We Will All Be Received In Mexico

My 9 year-old and I traveled in February to Mexico City for a brief visit. On our first day, during a two-hour walk touring our center-city neighborhood, I was pleased to hear her say “If my school was here, and my friends were here, I’d like to live here.”

My Ranch Water drink in Roma

Her comment followed directly after her inquiry into the price of things.  Our 30-minute Uber ride from the Mexico City airport cost just $7. The plane ticket itself cost just $250 on a Mexican discount airline. She realized the food we were buying – in Mexico’s most expensive city – was about half the price of food in San Antonio – one of the United States’ least expensive cities. I enjoyed watching her wrap her math-brain around exchange rates between the US dollar and the Mexican peso. I’m pretty sure in part she liked Mexico because she likes a bargain. That’s my girl!

Throughout the rest of our brief trip I thought about other financial and economic comparisons with Mexico.

Mexico is the 15th largest economy in the world, and the 11th largest when measured by purchasing power parity. (This second measure takes into account the domestic cost of living, and is considered a better measurement of poverty in a country). Eleventh in purchasing power parity ranking puts Mexico, perhaps surprisingly, ahead of Italy, Spain, and Canada.

My purpose in going to Mexico gave me anecdotal insight into the system of healthcare in Mexico. Like the United States, Mexico has a somewhat chaotic mix of public and private health care. Unlike the United States, Mexico offers some form of basic universal coverage.

I came to Mexico to visit my “host mom” from 27 years ago, in the house where I first lived in Mexico City during college. I visited because her breast cancer – in remission from 7 years ago – returned in December 2019. She had an emergency procedure to drain her lungs in January. I learned from her son that she had the option of electing to pay at a private hospital – with what they perceived as top-notch surgeons – or going to a public hospital to undergo the procedure, for free. Her son had recently received a lump sum severance from Ford Motor company, where he had worked in marketing. He decided to use that money to pay for the lung drainage procedure for his mom at the private hospital.

My traveling companion is 9 Years Old…

She now gets her regular chemotherapy treatments, which would cost them around $1,000 each, for free at the public hospital. This is essential because she has no private insurance. She and her son admittedly don’t love the scene at the public hospital, which they describe as chaotic and an inconvenient hour’s drive away. On the other hand, free chemotherapy treatments.

Ever since I first met her 28 years ago, my host mom has walked on crutches from having survived polio as a child. She can’t work. She’s privately uninsurable due to the polio as well as due to her previous bout with breast cancer. But with free chemotherapy, she’s alive to fight the cancer some more, and her family is not bankrupted.

I know some form of basic universal health care coverage remains an extremely controversial subject in the United States. I did not visit the free public hospital in Mexico. I trust my host family’s report that the scene isn’t great. In the face of death and bankruptcy, however, I am grateful that Mexico offers free cancer care to all of its citizens. My host mom deserves a chance to fight cancer and live longer.

My favorite building in Mexico City

Like much of Latin America throughout history, Mexico’s income is unevenly distributed, with the top 10% of the population earning 33% of the nation’s total income. And yet, in the United States, the top 10% earns 39% of annual income. We’re more unequal in terms of income earned in this country than is Mexico these days.

Looking at wealth inequality puts us in the United States further to shame. The most common simple measurement of wealth inequality, the Gini coefficient, indicates the United States as a more unequal society than Mexico. While Mexico has wealth inequality typical of Latin American countries, the United States by contrast is a complete outlier on inequality measurements, when compared to its common peer group of wealthy countries such as Canada, Australia, and European countries. 

While Mexico’s economy has grown at a slightly slower rate than the United States’ economy over the 25 years since I last lived there, the changes in wealth in Mexico are significant. This is probably most obvious in central Mexico City, where my daughter and I visited. 

I remember as a college student fantasizing about retiring some day to Mexico and living simply, on a very modest amount of money. The cost of living can be very attractive in Mexico, especially in rural areas. I think my daughter began to appreciate that idea as well, even though we only visited the expensive parts of its biggest city.

I lived in Mexico long enough (back in the 1990s) to not be naive about its struggles. Struggles with poverty, violence, corruption, and the absence of the rule of law in so many areas. 

Yes, in the United States we’re richer, outright and on average, than Mexico. But increasingly, we’re a harsher society. 


