Your Happiness should be a Priority
Everyone in Mexico is about to become happier
Photo by Robert Collins on Unsplash
I love that smell. My nose always recognizes the minute we cross the border into Mexico. A combination of exhaust gas, cooking oil and other not so good stinks reek through my nose. Even today it wakes me up thinking I am a kid again in my parent’s station wagon.
I did not notice the reality about the quality of life in Mexico though. I was only concerned with the bags full of pesos that we took back home. Nothing mattered as long as I was able to play for hours in the arcade down the street from my house.
Now, my eyes are opened and I see the extreme poverty coexisting with the extreme luxury. Kind off as if there are two Mexicos with so little in between. One has individuals who struggle daily to make a better living in Mexico and the other one is filled with people driving around in Hummers.
One sure thing, change is coming that will affect everyone's quality of life in Mexico; from those already living here today to the ones that will be living here tomorrow.
First, let's look at some issues in Mexico
Poverty is vast in Mexico
The National Council for the Evaluation of Social Development Policy (CONEVAL) reports on poverty in Mexico every 2 years for States and every 5 years for Cities (Municipales). Poverty is classified into categories that are based on access to basic resources needed to achieve a minimum standard of living. Education, health care, food, water, shelter and sanitation are considered basic services.
7.4% of the population in Mexico is living in Extreme Poverty
- Individuals lack access to 3 or more basic resources
- Individual income is below the minimum for basic needs
- Increases to 16.8% (Is this our fault?) when taken relative to where they live
41.9% of the population in Mexico is living in Moderate Poverty
- Individuals lack access to at least 1 basic resource
- Individual income is below the minimum for basic needs
- Increases to 48.8% (Expats, Foreigners?) when taken relative to where they live
Causes of poverty are widespread in Mexico
A noteworthy source of poverty is individuals. Not individuals that are born into poverty or experience it, rather those individuals that exploit through poor government policies.
- Corruption inhibits development by embezzling money allocated for development projects. More prevalent in countries with a history of colonization.
- Natural causes such as natural disasters, agricultural cycles and warfare limit resources by diverting money away from social programs to relief. Leads to inequality.
- Structural adjustments force developing countries to open their markets and compete with developed economies. Conditions, greatly influenced by globalization, are set by the International Monetary Fund and World Bank. Maintains inequality.
- Inadequate liberal policies lead to a lack of competition and job losses. An uneven distribution of wealth is also very visible.
Now the good part.....how will quality of life in Mexico be affected
Quality of life is a subjective term that can measure happiness and is impacted by your standard of living. I like to think of it as "my utility". If you are moving here, then most likely you are not worried about your standard of living in Mexico. But your quality of life will be of concern because of other's standard of living in Mexico.
New policies that are being implemented by President Andres Manuel Lopez Obrador today will strengthen Mexico as a country. Its citizens will prosper and in turn you will be happier living in Mexico.
Mexico is finally planning for the future
Getting stability under control
President Obrador signed a law on December 15, 2020 that limits activity of foreign agents operating in Mexico. Yes, you heard me right, FOREIGN AGENTS operating in Mexico.
- Sovereignty, less foreign influence dictating domestic affairs
- Failed policies are replaced, especially crime fighting practices
- Crime spread, including to popular Expat and vacationing spots
- More funds available for social and development programs
Structural adjustments for the benefit of Mexico
Everywhere I look, I see big global chains. The only memory of locally owned businesses is lost in the Miscelaneas found at every corner. Too late for that industry but the energy industry is shivering in its skin right about now.
Mexico is investing in state owned companies in an effort to make them more productive and meet domestic consumption needs. However, in order for Pemex and CFE to reach these expectations, some barriers to their success had to be removed.
- Energy contracts are now granted for 5 years, not 20 years
- Energy Security and Sovereignty policy objective based
- No new exploration and production (E&P) contracts until further notice
- More investment as money stays in Mexico and does not flow to foreign countries
- Mexico will be energy dependent (70% of Mexico's refined fuels are imported)
Laws against corruption are adopted
Corruption in Mexico is very common and widely accepted. I must say that it is part of the culture in Mexico. More dumbfounding is that corruption was not considered a serious crime until just last year. No matter the monetary or societal harm caused. You know why, because politicians are the ones committing the crimes. So they did the following:
- Overhauled the Judicial System and fixed the root of the problem
- National Anticorruption System headed by a citizen (Stronger Institutions)
- Public officials need to disclose taxes, assets and potential conflicts of interest
- Cut State Budgets and States ability to borrow money
- Increased funding in education, health, development and human capital building
Creating opportunities for Mexican citizens
Most individuals in Mexico do not live alone. Simply for the reason that they do not earn a livable income, you either live with your parents or with your spouse's parents. President Obrador has championed to improve the standard of living for the common citizen.
- Passed a 15% increase in minimum wage
- Upset the IMF with no bailouts for businesses
- No tax right offs for corporations (Saw a $4 Billion dollar increase in revenue)
- Did not jam up future generations with debt
- More investment for domestic production projects
- Inflation maintained at 3.2%
- Outsourcing in Mexico is going away
Still a lot of work to be done......
All these changes were made possible because a president was willing to help his citizens. Before, the government would collude with the highest paying party at the expense of the average worker. The following real-life example explains a lot.
Here in Mexico, a committee comprised of one representative for workers, one for businesses and one for the government vote to increase the minimum wage by majority. It should come of no surprise that year after year it resulted in an increase equivalent to the official inflation rate.
This year, a 15% increase to the minimum wage was approved. How did this happen? By finally having the government side with workers. Same with tortillas. The head of the Tortilla Organization, you heard right, said an increase of $1 peso was foreseen for 2021 because of an increase in costs.
The Secretaria de Economia said it saw no reason to justify an increase in prices because corn production was better than years before. And just like that, no price increase. However, tortilla prices are starting to slowly go up because of speculation in the fuel market. Always something. No?
I believe Mexico is on the right path
You can always tell someone is doing something right by the press they receive. Lately, Mexico has been receiving a lot of bad press.
However, only citizens of Mexico should dictate the affairs of their country. And from the looks of it President Obrador is getting it right.
It is a fragile agreement that is solely based on President Obrador's commitment to put Mexico's interests first. There still exist some that do not want a change in the status quo and Mexico risks regressing back to the same old same old.
And your standard of living in Mexico
Like I said before, all these changes will benefit current and future citizens of Mexico. It will even benefit tourist. Crime will go down and the quality of life in Mexico will increase as more opportunities become available, including the unheard off, like wage growth.
You still have to get to the standard of living you are used to so that you can live comfortably in Mexico. I invite you to browse my posts about life in Mexico and to look into my guide about living in Mexico City.
We touch on all the basics, other not so basics, useless facts and useful facts about life in Mexico. Because a wrong choice can really hurt your pocket and your comfort. It will be wise to prepare, especially when the powers that be impose their counterproductive policies onto you that will impact your quality life in Mexico.
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