Neoliberalism And Structural Adjustment Programs: The Impact on Southern Mexico and Beyond

[This article appeared in the October issue of The Peace Center Newsletter, Wilkes-Barre, PA. What follows is the unedited version]

To better understand the economic and political situation in Chiapas, Mexico, and to more clearly comprehend the meaning and necessity of the Zapatista uprising on January 1, 1994 - and their continuing struggle to redirect and redefine Mexico's future - one needs to examine the particular social, cultural and economic conditions in Southern Mexico within the larger global context that includes the power and reach of transnational corporations and the economic infrastructure which enables and supports their actions.

On January 1, 1994 Mexico officially joined NAFTA, also on this date the Zapatistas (EZLN) initiated a rebellion in the southern state of Chiapas, Mexico - this was not a coincidence. The Mexican government was attempting to present itself as "first world," stable, prosperous, and ready to take part in the global economy based on terms laid out by the United States, the World Bank, and the International Monetary Fund. The actions of the Zapatistas were meant to challenge this economic shift by the Mexican government towards what is now commonly referred to as "neoliberalism." Since world attention was on Mexico due to NAFTA, the strategically timed Zapatista uprising gained a major potion of the spotlight in the media, as well as in economic circles. After initial attempts to characterize the Zapatistas as "outsiders" or merely local terrorists, the Mexican government and the international press had to recognize that the Zapatistas were clearly Mexicans and primarily indigenous, and that their cause and issues were supported by a larger number of citizens far beyond Chiapas.

The issues at stake for the Zapatistas were broad based - cultural, economic, political, social, and ethnic. And their need to address these issues at this time was clearly linked to the impact of NAFTA and concomitant neoliberal policies which had recently begun to alter the very fabric of Mexican life.

Neoliberal policies are most clearly stated and outlined in the Structural Adjustment Programs (SAPs) which borrowing countries must comply with in order to receive loans from the International Monetary Fund or World Bank. These SAPs also provide the foundational infrastructure to agreements such as NAFTA. The requirements imposed through these programs include: privatization of all nationally held enterprises (such as oil, telephone service, mining, etc.), deep cuts in social spending (health, education, housing, etc.), emphasis on export commodity production (nearly eliminating loans for those in the sectors producing goods for internal consumption), and currency devaluation. These are the four primary areas laid out in the SAPs, though other individual cases may require business deregulation, wage suppression and a raising of interest rates.

The negative consequences of these programs on the poor and low wage worker is dramatic. Slashes in social spending eliminates programs in education, and health services, and income plunges with the devaluation of the currency and wage suppression. The impact on small companies and farmers who have historically produced goods and crops for internal consumption caused by the shift of capitol and loans to large scale export production takes a little longer to be felt, but the result is often devastating - bankruptcy, foreclosures, loss of traditional jobs, etc. And privatization can be stated simply as a means to sell off the nations (the peoples) wealth. It should be clear as you consider the requirements set forward above that the infrastructure imposed by the Structural Adjustment Programs is meant to favor the "opening up" of a countries resources and labor force to benefit the exploitation of large transnational corporations who have no national allegiance. Their interest is strictly in profits for their share holders - at whatever cost..

Returning to Mexico, in order to comply with NAFTA, Carlos Salinas (then president of Mexico), working with his rubber stamp ruling political party (PRI) changed certain articles of the Mexican constitution that would among other things privatize the communal land holdings know as "ejidos." The ejidos have been the constitutionally protected land base of the indigenous since the revolution - the creation and protection of the ejidos was a central goal of Zapata and the revolution movement nearly 100 years ago.

The Zapatistas, made up of, and representing the indigenous whose culture is linked to the land, recognized that the elimination of the ejidos was an attempt to eliminate the culture of the Mayan. The uprising, and the discussions which followed with the federal government sought to address a wide range of issues regarding autonomy, and political and cultural rights for the indigenous. It was clear to the Zapatistas that only with new constitutional guarantees would the cultural life of the indigenous be protected.

To understand the impact of the flip side of intensified export production - that is reliance on imports - you can again look to an incident this past fall in an area close to San Cristobal, Chiapas. Through NAFTA the U.S. has been able to flood the Mexican market with cheap corn, lowering the value of corn produced internally. In Chiapas, corn farmers protested the reduction in prices set by the government with a road block and demonstration. This protest was met by state military forces firing tear gas form helicopters and soldiers on the ground firing bullets into the crowd - three farmers were killed and many wounded.

Structural Adjustment is a reinvented form of colonialism in which the national governments now carry out the wishes of the powerful multinational companies - a "neat" arrangement in which the appearance of democracy shields the reality of external exploitation and domination.

At the time of the uprising the Zapatistas called upon the total population of Mexico (and those worldwide) to "awaken" - to recognize the impact of neoliberalism on their lives, and take action. One action you can take is to become involved in the Witness for Peace "People and the Profit Margin" campaign, contact the Peace Center.