I kept humming to myself during our trip my version of the lyrics from Paul Simon’s Graceland. “My traveling companion is nine years old. She is the child of my first marriage. I have reason to believe, we both will be received, in Me-xi-co.”

See related post:

Entrepreneurship lesson from the Let’s Go Mexico Book series

Post read (113) times.

Entrepreneurs: Pack Half the Luggage, Bring Twice The Money

A version of this post ran in the San Antonio Express News.

In late high school and college I travelled to Mexico as often as I could. Some trips I went for ten days, later trips for a semester of school, then a whole summer. Finally, after graduating from college, I lived and studied in Mexico for a year.

I always carried the student travel bible at the time, Let’s Go Mexico, whenever I crossed the border.

I memorized two pieces of advice in the Introduction to my Let’s Go Mexico book.

“First, lay out all of your clothes and other luggage you intend to take in one pile on your bed. Next to that pile, place all of the money you think you will need to spend.

Now, pack half the stuff and take twice the money.”

The second piece of advice from Let’s Go Mexico was of a similar vein, something along the lines of “Take no more luggage than you could – if necessary – carry at a dead run in the middle of the night for a mile.”

I loved that advice and it always – for me at least – put me in the right adventurous frame of mind for border crossing.

Advice for Entrepreneurs

I’ve written before that it helps entrepreneurs to be a bit ignorant and maybe a touch funny in the head in order to launch themselves into a new business venture.

Entrepreneurs are risk takers. They exhibit the kind of crazy that would enjoy situations involving a dead run for a mile at midnight on the streets of Juarez.

Lately I’ve thought about the Let’s Go Mexico advice, and how that’s exactly the advice I would give to first-time entrepreneurs.

Instead of luggage, of course, you have your business start-up costs.

First, in your business plan, lay out all of the costs of things you think you need to get started. Next to that, figure out how much money you already have available for your venture. Here’s the thing: To survive your first year in business, you’ll have to make do with half those things, and you’ll need twice the money.

Also, if luggage in my analogy equals costs, try to start your business with no more costs than you can carry at a dead run for a mile in the middle of the night. Ok, the metaphor doesn’t quite work. But I hope my point is clear(-ish.) Entrepreneurship is incredibly difficult, your business will encounter the unexpected, and you’ve got to be ready to pivot in a totally unanticipated direction.

Writing a Business Plan

I work on educational videos for a regional non-profit microlender LiftFund that offers training for new (and experienced) entrepreneurs. Writing a business plan is one of those things which every business owner does.

A couple of my videos walk folks through the different component parts of a business plan. What I want to say at the end of the videos, however, is that – no matter what your plan says – you’ll need to cut your planned costs in half and figure out a way to put your hands on twice the cash.

Business Guru Mike Tyson

Everybody’s Got a Plan

I guess the following is a true story, since I found it on the interwebs.

Boxing great Mike Tyson was peppered, pre-fight, with journalists’ questions, asking how he would respond to his opponent’s plan for delivering a devastating left uppercut.

Mike responded sagely “Everybody has a plan ‘til they get punched in the mouth.”

(In my mind’s ear, I always hear that quote in a high-pitched voice, the final word pronounced ‘mouf.’)

Anyway, the point is, an entrepreneur’s written business plan only gets you so far. Because, at some point, everything goes into complete disarray.

Metaphorically speaking, you’ll be bleeding from the mouth, running your business at top speed for a mile in the middle of the night, just praying you make it to safety.

So remember, you entrepreneurs: carry half the luggage, and bring twice the money.


Please see related posts:

Videos Playlist for Entrepreneurs – Learn Excel

Video for Entrepreneurs – Personal Financial Statement

Entrepreneurship Part I – Fixed Income v. Equity

Entrepreneurship Part II – Lessons From Finance

Entrepreneurship Part III – The Air, Taxes, Retirement

Entrepreneurship and Its Discontents


Post read (1176) times.

Mexican Democracy – Something Hopeful This Week

The Mexican Tricolor

And now for something completely different:  Mexican Democracy.

No, that’s not the name of Axl Rose’s next tortured, long-awaited, magnum opus.

