The Lost decade

Luis EcheverríaJosé López PortilloMiguel de la Madrid

The lost decade: From the oil boom to the monetary devaluation.

Preamble

Miguel de la Madrid

Videos: Lost Decade

Economy

José López Portillo

Luis Echeverría

INDEX

Gustavo Díaz Ordaz and consequences of his presidential period

Preamble

The stabilizing economic model started to break down; it became more challenging to continue with the import substitution model.Agricultural market after so many years of prosperity and encourage industrial growth, it also started to decay.The result was a vast middle social struggling and becoming more discontent with the government. That, later on, caused various social movements like the student's movement in 1968. The matanza de Tlatelolco became the official seal of the Díaz's government.

Goverment of Díaz Ordaz

The decay of the Mexican miracle, deterioration of the quality of life, and the discontent of various sectors of society demanded a democratic opening to participation and representation.For the new president, it seemed necessary to reform the economic model to redirect the economy and to satisfy economic growth. Still, also, he needs to solve the vast demands of a society that was willing to fight for its liberties and rights.

Overview: Luis Echeverría

He tried to avoid conflicts with the business class but warned that his alliance with that group could cause disagreement in other social sectors

Chosen to manage the crisis

Inherited a deep economic crisis, the discovery of numerous oil fields that will later benefit the economy

Overview: José López Portillo

Overview: Miguel de la Madrid

Immediate economic reordering program: 1) Reduction in public spending 2) Employment protection 3) Continue productive production 4) Honesty and efficiency in the public sector 5) Protection and incentives for programs that will provide basic products to the popular sector 6) Tax reforms 7) Desarrollo Nacional 8) Realistic Exchange policy 9) Constitucional reforms

Luis EcheverríaJosé López PortilloMiguel de la Madrid

Economy

A confrontation between the president and people in the business that didn't agree with the economic policy (the state control the economy). Poor management of public spending, devaluations, and inflation and the decay of the purchasing power resulted in the economic crisis at the end of this period.

Economy of Luis Echverria

• Discovery and exploitation of the new oilfields
• Exportations started to increase that became the oil boom for Mexico
• 1981 Mexico became the first country ever to supply the oil reserve of the USA.

1) The first two years were designed to overcome the crisis from that sexennial. 2) Next two were planted to consolidate the economy 3) Accelerated growth

Oil: pivot of the national economy

Reactivation of the economy

• Due to the oil boom, Mexico managed to overcome the crisis during the first years with a growth of 9% in the GDP
• 1980 Tax reform implemented the I.V.A. of 10% in products.

Stages of economical development

Economy of José López Portillo

The economy became dependent on the oil exportations, and it became vulnerable to the variation of one product in the international market. When the price of the oil dropped the Mexican expectations collapsed

The reliance towards the Mexican peso decayed, people started to change pesos for dollars permanently damaging the Mexican banks: Dollar had reached an exchanged rate of 49 pesos per dollar. The results were: devaluation, inflation, employment, external debt.

$49.00

COLLAPSE of the economy

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After the earthquake of 1985 he created the Pact of Economic Solidarity between private businessmen, workers and farmers

Strengthen the internal market and increase the efficiency of the industrial sector to create international competition

Beging of a liberal economical model. Abandonment of protectionist policies and advance to neoliberalism

Restore confidence in the business sector, privatizing 34% on the banks. Increade IVA from 10 to 15%

Economy of Miguel de la Madrid

Economic crisis 1982

VÍDEOS

+info

Lost Decade

• Delgado de Cantú, Gloria M.( 2015); Historia de México, Legado histórico y pasado reciente; México D. F.: Ed. Pearson Educación.
• Escalante Gonzalbo, Pablo, (Et. Al.). (2016), Nueva Historia Mínima de México, México D. F.: El Colegio de México.
• Medina Peña, Luis. (2012) Hacia el nuevo Estado Mexico, 1920-2000; México D.F. Fondo de Cultura Económica. 3

References

Teacher Dany

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