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 market 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. .
In Mexico collective bargaining is actually very centralized. The government demands that the unions that run collective bargaining must register with the state, and all other movements are shut down. The result is that one major union represents the entire workforce within the firm. This does not allow for labor flexibility and in turn suppresses efficiency and the growth of the economy. Also, the corruption of the political system plays a huge part. The labor unions give under the table payoffs to politicians to assure that their interests are protected. The labor ministry must approve industry-wide contracts and changes, and most of them are denied because of the payoffs.
