Global Processes and Local Consequences of Decentralization: A Subnational Comparison in Mexico

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Global Processes and Local Consequences of Decentralization: A Sub-national Comparison in Mexico a

Aylin Topal a

Middle East Technical University, Department of Political Science and Public Administration, METU Üniversiteler Mah, Dumlupınar Blv. No:1 06800, Çankaya Ankara, Turkey Published online: 15 Aug 2013.

Click for updates To cite this article: Aylin Topal (2015) Global Processes and Local Consequences of Decentralization: A Sub-national Comparison in Mexico, Regional Studies, 49:7, 1126-1139, DOI: 10.1080/00343404.2013.812782 To link to this article: http://dx.doi.org/10.1080/00343404.2013.812782

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Regional Studies, 2015 Vol. 49, No. 7, 1126–1139, http://dx.doi.org/10.1080/00343404.2013.812782

Global Processes and Local Consequences of Decentralization: A Sub-national Comparison in Mexico AYLIN TOPAL Middle East Technical University, Department of Political Science and Public Administration, METU Üniversiteler Mah, Dumlupınar Blv. No:1 06800, Çankaya Ankara, Turkey. Email: [email protected]

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(Received May 2012: in revised form April 2013) TOPAL A. Global processes and local consequences of decentralization: a sub-national comparison in Mexico, Regional Studies. This paper argues that through decentralization policies, the imperatives of neoliberal rules of competition have been diffused into the local level, generating different development patterns depending upon characteristics of the local economy and its insertion into global processes. Therefore, implications of decentralization policies can be analysed by focusing on prevailing local economic activity and a particular pattern of class forces that arise from it. The paper attempts to make the case that how each local economy integrates into global economic processes, and which economic and social groups are empowered and/or disempowered in that integration, shape the pattern of local development. Mexico

Competitiveness

Neoliberalization

Decentralization

Local development

TOPAL A. 去中心化的全球进程与在地结果 : 墨西哥的次国家层级比较研究，区域研究。本文主张，透过去中心化政 策，新自由主义的竞争需求已扩散至地方层级，创造出根据地方经济及其嵌入全球进程之特徵的不同发展模式。因 此，去中心化政策的意涵，可以透过聚焦盛行的地方经济活动，以及从中生成的特定阶级动力模式加以分析之。本 文企图解释各地方的经济如何整编至全球经济过程，以及在整合的过程中，何种经济与社会团体被赋权与／或剥夺 权力，并如何形塑地方发展模式。 墨西哥

竞争力

新自由主义化

去中心化

地方发展

TOPAL A. Les processus mondiaux et les retombées locales de la décentralisation: une comparaison sous-nationale au Mexique, Regional Studies. Ce présent article affirme que par le biais des politiques en faveur de la décentralisation, les impératifs des règles néolibérales de la concurrence ont été diffusés au niveau local, ce qui a engendré des modes de développement en fonction des caractéristiques de l’économie locale et de son intégration dans les processus mondiaux. Ainsi, on peut analyser les retombées de la décentralisation tout en focalisant l’activité économique en vigueur et la structure particulière des forces de classe qui en découlent. L’article cherche à argumenter que la façon dont chaque économie locale s’intègre dans les processus économiques mondiaux, et les couches sociales et économiques dotées de et/ou privés de pouvoir dans ce processus d’intégration, influencent la structure du développement local. Mexique

Compétitivité

Néolibéralisation

Décentralisation

Développement local

TOPAL A. Globale Prozesse und lokale Konsequenzen der Dezentralisierung: ein subnationaler Vergleich in Mexiko, Regional Studies. In diesem Artikel wird die These aufgestellt, dass die Gebote der neoliberalen Wettbewerbsregeln aufgrund der Dezentralisierungspolitik in die lokale Ebene diffundiert sind und je nach den Merkmalen der lokalen Wirtschaft und ihrer Einbindung in globale Prozesse unterschiedliche Entwicklungsmuster erzeugen. Die Auswirkungen der Dezentralisierungspolitik lassen sich daher analysieren, indem man sich auf die vorherrschende lokale Wirtschaftstätigkeit und das daraus entstehende bestimmte Muster von Klassenkräften konzentriert. Im Artikel wird argumentiert, dass das Muster der lokalen Entwicklung davon abhängt, wie sich die jeweilige lokale Wirtschaft in die globalen Wirtschaftsprozesse integriert und welche wirtschaftlichen und sozialen Gruppen durch diese Integration an Bedeutung gewinnen und/oder verlieren. Mexiko

Konkurrenzfähigkeit

Neoliberalisierung

Dezentralisierung

Lokale Entwicklung

TOPAL A. Procesos globales y consecuencias locales de la descentralización: una comparación subnacional en México, Regional Studies. En este artículo se sostiene que mediante las políticas de descentralización, los preceptos de las normas neoliberales de competencia se han difundido a nivel local, generando diferentes modelos de desarrollo según las características de la economía local y su inserción en los procesos globales. Por tanto, se pueden analizar las repercusiones de las políticas de descentralización © 2013 Regional Studies Association http://www.regionalstudies.org

Global Processes and Local Consequences of Decentralization: Sub-national Comparison in Mexico 1127 prestando atención a la actividad económica local predominante y un modelo específico de las fuerzas de clases que se derivan. En este artículo se postula que el modelo del desarrollo local depende de cómo se integra cada economía local en los procesos económicos globales, y qué grupos económicos y sociales están habilitados y/o deshabilitados en esta integración. México

Competitividad

Neoliberalización

Descentralización

Desarrollo local

JEL classifications: O21, P16, R11, R58

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INTRODUCTION Since the 1980s, central governments around the world have been transferring a wide scope of political, economic and administrative functions to local authorities. Most international donors and developmental agencies have been significantly investing in decentralization policies, especially in developing countries. Observing this policy shift, there has been increasing academic interest concerned with revealing the mechanisms that help explicate the impact of decentralization policies on global, national and local political economic relations and on social regulation. Studies along this line brought an ‘inherently variegated’ character of ‘actually existing neoliberalism’ and paths of neoliberalization into the fore (BRENNER and THEODORE , 2002; BRENNER et al., 2010). This paper attempts to contribute to this literature on uneven geographical development of neoliberalism by way of proposing a theoretical framework for underlining relations between global economic changes since the late 1970s and the decentralization processes as well as identifying three local development patterns evolved in three states in Mexico after the implementation of decentralization policies since 1983. The paper examines the local consequences of decentralization. It argues that the implication of decentralization policies can be assessed by focusing on the prevailing local economic activity and particular patterns of class forces that arise from it. Through decentralization policies, the imperatives of neoliberal rules of competition have been diffused into local economies, generating different local development patterns depending upon the characteristics of the local economy and its insertion into global processes. Specifically, whether decentralization leads to a democratic aperture at the local level is dependent on how a specific local economy is integrated into the world market, and which economic and social groups are empowered and/or disempowered in that integration. How a particular local economy integrates into the world market with its external ties, needs, strengths and weaknesses determines the interests, aspirations, and strategies of state managers and societal actors. These factors in turn shape local development and the neoliberalization pattern in each locality. This paper focuses on Mexico – a country where decentralization policies have been implemented gradually since 1983 and which have produced a range of

