Globalization, democracy, and mexican welfare, 1988-2006

Comparative Politics

Volumn 42, Issue 1, 2009, Pages

  Dion, Michelle ^a  

^a NONE

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EID: 72849124486     PISSN: 00104159     EISSN: None     Source Type: Journal    
DOI: 10.5129/001041509x12911362972836     Document Type: Article

References (144)

1. Contributory social insurance includes public pensions, health insurance, worker's compensation, and, less commonly in Latin America, family allowances and unemployment insurance. Social assistance is often noncontributory and means-tested, and provides income transfers, subsidies, or other benefits to recipients. Together, social insurance and social assistance constitute social protection.
2. On pension privatization, see Stephen J. Kay, "Unexpected Privatizations," Comparative Politics, 31 (July 1999): 403-23;
3. Raúl Madrid, Retring the State: The Politics of Pension Privatization in Latin America and Beyond (Stanford, CA: Stanford University Press, 2003);
4. and Sarah M. Brooks, Social Protection and the Market: The Transformation of Social Security Institutions in Latin America (New York: Cambridge University Press, 2008).
5. On social assistance, see Wayne A. Cornelius, Ann L. Craig, and Jonathan Fox, eds., Transforming StateSociety Relations in Mexico: The National Solidarity Strategy (La Jolla, CA: Center for U.S.-Mexican Studies, University of California, San Diego, 1994);
6. Kathleen Bruhn, "Social Spending and Political Support The 'Lessons' of the National Solidarity Program in Mexico," Comparative Politics, 28 (January 1996): 151-77;
7. Carol Graham, Safety Nets, Politics and the Poor: Transitions to Market Economies (Washington, DC: Brookings Institution Press, 1994);
8. Norbert R. Schady, "The Political Economy of Expenditures by the Peruvian Social Fund (FONCODES), 1991-1995," American Political Science Review, 94 (June 2000): 289-304;
9. Beatriz Magaloni, Voting for Autocracy: Hegemonic Party Survival and its Demise in Mexico (New York: Cambridge University Press, 2006), chap. 4;
10. and Beatriz Magaloni, Alberto Diaz-Cayeros, and Federico Estévez, "Clientelism and Portfolio Diversification: A Model of Electoral Investment with Applications to Mexico," in Patrons, Clients and Policies: Patterns of Democratic Accountability and Political Competition, ed. Herbert Kitschelt and Steve Wilkinson (Cambridge: Cambridge University Press, 2007), 182-205.
11. See Robert R. Kaufman and Alex Segura-Ubiergo, "Globalization, Domestic Politics, and Social Spending in Latin America," World Politics, 53 (July 2001): 553-88;
12. Nita Rudra, "Globalization and the Decline of the Welfare State in Less-Developed Countries," International Organization, 56 (Spring 2002): 411-45;
13. Geoffrey Garrett, "Globalization and Government Spending around the World," Studies in Comparative International Development, 35 (Winter 2001): 3-29;
14. and Erik Wibbels, "Dependency Revisited: International Markets, Business Cycles, and Social Spending in the Developing World," International Organization, 60 (April 2006): 433-68. These studies use IMF Government Finance Statistics data on "Social Security and Welfare" spending, which combine social insurance and social assistance expenditures. Most studies treat these data as if they measure only social insurance or pensions, when in fact they do not.
15. Average trade openness, net foreign direct investment, and gross private capital flows in relation to the size of the economy in Latin America and the Caribbean were relatively constant throughout the 1980s, but all three expanded types of economic integration grew in the 1990s, with capital account openness nearly doubling over the decade. See World Bank, World Development Indicators CD-ROM (Washington, DC: World Bank, 2001).
16. Garrett, "Globalization and Government Spending";
17. and Kaufman and Segura-Ubiergo, "Globalization, Domestic Politics."
18. See also, Dani Rodrik, "Why Do More Open Economies Have Bigger Governments?" Journal of Political Economy, 106 (October 1998): 997-1032;
19. David S. Brown and Wendy Hunter, "Democracy and Social Spending in Latin America, 1980-1992," American Political Science Review, 93 (December 1999): 779-90;
20. Rudra, "Decline of Welfare State";
21. George Avelino, David S. Brown, and Wendy Hunter, "The Effects of Capital Mobility, Trade Openness, and Democracy on Social Spending in Latin America, 1980-1999," American Journal of Political Science, 49 (July 2005): 625-41;
22. Wibbles, "Dependency Revisited."
23. Susan Strange, The Retreat of the State: The Diffusion of Power in the World Economy (New York: Cambridge University Press, 1996).
