Unfortunate Bedfellows

Mexico Today –  July 07, 2021
Luis Rubio

 No one can mistake the government of China for the government of Mexico. Regardless of their huge historical and cultural differences, both countries are pursuing transformation, each in its own way and style. Whatever the future of the Asian giant holds, the great contrast between the two countries is that the Chinese government has monumental ambitions and is crystal clear on how it intends to achieve them. Anyone who has seen its airports, roads, trains, and especially the increasingly sophisticated products emerging from ifts factories can only marvel at its achievements.


And yet, Stanford University-based researchers Scott Rozelle and Natalie Hell argue that China’s successes in recent decades obscure the enormous challenges facing that nation. Despite being the world’s second largest economy, China still remains, in many ways, an impoverished nation. These authors’ emphasis is not on the visible and successful portion of China, but on its backwoods, where the necessary conditions to escape poverty and underdevelopment are non-existent. In particular, the authors analyze education in China’s rural areas (where hundreds of millions of people live) and conclude that the desired transformation is impossible based on its current educational reality.


The authors’ analysis of China could also be an account of the Mexican reality: success to date is largely due to the availability of cheap labor with few skills, which has yielded extremely high growth rates for several decades. However, only 12.5 percent ​​of Chines workers have a college education, the lowest rate of any nation at China’s level of development. Although it has a theoretically inexhaustible source of cheap labor, China beginning to lose competitiveness due to constant wage increases in the manufacturing sector. In contrast to Korea, Taiwan, Singapore, and other nations that achieved a complete transformation, China has not invested in education and is now paying the price.


The authors’ core argument is that the transition to an advanced economy requires a population with high levels of education, capable of adapting to the changing demands of the labor market in order to raise the economy’s overall productivity levels. The authors differentiate between countries that make these investments in education and those that do not: the former manage to avoid stagnation along the way, the so-called “middle-income trap,” while the latter get stuck and are unable to sustain a growing level of income. The authors point to Mexico as the perfect example of the second case: countries that bet on cheap labor and ended up stagnating along the way, and suggest that China, having undervalued education, is in the same predicament.


Every country has its own circumstances and follows the logic mandated by its realities. In Mexico’s case, one government after another has preferred to use the teachers’ unions to advance its political objectives rather than betting on the country’s development. For some Mexican administrations, these unions have been key to maintaining political control over vast regions of the country; for others they have been nothing more than an electoral tool. Still other more radical political actors are betting on Mexico’s unions and their leaders as the muscle for the day when the “great confrontation” between the forces of good and evil takes place. Regardless of the rationale behind the plans of previous Mexican administrations, the glaring fact is that neither has understood the enormous challenge that shifting from an industrial society to a knowledge society entails. Therefore, betting on Mexico’s educational status quo is betting on poverty.


In the industrial era, what added value was the production process itself, and companies focused on improving production technology and boosting productivity on the factory floor itself (i.e. improving the use of workers’ manual skills). In the knowledge era, the major difference and the space where the greatest value is added is on the creative front, which has to do with process design, software development, and applying the human mind to devise new technologies, all requiring a command of computer skills. In one word: a radically new world. Education ends up being key to incorporating the entire population to the digital world.


China is an authoritarian nation that used all its capabilities to push whirlwind development over the past four decades. If Rozelle and Hell are right, its future will be less commendable than it would appear today, and certainly will fall well short of its ambitions. The problem with Mexico is that, in order to get out of the hole in which Mexicans find themselves, the bare minimum required is to imagine a better future, something that China has in spades, but which Mexicans seem to be denied, at least with the current López Obrador administration.


* Luis Rubio is chairman of México Evalúa-CIDAC and former chairman of the Mexican Council on Foreign Relations (COMEXI).  A Spanish version of this Op-Ed appeared first in Reforma’s newspaper print edition.

Twitter: @lrubio