outcomes in different states. It uses a sub-national comparative method, which is an effective methodological approach used to understand the impact of decentralization in different regions of a country. The paper focuses on three Mexican states: Chihuahua, Guerrero and Tabasco. The main criterion for selecting these cases is the character of the local economy: Chihuahua is one of the biggest maquiladora economies;1 Guerrero has one of the most important tourist destinations (that is, Acapulco), coupled with strong and organized indigenous peasant population; and Tabasco is the richest of the Mexican states in terms of natural gas and oil. The analysis here synthesizes the established secondary literature with an overall distillation of primary sources including key informant interviews, local and national newspaper archives, and official reports on development plans for the period 1983–2010. The fieldwork for this study, which was conducted in 2005, 2006 and 2010, includes ninety-six semi-structured interviews2 with scholars (nine), policy-makers (thirty-two), prominent businessmen (twenty-three), and other non-governmental organizations (thirtytwo) in the three study cases (thirty in Chihuahua, twenty-five in Guerrero and twenty-four in Tabasco) and Mexico City (sixteen).3 Scholars were social scientists with expertise in regional development in general or in the three cases of particular interest. The interviews with policy-makers who are privy to decision-making provided a glimpse into explaining policy change towards and during the process of decentralization. Interviews with businessmen and other non-governmental agencies were useful in revealing agents’ perceptions of the decentralization policies as well as their strategies in terms of alliances and conflicts that are central when examining the dynamics of social transformation. The information gathered in the interviews was sorted out so as to identify different trends reflected by several groups of interviewees. While such a mapping has been attempted, a range of ideas and insights have emerged that revealed the aspects of decentralization in each state of Mexico. The archival research includes a review of archives of three newspapers that are nationwide circulated: El Excélsior, La Jornada and El Financiero, and several local newspapers published and circulated in Chihuahua, Guerrero and Tabasco. Official reports mostly include public and media releases of federal and state governments on development policies. The archival research was functional in linking what the

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informants said and the related events that took place at the local, national and global levels. The paper is structured as follows. The first section constructs the theoretical framework of the argument that is offered in this paper. The second section summarizes the decentralization policies that have occurred in Mexico since the early 1980s. The third section analyses the distinct decentralization patterns by focusing on the three Mexican states of interest: Chihuahua, Guerrero and Tabasco. The concluding section brings a crosscase perspective, comparing the cases and underlining the main factors that account for the contrasting effects of decentralization.

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THEORETICAL FRAMEWORK The theoretical framework proposed here emphasizes the role of local social relations that are relatively specific to each social formation, without treating them as independent from economic processes. In other words, the way the economic transformations affect the political transformations is shaped by the particular political economic history of each locality. Nevertheless, it should be noted that the translations of the economic transformations into political relations are never simply a translation of dominant interest. It is always a focus of contention and conflict between opposing forces, and of negotiation and compromise, in ways which are specific to the history of particular regions. The framework underlines the fact that the general motions of capitalism manifest themselves in specific regional and local forms. Therefore, the world economy cannot be abstracted from the particular local, regional and national economies that constitute it. That is to say, global dynamics are driven by forces within and relations among local, regional and national economies. The case studies will show that national and global politics do not float above local politics. Rather, they are continuously shaped and reshaped by local states and dominant alliances in localities. Changes at the local level translate into transformations in national and global-level politics. In order to make sense of these intrinsic relations among local, national and global levels, the framework should start with an analysis of the underlying relations between global economic changes since the late 1970s and decentralization. During the late 1970s and early 1980s, most of the developing countries were faced with problems of an external debt crisis exacerbated by the economic shocks and recession in the developed countries. To overcome the balance of payment deficits, as a manifestation of the bottleneck of capital accumulation, certain changes in the fields of both state intervention and interest representation were required. Yet, neoliberalism, a universal class project to reassert the hegemony of capital over labor on the global scale, is not simply a trend (CAMMACK , 2006, 2010). Although it originated

in advanced capitalist countries, the neoliberal policy framework was shaped to a great extent by diverse social and economic alliances in each country standing in different positions in the world economy. The deepening of the internationalization of the economy appeared as a viable strategy to overcome the crisis which would enhance the capacity of multinational corporations to exploit further the historically created unevenness of the natural and social environment. Bretton Woods institutions – The World Bank and the International Monetary Fund (IMF) – came onto the scene in order to augment the influence of these international actors in shaping national agendas. In the early 1980s, these international financial institutions (IFIs) turned into important agents in regulating the global economy (WOOD , 2002). The key running theme in World Bank and IMF reforms was the pursuit and promotion of capitalist competition on a global scale by accelerating the increasing interconnectedness of national economies and removing the administrative and legal barriers to capital (CAMMACK , 2010, p. 271; JESSOP , 2002, pp. 81–83). However, these reforms and adjustment packages were not imposed against the will of dominant coalitions in the countries. In each country, dominant capitalist classes backed the stand-by agreements and structural adjustment packages of the IFIs perceiving that further integration into the world market would bring them the advantage of being internationalized. The states of the developing world are not subordinated to the impersonal dynamics of globalized capital. Rather than withering away, the shift to the neoliberal model organizes and rationalizes state intervention in different ways (PECK , 2001, p. 447). The changes in the state’s role are redesigned and reoriented in response to the need for mediating and supporting the competitiveness of the national economy (JESSOP , 2002). Multinational corporations’ urge to exploit uneven regional development tended towards territorial fragmentation of space and political authority. In many developing countries, territorial fragmentation of space and political authority took the form of decentralization policies implemented in tandem with neoliberal policies. Therefore, the transition to neoliberalism has a tendency to bring about decentralization policies, but it does not necessarily lead to a specific extent or content of decentralization. When this tendency became actualized and took the empirical form of decentralization policies, they diffused the disciplinary force of neoliberal rules of competitiveness into local economies which would legitimize market logics on the grounds of efficiency (cf. PECK and TICKELL , 1992). Therefore, these policies have a tendency to bring the market-oriented groups closer to political decisions. The decentralization policies increased the assumed role of the local state – whatever form it takes in different countries – in the state system in relation to