24. Vito Tanzi, "Globalization and the Future of Social Protection," Scottish Journal of Political Economy, 49 (February 2002): 116-127
25. Layna Mosley, "Room to Move: International Financial Markets and National Welfare States," International Organization, 54 (October 2000): 737-773
26. David Cameron, "The Expansion of the Public Economy: A Comparative Analysis," American Political Science Review, 72 (December 1978): 1243-1261
27. Beyond the OECD, see Garrett, "Globalization and Government Spending";
28. Kaufman and Segura-Ubiergo, "Globalization, Domestic Politics";
29. and Rudra, "Decline of Welfare State."
30. Kaufman and Segura-Ubiergo, "Globalization, Domestic Politics";
31. Wibbels, "Dependency Revisited";
32. and Brooks, Social Protection and the Market. Few Latin American countries provide unemployment insurance as compensation.
33. Kaufman and Segura-Ubiergo, "Globalization, Domestic Politics";
34. R. Douglas Hecock, "Electoral Competition, Globalization, and Subnational Education Spending in Mexico, 1999-2004," American Journal of Political Science, 50 (October 2006): 950-61.
35. On human capital and development, see World Bank, World Development Report 1990: Poverty (Washington, DC: World Bank, 1990);
36. and World Bank, World Development Report 1993: Investing in Health (Washington, DC: World Bank, 1993).
37. Marcus J. Kurtz, "The Dilemmas of Democracy in the Open Economy: Lessons from Latin America," World Politics, 56 (January 2004): 262-302.
38. Kurtz, "Dilemmas of Democracy";
39. and Katrina Burgess, "Loyalty Dilemmas and Market Reform: PartyUnion Alliances under Stress in Mexico, Spain and Venezuela," World Politics, 52 (January 1999): 105-134
40. M. Victoria Murillo, "From Populism to Neoliberalism: Labor Unions and Market Reforms in Latin America. World Politics, 52 (January 2000): 135-174
41. Paul Pierson, "The New Politics of the Welfare State," World Politics, 48 (July 1996), 143-179
42. Theda Skocpol, Protecting Mothers and Soldiers: The Political Origins of Social Policy in the United States (Cambridge, MA: Harvard University Press, 1992).
43. Magaloni, Diaz-Cayeros, and Estévez, "Clientelism and Portfolio Diversification."
44. Alberto Diaz-Cayeros, Beatriz Magaloni, and Barry R. Weingast, "Tragic Brilliance: Equilibrium Hegemony and Democratization in Mexico," unpublished manuscript, Stanford University, April 2003.
45. Whereas clientelism hinges on excludability and particularistic benefits, nonclientelistic provision of benefits to generate political support are nonexcludable and uniformly provided according to criteria universally applied to all potential beneficiaries. Herbert Kitschelt, "Linkages between Citizens and Politicians in Democratic Polities," Comparative Political Studies, 33 (August/September 2000): 845-79.
46. Alberto DiazCayeros and Beatriz Magaloni emphasize the potential for changes in patterns of clientelism when policies are centralized. "The Politics of Public Spending, Part I-The Logic of Vote Buying," Background Paper for the World Bank World Development Report 2004, April 25, 2003.
47. Diaz-Cayeros and Magaloni, "Politics of Public Spending";
48. and Hecock, "Electoral Competition."
49. Diaz-Cayeros and Magaloni, "Politics of Public Spending."
50. George Tsebelis, Veto Players: How Political Institutions Work (Princeton, NJ: Princeton University Press and Russell Sage Foundation, 2002).
51. Kay, "Unexpected Privatizations";
52. Stephan Haggard and Robert R. Kaufman, "Introduction," in Reforming the State: Fiscal and Welfare Reform in Post-Socialist Countries, ed. János Kornai, Stephan Haggard, and Robert R. Kaufman (New York: Cambridge University Press, 2001), 1-24;
53. Madrid, Retiring the State;
54. and Evelyne Huber, "Globalization and Social Policy Developments in Latin America," in Globalization and the Future of the Welfare State, ed. Miguel Glatzer and Dietrich Rueschemeyer (Pittsburgh: University of Pittsburgh Press, 2005), 75-105.
