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Shared Development Model in Mexico (1970-1976)

The essay discusses the 'Shared Development Model' in Mexico from 1970 to 1976, highlighting the economic reforms aimed at addressing social inequalities through increased public spending and state intervention. It outlines the challenges faced during this period, including high fiscal deficits, rising external debt, and the need for educational and land reforms. Ultimately, the policies led to economic instability, inflation, and a reliance on external debt, culminating in a crisis by the end of the Echeverría administration.

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0% found this document useful (0 votes)
13 views9 pages

Shared Development Model in Mexico (1970-1976)

The essay discusses the 'Shared Development Model' in Mexico from 1970 to 1976, highlighting the economic reforms aimed at addressing social inequalities through increased public spending and state intervention. It outlines the challenges faced during this period, including high fiscal deficits, rising external debt, and the need for educational and land reforms. Ultimately, the policies led to economic instability, inflation, and a reliance on external debt, culminating in a crisis by the end of the Echeverría administration.

Translated by

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NATIONAL PEDAGOGICAL UNIVERSITY

Bachelor's Degree in Pedagogy

ESSAY: "SHARED DEVELOPMENT MODEL"

BEATRIZ FLORES FLORES

OCTOBER 2011
MODELO DE DESARROLLO COMPARTIDO

(1970-1976)

Economically, the reforms were aimed at


to replace the stabilization model; the state
it should strengthen its intervention role to
regular economic and social inequalities
derivatives of development. The realization of such
reforms required the vertical integration of processes
imports substitutes stimulating the
production of capital goods and trying
resolve the chronic deficit of the balance of payments
which was one of the inherent characteristics of
model. This model was called "Development"
"Shared" and the intention was that through a
huge and growing public spending will be reached a
mayor justice social.

Between 1971 and 1981, the Mexican economy grew at an average annual rate of 6.7%.
in real terms and 3.7% per capita. The engine of growth was, first,
high fiscal deficit and then the oil boom. The agricultural sector continued
losing importance in national production. The industry grew slightly and
their participation gained two percentage points. The primary sector lost through
del secondary.

The stabilizing development arrived in the impressive seventies.


High growth and low inflation. By 1970, public spending was starting to grow.
accelerated compared to revenues. Thus, despite the policies
protectionists and the fixed exchange rate, the demand for imports increased
gradually reaching 9.7% of GDP while exports did so in
7.7% the scale external I needed a adjustment.

What happened during Echeverría's six-year term was that the uncontrolled public spending
began to generate pressures on the budget balance that eventually
they became unmanageable. Healthy public finances were the condition
essential to maintain a stable exchange rate which, in turn, was the
key at that time to maintain a low inflation. These conditions
they were the ones that generated a high investment during the Stabilizing Development
public and private that allowed to achieve and sustain rates of economic growth
above del 6 for one hundredin terms real.

By financing the exorbitant government spending in any way, Echeverría and


José López Portillo incurred in a growing debt both external and internal.
And, in this last case, the bank's credit quickly began to grow.
Mexico to the government, with the consequent pressures on the exchange rate that
eventually it exploded, spawning an inflation that almost reached 100 percent.

In the mid-seventies, the deterioration of economic growth and


the loss of effectiveness in development programs became evident. This
it tried to be compensated with the priority given to the export sector, the support
state funding for irrigation program financing in the northern region of the country,
the tax reduction, the increase in credit and technical assistance. The
structural deficiencies, both in the industrial and agricultural sectors, were linked to
the financial crisis and the deterioration of the balance of payments. The fiscal deficit increased
significantly, the overvaluation of the peso in the seventies, the growth
constant inflation, the systematic outflow of capital, and the decrease of the
Imports created the beginning of a prolonged crisis.

THE EDUCATIONAL REFORM

Despite the fact that the budget for the education sector is one of the highest that
assigns the federation around 4% of GDP value to the educational system not
advances at the desired pace, due to different factors and the growth of the
school population, however this increasingly demands the implementation of a reform
educational according to the characteristics of the country. In 1970, at the beginning of the
administration, Engineer Víctor Bravo Ahuja, Secretary of Public Education, observes
the priority problems and raises the need for reform, with approval
from the President of the Republic, which is summarized in the following points:

Educational Planning

Primary and Normal Education

Technical and Higher Education

The Educational Reform was launched in early 1973, and it focuses on:

Elevate the quality of teaching in rural areas.

Incorporate the indigenous peoples into national life.

Agricultural education is restructured at all its levels.

The administration of Luis Echeverría (1970-1976) showed from the beginning its
interest in improving the educational system and launched a Commission
Coordinator of the Educational Reform to diversify educational services,
increase the number of schools and reform the curricula. The reform of
this period was reflected in the publication of a new Federal Education Law
in 1973 replaced the Organic Law of Public Education of 1941. This
new law adopted the definition of education as an institution of the common good and
organized the national education system to establish new foundations that
they will promote the rights of all the inhabitants of the country to receive education
with the same opportunities.

