2000 2001–2004

vestment of oil revenues within Pemex toupgrade capabilities for exploration.

Fiscal Policy: Due in large part to the avail-ability of oil revenues for public expenditure,Mexico has one of the lowest tax rates of anymajor country in the Western Hemisphere.Taxes comprise only 11.2% of GDP, althoughhigh international oil prices have increasedoverall public revenues in recent years toaround 19% of GDP. Low public finances havemeant a limited ability to engage in neededinvestments in education, infrastructure, socialdevelopment, and the modernization of thepolice and judicial systems.

CULTURE AND SOCIETY IN MEXICO

Mexico’s population is around 103 millionpeople. The country has a rich and varied cul-tural heritage, with roots in indigenous andSpanish traditions, as well as those of Africa,the Caribbean, South America, and other partsof Europe. The original encounter betweenindigenous peoples and Spanish settlers hasbeen augmented by centuries of immigrationand contact with other parts of the world.

Today around 7–12% of Mexicans areindigenous, and they speak over sixty differentindigenous languages. Most of the rest of thepopulation is considered mestizo, that is, ofmixed indigenous and European heritage,although there are many who trace their ances-try to Africa as well as many families who haveimmigrated more recently from Europe, SouthAmerica, or the United States. Indeed, there isa community of several hundred thousandAmericans who live in Mexico today (some-where between 300,000 and one million).

Mexico has a long tradition in the arts andliterature.

Mexican Cinema: Mexico’s cinema set thestandards for Latin America in the 1940s and1950s before going into a long period ofdecline. In the 1990s Mexican cinemareturned with three major directors on theinternational scene: Alejandro GonzálezIñarritú (Babel, Amores Perros), Guillermo delToro (Pan’s Labyrinth, Hellboy), and AlfonsoCuarón (Y Tu Mamá También, Harry Potterand the Prisoner of Akaban), all of whosemovies were nominated for Oscars in 2007.Mexican actors and actresses, including SalmaHayek and Gael García, have also been high-ly successful internationally.

Music: Mexico is home to a variety ofmusical styles from classical music to love bal-lads to punk rock. Among Mexico’s mostpopular singers on the international scene areJuan Gabriel and Luis Miguel (romantic bal-lads); Paulina Rubio (pop); Maná (rock);Maldita Vecindad (hard rock), and Los Tigresdel Norte (norteña).

Painting: Frida Kahlo is among Mexico’smost celebrated painters and her work hasgone through an international revival inrecent years. Her husband, Diego Rivera, wasamong an influential group of mural painterswho had a huge impact on Mexican art in theperiod from the 1920s through the 1950s.Other leading muralists included JoséClemente Orozco and David AlfaroSiqueiros. Rufino Tamayo was one of the bestknown contemporary painters in Mexico.Francisco Toledo is perhaps the most influen-tial living Mexican painter.

Literature: Mexico has a long literary tra-dition that spans poetry, short-stories, novels,drama, and non-fiction writing. Among themost well-known writers abroad are poet36

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Octavio Paz, author of The Labyrinth ofSolitude, and novelist Carlos Fuentes, authorof Artemio Cruz and The Crystal Frontier.

Architecture: Mexico has had several well-known architects, but perhaps none betterknown than Ricardo Legorreta, who hasdesigned the Museum of Modern Art inMonterrey and the Camino Real Hotel inMexico City, among many other buildings inMexico, as well as several homes in theUnited States.

Folk art: Mexico boasts of an extensivearray of folk art, including brightly coloredalebrijes (woodcarvings of animals) inOaxaca, beautiful Talavera pottery in Pueblaand Guanajuato, decorated carnival masks inGuerrero, and painted clay figures fromPuebla. Indigenous peoples in Chiapas pro-duce traditional textiles, stunning for theirintricate designs and beautiful colors.

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FURTHER READING AND WEB RESOURCES

A list of readings and useful websites inEnglish for those who wish to do additionalresearch on the issues in this volume:

THE DYNAMICS OF U.S.–MEXICO

RELATIONS

Ventana a México: a Web Resource on U.S.–Mexico Relations, www.wilsoncenter.org/mexico

Jorge Dominguez and Rafael Fernández de Castro, The United States and Mexico:Between Partnership and Conflict, New York:Routledge, 2001.

Jeffrey Davidow, The Bear and the Porcupine, Princeton: Markus Wiener Publishers, 2004.

Guadalupe González and Susan Minushkin, editors, Mexico and the World 2006, MexicoCity: Centro de Investigación y DocenciaEconómicas and Comexi, 2006.

Sergio Aguayo, Almanaque México – Estados Unidos, San Diego: Fondo de CulturaEconomica USA, 2005.