55. Duane Swank, Global Capital, Political Institutions, and Policy Change in Developed Welfare States (New York: Cambridge University Press, 2002);
56. and Markus M.L. Crepaz and Ann W. Moser, "The Impact of Collective and Competitive Veto Points on Public Expenditures in the Global Age," Comparative Political Studies, 37 (2004): 259-285
57. Skocpol, Protecting Mothers;
58. Paul Pierson, "Three Worlds of Welfare State Research," Comparative Political Studies, 33 (August/September 2000): 791-821;
59. and Kathleen Ann Thelen, How Institutions Evolve: The Political Economy of Skills in Germany, Britain, the United States, and Japan (New York: Cambridge University Press, 2004).
60. For example, new members in the U.S. Congress in 1974 layered new committee institutions upon existing ones because they were unwilling or unable to change the existing institutions in which other members of Congress were invested. Eric Schickler, Disjointed Pluralism: Institutional Innovation and the Development of the U.S. Congress (Princeton, NJ: Princeton University Press, 2001).
61. Further, coverage tends to track closely with economic growth; but since the 1980s, expansion of social insurance coverage has lagged behind economic growth.
62. Rose J. Spalding, "State Power and its Limits: Corporatism in Mexico," Comparative Political Studies, 14 (July 1981): 139-61. The focus here is on national social protection providing in-kind benefits and transfers lasting more than one presidential administration. Mexico has also periodically provided universal subsidies for food (such as milk or tortillas) and other basic needs (such as electricity) and programs for rural agricultural development.
63. See Jonathan Fox, The Politics of Food (Ithaca, NY: Cornell University Press, 1993);
64. and Guillermo Trejo and Claudio Jones, "The Political Dilemmas of Welfare Reform: Poverty and Inequality in Mexico," in Mexico Under Zedillo, ed. Susan Kaufman Purcell and Luis Rubio (Boulder, CO: Lynne Rienner, 1998), 67-100.
65. Asa Cristina Laurell, "The Transformation of Social Policy in Mexico," in Confronting Development: Assessing Mexico's Economic and Social Policy Challenges, ed. Kevin J. Middlebrook and Eduardo Zepeda (Stanford, CA: Stanford University Press, 2003), 320-349
66. Nora Lustig, Mexico: The Remaking of an Economy (Washington, DC: Brookings Institution Press, 1998);
67. Diana Alarcón, "Income Distribution and Poverty Alleviation in Mexico: A Comparative Analysis," in Middlebrook and Zepeda, Confronting Development, 447-486
68. Mexico does not have public unemployment insurance, though the national labor law requires firms to provide severance pay for unjustified dismissals. In practice, however, enforcement has been weak due to significant costs associated with pursuing disputed benefits in labor courts.
69. The Federal Labor Law has not been reformed since 1973. On labor policy under Salinas, see Francisco Zapata, El sindicalismo mexicano frente a la estructuración (Mexico City: El Colegio de México, 1995)
70. and Zapata, Tiempos neoliberales en México (Mexico City: El Colegio de México, 2005).
71. Kurtz, "Dilemmas of Democracy."
72. Confederación de Trabajadores de México (CTM), Informe al 1130 Congreso de la Confederación de Trabajadores de México (Mexico City: CTM, 1991), pp. 34, 38.
73. Joy Langsten, "Los efectos de la competencia electoral en la selección de candidatos del PRI a la Cámara de Disputados," Política y Gobierno, V (August 1998): 459-500.
74. Carlos Salinas De Gortari, México: Un Paso Dificil a la Modernidad (Barcelona: Plaza and Janes Editores, S.A., 2000), 382-383
75. Contribution rates for the IMSS were raised in 1993, but the increases were insufficient to sustain the system and thought to threaten Mexico's competitiveness.
76. Interviews with reform team member and first president of regulatory agency of the privatized pension system, 2001.
77. Interviews with three members of original government reform team, 2001.
78. Interviews with PRI deputy, former SNTSS leader, and five government officials who participated in the reform process, 2001; Brooks, Social Protection and the Market.
79. Madrid, Retiring the State.
80. Comisión para la Modernización de la Seguridad Social del Consejo Coordinador Empresarial (CCE), "Propuesta para la modernización del Instituto Mexicano del Seguro Social," unpublished document, Mexico City, 1995;
81. Centro de Desarrollo Estratégico para la Seguridad Social (CEDESS), "Proyecto Aguila," unpublished document, Mexico City, 1995.