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Global Processes and Local Consequences of Decentralization: Sub-national Comparison in Mexico 1129 development. Although the scale and scope of local state intervention is inherently variegated and dependent on the local economy and the social forces associated with it, the main thrust of these interventions would be to organize and/or enable the balance of forces favourable to capital accumulation. Therefore, it is expected that local governments would be more inclined to adopt a pro-business stance in order to create a business-friendly environment. That is to say, decentralization policies have a tendency, in turn, to increase further the political class domination inscribed in the material organization and institutions of the local state (cf. POULANTZAS , 1978, p. 14). This potential power of class domination at the local level becomes actualized in the development goals and shifts in the direction of the policies. As bolstering economic competitiveness of the region becomes the main motivation behind policy-making and market-oriented actors gain the upper hand in local politics, the meaning of development may be narrowed down to the mega-projects that carry the potential to bring local and global together. For example, convention centres, highways, international airports and harbours may be presented as development projects that could promote economic development, growth and competitiveness (cf. KEATING , 1997, pp. 30–31). As these decentralization policies increase the links between local and global, different sub-national regions started to assume more direct roles in their relations with the world market. The regions such as border zones which are suitable for global production activities started to become cheap labour reserves. The reserves in these regions are prone to attract foreign and domestic investors which also benefit local capitalists as partners or subcontractors of these investor companies. Some other regions are blessed with unique environmental features that give them the opportunity to become tourist enclaves. Still others are assigned a ‘feeder role’ with their raw material resources and energy reserves. According to this division of labour among regions, they began to experience different development patterns with contrasting consequences for dominant and subordinate social classes. Different sub-national regions may have different features of development depending on the social composition of the locality as well as constraints of the environment. Where local business classes are internationalized – indulge in subcontracting and/or joint ventures with foreign capitalists – they marginalize other social classes and take over local state institutions and decentralized development agencies. The capitalist factions located in economically dynamic regions such as global production zones become stronger vis-à-vis other factions of capital due to their close relations with their foreign peers. Under these conditions, decentralization tends to bring about entrepreneurial local development. Where integration into the global economy empowers both mobilized subordinate groups such as peasants or workers along with local capitalists, a class compromise

may be called for. Particularly if local subordinate classes are mobilized around local political organization, and their collaboration is deemed necessary to increase the competitiveness of the local economy, decentralization may open spaces for new social actors and struggles. In these cases, local social groups’ demands for participation and democratization become important due to their potential to elevate social resistance by incorporating and leading large numbers of masses and bringing about massive grassroots movements, which would, in turn, undermine the legitimacy of the regime and more importantly competitiveness of the local economy. Under these conditions, decentralization tends to bring about contested local development. In every case, varying modes of local state intervention produced varying levels of statehood across regions within a country. The decentralization process broadens and deepens the geographical imagination of the state system. Parcellization of the national economy brought parcellization of sovereignty along with it, which called for analyses that examine how state power was reshaped at sub-national levels (cf. WOOD , 2002). Decentralization policies also carry the tendency to bring about authoritarian state-led local development where the local state retains control of local development. In these cases, the evolution of empirically well-developed institutions and strong state managers can be understood with reference to state ownership of resources, be it energy reserves or raw materials. In these cases, local capitalists enjoy being beneficiaries of various forms of state support. For the same reason, foreign capitalists have a vested interest in the local economy. What is critical here is that the partnership between local and foreign capitalists is mediated through the local state that intervenes actively to restructure the local economy. With decentralization, the local state becomes a centre of resistance which makes local politics a locus of an open-ended struggle between social classes. As decentralization policies draw the local level directly into global capitalism mediated by the local state, each mode of integration tends to empower and/or disempower certain social agents. This process is shaped primarily by the prevailing local economic activity and the historical evolution of a balance of class forces in each locality. The enhanced ability of social agents in crafting their strategies and alliances to pursue their material interest became determining factors of the outcome. Therefore, as DE FILLIPS (1999, p. 976) notes, localities are continuously constructed and reconstructed by both their relationships with the rest of the world and with the struggles that take place within them.

DECENTRALIZATION POLICIES IN MEXICO The years between 1970 and 1982 can be characterized by increasing discontent of, first, students, then peasants

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and workers, and ultimately the capitalist classes. In the 1970s, declining profitability levels began to have serious implications for the relations between labour and capital (SOEDERBERG , 2001, p. 65). In 1981 and 1982, Mexico experienced a grave economic crisis. At the same time, the growing paralysis of the bureaucracy and other institutions of the state reduced the effectiveness of the state to promote private capital accumulation, while moderating the conflicts and keeping them within the bounds of order (CYPHER , 1990, p. 97). The crisis was primarily a crisis of balance of payments due to increasing debt burden, but it also had consequences of rising inflation and the aggravation of foreign exchange difficulties. The combined impact of political turbulence and the debt burden together with social unrest led to a hegemony crisis. The crisis of hegemony necessitated two parallel restructuring processes: a shift in the economic development policies; and an institutional restructuring that would reform representational ties between classes and political parties. Decentralization policies could be examined as part and parcel of these processes in Mexico. While certain factions of capital demanded a reorganization of the state which would allow neoliberal market forces to operate at the local level, the working classes raised their demand for more participatory and democratic local politics. On top of these pressures, when the debt crisis hit the country in 1982, the IFIs ‘recommended’ to the government that it undertake ‘structural reforms’ to reduce the state’s deficits by cutting down on expenditures. These restructuring reforms were filtered through the institutional terrain and balance of forces in the political class struggle. The decentralization policies would be regarded as a way to organize better the interest of the dominant classes while winning the support of the subordinate classes without jeopardizing the political interests of state managers (TOPAL , 2009). The first extensive decentralization policies were initiated in December 1982 by the then President Miguel de la Madrid with an amendment to Articles 26 and 115 of the Constitution. With the amendments to Article 26, the sub-national governments were made responsible for undertaking operative decisions regarding planning and the execution of development programmes, while power to supervise and regulate these projects was retained by the federal government. As a result of the amendments to Article 115, also known as the Municipal Reform, the aim was to strengthen municipalities both administratively and financially with decentralized resources. A Subsecretary of Regional Development was founded under the Secretary of Programming and Budget (SPP) with the duty of monitoring regional development programmes and liaising with municipalities and states. The coordination between the federal and state-level authorities was achieved through treaty-like agreements called Development Agreements (CUD) where the

