WHY MEXICO, CHAPTER 7 (PART I)

Why do Mexicans pay so high interest rates?

   We are about to look into the second most important cause of insecurity, unemployment, and migration.

   Before that, let’s review the overall situation.

   The main characters in the drama of the failed project of Mexican development are politicians, foreign investors and banks, and their culpability is only circumstantial.

   Politicians have done everything possible in their power. The fact of they don’t having the attitude, ability or honesty to do their duties, is not their fault, but the various events that began with the discovery of America.

   Foreign investors are not to blame for being on the winner’s side, their task was to negotiate, and if they made easy deals it’s not their fault.

   The banks are now mostly own by international consortiums, and are taking advantage of the situation as it existed before of them. The now extinct Mexican banks were as insensitive as current banks.

   After this brief introduction, find next.

CAUSE NO. 2

ABUSIVE CREDIT POLICIES OF BANKS AND LARGE STORES

   Originally, banks all around the world had the sole objective of increasing their clients’ money by financing successful businesses.

   It was not until the second half of the nineteenth century that banks focused on the market of people with cash flow problems and began lending money for non-productive activities or goods, such as vacations, clothing, scholarships, and etcetera.

   Then in mid twentieth century, banks invented the “credit cards” and began the era of anguish for debtors and glory for banks.

   As of that moment, the loans for the purchase of food, household appliances, consumable for the home, and all kind of non-productive goods, have been increasing in number and money. Consequently, banks, instead of having the priority of contributing to economic growth, are now promoting the increase in the cost of living.

   In Mexico, banks and stores can charge total annual costs of more than 100% of the original loan. In addition, as in most underdeveloped countries, in México there are no regulations to prevent financial institutions from cheating customers into believing that they can improve their lives, by buying consumables with borrowed money. 

   Mexicans are very responsible and pay their debts until the liquidation or until the collapse of their finances, if this second possibility occurs, it is common that by then the bank has already recovered the loan and obtained reasonable profits. Banks or stores shall follow their nature and will not agree with the "reasonable", they will do everything to get extra benefits.

   Now let’s review how this relates to insecurity, unemployment, and emigration.

   Being persecuted by debt collectors is really disturbing, but when the reason for nonpayment is the loss of your job, the issue becomes a major problem. 

   The day after your failing payment, your creditor puts you in the list of “dishonorable debtors”, such status diminish your possibilities of getting a new job.

   When your experience gives you a managerial level, no one hires you, because banks and insurance companies will deny any possibility of doing business with you. Potential employers will not take the risk.

   So, the one who was once a respectable citizen is forced to do things he never intended to do, such as migrating to other country, or accepting a job without questioning whether it is legal or not.

WAY IN WHICH THE MEXICAN POLITICIANS ADDRESS THIS PROBLEM.

   Politicians do not see the relationship between the cost of money and the empowerment of criminal organizations. They feel they have to show commitment to the welfare of their constituents, so when they discover that stress has become the most important cause of absenteeism, they decide to discuss on the advisability of having the Social Security System provide psychological help.

   They are far from understanding that more than 60% of working Mexicans are dealing with unpayable debts that leave them without sleep and in constant stress.

   Saving their voters from abusive loan and credit practices is not part of any politician's plan.

PARTICIPATION OF THE POLITICIANS SUB-CULTURE IN THE NATIONAL CULTURE (Second attempt).

  To reject the first attempt was worthy, because now we know that the problems that politicians have made grow, can be solved, and that the solution is within the reach of politicians, regardless of their current alienation from reality.

   Here the new conclusion for this section.

   The participation of the Subculture of Politicians in the National Culture is total and deceptive. Total, because the politicians have shared culture and history for centuries with the entire population; It is deceptive, because politicians live in a superposition of alternative realities that prevent them from understanding what is happening and give them the intimate peace they need to justify their abuses.