82. CEDESS, "Proyecto Aguila";
83. and Alejandra González Rossetti, "Change Teams and Vested Interests: Social Security Health Reform," in Crucial Needs, Weak Incentives: Social Sector Reform, Democratization, and Globalization in Latin America, ed. Robert R. Kaufman and Joan M. Nelson (Baltimore, MD: Johns Hopkins University Press, 2004), 65-92.
84. On pensions, see Madrid, Retiring the State;
85. Brooks, Social Protection and the Market;
86. and Michelle L. Dion, The Progress of Revolution? Mexico's Welfare Regime in Comparative and Historical Perspective (Ph.D. Dissertation, University of North Carolina at Chapel Hill, 2002).
87. On health, see Dion, Mexico's Welfare Regime;
88. and González Rossetti, "Change Teams."
89. Unionization data are notoriously unreliable or unavailable in Mexico. IMSS coverage data, which the government uses to estimate the size of the formal private sector or workers that could potentially be organized, indicate that in 1989-1994, an average of 280,000 workers were covered, while this dropped to an average of 190,700 workers for 2001-2006. Over this same period, the ratio of IMSS-covered workers with permanent positions declined relative to those with seasonal or temporary positions. See Felipe Calderón, Primer Informe de Gobierno: Anexo, Presidencia: Mexico City, 2007.
90. Interview with SNTSS leader, 2001.
91. Though the FSTSE leadership was not politically independent from the PRI, segments of the teachers' union within the FSTSE have been independent and vocal critics of reforms.
92. In 2001 the Congress approved a largely technical reform that did not directly challenge any of the rights or benefits of workers but increased the capacity of the IMSS to penalize employers who evade contributions and stipulated that reserves of different insurance funds be kept separate. The 2002 reform addressed the investment regime of the private system, allowing investment abroad. Neither reform was very politically contentious. Though some political actors oppose investing pension funds abroad, most agree that rates of return need to improve and that the domestic market cannot supply sufficient safe investment opportunities.
93. Interviews with member of the IMSS Technical Council, representative of the employer sector, and representative of the Union Nacional de Trabajadores (National Union of Workers, UNT), 2005.
94. Interviews with leaders of the SNTSS, other member unions of the UNT, and a federal deputy, May and June 2005. Though SNTSS is formally independent and a founding member of the UNT, the SNTSS has historically held at least one deputy seat in the national Congress on the PRI proportional representation list.
95. Because the 2004 reform applies only to new workers, its financial impact will not be felt for decades. However, court precedent may facilitate similar legislation in sectors, such as electricity and petroleum, singled out as having "privileged" labor contracts. In the new SNTSS-IMSS labor contract of October 2005, new workers will be required to work longer for retirement benefits capped at 100 percent of the last salary, while benefits of current and retired workers will not change.
96. Interview with ISSSTE official, 2004.
97. These concessions include a higher guaranteed minimum pension, a public, nonprofit pension fund administrator for government workers with significant union oversight, and changes in the calculation of contribution credits for current workers.
98. Noncontributory social assistance is included in the president's proposed budget and does not require separate legislation. Only during the Fox administration did opposition legislators add provisions to ensure transparency.
99. Salinas, Mexico: Un Paso Dificil, 407-8;
100. World Bank, "Mexico: Country Assistance Evaluation," Operations Evaluation Department, World Bank, Washington, D.C., 2001, p. 5.
101. Magaloni, Diaz-Cayeros, and Estévez, "Clientelism and Portfolio Diversification," p. 40.
102. Juan Molinar Horcasitas and Jeff Weldon, "Electoral Determinants and Consequences of National Solidarity," in Cornelius, Craig, and Fox, Transforming State Society Relations, 123-41;
103. Bruhn, "Social Spending";
104. Michelle Dion, "La economía política del gasto social: El Programa Nacional de Solidaridad, 1988-1994," Estudios Sociológicos (mayo-agosto 2000): 329-62;
105. and Alberto Diaz-Cayeros and Beatriz Magaloni, "The Politics of Public Spending. Part II-The Programa Nacional de Solidaridad (PRONASOL) in Mexico," Background Paper for the World Bank World Development Report 2004, May 26, 2003.
106. Diaz-Cayeros and Magaloni, "Politics of Public Spending. Part II".
107. Salinas, Mexico: Un Paso Difícil, 409. Translation by author.
108. Santiago Levy, "Poverty Alleviation in Mexico," Policy Research Working Paper Series from the World Bank, No.679, May 31, 1991;
109. Graham, Safety Nets;
110. and Laurell, "Transformation of Social Policy."