In the same way, the National Adult Education Law was enacted.
1976, which regulated education for those over 15 years old who had not
Completed or finished primary or secondary education. This education was conceived
as extracurricular education, based on self-directed learning and the
social solidarity. During this period, various institutions were also created.
educational, such as the National Council for Educational Development (CONAFE), the
College of Sciences and Humanities (CCH), the College of Baccalaureate and the Council
National Council of Science and Technology (CONACYT). Likewise, the SEP modified its
organic structure and established the Undersecretariat of Planning and Coordination
Educational., agency that initiated the technical-administrative deconcentration with
the creation of 39 decentralized service units in the nine regions in
the ones into which the country was divided.

During the administration of José López Portillo (1976-1982), a


diagnosis of the school situation at the basic level and the National Plan was designed
of Education (PNE). The diagnosis of the PNE drew attention to various issues.
problems of preschool education: the attention to demand was low, the
the distribution of opportunities was unequal with a high concentration in the middle
urban and with almost exclusive attention from the middle and upper sectors. In addition,
lower efficiency rates were identified in the early grades of primary school that,
it was presumed, they were associated with children's absenteeism from education
preschool. For this reason, one of the priority objectives of the PNE was the
preschool education and the implementation of the Education for All Program,
whose goal was to assist all children with educational lag.

As a second priority of the PNE, the objective of linking education was highlighted.
terminal with the production needs for which it was necessary
develop programs for higher technical education. In this area, it stood out the
creation of the National College of Technical Professional Education (CONALEP) in
1979. The third priority of the PNE referred to the momentum provided by the government
to raise the quality of education, a goal that was achieved with a better
training for teachers thanks to the creation in 1978 of the University
National Pedagogical.

Another priority of the PNE was to improve the efficiency of the education service.
which was supposed to advance in the area of internal organization of the SEP and the
deconcentration of activities through the establishment of 31 delegations
in the federal entities. Likewise, progress was made in the design and implementation
of a general framework to coordinate and plan higher education. In 1976 the
SEP created the General Coordination of Higher Education, Science, and Technology.
As a complement to this action, the National Law was enacted in 1978.
Coordination of Higher Education and in 1979 the Coordination was established
National Council for the Planning of Higher Education (CONPES).

In 1980, an amendment to the third constitutional article included the concept of


university autonomy. In that addition, autonomy was conceived as the
exercise of certain powers that the State grants to public entities not
centralized. Thus, through a legal act issued by the Legislative Power, we
granted universities the right to issue their own
rules and regulations, to achieve its purposes with respect for academic freedom
and research and to determine their plans and study programs, among others
things.

Existen otras acciones relevantes durante el periodo sexenal de José López


Portillo who transformed the Mexican educational system. In 1978 the government
the federal government launched the National Education Program for Marginalized Groups
and in 1981, he developed the National Literacy Program and created the Institute
National Institute for Adult Education (INEA).

THE LAND REFORM

Since the beginning of 1970, a global crisis in the Mexican countryside becomes evident,
which is characterized by a decrease in food production levels and by a
peasant insurgency redistribution of lands, and the establishment of
best prices for the guarantee and economic development of its members.

After the agrarian policy is aimed at addressing the crisis of 1973


with the operation of the following strategies:

The increase in public investment in this sector.

The stimulus to production with appropriate guarantee prices.

The Ejidal Collectivization.

The reforms to the administrative apparatus

By 1974, 17.3% of the total public investment was invested, for 1975 it
increased to 20% that were allocated to irrigation works and expansion
rehabilitation of irrigation districts in addition to soil conservation etc... The
agricultural credit also increased, from 1970 to 1975 by 23% and for
1976 to 46.6%.

The increase in guarantee prices for corn, beans, and wheat was a
attractive for irrigation systems, as it was for large farmers
business subsists on agricultural exports of basic grains, but this did not achieve the
recovery of the areas affected by the storm, and those predominantly parts of the
rural population whose main food is corn.

The most ambitious project was the collective reorganization of the ejidos starting from
1973 but in 1974 the Master Plan for Organization and Training appears.
Peasant, where the objectives, goals, and guidelines of the strategy are set out.
collectivizing it also involves adapting the ejido organization to the goals of
National Agricultural Plans are as follows:

The Elevation of Production

The Increase of Rural Labor

The largest capitalization of the sector

THE EXTERNAL DEBT

Shared gender development and neglected important issues are:

The imbalance in the trade balance during the six years of his administration.

The imbalance in the budget of revenues and expenditures of the sector


public, promoted the growing deficits, which were covered through loans
internal and external factors that would later lead to the devaluation of
peso denominates floating in August 1976.

At this moment, the extreme debt amounted to $19,600,000,000 dollars.


to say it had almost quadrupled compared to the previous six-year term.

