The Impact of Globalization on Indigenous Peoples in Mexico and Bolivia

The following is a paper written for the author’s PLS 315 – International Political Economy class.

Globalization has presented itself in many different forms, affecting nearly all people of the planet. While much attention is paid to the extreme positive and negative impacts, the process has created both winners and losers. The same mixed result can be seen amongst the indigenous peoples of Mexico and Bolivia. These two significant indigenous populations have faced sizable challenges due to the integrating economic, political and cultural landscape. Nevertheless, the forces behind globalization have not only provided a means for resistance, but also a chance to confront the long-standing marginalized status of indigenous peoples. Despite these efforts, the effectiveness of political and social leaders as well as the policy of developed nations and multilateral institutions will determine the lasting impact of globalization.

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Gas Tourism and the Failure of Subsidies

The New York Times published this piece on the so-called “gas tourism” happening at the Mexican border. Gas tourism is the practice of actually driving somewhere to buy gas. Gasoline and diesel are much cheaper in Mexico then in America, and some living in border communities feel that provides enough incentive to brave traffic and drive out of their way. The existence of this practice should be both surprising and disheartening, but the cause is obvious.

Crude oil is a commodity, its price is set on the worldwide open market. Some reasons for why the prices differ so much are that Mexican gasoline is of poorer quality, and some American stations alledge that there is foulplay at work, such as diluting the fuel or speeding up the pump’s measuring. A large part of the reason though, is that while the American gas carries a tax to (partially) offset infrastructure and environmental damage, in Mexico gas is actually subsidized. Needless to say, if not for this market distortion (and for the lower quality of Mexican gas) it would not be possible to save money by burning gas in order to buy gas. Continue reading

Return of the subcompact car

Is this what is meant by new “green collar jobs” as the economy shifts?  There’s no clear definition of the “green collar job”, but Mexico will be getting 4,500 new jobs as part of a $3 billion investment in the country by Ford as the Ford Fiesta returns to their lineup. 25,000 jobs at direct and indirect suppliers are expected to be created, as well.

This further demonstrates how the shift towards ‘green’ alternatives does not have to come at the expense of the economy. In fact, with a possible fuel economy as high as 50 mpg on the gasoline model and a list price expected below $15,000, the new Fiesta could save consumers both on their car payments and at the gas pumps. Its not ridiculous to suggest that gas prices could rise to $10 or $12 per gallon in the next 5 years, making driving a luxury and cars like this a precious commodity to those who need an automobile.

How many more car fires are we going to see so people can buy a Fiesta?

Another example of the Export Land Model

Indonesia to withdraw from OPEC

Currently a producer a 860,000 barrels/day, Indonesia now needs all of that for domestic consumption as exports have fallen to 0.  In recent months, it has been forced to import from Iran, Saudi Arabia and Kuwait.

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