History of Mexico

Mother Earth Travel > Country Index > Mexico Map Economy History

Mexico's history is long. Although the timing of the arrival of the first inhabitants to the Americas has been a point of major controversy among archaeologists, recent archaeological findings indicate that tribes from northeast Asia walked across what is now the Bering Straits perhaps as early as 35,000 years ago. Finding abundant wildlife these peoples gradually moved south, populating the entire Americas over the next several thousand years.

In the area of present-day Mexico, the earliest settlers found a rugged and varied topography with only limited areas suited for human habitation. Viewed from space, modern Mexico roughly resembles a cornucopia, wide at the top but narrowing and curving to the east as it stretches southward. At the southern tip of the "cornucopia," the rectangular Yucatan Peninsula, described by some as a thumb, extends northward into the Caribbean Sea. Another discongruous piece of land, the Baja California Peninsula, is a long sliver of land offshore and paral-leling the northwest coast.

The land itself is characterized by a roughly Y-shaped series of mountain ranges. The two forks of the Y are rugged ranges that parallel the northern parts of the Pacific and Gulf of Mexico coasts. The base of the Y is a spine of mountains, with occasional breaks, that extends from central Mexico into Guatemala on the south. The center of the Y is a knot of active volcanoes in the center of the country, just south of Mexico City. Between the two northern ranges lies a high arid plateau, and the small coastal plains outside these mountain ranges are tropical rain forests. The Yucatan Peninsula is a flat humid jungle, and the Baja California Peninsula is a desert with yet another low mountain range running down its center.

Although most of the land has warm temperatures year round, lack of rainfall and rugged terrain were obstacles for the early inhabitants. Only the narrow coastal plains, the Yucatan Peninsula, and a few valleys in the southern area of the central plateau or in the volcanic central regions receive reliable rainfall for crops. Despite these constrictions, evidence indicates that between 7000 B.C. and 2000 B.C., corn had been domesticated, and agricultural villages had sprung up. By 1500 B.C., the Olmec, the first of a string of civilizations in Middle America, flourished.

The next three millennia would see a series of civilizations, each built on some of the advancements and traditions of its predecessors. After the Olmec in what is now called the Classic Period (0-A.D. 700), the Teotihuacán, Veracruz, and Monte Albán cultures built large ceremonial cities in south-central and eastern Mexico. From A.D. 700 to A.D. 900 in the Yucatan, the classic phase of the Maya civilization, considered by most archaeologists to be the most advanced pre-Columbian civilization in the Americas, was at its zenith. After A.D. 900, the center of power and culture shifted to the Valley of Mexico, site of present-day Mexico City, with the development of the Toltec and finally the Aztec empires.

The destruction of the Aztec Empire by the Spanish conquistadors in 1519 was one of the most decisive events in Mexican history. Aided by superior firepower and technology, and carrying deadly diseases for which the native inhabitants had no immunity, a band of several hundred European soldiers of fortune overran an empire of millions of inhabitants. In one of history's greatest epic stories, one which still reverberates in the Mexican psyche of today, a great civilization was virtually wiped out and replaced by an alien culture and political system. The Aztec capital of Tenochtitlán was leveled, and atop the ruins the Spanish built Mexico City, capital of half of their vast colonial empire in the New World.

Fueled by its rich silver mines, a new colonial society emerged stratified by race and wealth. The upper echelon was European, in the middle were people of mixed European-indigenous heritage, and at the bottom were the descendants of the native peoples who had survived the European onslaught of the 1500s. The Roman Catholic Church was omnipresent in all aspects of society, religion, and education. The colony was ruled by a viceroy appointed by the king of Spain.

Troubled by turmoil in Europe and influenced by the liberal ideas of French and American philosophers and the French and American revolutions, voices in Mexico began agitating for independence in the late 1700s and early 1800s. The formal break began with a proclamation by Father Miguel Hidalgo on September 16, 1810. The struggle for independence was long and fitful, however, and freedom from Spain was not finally realized until 1821.

Despite hopes that independence would bring political and economic change for the nation's masses, in reality the only change was in the country's ruler. For the next several decades, various strongmen held power. A disastrous war in 1848 resulted in the country ceding more than half its territory to the United States. A civil war in the late 1850s set the stage for a brief democratic interlude under President Benito Juárez, a French occupation and the establishment of an empire under Maximilian I, and finally the beginning of a dictatorship in 1871 under Porfirio Díaz that would last four decades.

Historians' view of the Porfiriato, as the dictatorship of Porfirio Díaz is called, is a schizophrenic one. On the one hand, the dictator opened the country to development, building a modern system of railroads, roads, factories, and schools. On the other hand (and this is the view stressed in Mexico's version of its history), the wealth generated by this period of political stability and increased trade was concentrated in a small upper class while the condition of the lower classes degenerated. Indigenous traditions or associations were totally rejected while European fashion and mores were slavishly imitated.