THE DEVALUATION

The characteristic of the national economy in the 1970s was the


stagnation with inflation, without a doubt three major variables that are
they started in the 1950s, contributed to marking the above.
The concentration of income in minority groups

The Imbalance of the Trade Balance

The fiscal deficit of the annual budget of income and expenses of the federation

The slow evolution of GDP and the increase in inflation were the result of the
policies adopted during the six-year term in economic matters that culminated with a
the escalation of prices at the international level starting in 1973, which shook even more
the national economy. The decline of GDP, especially starting from 1974, is
related to the stagnation of private investment resulting from the a
income concentration that fosters fiscal deficit and external imbalance.

1971 1972 1973 1974 1975 1976


$4545800 $5064600 $7070400 $997500 $14266400 $ 19600200

(Millions of dollars)

THE DEMOCRATIC OPENING

Since the student movement of 1968, the state has suffered a great deterioration that
obtained multiple manifestations, which shook society in general. It
further exacerbates the political crisis, on June 10, 1971, known as Thursday
of Habeas, by the intervention of the group of hawks who repressed by
through violence, a student demonstration as a result of rejection
from the society and the resignation of Lic. Alfonso Martínez Domínguez. As head of
department of the DF who was pointed out as the intellectual director.

The state, by losing political and ideological legitimacy, contributed to establishing the
democratic opening.

This crisis began in 1971 when it started to manifest, since the


Oligopolies encompass all economic sectors. The concentration of increases.
property and income tighten the markets, idle capital grows,
profits increase, real wages decrease, increase the
underemployment and unemployment and their consequences are: inflation, the
external debt and the freezing of salaries.

To reconcile with society, the state plans to operate two important


strategies.

I.- Populism.
Philosophy that identified the political left.

The promises to social groups.

The use of nationalist language.

Attacks on the foreign bourgeoisie.

The good treatment of intellectuals.

The decrease of repressions.

II.- The Budget Deficits, with External Debt

Establishing the foundations of the economic crisis ultimately leads to a political crisis.
reflects in this way.

In 1970, the PRI obtained 485 of the votes from the electoral register.

In 1976, the PAN did not launch a candidate for the presidency of the republic, while the
PPS and PARM join PRI.

Mr. José López Portillo, the PRI candidate for the presidency of the republic, wins
the election without contenders, and the simple political procedure.

It consisted of opening up to new ideas, such as the ideals at that time.


Cuba and the Chilean government of Salvador Allende, this of course caused the
anger of the bourgeoisie as it directly affected their interests and their
ambitions.

The economic crisis of the Echeverría six-year period was caused by instability.
worldwide, which led the Mexican government to take extreme measures such as
increase public spending, which led Mexico to incur internal debt and
externally increasingly, a debt that we are still experiencing even now
paying.

Economic crisis and democratic progress with only a few years remaining until the end of
The six-year term of Luis Echeverría began to reveal the possibility of a crisis.
economical, caused mainly by the volatility of the dollar and the peso, which
caused Mexico to accept the IMF's conditions and thus obtain support and
credit of the United States, this was celebrated by the dominant class of our
country since, those who benefited the most were them.
CONCLUSION

In this work, I realized that shared development took place because


the Government in creating the agencies and trusts; there was a strong intervention
of the State in the economy. In the seventies, Mexico faced the crisis of the economy.
global and the Mexican State expands its participation in the national economy.
Derived from the policy during this six-year term, there is a reliance on the growing
external debt and on August 31, 1976, the flotation of the peso is announced
And the exchange rate stability that had existed for 22 years is lost.

The government of Luis Echeverría 1970-1976 embarked on populist policies of


high deficit spending and monetary expansion to recover consensus
political. The political strategy consisted of accelerating economic development and
distribute their fruits more equitably through the accelerated expansion of
public sector and its increasingly broad role in decision making
economic. The overall effect of the applied economic policies was the
alienation of the private sector and the destabilization of the economy, inflation
the external current deficit increased rapidly and towards the end of its period
presidential in 1976 Thus, we can see that during the period 1970-1976.

Thus we can see that during the period 1970-1976. Since the end of the
In the 1960s, it was necessary to adjust the economic model to achieve a
exporting current that will drive technological and industrial development in
country heading towards manufacturing export. In that environment, the
oil surplus and the exporting industrial evolution reverses. There was a
great distortion of the economic allocation caused by oil; the boom
the oil industry did not last more than a few years, which were lost in games of
interests to decide where to invest oil surpluses; the result
It was global that an external liability accumulated which led us to the crisis of '82.
although, on the other hand, there was modernization and industrial investment.

With Gustavo Díaz Ordaz and Luis Echeverría during their respective terms.

The project to modernize the industry, increase productivity and


achieve international competitiveness by incorporating modern technology.
Echeverría sought to reorganize the constitutional mixed regime through the
public investment, as the key force to drive growth. The fight against the
False ideology based solely on economic indicators and not on social ones.
It turned towards a neopopulism that was encouraged during the period of
President José López Portillo, for the oil wealth. Oil exports gave him
It would grant financial self-determination to Mexico. With the leadership of the State,
by the year 2000 Mexico would be different; because the areas would be developed
strategic: steel, chemicals, petrochemicals, fertilizers, electricity and
oil as the spearhead of this developmental model.

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