president, governors and SPP representatives meet annually to decide on development projects financed from Ramo 26 (also known as Regional Development Budget Line) (SECRETARÍA DE PROGRAMACIÓN PRESUPUESTO (SPP), 1983, p. 5). Decisions over public spending at state and municipality levels would be reached in Development Planning Committees (COPLADEs) chaired by the governor and composed of permanent technical staff and an ‘elaborate array of sectoral and regional authorities as well as representatives of the social forces’. After annual development, projects are ranked in order of priority and crafted in detail at COPLADE meetings; further negotiations and final decisions on these projects would be made at the federal level at CUD meetings. The federal government allocated additional revenue to states via three other mechanisms: the General Fund of Participation, the Complementary Financial Fund, and the Municipal Development Fund. States were to transfer at least 80% of their revenue to municipal governments. States and municipalities were also authorized to levy property taxes and fees for basic public services and to handle state auctions for subcontracting infrastructure services as well as the construction and illumination of roads and bridges (BERTRAN and PORTILLA , 1986). If all these resources fall short of expenses, the reform authorized sub-national governments resort to public borrowing. Between 1983 and 1995, sub-national governments accumulated heavy debt burdens and huge payment obligations (HERNÁNDEZ TRILLO et al., 2002). The 1995 financial crisis also corresponds to unsustainable budget deficits of sub-national governments. In order to ease this credit burden of sub-national governments, the federal government had to implement extraordinary transfers and debt-rescheduling programmes (HERNÁNDEZ TRILLO et al., 2002, p. 370). Therefore, the second wave of the decentralization reforms could be understood as part of the recovery plan for the 1995 economic crisis (RODRIGUEZ , 1997, p. 247). The New Federalism reform of the Ernesto Zedillo government (1994–2000) had three aims: extensive decentralization of the public administration, enhanced budget coordination and revenue-sharing between federal and state governments, and stronger municipality administration (PODER EJECUTIVO FEDERAL , 2000, p. 125). Combining these three aims, the reform brought a clearer definition of the allocation of resources and administrative functions across federal, state and municipal levels (CABRERO , 2000). The new functions and faculties of the sub-national governments had to be funded either by increased federal transfers or by enhanced opportunities to increase local revenues through taxation and other mechanisms. The funds were transferred for regional development via Ramo 26. The New Federalism also corresponds to operative and conceptual breaks in the

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Global Processes and Local Consequences of Decentralization: Sub-national Comparison in Mexico 1131 development policies by aiming to establish public– private partnerships in order to increase sub-national revenue. To win their partnership, the development programmes had to appeal to the private sector. The Congress amended Article 115 of the Constitution in 1999, which defined municipalities as political entities that are able to set policies for local affairs within their jurisdiction like states and the federal government. The reform also gave municipalities the authority to assume new administrative functions through agreements with state governments. City councils were enabled to make long-term planning commitments without the approval of the state legislator. Designing and executing regional development projects became a responsibility of the municipalities. CUD meetings were abolished, which meant that federal government gave up the authority of regulating and supervising the development projects. Federal transfers of several funds, converted to Ramo 33 from Ramo 26, were made automatic. The decentralization policies implemented between 1980 and 2000 brought about a notable increase in the decentralized spending, from 20.3% in 1980, to 47.3% in 1984 and 60.3% in 2000 (PODER EJECUTIVO FEDERAL , 2000, pp. 3, 13).

SUB-NATIONAL COMPARISON Chihuahua: entrepreneurial local development

In Chihuahua, decentralization policies unleashed an opportunity for internationalized local capital to pursue their own development agenda in the region. After decentralization, local business groups in the maquiladora industry became involved in political processes as a united front in order to boost the competitiveness of their locality. Local and foreign capital investing in the maquiladora industry ventured a partnership with the local state; and from then on this public– private partnership initiated and implemented all local development plans. This alliance, in time, shaped the development capacities of the local state and captured the control of local development. In this process, subordinate classes have been either marginalized and disqualified in local politics or absorbed into business-funded civil society associations. Decentralization policies in Chihuahua led to entrepreneurial local development. The main factor that explains the emergence of the entrepreneurial local development is the strategies and alliances of internationalized local business classes. Formation of the local capital is rooted in the historical development of the states’ local political economy which has been largely shaped by the state’s geographical location and under-soil resources. The state of Chihuahua is in the north-west of Mexico neighbouring the United States with several border gates that connect Ciudad Juaréz with the US states of New Mexico and the Texan city of El Paso. Since the late nineteenth century, the state’s bonanza of metal and mineral

mines has attracted investors across the border to the region in partnership with local landowners. Metal and mineral-mining businesses triggered the development of finance, transportation and communication networks in the region. At the beginning of the twentieth century, Chihuahua became a major centre of the industry, finance, mining and cattle breeding sectors in Mexico. The capability of local businessmen to establish successful and relatively independent relations with US counterparts proved to be a central factor in shaping the local state institutions. The Porfiriato (1876–1911) can be identified with the strong alliance between Northern businessmen and political elites. In the aftermath of the Mexican Revolution (1910–1920), local elites negotiated with the new revolutionary elites and regained the control of local politics until 1934 (WILLIAMS , 1990, p. 302). However, during the Cardenas era (1934–1940), the influence of the North on decision-making in Mexico City relatively declined. Regional business organizations, such as the Confederation of Republican Mexican Businessmen (COPARMEX), suffered from a lack of representation (SHADLEN , 2000, p. 91). COPARMEX was regarded as an unofficial voluntary association and left outside the corporatist alliance. In the post-revolutionary era, Northern capitalists were not the leading faction of capital that could shape the development framework. Until the 1980s, while the hegemonic national development framework was in line with inward-looking import substitution, the local economy of Chihuahua was mainly reliant on necessarily outward-looking border relations. That the national development programmes gave very little room for manoeuvre for local state governments and weakened local state institutions strained the local state–capital relations. Eventually the regime lost its support base in the region. To deal with this problem, the Institutional Revolutionary Party (PRI) imposed local politicians from the centre and even resorted to fraud when such candidates failed to come first in the elections (CHAND , 2001, p. 29). This isolation from local social actors gave the local state managers less capacity to implement local development programmes. Since the 1970s, the maquiladora industry became the main economic activity in the US–Mexico border zone, which changed the socio-economic structure of the region.4 The growth of the maquiladora industry strengthened the links between Chihuahua and the world market. Foreign investors preferred to invest in the maquiladoras as partners of Mexican firms mostly based in Chihuahua.5 As MIZRAHI (1996) argues: the maquiladora industry led to a formation of new type of entrepreneurs who are related to the maquiladora industry as […] sub-contractors. (p. 85)

The industry requires non-unionized and inexperienced labour, which made Chihuahua a major destination for

