Mexico Is on the Rise, But What About Its Middle Class?

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From left: U.S. President Barack Obama and Mexican President Enrique Pena Nieto at the National Palace in Mexico City, on May 2, 2013.
Mexico Presidency / Handout / REUTERS

From left: U.S. President Barack Obama and Mexican President Enrique Pena Nieto at the National Palace in Mexico City, on May 2, 2013.

When President Obama visited Mexico in May, he spoke a few words of Spanish, praised the paintings of Frida Kahlo and quoted author Octavio Paz. Then he hit his key message: “Because of the sacrifices of generations, a majority of Mexicans now call themselves middle class, with a quality of life that your parents and grandparents could only dream of.” The words conjured up an image of a Mexico transformed from the campesinos of the early twentieth century to a rising power for the new millennium. Mexico’s “new middle class” is also a big theme for its new president, Enrique Pena Nieto, who wants his neighbors to think of Mexico as more than just a place of beautiful beaches and violent crime. Obama’s speech dovetailed neatly with Pena Nieto’s agenda, but it has sparked a national debate here, about what makes someone middle class in Mexico, and whether the middle class are really thriving or just surviving. After a disappointing first-quarter— Mexico’s economy grew just .8%, the worst performance since the end of 2009, that debate has renewed urgency.

Among the residents of the Mexican capital, from its cinderblock slums to its Bohemian bookshop-cafes to its plush financial district, there is little consensus. Brenda Venega, a student, defines middle class as someone earning more than 8,000 pesos ($640) per month; she falls into that box thanks to her parents. Marisol Granados, a waitress in a cafe, insisted there was no middle class, only have and have nots, and that she was part of the latter. Computer repair shop owner Victor Serna says the middle class have privileges that set them apart from the rest, and he was in of the poor majority. “The middle class is smaller all the time and the gap is growing,” says Jose Lopez, a health administration worker. “Jobs are paid less while prices go up.”

(MORE: Mexico’s New Boom: Why the World Should Tone Down the Hype)

Pundits and politicians also differ sharply on the parameters. With about 46 percent of Mexico living in poverty according to the government, some argue the rest—the majority that Obama addressed in his speech— are middle class or rich. Various think tanks have come up with their own diverse formulas, according to which the Mexican middle class could account for as little as one-fifth of the population to more than two-thirds. Shannon O’Neil, Senior Fellow for Latin American Studies at the Council on Foreign Relations and author of the recent book Two Nations Indivisible, paints a hopeful vision of Mexico, calculating that roughly half of the country is middle class. “It is not just earnings, but also looking at people as consumers,” O’Neil says. “In the United States, the classic middle class was a chicken in every pot and a car in every driveway. You look at Mexico and roughly half the people have a car, and almost everybody has a cellphone and a television.” Some Mexican academics have also argued that the middle class is growing, based on various data about spending habits, ranging from the number of cinema screenings to kilograms of meat consumption.

Others vehemently oppose this idea, pointing to studies showing that, despite the rise of the Mexican consumer class, the percentage of people living below the poverty line has been almost unchanged in the last two decades. “Those who grab at consumerism as the central phenomenon of modern Mexico have an ideological program,” says law professor John Ackerman of Mexico’s National Autonomous University. “What they are trying to do is say that Mexico is not a polarized society politically or economically, that everything is moving towards the middle, when this is simply not the case.” Historian Lorenzo Meyer calls the idea of a booming Mexican middle class “wishful thinking.”

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These competing visions of Mexico — of a society of strivers versus a poor country struggling to make good — are in part a reflection of the larger debate over the country’s free market reforms, which began in the 1980s. During that period, Mexico has become one of the most globalized countries in the world, signing trade agreements with more than 40 countries, including the 1994 NAFTA accord with the United States and Canada. Assembly plants churning out goods for export have risen while traditional small farming has declined. The population has become more urban, though much of that growth has been in chaotic slums in the capital and in border cities such as Tijuana. It has also privatized large chunks of its economy, enriching Mexico’s growing population of billionaires—it now has 15, according to the most recent Forbes list—including the world’s richest man, Carlos Slim. Pena Nieto is pushing for further reforms such as opening up Mexico’s oil industry, a strategy firmly supported by Washington.

In many ways, the fortunes of the Mexican middle class — however it’s defined — are linked to that of the American middle class. Obama’s focus on the middle class in his speech, Meyer says, reflects the U.S. President’s domestic discourse, which is always aimed at his middle class voting base. “In Obama’s speeches, I only hear him talk about the middle class and sometimes the rich,” Meyer said. “But where are the poor? It is like the poor are becoming completely absent from the dominant political debate.” However, in the crisis-ridden global economy of the last five years, some argue that even the U.S. middle class is under threat. Both Obama and Pena Nieto hope this volatile economy will turn around enough so that their forecasts of a North America growing in prosperity will be more than just words.

MORE: Obama’s Mexico Visit: Not Just About the Drug War Anymore

22 comments
CharlesCGrillo
CharlesCGrillo

HI  Ioan --    Great article  I will be following more --     CHARLES  CARL  GRILLO  Denver Colorado--- saluto'

CamiloErazo
CamiloErazo

well well. its a joke to think about a middle class rising, when what is rising in latinamerica´s is consume thanks to china. ya ya made in china is everywhere. now if as lannata said in his doccumentary about BRIC, we´ll live in a world of poor people and technology, this is not a good way to embrace rich people and politycians to look forward on new ways to manage (look for some german tech bussiness model) big companyes and institutions.

pesobill
pesobill

Mexico's middle class would be lower than poverty level in United States , the new Government in Mexico is trying to paint a picture of success for Mexicans  " Aren't we all doing so well ?" , what a joke ...

Truth be told , having lived in Mexico for years , Mexico will be a third world player for years and while a very small upper class exists , most of Mexico struggles very hard for basics and real estate is heading lower and lower .

Bad investment in the long term , time to short the Peso and Mexico ...

BenIncaHutz
BenIncaHutz

Mexico is on the rise? Oh you mean they took care of the Narcos that are running parts of the country? Does that mean their 11 Million citizens living in the US illegally can return home to find jobs waiting for them?

SYoungReports
SYoungReports

@El_Narco_Book I think it's telling how the perception of the growing MX middle class was 1st sold to US public before being messaged here.