Andrew Selee, ed., Perceptions and Misconceptions in U.S.-Mexico Relations,Washington, DC: Woodrow Wilson Centerand Letras Libres, 2005. Available atwww.wilsoncenter.org.

Josefina Vázquez and Lorenzo Meyer, The United States and Mexico, Chicago:University of Chicago Press, 1987.

Robert Pastor and Jorge Castañeda, Limits to Friendship: The United States and Mexico,New York: Alfred A. Knopf, Inc., 1989.

Rossana Fuentes-Berain, Andrew Selee, and Heidy Servin Baez, eds., Journalism beyondBoundaries, Washington, DC: WoodrowWilson Center and Foreign Affairs enEspañol, 2005.

Jonathan Fox and David Brooks, eds., Cross-Border Dialogues: U.S.–Mexico SocialMovement Networking, San Diego: Centerfor U.S.–Mexican Studies, University ofCalifornia, 2002

NAFTA AND ECONOMIC RELATIONS

Sidney Weintraub, ed., NAFTA’s Impact on North America: The First Decade,Washington, DC: Center of Strategic andInternational Studies, 2004.

John J. Audley, Demetrios G. Papademetriou, Sandra Polaski, Scott Vaughan, NAFTA’sPromise & Reality: Lessons for the Hemispherefrom Mexico, Washington, DC: , CarnegieEndowment for International Peace, 2003. Available at http://www.carnegieendowment.org.

Gary Clyde Hufbauer and Jeffrey J. Schott, NAFTA Revisited: Achievements andChallenges, Washington, D.C.: Institutefor International Economics, 2005.

David Bacon, The Children of NAFTA: Labor Wars on the U.S./Mexico Border, Berkeleyand Los Angeles: University of CaliforniaPress, 2004.

Edward J. Chambers and Peter H. Smith, eds., NAFTA in the New Millennium, La Jolla, Cal.: University of CaliforniaPress, 2002.

John Burstein, U.S.-Mexico Agriculture and Rural Poverty, Washington, DC: WoodrowWilson Center, 2007.

A Strategy for Building Competitiveness Within North America, Washington, DC: Councilof the Americas, 2005. Available athttp://www.americas-society.org.

MIGRATION AND MIGRANTS

Migration Policy Institute and Migration Information Source, www.migration policy.org

Task Force on Immigration and America’s Future, Immigration and America’s Future: A New Chapter, Washington, DC: MigrationPolicy Institute, Manhattan Institute, andWoodrow Wilson Center, 2006.

Jeffrey Passel, Unauthorized Migrants: Numbers and Characteristics, Washington,D.C.: Pew Hispanic Center, 2005.

Víctor Zúñiga and Rubén Hernández-León, eds., New Destinations: MexicanImmigration in the United States, NewYork: Russell Sage, 2005.

Douglas S. Massey, Jorge Durand, and Nolan J. Malone, Beyond Smoke and Mirrors:Mexican Immigration in an Era of EconomicIntegration, New York: Russell SageFoundation, 2002.

Xóchitl Bada, Jonathan Fox, and Andrew Selee, eds., Invisible No More: MexicanMigrant Civic Participation in the UnitedStates, Washington, DC: Woodrow WilsonCenter and UCSC, 2006.

SECURITY AND RULE OF LAW

Transborder Institute, University of San Diego, www.tbi.org

Raúl Benítez-Manaut, Mexico and the New Challenges of Hemispheric Security,Washington, DC: Woodrow WilsonCenter, 2004. Available at www.wilsoncen-ter.org/mexico.

Wayne A. Cornelius and David Shirk, eds., Reforming the Administration of Justice in

Mexico, Notre Dame: University of NotreDame Press, 2007.

Mexico Security Memos, Stratfor Consulting Intelligence Agency. Available athttp://www.stratfor.com.

United States Department of State, Bureau for International Narcotics and LawEnforcement Affairs, InternationalNarcotics Control Strategy Report, Volume I,Drug and Chemical Control, March 2007.

Bruce Michael Bagley and Sergio Aguayo Quezada, eds., Mexico: In Search ofSecurity, Miami: University of MiamiNorth-South Center, 1993.

MEXICAN HISTORY AND POLITICS

Ventana a México www.wilsoncenter.org/ mexico

Julia Preston, Opening Mexico: The Making of a Democracy, New York: Farrar, Straus &Giroux, 2004.

Daniel Cosío Villegas, ed., A Compact History of Mexico, Mexico City: El Colegio deMéxico, 1995.

Enrique Krauze, Biography of Power: A History of Modern Mexico, 1810 –1996, New York:HarperCollins Publishers, 1997.