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immigrants from the South. It also led to an emergence of a new middle class working in the maquiladoras as technically trained and highly skilled managers, administrators and workers.6 During the 1970s, the maquiladora industrialists had already been organized to identify the priorities of the region when the local government lacked a specialized office for economic development (RAMOS VACA , 2006). In 1973, they led the foundation of a businessled private development agency called Economic Development of Chihuahua (DESEC). After the first decentralization policies, development programmes provided local business groups with a suitable channel to convey their pressures. An influential businessman, Samuel Kalisch Valdez, noted: ‘we welcomed the decentralization policies of the de la Madrid government by assisting the foundation of the COPLADE’.7 Indeed, COPLADE was initially reliant on DESEC for regulating the maquiladora industry in Chihuahua. DESEC supplied the state agency with information regarding the sector and staff specialized in economic development.8 As the local governments became a strategic locus for development policies, local business groups started to take initiatives in nominating the candidates for public offices, to provide funds for the political parties, particularly for the National Action Party (PAN), and to design the election campaigns (MIZRAHI , 1996). In the 1990s, most of the candidates who ran in mayoral races in Chihuahua had business backgrounds. Parallel to these efforts in controlling high-level local state offices, these local business groups also attempted to organize other social actors around their development agenda. The business groups aimed to administer development plans and strategic actions that would mark the course of the economic development of Chihuahua. DESEC initiated an economic development project called the 21st Century Chihuahua in March 1991 and presented it to the state government in 1992. This project was adopted by the state government and even defined the soul of the State Plan of Development between 1993 and 1999.9 In 1990, a severe storm and flooding caused significant physical damage in Chihuahua City, particularly in the neighbourhoods of maquiladora workers. Upon this destruction, the business groups played an active role in social development. After all, a clean and safe environment is an important factor in the new investment decisions of foreign companies, as their quality labour force, including managers, would prefer a better environment.10 Therefore, improving the living conditions of the workers appeared to become a shared concern of the local maquiladora industrialists. Samuel Kalisch Valdez, then President of DESEC, gathered a group of eighteen local firms and lobbied the state government to enact a voluntary tax up to 10% above the payroll tax. The firms projected this fund would be utilized for housing and flood reconstruction. In

1994, management of this fund was transferred to the Chihuahua Business Foundation (FECHAC), which was founded by the business groups in the maquiladora industry. Since then, FECHAC, as a permanent member of COPLADE, has designed urban and social development projects to be adopted by COPLADE.11 Therefore, local business groups not only have been planning the projects for their private funds, but also have been determining the social development priorities for decentralized public resources. As a local newspaper editor notes: ‘wide segments of the population in Chihuahua view the decentralisation policies as an important step towards local participation and democratisation’ (EL HERALDO DE CHIHUAHUA , 1983). In agreement with this position, some scholars argue that society in Chihuahua has been through a ‘political awakening’ since the 1980s with ‘an explosion of activities by a wide variety of civic associations dedicated to the promotion of democracy, clean elections, and human rights’ (CHAND , 2001, p. 205). Not surprisingly, The World Bank reports on Chihuahua put a special emphasis on the notion of ‘social capital’ to indicate how local communities are united around shared goals and build bonds of trust within communities (EL DIARIO DE CHIHUAHUA , 1997). For local business groups, bolstering civil society has also become a central issue of public–private partnership.12 The president of the Chihuahua chapter of the National Chamber of Manufacturing Industry (CANACINTRA) declared that: the only formula to end centralism is to strengthen society and civil society associations. We have to fight against centralism for federalism and democracy. This fight needs all our hands, not only of the governments. (EL DIARIO DE CHIHUAHUA , 1996)

Local business groups formulated their struggle for power with the terms of a fight for democracy that could only be reached through decentralization and regional autonomy. Local businessmen, particularly those affiliated with COPARMEX, focused on awakening their civil society to bring about an ‘entrepreneurial culture’ in Chihuahua.13 The business groups attempted to convey their message that ‘by virtue of simply being citizens, they belong by definition to the so-called private initiative’ (VALDÉS UGALDE , 1996, p. 139). Business-funded local civil society associations such as the Civic Front of Citizen Participation and the State Committee of Citizen Participation were established in 1983 and 1994, respectively, as central actors in the public–private partnership to supervise social development programmes with the state government. Thus, political awakening and the explosion of civil society associations in Chihuahua could be better understood by taking business leadership and their financial supports into consideration. Although this hegemony of businesses may appear stable at the outset, there are noticeable challenges to

Global Processes and Local Consequences of Decentralization: Sub-national Comparison in Mexico 1133 entrepreneurial local development. The emergence of entrepreneurial civil society and the rhetoric of democratization explain partly why the entrepreneurial local development in Chihuahua is likely to persist. Through civil society associations, local businessmen managed to co-opt non-capitalist interests in the region. Entrepreneurial civil society served to seal conflicts and portrayed local politics more consensually. However, the state of Chihuahua is disreputable for urban insecurity and violence, which increases doubts about corruption, the quality of public services and spaces for community participation in local governance (TORONTO STAR , 2010; MEDIODRAMA , 2009).14

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Guerrero: contested local development15 In Guerrero, the pattern of local development following the implementation of the decentralization policies differed dramatically from the case of Chihuahua. The local regime of Guerrero can be characterized by continuous contestations among various social classes in the local state apparatuses as well as within the local branches of the political parties. Although increasing competitiveness of the local economy to attract more investments to the region became the main objective of the local actors, these motivations did not result in an entrepreneurial local development. Unlike Chihuahua, non-capitalist classes in Guerrero started to have significant pull with local political parties and local governments. In Guerrero, the decentralization policies led to what is called here ‘contested local development’. The main factor that explains the emergence of the contested local development is the strategic alliance of the local capitalist classes invested in the tourism industry with the indigenous peasant movement. Examining the geographic and demographic characteristics of the state of Guerrero is an important first step in tracing the formation of this dominant coalition. The state capital is the city of Chilpancingo, and other important cities are the three tourist enclaves of Acapulco, Ixtapa and Taxco that form the ‘Triangle of the Sun’. Since the 1940s, Acapulco has become one of the most significant tourism centres of Mexico. With development of the tourism sector in the 1970s, multinational investors showed an interest in the region. When the local economy was poised to integrate into the world market with its tourism industry, foreign tourism firms invested heavily in the region in partnership with local business groups. Following the decentralization of the development plans, the Secretary of Tourism was regionalized to provide better development of the tourism industry. In Acapulco, a coordination office of the Ministry of Tourism (SECTUR) was established (NOVEDADES ACAPULCO , 1984). The decentralization of the tourism development agencies increased the importance of local politics for tourism industrialists (EL SOL DE ACAPULCO , 1983).

