Mexico is a nation that is “bright with promise, yet it is held back and entangled by its history” (Parfit, pp 5). Underneath the colorful surface lies a dark past that has harmed the people. Mexico has a long record of corruption, discrimination, ignorance, and greed that has held back a country with incredible potential. This corruption has sent the benefits of their massive resources either to other countries or to the rich and has neglected the lower classes. In an effort to protect himself, the workingman has banded together to form labor unions, and they try to protect themselves. This movement has had some great successes and has implemented labor laws meant to give them security and protection. Although implemented with good intent these laws have in effect harmed the country in the long run. They have hampered the macro-economic growth of the economy and actually harmed those whom the laws were made to protect.
Centralized collective bargaining is one of the biggest hurdles impeding the Mexican economy today. Mexico has not been able to be very competitive on the international mark
et because they have not been able to be efficient in their production, thus keeping production price higher than those of the rest of the world.
From my initial readings I feel that with decentralized collective bargaining and broader market flexibility, Mexico has the potential to be a global power. They also need to change their policy of unemployment insurance so it is not comfortable to be out of work. I feel that unions are good up to a point. They need to exist to protect the worker, but only on a company level. When unions are strong enough to control whole industries across the board and have an influence with the government the economy will suffer.
These labor unions have caused major hurdles for the Mexican economy and have actually held the economy back from the type of growth potential that it should have given the types of resources that the country has available to them. These labor unions have created policies that have favored protectionism and job security that have done more harm than good. Some of the repercussions that this country has seen have been a huge surge in the informal job sector and slow
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