Roderic Camp, Politics in Mexico: The Democratic Consolidation, Fifth Edition,New York: Oxford University Press, 2006.

Joseph S. Tulchin and Andrew D. Selee, Mexico’s Politics and Society in Transition,Baltimore: Woodrow Wilson Center Pressand Johns Hopkins University Press, 2003.

Jonathan Fox, Accountability Politics: Power and Voice in Rural Mexico, OxfordUniversity Press, 2007.

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MEXICO’S ECONOMY

Centro de Investigación para el Desarrollo, A.C. (CIDAC), www.cidac.org

World Bank, Poverty in Mexico : an Assessment of Conditions, Trends, andGovernment Strategy, Washington, DC:World Bank, 2004.

Nora Lustig, Mexico: The Remaking of an Economy, 2nd Edition, Washington DC:Brookings Institute Press, 1998.

Enrique Dussell Peters, Polarizing Mexico: The Impact of Liberalization, Boulder:Lynne Rienner, 2000.

Pamela Starr, Challenges for a Postelection Mexico: Issues for U.S. Policy, Washington,DC: Council on Foreign Relations Press,2006. Available at www.cfr.org.

MEXICO’S CULTURE AND SOCIETY

Mexican Cultural Institute, www.embassy ofmexico.org

Letras Libres magazine (in Spanish),www.letraslibres.com

Octavio Paz, The Labyrinth of Solitude, New York: Grove Press, 1985.

Carlos Fuentes, The Crystal Frontier, New York, Farrar, Straus & Giroux, 1997.

Sam Quinones, Antonio’s Gun and Delfino’s Dream, Albuquerque: University of NewMexico Press, 2007.

C.M. Mayo, editor, Mexico: A Traveler’s Literary Companion, Whereabouts Press,2006.

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ANDREW SELEE has been director of theWoodrow Wilson Center’s Mexico Institutesince its founding in 2003. The Institute seeksto build dialogue and communicationbetween Mexico and the United States in aplural and non-partisan environment and topromote a greater understanding of Mexico inthe United States.

Selee is an Adjunct Professor of Govern-ment at Johns Hopkins University and a for-mer visiting scholar at El Colegio de México.He serves on the board of Comexus, theMexico–U.S. Fulbright Commission and is aterm member of the Council on Foreign

Relations. He has worked in the U.S. Houseof Representatives and on development proj-ects in Mexico and South America.

He is the editor or co-editor of several publi-cations including Perceptions and Misconceptionsin U.S.–Mexico Relations and Mexico’s Politicsand Society in Transition. He is also a contribut-ing editor to the Library of Congress’sHandbook of Latin American Studies.

Selee holds a Ph.D. in Policy Studies fromthe University of Maryland and an M.A. inLatin American Studies from the University ofCalifornia, San Diego.

ABOUT THE AUTHOR

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ABOUT THE WOODROW WILSON CENTERTABLE OF CONTENTS

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Overview

Introduction

Part I: An Overview of U.S.–Mexico Relations

The Economic RelationshipMigrationSecurityCooperation between the United States and Mexico

Part II: An Overview of Mexico’sPolitics, Economy, and Society

A Brief Political History of MexicoMexico’s Political SystemMexico’s EconomyCulture and Society in Mexico

Further Reading and Web Resources

About the Author

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Lee H. Hamilton, President and Director

BOARD OF TRUSTEES

Joseph B. Gildenhorn, ChairDavid A. Metzner, Vice Chair

PUBLIC MEMBERS:

James H. Billington, Librarian of Congress;Bruce Cole, Chair, National Endowment for theHumanities; Michael O. Leavitt, Secretary, U.S.Department of Health and Human Services;Tamala L. Longaberger, designated appointeewithin the federal government; CondoleezzaRice, Secretary, U.S. Department of State;Cristián Samper, Secretary, Smithsonian Instit-ution; Margaret Spellings, Secretary, U.S.Department of Education; Allen Weinstein,Archivist of the United States.

PRIVATE CITIZEN MEMBERS:

Robin B. Cook, Donald E. Garcia, Bruce S.Gelb, Sander R. Gerber, Charles L. Glazer,Susan Hutchison, Ignacio E. Sanchez

ABOUT THE CENTER

The Center is the living memorial of the UnitedStates of America to the nation’s twenty-eighthpresident, Woodrow Wilson. Congress estab-lished the Woodrow Wilson Center in 1968 asan international institute for advanced study,“symbolizing and strengthening the fruitful rela-tionship between the world of learning and theworld of public affairs.” The Center opened in1970 under its own board of trustees.

