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Social classes are generally defined according to criteria such as property, wealth, education, occupation, or social origin. Some economic theories address social class as a function of the place each person occupies in the production process, and assign philosophical values and political positions to the members of each class. Some societies revolve around class differences, just as other societies ignore their very existence. Some build political and partisan organizations around social classes, while others design mechanisms to deliberately cross the social lines that divide them. For example, in England, the Labour and Conservative parties each originally organized around a social class, whereas in the United States, the Republican and Democratic parties are not directly linked with social strata, but instead are divided by cultural and regional differences.
The concept of middle class is hard to establish and complex to grasp, but that makes it no less real nor politically relevant. From a Marxist perspective, which ties the definition of social class to the productive process (owners of the means of production versus workers), the notion of “middle class”, is to a large extent repugnant. Even so, the middle classes of practically all modern societies, and all developed ones, share a common characteristic: those who are part of the middle class earn enough income to live in an urban environment and want to systematically improve their social and economic standing. At least in a colloquial sense, the definition of a middle class person is related to some level of economic independence, even if one has little individual political or social influence. The concept of middle class is elastic because it includes people with very distinct income levels. The term encompasses professionals, business people, bureaucrats, academics, and other workers—all of whom have sufficient income to live.
A middle-class household in Mexico is generally a family living in an urban context, although there is no reason to exclude the possibility that households in rural areas are also heading in this direction. The transformation from a mostly rural and mostly poor country to a less poor, mostly middle class country occurred, in large part, thanks to the communications revolution, improved transportation, and the benefits of emigration, including remittances.
Besides the availability of sufficient incomes, the Mexican middle class is defined by a search for social mobility and advancement; employment normally within the service sector; interest in culture, film, and other artistic expressions as means of entertainment; the rental or ownership of a house or apartment for one’s family; adding a second story to one’s house; car ownership; or the meeting of other material needs. The same is true for owning a television, having Internet access, and participating in virtual social networks. In fact, the extent to which a country progresses in the information age, where technology and creative capacity play a fundamental role in promoting development, largely determines the kind of growth and employment opportunities that an ever-increasing number of middle class people can access.
The definition of the middle class also includes a positive worldview, an interest in enjoying life beyond the day-to-day, an expectation of systematic economic advancement, and a belief that education is essential to the development of one’s children.
The search for better schools is a clear demonstration of the values that motivate the middle class, and explains the remarkable growth of low or no cost educational centers to meet this demand in Mexico. To the extent that parents associate education with success in life, the seeds of a permanent middle class are sown and a path toward systematic progress is established.
To satisfy this demand, in the face of bottlenecks in the expansion of public school systems, the number of private establishments dedicated to educational services has grown from 33,495 according to INEGI’s 1999 Economic Census, to 44,780 in 2009—representing an increase of 34%.
The number of people employed in the provision on these services increased by 81%, growing from 362,015 to 653,736 people. The expansion of private education is a widespread phenomenon, often occurring in what appear to be non-middle class communities. This expansion has taken place even as, for demographic reasons, the number of young students is declining. In sum, the combination of more personnel and less students should result in a gradual increase in the quality of education. It can be difficult to pinpoint some of the factors that characterize the middle class; it is less complicated, however, to identify people who can be characterized by those factors in terms of politics or consumption.
To market analysts, for whom what’s important is differentiating social groups according to parameters typically related to their capacity to consume, the middle class can be clearly delineated and subdivided according to income and consumption patterns. The same is true for pollsters researching electoral questions: for them, knowing someone’s precise income is irrelevant—they seek instead to identify social groups according to their attitudes and profiles. Difficult though it may be to define the middle class in conceptual terms, Mexico’s middle class does exist in practical terms: it is visible, and it can be measured.
Transformation towards a middle class society:
› The increase in GDP per capita translates into an improved quality of life and life expectancy for Mexicans.
› Although widespread poverty exists, Mexico is no longer a poor country.
› The 2006 presidential election caused a spike in in-kind transfers to the lower income population, potentially distorting
› The existence of more working age people than dependents is conducive to development and the accumulation of wealth.
› Today, Mexicans receive more and better education than their parents.
