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Jesus Gerardo Lopez Lozano jgl679

GOV 337M/LAS 337M Final Exam Part 1 12.13

Labors emergence, golden times and inevitable decay.
Ever since its emergence from the Revolution, the labor movement became a politically powerful
agent because of the impressive quantities of people it could amass and the support it could
provide. This movement was crucial to the incorporation and stability of the dominant,
hegemonic, one-party regime that the PRI enjoyed for 70 years. Through the populist alliance,
the PRI managed to create a relationship with labor of inducements and constraints that
guaranteed them unparalleled support and thus, political dominance. Mexicos economic policy
of Import Substitution Industrialization (ISI) made possible for the PRI to be able to make these
socioeconomic and political exchanges with the labor movement. It was not until 1980s that the
outlook changed and the labor movement started loosing its structure and political influence. The
implementation of neoliberal policies, the shift from Import Substitution Industrialization to
Export Oriented Industrialization (EOI), and economic crises were some of the main reasons
behind this breakdown of the labor movement power. The PRI started to loose power and was
not able to keep up with all the demands of the populist alliance, and the labor movement started
to shift in structure as many of the unionized workers became unemployed and had to disperse
geographically, thus the ability to round support became strained. It was not until 2000 and the
PANs victory over the PRI for the presidential elections that the labor movement changed in
structure completely. This essay will attempt to provide an overview of how the political
importance of labor has changed before and after 1980s.

The roots of the labor sector can be traced back to the post-revolution era in the 1900s when a
new urban working middle class came into existence as the new industrialization movement
started to flood Mexico. This came to be known as the labor sector, and as it started to grow
Jesus Gerardo Lopez Lozano jgl679
GOV 337M/LAS 337M Final Exam Part 1 12.13

more and more it became clearer to those in power about the unionized workers capacity to []
mobilize support [] or oppose it by disrupting key economic activities (that) gave labor
political importance disproportionate to their size (Middlebrook, 55). Yet it was not until
Lazaro Cardenas that this labor sector became institutionalized as part of the populist alliance.
The populist alliance brought the creation of the CTM, an umbrella organization that represented
the numerous labor unions in the country and gave them a channel of political representation so
they could bargain with the political actors to obtain material benefits for their sector through
corporatism. The CTM was the central pillar of labor support for the PRI regime (Burgess, 76).
This corporatism or relationship of exchanges with the PRI consisted of two inducements, a
socioeconomic one and a political one. In the socioeconomic inducement the CTM favored
conciliation and arbitration over mobilization and contributed to wage moderation, in exchange
they received considerable material benefits and social welfare benefits. This stabilizing
development brought both employment and wage gains to workers. For the political bargain the
CTM would endorse the new candidate and undermine other rivals. Furthermore, CTM would
rally people to actively participate in PRIs campaigns municipally, statewide and nationally and
during voting periods. In exchange for this favorable support, they received various political and
organizational benefits such as guaranteed party posts in local, state and federal
levels(Burgess, 80). More over, Mexicos ISI strategy at the time provided a natural link
between labor and business, which proved necessary for negotiations between the sectors for
wage moderations and employment relations. Additionally, the PRI was able to promise jobs and
positions of power because of the great amounts of State-Owned-Enterprises or SOEs.

Jesus Gerardo Lopez Lozano jgl679
GOV 337M/LAS 337M Final Exam Part 1 12.13

The crisis of 1982 brought fundamental changes to Mexicos economic development strategies.
With a huge burden of debt and no ability to pay or borrow further, Mexico saw itself forced to
accept a rescue package from the IMF that contained the conditions that free market policies and
trade liberalization ideals were implemented. Trade tariffs and import licenses virtually
disappeared for most products, and [] elimination of direct export subsidies (Lustig, 119)
followed suit. With this, Mexico sought to [] stimulate nonoil exports, curb inflation, and
foster economic efficiency (Lustig, 120). Liberalization, privatization of most SOEs, including
telephone giant TELMEX and Mexicos Central Bank, and deregulation, was thought to be the
best strategy to get out of the economic slump. But the labor movement suffered from the shift
from ISI to EOI as this broke the linkage that was naturally created between capital and labor.
Additionally, because businesses demanded a flexible workforce, in terms of wages, employment
and layoffs, that would be set by market conditions and not by political negotiations, the state
moved from an activist state to a laissez faire, ending with the regulation of class interactions.
Mexican policy makers focused on macroeconomic adjustments (privatization, free market and
big businesses) while leaving microeconomic restructuring to the markets (Pastor and Wise,
77). This, along with the shift in preference from the PRI to advance big business position vis--
vis the global markets ultimately diminished rather than enhanced the structure of the political
party and its labor movement. Whats more, the demographic changes that this shift brought
eroded the strength and unity of the labor movement. Changes included as an increase in the
informal sector, which includes all of those people who had jobs that were under the
governments radar, such as balloon selling at stop lights, and thus paid o taxes or received any
benefits from the government; an increase in the work feminization, which was a direct result of
the increase in the maquila industry and the need for small hands a more docile force; and the
Jesus Gerardo Lopez Lozano jgl679
GOV 337M/LAS 337M Final Exam Part 1 12.13