In all its activities the Woodrow WilsonCenter is a nonprofit, nonpartisan organiza-tion, supported financially by annual appropri-ations from Congress, and by the contributionsof foundations, corporations, and individuals.Conclusions or opinions expressed in Centerpublications and programs are those of theauthors and speakers and do not necessarilyreflect the views of the Center staff, fellows,trustees, advisory groups, or any individuals ororganizations that provide financial support tothe Center.

Mexico InstituteMexico Institute

MORE THAN NEIGHBORS:An Overview of Mexico and U.S.–Mexico Relations

Andrew SeleeWoodrow Wilson Center

1300 Pennsylvania Ave., NWWashington, DC 20004-3027Tel 202.691.4399Fax 202.691.4076mexico@wilsoncenter.orgwww.wilsoncenter.org/mexico

The WOODROW WILSON CENTER promotes non-partisan, plural dialogue on issues of major policy concern in theUnited States and abroad. Through its Latin American Program, the Center addresses concerns of democracy, devel-opment, and security in the Western hemisphere.

The Woodrow Wilson Center started the Mexico Institute in 2003 to improve understanding, communication, andcooperation between Mexico and the United States by promoting research, public discussion, and publications onissues of mutual concern.

CO-CHAIRSMr. José Antonio Fernández

Carbajal, Chairman and CEO,FEMSA

Mr. Roger W. Wallace, Vice President, Pioneer NaturalResources

MEMBERSMr. Sergio Aguayo, Chair,

FUNDAR, and Professor, El Colegio de México

Mr. Herb Allen, Chairman and CEO, Allen and Co., LLC

Mr. Donald E. Axinn, Chairman, Donald E. AxinnCompanies

Mr. Alberto Bailleres, Chairman, Grupo BAL and ITAM

Mr. Malin Burnham, Chairman, Burnham Real Estate

Dr. Enrique Cabrero Mendoza, Director General, CIDE

Dr. Luis de la Calle, Partner, De la Calle, Madrazo, &Mancera

Dr. Roderic Ai. Camp, Professor, Claremont-McKenna College

Mr. Eduardo Cepeda, Managing Director, J.P. Morgan Chase-Mexico

Mr. Brian Dyson, Retired President, Coca-Cola &President, ChathamInternational

Ms. Maria Echaveste, President, Nueva Vista Group

Mr. Jaime El Koury, Partner, Cleary Gottlieb, New York, NY

Dr. Rafael Fernández de Castro, Director of InternationalRelations, ITAM University

Dr. Rossana Fuentes-Berain,Opinion Editor, El Universal

Mr. Donald E. Garcia, President, Pinnacle Financial Group

Amb. Antonio O. Garza, U.S. Ambassador to Mexico

Mr. Armando Garza Sada,Chairman and CEO, Versax

Mr. Neal R. Goins, President, ExxonMobil Ventures-Mexico

Dr. Bernardo González-Aréchiga, Dean, School of Public Administration,Monterrey Tec

Amb. Lawrence Harrington, Representative in Mexico, Inter-American Development Bank

Mr. Carlos Heredia, Senior Advisor on International Affairsto the Governor of Michoacán

Mr. Guillermo Jasson, Latin American Regional Head,Investment Banking, MorganStanley

Amb. James Jones, Chairman, Manatt Jones Global Strategies

Mr. Alejandro Junco, President and Publisher, Reforma and ElNorte

Hon. Jim Kolbe, SeniorTransatlantic Fellow, GermanMarshall Fund

Dr. Enrique Krauze, Director, Letras Libres

Mr. Robert Lovelace, Chairman, Capital Research Company

Dr. Lorenzo Meyer, Professor, El Colegio de México

Dr. Diana Negroponte, VisitingFellow, Brookings Institution

Mr. Fred Niehaus, Senior Vice President, Western Union

Dr. Susan Kaufman Purcell, Director, Center forHemispheric Policy, University of Miami

Amb. Jesús Reyes Heroles, Director, PEMEX

Amb. Andrés Rozental, Past President, Mexican Council onForeign Relations

Mr. Luis Rubio, President, CIDACAmb. Arturo Sarukhan, Mexican

Ambassador to the UnitedStates

Dr. Peter H. Smith, Simón Bolívar Professor, University ofCalifornia, San Diego

Dr. Luis Téllez, Secretary of Communications andTransportation

Dr. Javier Treviño, Vice President, CEMEX

Dr. Mónica Verea, Professor, National AutonomousUniversity of Mexico

Dr. Peter Ward, Professor and former Director, Mexico Center,University of Texas, Austin

MEXICO INSTITUTE ADVISORY BOARD