After the decentralization of SECTUR, a significant shift in the development projects away from agriculture and towards the tourism sector took place. The shift became particularly visible in 1987, when subsidies for agriculture were eliminated and public resources were allocated largely for urban development programmes, such as mega-projects intended to increase the competitiveness of the tourism sector for both investors and tourists. The biggest of such investments was a shopping complex, Ixtapa Marína, and the Cuernavaca–Acapulco Superhighway. In 1993, State Consultative Tourism Boards were established to promote the participation of local and global tourism sector representatives in local development programmes. Through these public–private consultative boards, local tourism industrialists and representatives of international hotel chains started to provide consultation, advisory and technical support services to state tourism agencies. The new direction of the development programmes generated new dynamics of popular resistance by indigenous peasant communities. Guerrero has a significant indigenous peasant population coupled with a valuable tourism sector. The region is characterized by its militant indigenous movements. The phase ‘Guerrero bronco’ has long been associated with the resistance movements in the region. The term ‘bronco’ refers to the wild and uncontrollable mustang that symbolizes the movement (BARTRA , 1996). Alliance with an already existing indigenous peasant movement appeared as a viable strategy for both local business groups and their global partners to challenge the PRI dominance over local politics.16 At the same time, local–global networks of the tourism sector needed to ally with the indigenous peasant movement to increase the competitiveness of the local economy for investment and for attracting tourists for cultural tourism. Reducing poverty, encouraging the indigenous culture and improving the infrastructure were in the interest of the tourism industrialists. This alliance, which took place under the Party of Democratic Revolution (PRD), weakened authoritarian PRI elites in the big municipalities, while strengthening the influence of the indigenous peasant organizations and enabling the hitherto strong local peasants groups to contest the local development programmes. Nevertheless, inherently antagonistic interests of the tourism industrialists and indigenous peasants resulted in contentious local development. The owners and managers of the international hotel chains such as Holiday Inn, Hilton International, Inter-Continental, Hyatt International and Marriott became influential actors in local politics (ACAPULCO NEWS , 1980), which created strong discontent among indigenous peasant communities. They organized collectively in the PRD to define the terms of the regional development. The PRD strengthened the social power of the indigenous peasants by helping to form new social organizations. The most prominent organizations

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were the Council of Nahua Peoples in Alto Balsas (CPNAB), the Guerrero Council of 500 Years of Indigenous Resistance (CG500ARI) and the Tlachinollan Human Rights Centre of the Mountains. These organizations became active in defending the rights of the rural activists who were often threatened, jailed, killed and disappeared. They also functioned to channel government funds to community projects like road repair, piped water systems, latrines, electrification, wood stoves and cultural maintenance. Finally, since the late 1990s, the local development programmes have become a matter of contestation between the indigenous peasant groups and the tourism sector industrialists. What characterizes the case of Guerrero is the combination of weak state institutions and strong local nonbusiness classes – specifically, the indigenous peasants. Until the 1980s, political economic relations based on agricultural production had produced clientelist relations which, in turn, weakened local state institutions. The local version of the Mexican state corporatism in Guerrero was constructed through force-based domination. Bottom-up control of cacique families has been a well-established structure in Guerrero.17 The local state institutions turned into apparatuses for narrow political and economic interests. The local state repressed the opposition groups using its military force. Despite being repressive and dominant, the state managers were neither hegemonic nor capable enough to implement development programmes. Radical organizations survived the formation of new state institutions in the post-revolutionary era. After the establishment of the corporatist state form, the peasants’ and teachers’ resistance continued to have a strong presence in local politics (AVANCE/ GUERRERO , 1978). When the corporatist structure was challenged in the face of the authority crisis of the late 1970s, new local actors and movements raised their demands for thorough changes in the local regime.18 The crisis of the state manifested itself most radically in Guerrero with growing the militant indigenous movements. Guerrero’s experience with decentralization provides insights for an understanding of how decentralization policies would lead to an opening in local authoritarian regimes by strengthening local subaltern opposition groups despite local business groups’ attempts to take over local development programmes. As tourism industrialists began to determine local development programmes to increase the competitiveness of the local economy in tourism, the power of the former party bosses (caciques) and elites of the agricultural sector was curtailed. This in turn abolished some of the repressive mechanisms and helped previously marginalized, but locally organized, indigenous peasants to mobilize around political organizations, mainly the PRD. These political organizations prevented the local business groups from dominating these social groups. Local development turned into an open-ended contest. The

process of decentralization has opened political spaces for new actors and social struggles. Tabasco: authoritarian state-led local development19

While the decentralization policies have enabled local business groups and their foreign partners to play the central role in local development in Chihuahua, the decentralized development programmes in Tabasco have been crafted by the PRI-dominated political elite and implemented in the municipalities with close supervision of the state managers. In Tabasco decentralization did not lead either to a transfer of the development capacities to the private sector or to a weakening of the regulatory mechanisms of the state in local development. Instead, the local state employed strong administrative capacities to design and implement decentralized development programmes. State managers in Tabasco took the initiative to re-regulate the local economy through development programmes. The neoliberal decentralization process reinforced corporatism, encapsulated social dynamics into state-initiated organizations, and evolved towards what is called here authoritarian state-led local development. The main factor that explains the emergence of authoritarian state-led local development in Tabasco is the nature of the relations among foreign oil oligarchs, local capitalists and state managers. The geographic characteristic of Tabasco has been an important determinant in the formation of these local social relations. The determining geographical characteristic is not Tabasco’s borders with Guatemala, but its natural resources: the state is called ‘the energy state’. It has acquired a prominent role in the national economic development due to its rich natural resources with important exploitation of oil in both gas and crude form as well as the generation of electricity from water resources.20 Oil reserves in Tabasco were discovered in the 1830s, but oil’s impact on the state was felt during the Porfiriato. Porfirio Díaz prioritized the establishment of transportation and communication services in the state. He also had a particular interest in promoting the administrative structure of the local state which would enable local state managers to regulate the immense natural wealth of the region. New discoveries of oil deposits in 1902 attracted more national and foreign attention to the region. Particularly, foreign companies became very interested in exploiting the wealth of Tabasco.21 After the Revolution, Tabasco became one of the states where corporatism was established firmly.22 The most important factor behind this was the nationalization of the oil resources and foundation of Mexican Petroleum Enterprise (PEMEX) by Cárdenas in 1938.23 Local actors, which are overwhelmingly dependent on the oil revenues, have ascribed the state a central role in development. Therefore, public ownership of the natural resources in the region has strengthened the corporatist state–society relations and the bureaucratic

