The level of inequality in Mexico is so extreme that its four wealthiest inhabitants have amassed fortunes equivalent to nine percent of the nation’s GDP, while 53.3 million people (45.5 percent of the population) live in poverty.
The extent of Mexico’s rampant and rapidly worsening wealth disparity was laid bare in a study released by international charity organization Oxfam on Wednesday.
The report, entitled “Extreme Inequality in Mexico: Concentration of Economic and Political Power,” reveals that while GDP per capita increased by less than one percent per year, the fortune of the 16 richest Mexicans quintupled between 1996 and 2014.
Mexico’s economy has stagnated in this period, and the number of people living in poverty has grown considerably, while the nation’s wealthiest man, telecommunications magnate Carlos Slim, has built up a fortune that equates to almost six percent of Mexico’s GDP.
The report was authored by Dr. Esquivel Hernández, a researcher at Mexico’s National Autonomous University and El Colegio de México.
At a press conference to announce his findings on Wednesday, Hernández revealed that “inequality conditions in Mexico are such, that one percent of the population holds 43 percent of the total wealth in Mexico.”
Although Mexico is the world’s 14th biggest economy, it is – alongside Chile – one of the two most unequal countries within the Organization for Economic Co-operation and Development (OECD), Hernández noted.
“The issue of extreme inequality must be included in the national debate agenda for ethical, political and economic reasons,” he added, noting that “economic growth is low, average wages are not increasing and poverty persists, but the fortune of a mere few is still expanding.”
Government must shake off the influence of the elite
The study argues that inequality can be reversed through the collaboration of political actors, civil society and the private sector. However, Consuelo López Zuriaga, the director of Oxfam México, suspects that Mexico’s political and business elite have little appetite for significant change.
“There is growing and widespread consensus among decision makers, opinion leaders and the population that the gap between the rich elite and the rest of society is a result of political decisions and practices that limit the chances of equal political participation,” López said.
“We are concerned about the excessive influence of private economic powers over public policy and it is alarming to see how this affects the exercise of citizen’s rights,” she added.
“For example, while the wealth of Mexican multimillionaires is multiplied by five, 48 percent of state schools have no access to sewage, 31 percent have no drinking water, 12.8 percent have no bathroom or toilets, 11.2 percent have no access to electricity.”
Upon presenting the report, Oxfam announced the launch of “IGUALES,” a national campaign aimed at fighting inequality and poverty in Mexico.
Through IGUALES, Oxfam will pressure the government to prioritize the basic rights to food, health and education; impose a more progressive tax structure; introduce a fairer minimum wage; and enhance transparency and accountability in government, among other proposals.
Oxfam hopes the campaign will limit the influence of Mexico’s elite over public policy, thus leading to real changes in economic, social and gender inequality by 2019.
Growing awareness of inequality
While Mexico has not experienced anti-inequality demonstrations on the scale of the Occupy movement that sprung up in the United States in 2011, there does seem to be growing recognition that it is a major problem.
At an economic forum in Veracruz this week, political analyst Javier Tello blamed President Enrique Peña Nieto for overseeing a continuation of the poverty and inequality that has inhibited economic growth in Mexico for the past three decades.
“Someone has to rescue the country from the enormous inequality it’s experiencing,” Tello affirmed.
In an editorial on inequality on Tuesday, Animal Político columnist Majo Siscar slammed Mexico’s minimum wage as “ridiculous,” noting that it is barely enough to cover most Mexicans’ basic food needs.
El Financiero columnist Pablo Hiriart argued this week that “bad education is one of the root causes of our shocking inequality.”
Hiriart’s colleague Jorge Suárez Velez agreed that education is crucial to solving this issue. In order to begin fighting inequality, he affirmed, Mexico’s universities must enhance their relationships with local communities and facilitate access to higher education for promising students from low-income families.