In 1910 the pent-up resentment of the lower classes coincided with the political disaffection of middle-class intellectuals, producing the series of violent political convulsions known as the Mexican Revolution. Rebel groups sprang up across the nation, and Díaz resigned. Instead of uniting, however, the rebel groups soon turned on each other. Various men, supported by one of the rebel factions or remnants of the former central government, held the presidency in rapid succession as fighting swept back and forth over the country. Although they disagreed over who should run the country, the leaders of the Revolution were united in their calls for social justice, land reform, and a new sense of nationalism based on Mexico's indigenous heritage. When the fighting finally ended in 1920, the ideals that they evoked defined the new Mexican nation that emerged.

The constitution of 1917, still in effect, established the present-day framework of Mexican politics. A strong president with a six-year term, a relatively weak legislature dominated by the party of the Revolution, and a nominally independent judiciary were all established. The Roman Catholic Church was stripped of most of its properties and formal power. Much of the land was taken from large landowners and organized into ejidos, or communes, for peasants to work. Heavily influenced by foreign liberal and leftist ideas and born of a popular revolution against oppression, the constitution had a decided revolutionary cast. The National Revolutionary Party (Partido Nacional Revolucionario--PNR) was formed in 1929 to successfully carry out the constitution's goals (the party later added the adjective "institutional" to indicate the consolidation of the redistribution phase of the revolutionary program--Partido Revolucionario Institucional--PRI).

The extent to which post-revolutionary administrations have implemented revolutionary ideals has been a benchmark by which Mexican historians have generally judged these administrations. Administrations in the 1920s and 1930s adhered to these goals more faithfully, the most significant act during these years being the nationalization of the petroleum industry. Post-1940 governments, however, seemed more concerned with political stability and economic growth than with land reform or new social programs.

The Revolution also had a profound effect on the role of the military. Formerly one of the largest and most influential players in Mexican politics, the armed forces were reduced in size after 1920 and their role redefined as one of guaranteeing domestic political stability. Quelling social unrest and eliminating guerrilla activity became their primary duties. As "servants of the people," units were more likely to be involved in development-oriented civic action than in training to defend the country from foreign intervention.

The Revolution added another irritant in the frequently stormy relations between the governments of Mexico and the United States. Long at odds over a variety of issues--including Mexican bitterness over territory lost in the Mexican War of 1848 and political and military interventions by the United States in Mexican affairs--the United States was alarmed by the leftist tone of revolutionary rhetoric and Mexico's friendliness with socialist governments and revolutionary movements worldwide. Often fueled by unspoken prejudices and stereotypes on both sides, friction between the two countries sometimes resulted in chilly relations and bitter denunciations by politicians. Not until the end of the twentieth century, when the two countries realized how economically interdependent they had become, did the rhetoric cool and genuine attempts at cooperation and understanding each other's political position occur.

Economic growth was probably the most significant legacy of the PRI in the mid-twentieth century. From 1940 to 1980, growth was rapid and sustained. The nation's vast mineral wealth was exploited. Petroleum reserves, estimated to be among the largest in the world, were used by the government to develop new petrochemical industries. Agriculture diversified and expanded, and government planners gave particular emphasis to the development of new crops for export. The industrial sector accounted for an ever larger share of the economy, and maquiladoras, or assembly plants along the United States border, grew exponentially. By 1980 Mexico was the world's fifteenth largest industrial nation.

Although the numbers of Mexicans who could be classified as middle class rose, the benefits of economic growth were not shared by all of Mexico's citizens. The stark inequality that had characterized Mexico at the turn of the century was not significantly ameliorated by the processes of modernization that began in the 1940s. Despite the economy's rapid growth rate in the post-World War II period, an even faster rate of population growth meant that the economy could not produce sufficient jobs for the many millions of young people entering the workforce every year. The exhaustion of the land available for redistribution in the 1950s also created conditions of severe rural unemployment. Beginning in the 1950s, rural-to-urban migration began to change the face of Mexico from a predominantly rural to an urban society. The search for work often resulted in displaced workers living in worse conditions than before. The population of Mexico City, for example, swelled to 15 million in the 1990s, with millions living in miserable slums on hillsides or on marginal land on the outskirts of the city. Statistics on standard of living indices showed improvement in some urban areas and throughout the north, but few improvements in the south, where Mexico's population tended to be more rural and more heavily mestizo or indigenous.

The PRI's legacy of political stability and economic growth generated little enthusiasm or gratitude among the Mexican people. In fact, the opposite occurred, as the rise of an urban middle class produced pressures for political reform during the 1980s. Either by legal or fraudulent means, the PRI consistently won every election at the state and national levels, ceding only the occasional municipality to the conservative National Action Party (Partido de Acción Nacional--PAN) or to government-financed "satellite" parties. Widespread corruption only heightened cynicism. Corruption became synonymous with all government dealings, from the presidency to daily life, where most Mexicans had to bribe petty government officials to obtain basic public services. The PRI, the party of revolutionary change in the early years of the century, was now seen as the primary obstacle to reform.