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Global Processes and Local Consequences of Decentralization: Sub-national Comparison in Mexico 1135 structure of the local state institutions. Unlike in Chihuahua and Guerrero, the Tabasco chapter of the PRI was able to set the agenda for the socio-economic development programmes and incorporate various classes in these programmes by rendering them dependent on the local state. The oil boom in 1973 produced profound economic changes in Tabasco (TULEDA , 1989, pp. 236–237). During that decade, PEMEX invested billions of pesos in the region for drilling wells and other infrastructure constructions. In addition to the direct investments, the state of Tabasco and its municipalities received revenue shares proportional to the international oil prices and the volume of oil exportation. PEMEX became the most important taxpayer in the state. The enormous increase in financial capacity permitted the state government to transcend the traditional political– administrative limits of its actions and start assuming an effective ‘guiding role’ in regulating the local and regional economy (TULEDA , 1989, pp. 262–263). The Committee for the Promotion of Socioeconomic Development of Tabasco (COPRODET) was established in 1975 as a result of this increased financial capacity. It was the most well-established local development agency in Mexico receiving more professional, logistical and political support for planning than any other state (WILSON SALINAS , 1983). The central government ordained that PEMEX collaborate with COPRODET and with the governor of Tabasco to resolve the issues of mutual concern, such as materials’ bottlenecks and transport difficulties, and to inform the agency of its planned activities (SCHERR , 1985, p. 60). The establishment of COPRODET had provided the state institutions with a coherent perspective on development and enabled the state to regulate the development programmes more effectively, even before the decentralization policies were introduced. The first decentralization policies were hailed by the governor and the local chapter of the PRI. In his various public talks, the governor at the time, Enrique González Pedrero, underlined the importance of decentralization and its impact on local democratization and development.24 The secretary of finance of the government of Tabasco pointed out that ‘decentralisation of the funds would enable a healthier insertion of financial resources into the circuits of the local economy’ (RUMBO NUEVO , 1982). In April 1983, the state government established the Development Planning Committee of Tabasco (COPLADET). In addition to COPLADET, in May 1983 the governor sent another proposal to the state congress to establish another planning agency, the State System of Democratic Planning (SIESPLADE). In his speeches, González Pedrero noted that COPLADET coupled with SIESPLADE would strengthen the ‘rector’ role of the state, increase the sovereignty of the state government and stimulate a mixed economy for socioeconomic development (GONZÁLEZ PEDRERO , 1987, pp. 37, 46). In 1984,

the state government launched a course for the personnel of the municipalities in order to provide teams with high-technical qualifications as well as training about the political, economic, and social problems of the country and the region (RUMBO NUEVO , 1984a). In Tabasco, decentralization primarily meant decentralization of the PEMEX administration. The National Plan of Development 1983–1988 included a ‘restructuring’ of PEMEX, according to which the capital city of Tabasco, Villahermosa, was accepted as the regional centre of PEMEX. In order ‘to cultivate more harmonic relations with the local government and communities in Tabasco’, new PEMEX offices were opened in Villahermosa (ARIAS RODRÍGUEZ and GUSMÁN HUGO , 2004). More importantly, with the amendment to Article 28, the exploration and exploitation of oil deposits could be undertaken through joint ventures with the private sector. Immediately after this amendment, foreign oil oligarchs such as Halliburton, BP, Shell and Exxon became involved in various parts of the oil production in partnership with PEMEX. When the design and execution of the local development programmes were decentralized, these foreign companies opened branches in Villahermosa and developed closer relations with the local governments either through PEMEX or directly with their branches. The pattern of local development in the process of decentralization grew out of vigorous policy networks that linked the state government with foreign private enterprises. In order to provide these corporations easier market entry, the local state regulated the development programmes with the supervision of PEMEX (RUMBO NUEVO , 1983). Since most of the state income was gained through the energy sector, the PEMEX administration and its foreign partners started to get involved in the design of the local development programmes.25

In 1995, with a ‘Special Coordination Agreement’, cosigned by the governor and the general director of PEMEX, the local government became the central agent in managing PEMEX-funded development programmes. The State Plan of Development between 2002 and 2006 was a continuation of this relationship between PEMEX, the foreign investors and the state government, arguing that the economic potential of the state can only be consolidated in partnership with the oil industry. The local state of Tabasco operated within a public– private partnership at the local–global line and crafted development policies within the constraints of the neoliberal policy framework. Unlike in Chihuahua, local business groups were junior partners in this coalition. The local state of Tabasco has led the development by placing the primary focus on bolstering the economic competitiveness of the local economy to create a suitable environment for private capital accumulation. For this purpose, the state government embarked on

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organizing the local business groups by initiating the foundation of local business associations to increase the competitiveness of local entrepreneurs and to promote foreign investments in the region (NOVEDADES DE TABASCO , 1996). In 1997, the state government initiated the launch of Tabasco House in Houston, Texas, to open new markets for capitalists (MADRAZO PINTADO , 2000, p. 65). Other such associations, namely the Tabasco Foundation, the Society of Capital Investments Alza Patrimony, the World Trade Centre Tabasco, and the Regional Centre for Business Competitiveness attempted to knit a network so that local businesses could act as a united front. These organizations started to represent the private sector in COPLADET meetings. In 2000, the state government initiated an economic development programme, the Grand Vision of Tabasco XXI Century, to coordinate the articulation of the local small and medium-sized enterprises with PEMEX and its foreign subcontractors. As part of this programme, the state government established the Regional Centre for Business Competitiveness (CRECE) and a Trust for Business of Tabasco (FIDETAB) with the objective of complementing national sources of credit for local firms. Close cooperation between the local state, PEMEX and foreign oil oligarchs insulated the state from local communities, which led the local regime to evolve towards authoritarianism. Between 1982 and 1988, participation in COPLADET meetings in Villahermosa was limited to the representatives of PEMEX, stateinitiated business associations and state bureaucrats. During the 1988–1992 period, COPLADET meetings were not held regularly, and the allocation of the decentralized resources and development programmes were not announced publicly. Despite the efficient institutional structure of local development agencies, the state government did not transfer development responsibility to the municipalities or the social organizations. The development priorities of each municipality were determined by the state government and development plans of the municipalities were closely supervised by governors’ advisors and high-ranking bureaucrats. The motto of the local government – ‘Tabasco has everything, because Tabasco has a governor’ – was used to show the centrality of the state managers in local politics. In this period, foreign oil companies became involved in local socioeconomic programmes, and meeting the energy demands of the world market became the main concern of the local state managers, at the cost of silencing the voice of the local communities. The legitimacy of this local development pattern was secured by buying off the opposition and containing dissent through state employment as well as using decentralized revenues to reward loyal constituencies and, if necessary, mollify others. Besides, while local development programmes have weakened all non-oil sectors, squeezing out vital industries such as traditional agriculture and manufacturing, the hope was that

PEMEX would bring jobs, schools, food, healthcare and housing, despite having limited social development programmes. Local communities expected that PEMEX would reinvest its profits in the community.26 These expectations also inhibited the development of civil society outside of state control. Various key informants in Tabasco mentioned that by the 1990s it became clear that oil-based development had brought localities nothing but misery and destruction. Increasing environmental awareness and an emphasis on sustainable development enabled the local peasants to raise their voices. Thousands of peasants petitioned PEMEX for damages related to its pollution of the environment. These protests attempted to pose deeper political questions about the legitimacy of the local state. Local community struggles have grown with the mobilization of the peasants around the centre-left opposition party, PRD (GÓMEZ TAGLE , 1994, pp. 81–82). Although the opposition has had a significant presence in some municipalities since the late 1980s, the PRI is still the governing party in the state. Local government is struggling to control the newly emerging societal organizations and to minimize local participation in policy-making processes.