111. Magaloni, Diaz-Cayeros, and Estévez, "Clientelism and Portfolio Diversification."
112. Molinar Horcasitas and Weldon, "Electoral Determinants";
113. Bruhn, "Social Spending";
114. Dion, "La economia politica del gasto social";
115. Magaloni, Diaz-Cayeros, and Estévez, "Clientelism and Portfolio Diversification";
116. and Magaloni, Voting for Autocracy, chap. 4.
117. Diaz-Cayeros and Magaloni, "Politics of Public Spending, Part II."
118. Magaloni, Voting for Autocracy, chap. 4.
119. Though PRONASOL led to the creation of a new ministry, some services, including healthcare, were subcontracted from the IMSS.
120. Laurell, "Transformation of Social Policy," 94-95
121. Juan Pardinas, "Fighting Poverty in Mexico: Policy Challenges," in Mexico under Fox, ed. Luis Rubio and Susan Kaufman Purcell (Boulder, CO: Lynne Rienner, 2004), 65-86;
122. Laurell, "Transformation of Social Policy";
123. Alarcón, "Income Distribution." Infrastructure expenditures were decentralized or moved into other programs.
124. Laurell, "Transformation of Social Policy," 342-343
125. John Scott, "Progresa: Una Evaluación Preliminar." working document, División de Economia, Centro de Investigación y Docencia Económicas: Mexico City, 2000;
126. Alina Rocha Menocal, "Do Old Habits Die Hard? A Statistical Exploration of the Politicisation of Progresa, Mexico's Latest Federal Poverty-Alleviation Programme, under the Zedillo Administration," Journal of Latin American Studies, 33 (August 2001): 513-538
127. Tina R. Green, "The Political Economy of a Social Transfer Program: Evidence from PROGRESA in Mexico," paper presented at the 2005 Midwest Political Science Conference, Chicago, IL, April 7-10, 2005;
128. see also Rocha Menocal, "Old Habits."
129. Ana Lorena De La O, "Do Poverty Relief Funds Affect Electoral Behavior? Evidence from a Randomized Experiment in Mexico," unpublished manuscript, Massachusetts Institute of Technology, October 10, 2006.
130. Pardinas, "Fighting Poverty in Mexico," 67;
131. Alina Rocha Menocal, "Less Political and More ProPoor? The Evolution of Social Welfare Spending in Mexico in a Context of Democratisation and Decentralization," Nord-Sud aktuell, 3/4 (Quartal 2005): 346-359
132. Gonzalez Rossetti, "Change Teams," 85-86.
133. Oportunidades, Oportunidades: Informe de actividades, 2005 (Mexico City: Oportunidades, May 2006).
134. World Bank, World Development Report 2006: Equity and Development (Washington, DC, and New York: World Bank and Oxford University Press, 2005).
135. J. Frenk, R. Lozano, M.A. Gonzalez-Block, et al., Economía y salud: Propuestas para el avance del sistema de salud in México (Mexico City: Funsalud, 1994).
136. The initiative passed the lower chamber with 305 for, 115 against, and 80 abstained or absent. Centro de Estudios Sociales y de Opinion Pública, Programa Seguro Social (Mexico City: Chamber of Deputies, LIX Legislatura, February 2005).
137. Deputy Miguel Alonso Raya (PRD, Chair of the Social Security Commission), "Comentarios sobre el Seguro Popular," unpublished document, November 2003.
138. Centro de Estudios Sociales y de Opinion Pública.
139. See note 4.
140. Contrast Swank with Evelyne Huber, Charles Ragin, and John D. Stephens, "Social Democracy, Christian Democracy, Constitutional Structure, and the Welfare State," American Journal of Sociology, 99 (November 1993), 711-749
141. Rocha Menocal, "Less Political."
142. On welfare regime types, see Gosta Esping-Andersen, The Three Worlds of Welfare Capitalism (Cambridge: Polity Press, 1990). See Laurell for a similar assessment of Mexico.
143. Carlos H. Filgueira and Fernando Filgueira, "Models of Welfare and Models of Capitalism: The Limits of Transferability," in Models of Capitalism: Lessons for Latin America, ed. Evelyne Huber (University Park, PA: Pennsylvania State University Press, 2002), 127-58;
144. Armando Barrientes, "Latin America: Towards a Liberal-Informal Welfare Regime," in Insecurity and Welfare Regimes in Asia, Africa and Latin America: Social Policy in Development Contexts, ed. Ian Gough and Geof Wood (Cambridge: Cambridge University Press, 2004) 121-168