This editorial by Arturo Huerta González originally appeared in the January 20, 2026 issue of La Jornada de Oriente, the Puebala edition of Mexico’s premier left wing daily newspaper. The views expressed in this article are the authors’ own and do not necessarily reflect those ofMexico Solidarity Mediaor theMexico Solidarity Project*.*
It’s important to remember that when Salinas de Gortari governed the country, he declared that his economic policy was the only acceptable one. Like Margaret Thatcher, he championed a policy of more market and less government intervention, fiscal austerity, free trade, exchange rate stability, and deregulation of the financial sector. This led to the December 1994 crisis. The irony is that this policy continues to this day despite recurring economic crises and the resulting stagnation, because it serves the interests of the hegemonic financial sector and international corporations. Despite this, the current administration maintains that economic policy will not change.
The government defends its policies, claiming they are not neoliberal, that they have reduced poverty and extreme poverty, and that minimum wages have increased. While the share of wages in national income has improved, it has not boosted economic activity. This is because, although increased purchasing power boosted demand, it was channeled into imports as a consequence of trade liberalization and the cheap dollar. Therefore, it did not generate internal multiplier effects in favor of industrial and agricultural production, nor did it create more formal employment. What the government has failed to mention is that the social policies implemented were financed at the expense of reduced public investment, which fell by 22.8% in the third quarter… This negatively impacts the growth of the productive sector and the creation of formal jobs, which in 2025 totaled only 278,697 registered with IMSS (Mexican Social Security Institute). This is insufficient, given that over one million young people enter the labor market annually, leaving them unemployed or underemployed in the informal economy, without guaranteed wages or any employment benefits. Without economic growth and the creation of formal jobs, the poverty reduction targets touted by the current administration will not be met. Poverty is not combated with social policies alone, but rather with the creation of well-paid formal employment, which is not currently happening.
The national economy is facing increasingly serious problems. From 2018 to 2024, it grew at an average annual rate of 0.8%, less than in previous administrations, and in 2025 it is projected to grow by around 0.3% . There are no prospects that the current administration will reverse the downward trend created by the prevailing economic policy, which is detrimental to national production, employment, and economic growth. The Mexican Stock Exchange is projected to grow by 34.6% from January 2, 2025, to January 16, 2026, but in a context of stagnant economic growth, speculation is unsustainable, which will cause the stock market to fall and the peso to devalue.
The prevailing neoliberal economic policy — characterized by budget cuts aimed at avoiding fiscal deficits and increased public debt , coupled with high interest rates , a weak dollar (strong peso) , and free trade, where most products from USMCA countries are tariff-free — is unsustainable. It is contracting public and private investment , hindering job creation, and leading to the displacement of domestic production by imports. Domestic producers are becoming undercapitalized, over-indebted, and insolvent, which will destabilize the banking sector.
This is increasing discontent among broad sectors of the population who question the policies that affect them. The unresolved economic, political, and social problems generated by economic policy will ultimately lead to crisis.
Every crisis requires a rethinking and modification of the economic policies that generated it. The problem is that, despite recurring economic crises, the same policies persist, given the economic and political power of the sectors that benefit from them. But this has its limits. The growing problems will change the balance of power. Those affected, such as basic grain producers, transporters, and many others, are mobilizing and demanding that policies respond to the needs of the majority and stop favoring the financial sector, imports, and transnational corporations. This discontent will be even greater when the crisis manifests itself, as international support will no longer be available, given the problems many economies are facing.
Some policymakers have argued that the proposals of critical economists to address the country’s problems—such as drastically reducing interest rates, increasing public spending to boost the domestic market and import substitution, and regulating the movement of goods and capital, including the banking and financial sector —would be disastrous, extremely bad, and would increase unemployment. They maintain that current free-market policies are preferable. It should be noted that neoliberal policies have led to stagnant economic growth and frequent crises. Therefore, the policies that should be implemented to restore growth are those that were in place in Mexico from the late 1930s until 1981, when we experienced an average annual growth rate of 6.4%.
The government cannot say that its first strategic objective is to maintain the trade agreement with the US and Canada, which, although it has increased trade , is controlled by transnational companies , has led us to have less industry, less production of basic grains, fewer formal jobs, as well as to depend on the ups and downs of the US economy and government.
The government’s main objective should be the implementation of monetary, fiscal, exchange rate and credit policies aimed at boosting industry, agriculture, employment, as well as reducing the foreign trade deficit and dependence on capital inflows, in order to generate better endogenous conditions for accumulation and growth.
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