Beginning in the mid-1980s, the PRI's overwhelming dominance over the political system began to decline. The massive earthquake that struck Mexico City in 1985 underscored the corruption and ineptitude of the authorities, who were slow to provide relief to the hundreds of thousands made homeless by the natural catastrophe. Spurred by government inaction, hundreds of nongovernmental civic associations arose in the aftermath of the Mexico City earthquake. In addition to providing resources for community self-help, many of these new organizations became a nucleus for opposition political activity during the latter 1980s.

Building on the policies of President de la Madrid, the Salinas administration carried out a comprehensive structural transformation of the Mexican economy. Salinas's domestic macroeconomic policies put into practice a package of market-oriented reforms endorsed by the United States and international financial organizations; these reforms collectively became known as the "Washington consensus." The three pillars of Mexico's structural adjustment program were the privatization of the country's vast network of parastatals, the liberalization of its foreign trade, and the modernization of its financial system.

It was through its comprehensive economic program, rather than its political reforms, that the Salinas administration left a lasting impact on Mexico. By the time Salinas entered office, Mexico had already dramatically reversed its foreign trade practices by acceding to the General Agreement on Tariffs and Trade (GATT--as of January 1995 became known as the World Trade Organization) in August 1986. As a result of its accession to GATT, Mexico unilaterally lowered its average tariff level from 100 percent ad valorem to a structure with a top rate of 20 percent. At the same time, it reduced or eliminated many non-tariff barriers such as import licenses and quotas, the combined effect of which had been to close the Mexican market to most foreign imports for more than fifty years.

The Salinas administration expanded the process of structural adjustment begun by its predecessor. A key element of the government's structural adjustment program was the privatization of Mexico's vast network of parastatal industries. Between 1986 and 1994, the government privatized more than 700 state-owned companies, including all eighteen government-owned commercial banks, the national telephone company, a national television network, airlines, movie theaters, several sugar- and food-processing plants, several large copper mines, steel production facilities, and the maritime port system. The sale of state-owned companies generated US$22 billion in government revenues, the majority of which was used to reduce the massive foreign debt and to finance new infrastructure and social expenditures.

In addition to the sale of state companies, the government also undertook a major overhaul of its Byzantine financial and regulatory systems. The Salinas administration oversaw the privatization of the domestic commercial banks and the passage of a new national Law of Banking and Credit that thoroughly modernized domestic banking. Opportunities for foreign investment, which had been severely restricted since the Revolution, were expanded considerably under the 1993 Foreign Investment Law. For the first time since the Revolution, foreigners were allowed to own commercial and residential property directly, rather than through a Mexican intermediary. New commercial and securities market regulations encouraged a massive influx of foreign direct and portfolio investment during the early 1990s. The most visible consequence of increased foreign investment was the explosive growth of the in-bond (tariff and tax-free) maquiladora manufacturing plants along the Mexico-United States border. Additionally, after 1993 the capitalization of the Mexican stock market soared, as a new generation of foreign (mainly United States) investors sought the higher returns afforded by emerging markets such as Mexico's.

The dramatic restructuring and austerity measures of the Salinas years produced a positive turnaround in Mexico's macroeconomic performance, although they did not produce the sustained high growth rates which many had hoped for. Annual inflation fell from 159 percent in 1987 to 6.7 percent during the first three quarters of 1994. Concurrently, the average annual economic growth rate between 1988 and 1994 was a modest 2.6 percent. Unemployment and underemployment remained high, especially in the countryside, fueling record levels of legal and illegal migration to the United States. Moreover, the new prosperity was unevenly distributed, being largely concentrated in the north and among a minority of relatively well-educated, urban professionals and white-collar workers.

Perhaps the single most important catalyst for the transformation of Mexican economic policy was the Salinas administration's ambitious goal of participating as a full partner in the emerging North American free-trade zone begun by Canada and the United States in the early 1990s. President Salinas and his advisers viewed Mexico's integration into the world trading system as the only viable basis for their country's future long-term growth. Bowing to geographic reality, Salinas discarded decades of protectionist and nationalistic practices by past Mexican governments to forge a close and lasting economic and political partnership with the United States. The objective was nothing less than Mexico's full incorporation into the emerging North American financial and trading bloc. In 1991 Mexico began negotiations with Canada and the United States on the terms of a trilateral free-trade treaty, the North American Free Trade Agreement (NAFTA).

The ratification of NAFTA on January 1, 1994 boosted international confidence in the Mexican economy, spurring an influx of foreign capital and fueling predictions of an imminent economic boom. National opinion polls showed President Salinas's popularity to be at an all-time high, and the PRI was preparing to pass the mantle of the presidency to Salinas's handpicked successor, Luis Donaldo Colosio Murrieta, in the August 1994 presidential election.

For 71 years, Mexico's national government had been controlled by the PRI, which had won every presidential race and most gubernatorial races until the July 2000 presidential election of Vicente Fox Quesada of the National Action Party (PAN).

More History of Mexico

SOURCES: Country Studies/Area Handbook by the US Library of Congress, U.S. Department of State

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