› From a structurally poor society to a population capable of transforming its quality of life
› Changes in consumption patterns have transformed Mexico from a society challenged by malnourishment to one facing problems of obesity.
› Total health spending—including public, private and out-of pocket costs—has tripled in 18 years.
› An ever-growing portion of Mexicans own their own home.
› The quality of housing has improved; today 60% of Mexicans live in homes with three or more bedrooms.
› Access to credit has increased the capacity of Mexicans to purchase automobiles.
› Purchasing power has increased, changing lifestyles and patterns of consumption.
› The use of cellular telephones and the Internet has grown in the last decade.
› Today, 65% of Mexicans travel outside their city at least once a year.
The two central arguments of this book are, first, that Mexico has become a middle-class society that, while still at a precarious stage, has nevertheless been transformed on all fronts, and second, that there is nothing more important to Mexico’s future—to its development and stability—than strengthening and expanding its middle class, especially right now, when the global and domestic economic situations have changed growth patterns and dampened expectations about the future.
In such circumstances, the pertinent question should be: what makes a society advance toward becoming a middle-class nation, and what can be done to help it advance in that direction?
It is important to recognize that despite appearances and independent of the current global economic crisis, there is no doubt that diverse segments of the Mexican population have experienced substantial economic improvements in recent years (even though the gap between the rich and poor persists). The past 15 years of economic stability and the demographic window have made possible the growth of the middle class—just as happened in the 1950s and ‘60s. The second chapter of this book shows how this has taken place and why the Mexican process has been distinct, above all because (though this phenomenon is not exclusive to Mexico) the growth of the middle class has more to do with a family’s combined income rather than the employment or salary of any one individual.
Mexico’s economic stability and the growth of the middle class are due, in essence, to four factors that have been described. First is the drop in fertility rates and the reduction in the dependency ratio—the number of children and elderly dependents over the size of the workforce.
Second is the macroeconomic strategy specifically dedicated to achieving stability; that is, a modest fiscal deficit and monetary policy designed to combat inflation. It is no coincidence that the common denominator between the two great eras of middle-class growth in Mexico (1950s and ‘60s, and from about 1995 until the present day) has been financial and economic stability, even when rates of economic growth have been less than spectacular.
The third factor is economic openness and the elimination of barriers to investment and commerce. Of course, these measures have not been employed sufficiently to achieve high levels of economic growth, but the important and transcendental role they play in making essential goods and services available to the middle class should not be underestimated. The fourth factor has to do with the significant expansion of education, health care, and poverty reduction programs.
Within this context of economic and social advancement, the greatest challenge the Mexican middle class faces lies in the economic crisis that has affected the world and, with particular severity, the domestic economy. The risk is double: first, families who have already achieved middle-class status could lose their ability to maintain it; second, the general lack of economic growth limits opportunity and social mobility, translating into widespread stagnation and, consequently, fewer possibilities for families to join Mexico’s middle class.
The challenge, as has been described, is not just preventing the erosion of the incipient middle class, but is rather creating the conditions that will serve as a platform to support its growth. Such an opportunity could materialize if, as part of government led strategy, the main obstacles to growth were removed. This could serve to not only hasten economic recovery but also to pave the way to greater productivity and social mobility.
In considering how to consolidate the middle class, one must understand the dynamics of the transformation in goods and services production that has taken place, and especially the means of adding value in the current world economy. It means strengthening the factors that have been mentioned: taking advantage of the fleeting demographic window; maintaining macroeconomic stability to avoid recurring crises that destroy wealth; expanding openness and competition in all economic sectors; and revolutionizing the education and health care systems to meet the needs and expectations of the country’s citizens.
In this bicentennial year of Mexico’s independence, it is worth asking whether the country is reaching maturity at 200 years old. The answer rests in its capacity to become a middle-class country. Conditions in 2010 are far better than in 1810 or 1910, thanks to democracy, albeit imperfect, a more competitive economy, despite burdensome monopolies in some sectors, a demographic window that represents a one-time opportunity for achieving authentic development, and without doubt, a majority middle-class population in spite of many analysts’ and politicians’ failure to recognize it.
By Luis de la Calle and Luis Rubio, Wilson Center, January 2012