emergence of the urban social movements, which are community organizations that lobby the
government for public interest purposes such as housing, urban services and fiscal
improvements. This last social movement became the new expression of social movement and
the political opposition to the free market model.
With the new EOI policies, wages shrunk, a great amount of businesses went bankrupt and those
who were able to withstand international competition adopted a leaner and meaner mindset.
This made them sacrifice capacity in exchange for efficiency, which led to huge layoffs. At this
point the CTM became more of a liability than an asset for the PRI (Burgess, 81). With the
economy on downward spiral with this crisis, the generous social spending was too much and
interfered with the inflation-controlling needs of the country and the competing marketplace.
Social spending was cut in half as targeted social welfare programs were created as a response to
the economical challenges Mexico faced. With the PRI loosing its ground politically because of
these changes, it became hard to [] guarantee candidacies to CTM leaders [] (Burgess,
81). All of this together translated into the PRIs loss of dependency on the CTM and the lack of
CTM to deliver mass amounts of votes on Election Day.

The CTMs continued loyalty to the PRI, especially in the context of redoubled worker hardship
and declining PRI hegemony, reflects the meager options of its leaders(Burgess, 100). Thus as
it can be understood, the post-1980s labor movement was one characterized by the restraint in
alternatives that the CTM had. The PRI was loosing its ground to the opposition parties, and with
it, its capacity to offer the socioeconomic inducements, but the CTM remained loyal to the PRI
because they were the only party willing and able to offer them leadership privileges and
protections (Burgess, 100). Things changed radically in the labor movement arena when the
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GOV 337M/LAS 337M Final Exam Part 1 12.13

PRI was defeated in 2000 with Vicente Foxs and the PANs victory in the presidential elections.
This brought further change in the labor movement and introduced new players to the movement.
The National Union of Workers (UNT) along with its social pressure group the Social Workers
Movement (MST) became the rival organization to the CTM, with their objectives being to
challenge the economic policies imposed through elite pacts, and to free labor organizations from
the corporatist practices associated with the PRI (Burgess, 95). The labor arena received another
dose of change when the PRD and PAN introduced two labor-law reform proposals to congress
that called for changes that would enhance union autonomy, encourage union democracy, and
transfer control of labor justice from the executive to the judiciary (Burgess, 97). Calling for
state-labor relations to moved to more fragmented, loosely institutional interactions. The
transformation of the whole political arena with the defeat of the PRI challenged the previous
corporatism that was in place during the one-party dominant regime between the party and the
labor unions. A labor movement thats more responsive to their bases in a context of greater
autonomy from the state, increased union competition, and enhanced access by workers to
mechanisms for holding their leaders accountable (Burgess, 100) is what the pressures from the
globalized economy and the new regime change aim to provide.

The labor movement has suffered an intense transformation since its conception in the
industrialization era. After being recognized by the PRI as an indispensable tool for support in
the 1930s it was incorporated to the populist alliance and enjoyed 70 years of material benefits
and political influence alongside the PRI. Welfare, wage arbitration and political posts were
some of the benefits that the labor sector found in this corporatism exchange with the PRI. It was
not until the economic crisis of 1982 and the overhaul of the Mexican development economic
Jesus Gerardo Lopez Lozano jgl679
GOV 337M/LAS 337M Final Exam Part 1 12.13

policies that the movement saw its political influence threatened. The new economic situation
made the system of exchanges hard to keep up with as the PRI saw this exchange as interference
with the economic welfare of the country. With the new neoliberal policies and the shift from ISI
to EOI the movement not only saw its unity eroded and dispersed, but saw the emergence of new
actors in the labor arena: the informal sector, the woman workforce and the urban social
movements. The labor sector was further changed when the PAN won the presidential elections
in 2000 and Vicente Fox rose to power. New players came into the picture to compete with the
CTM, specifically that of the UNT and called for a more democratic and autonomous labor
movement, one that was not so dependent on political parties, specifically the PRI. The CTM
lost most of its political influence when the PRI lost its power and as Burgess states, it is highly
unlikely that they will be able to regain the policymaking influence they had previously and must
now withstand the pressures exerted by the liberalization of trade, the deindustrialization and the
informality that has increased in the labor-market.


Burgess, Katrina Mexican Labor at a Cross Roads in Joseph Tulchin and Andrew Selee (eds.)
Mexicos Politics and Society in Transition. Boulder, CO: Lynne Rienner, 2003, pp73-107.

Lustig, Nora. Mexico: The Remaking of an Economy. Washington, D.C.: Brookings Institution
Press, 1992, pp 14-27, pp 28-60, pp 96-140.

Middlebrook, Kevin. The Paradox of Revolution. Baltimore: Johns Hopkins University Press,
1995, pp 72-106.
Jesus Gerardo Lopez Lozano jgl679
GOV 337M/LAS 337M Final Exam Part 1 12.13


Pastor, Robert and Carole Wise Mexican-Style Neoliberalism in Carole Wise (ed.) The Post-
NAFTA Political Economy, pp 41-81.