CONCLUSION The effects of neoliberal economic restructuring are realized through the mediation of a political process of decentralization, which translates them into new orientations in local development patterns. Therefore, each local economy has its own trajectory of neoliberalization with different levels of state intervention, and varying social relations. The case studies show that whether decentralization leads to the domination of business groups or the open-ended contest between social classes depends on the nature of local political economy, and how incorporation into the global economy empowers and/or disempowers local economic actors. Local economy shapes the industrial structure, social composition and the political institutions of the locality. It also defines the relationship of the locality with the rest of the world and struggles that take place among networks of local, national and global actors. Different socio-economic circumstances help one to define the nature of neoliberal globalization. In the case of Chihuahua, the cross-border cooperation among non-governmental organizations as well as between the municipalities in shaping the development programmes are reminiscent of the arguments regarding blurred national borders in the era of neoliberal globalization. In the border regions, the local business groups on both sides of the border allied with each other to increase the attractiveness of the region for subcontracting activities and foreign investment. This cross-border alliance appears to limit – if not eclipse – the functions of the local and national states. The experience of

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Guerrero suggests that neoliberal globalization brings its own contradictions and mobilizes its own grave-diggers. The contested local development pattern in Guerrero caused a significant transformation in the local regime. Nevertheless, the indigenous peasant movement in Guerrero has the potential to link up with anti-globalization movements. In the course of decentralization, a diverse array of localized struggles in different contexts could be embraced and connected to a bigger concern that would uncover the class content of these struggles. Finally, the case of Tabasco shows that local governments have become important agents in designing the local development plans favouring the local business groups. Thus, the boundaries of the state have not been simply rolled back. Instead, in the era of neoliberal globalization, the regulation mechanisms of the state have been redefined in different scales, policy objectives have been recast, and the interface of the public and private sector has been restructured. Acknowledgements – The author would like to thank Adam Morton, Alfredo Saad-Filho, Chris Pickvance, Erik Olin Wright, Galip Yalman and the anonymous referees for their insightful comments on the manuscript of this article.

NOTES 1. The term maquiladora is used to describe factories along the US–Mexico border where foreign merchandise – machinery, raw materials, parts and components – is imported duty-free into Mexico on a temporary basis, assembled or manufactured by Mexican workers and then exported with duties assessed only on the valueadded, either to the country of origin or to a third country. 2. Interviews were designed to be rather flexible. There were predefined question sets for various actors. Yet, most of the interviews could be defined as interactive. Responding to the situational dynamics, interviews would turn into fruitful discussions with respondents. All interviews were taped. The tape records were complemented with observational notes. Immediately after each interview, summary notes were taken on the major themes that begin to emerge, which would also inform and shape to a great extent the subsequent interviews that would be carried out. 3. Their positions range from a former president of Mexico (Miguel de la Madrid; interviewed on 30 June 2005) to a former undersecretary of regional development (Manuel Camacho Solis; interviewed on 18 July 2005), from a governor (Enrique González Pedrero; interviewed on 27 July 2005) to mayors, from secretaries of planning and programming to other key officials who have access to information on decentralization policies and process in general.

4. The maquiladora industry provided foreign investors with cheap and disorganized labour reserves along with comparatively unregulated conditions without any trade barriers. 5. By the 1980s the investments in the sector were almost evenly divided between Mexican and US firms. 6. Interview with Reyes López, former President of COPARMEX, 16 February 2006. 7. Interview with Samuel Kalisch Valdez, former President of DESEC and COPARMEX, 11 February 2006. 8. Interview with Alonso Ramos Vaca, former President of the Council for Economic Development of the State of Chihuahua (CODECH), 18 February 2006. 9. Interview with Ramos Vaka. 10. Interview with Samuel Kalisch Valdez. 11. Since 1994, the FECHAC has designed and executed more than 1500 development projects through COPLADE. These projects include building, renovating and refurbishing schools and healthcare institutions, providing elderly care, and organizing seminars for microenterprise owners (AGUIRRE , 2006, p. 1). 12. Interview with Fernando Álvarez Monje, former President of the Chihuahua Executive Committee of the PAN, 17 February 2006. 13. The term ‘entrepreneurial culture’ was mentioned in the interviews by several businessmen in Chihuahua. 14. As KOONINGS and KRUIJT (2006, p. 7) suggest, ‘the absence or failure of governance opens the ways for a variety of armed actors and violence brokers who carve out alternative, informal spheres of power on the basis of coercion’. 15. The analysis on Guerrero is confined to the municipalities around the tourism centres, especially Acapulco. The analysis here also leaves out the impact of increasing drug-cartel conflict since President Felipe Calderón took office in 2006. 16. Interview with Miguel Garcia Maldonado, former President of Protur, 15 June 2006. 17. The biggest cacique family, the Figueroa, ruled the state for over forty years, taking direct control of leading political positions. 18. Interview with Rosa Icela Ojeda Rivera, General Secretary of the Communist Party of Mexico, 13 June 2006. 19. This pattern of local development is largely inspired by POULANTZAS ’s (1978, pp. 203–216) discussions of authoritarian statism. 20. Mexico is the fifth largest oil-producing country in the world and its oil wealth has generated the largest portion of the country’s income for most of the post-war era. The state of Tabasco is the richest of the Mexican states in terms of oil and natural gas. Moreover, the rivers and lakes of the state constitute 30% of national hydraulic resources. 21. During the Díaz government, sixteen British and USowned companies had total control over the oil industry. 22. During the 1920s and 1930s, the local government initiated the creation of official farmers’ and peasants’ cooperatives; in total, 176 cooperatives – 115 producer, fifty-eight consumer and three mixed – were formed, most of which had remained active until the 1990s. The rank and file of these cooperatives were closely tied to the local state government (ASSAD , 1996, p. 140). 23. Each year the anniversary of the expropriation is celebrated with festivals in Tabasco.

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24. These ideas came up several times in the interview with González Pedrero. For some of his statements on this line, see RUMBO NUEVO (1984b) and GONZÁLEZ PEDRERO (1987, pp. 90–91).

25. Interview with Enrique González Pedrero, former Governor of Tabasco, 27 July 2005. 26. Interview with José Luis Sanchez López, former PRD Deputy, State Congress of Tabasco, 2 March 2006.

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