Mexican democracy is a topic I used to obsess over before I became a finance guy, on my distinguished journey to the pinnacle of achievement: an obscure ex-banker typing up his opinions on finance, while wearing pajamas.

Nearly 20 years ago I was among the foremost scholars in the US, writing in English, on historical reforms to the Mexican Constitution.

Seriously.  Ok, there were about 3 of us in the whole world who cared, but still.

So what’s happening with Mexican democracy today?

This week Mexico will reform its Constitution to allow for the re-election of legislators and mayors.

This makes me very happy, and I’d like to tell you why.

I wrote an academic paper in 1997 arguing that Mexico had no chance at a strong democracy without allowing the re-election of legislators.

I’m certain that the other 2 people in the world who read this paper the first time around found my views fascinating.

But guess what?  I was right then, and I’m still right, dammit.  That’s why I’m removing the foil on some fancy imported beer for Mexico to celebrate this week’s reform.

A visual representation of honoring Mexico’s reform this week

Some Mexican political history background on ‘No Re-Election’

For the past 100 years or so, and up until this week, elected officials in Mexico have never been allowed to run for re-election.

Not the President, not Governors, not Mayors, not Senators, and not Representatives.[1]

A history of authoritarianism

“No Re-Election” in fact has always been the #1 political principal and key slogan of the Mexican Revolution[2] – dating back to 1917 – in response to Mexico’s troubled 19th Century history of strongmen who occupied the Presidential Palace like incurable infectious diseases.

By forbidding re-election at the Presidential level, Mexico avoided cults of Presidential personality that plagued much of Latin America[3] throughout the 20th Century.  Most people believe the ban on Presidential re-election served Mexico well.

Unfortunately, the key constitutional weaknesses of Mexican democracy to this day also flow from this same ban on re-election.

An overly strong party system, and an overly strong presidency, are the logical consequence of the constitutional ban on the re-election of legislators.

Comparing the Mexican Congress to the US Congress

We Americans disagree on many things politically but the one thing that unites us, as a people, is our view of the loathsomeness of the US Congress,[4] currently enjoying single-digit approval ratings.

You don’t like the US Congress?  At least they have some responsibilities.  Let me introduce you to something worse.

The Mexican Congress has toiled in laughable irrelevancy since the Mexican Revolution.

You see, when you get elected to a 3-year term in the Mexican legislature, with no possibility for re-election, there’s kind of no point in doing your current job.  You need the next job.  And that next job doesn’t come from the people who voted for you, but rather from your party bosses and the President’s patronage machine.

With no re-election, there’s no possibility of legislators learning the ropes.  There’s no possibility in the Mexican Congress of developing a long-term personal power base – through constituent services, long experience, and the ability to pass complex legislation.

If you’re in the Mexican Congress you are the kale salad at a BBQ Meat-opia even.  The Mexican Congress is a loaf of white bread at the buffet of a gluten-free Paleo-diet convention.[5]  If you’re in the Mexican Congress nobody cares about you.

At least the US Congress matters.

You may not like Harry Reid or Mitch McConnell or John Boehner or Nancy Pelosi or any number of powerful legislators, but you have to admit:

  1. They wield power.
  2. They effectively advocate causes and coalesce interest groups.
  3. They serve as a check on the Executive & Judicial branches of government.

The result of the constitutional “No Re-Election” rule on separation of powers has been catastrophic, historically, for Mexican democracy.

Power has concentrated in the hands of the ruling party and the President unfettered by a stunted Legislative branch (and for others reasons, a flaccid Judicial branch[6])

The consequences of this week’s new law, in context

Do I think allowing for re-election in the Mexican Congress will spark a flowering of good governance, model democratic process, and a beacon of hope on our southern border?  Not quickly, and not noticeably at first.  I’m an optimist, but I’m not an idiot.

So then how important is this?

Look, re-election doesn’t solve – in the short run – top priorities like grinding poverty, or drug violence, or the myriad other structural challenges for Mexico right now.

On the other hand, I don’t think effective national governance can develop without allowing re-election in the Mexican legislature.  So this reform – which partially retracts a key pillar of the Mexican political identity forged in their 1917 Revolution – represents one of those subtle but ground-shifting institutional reforms that over the long run opens up new possibilities.  I’m celebrating, cautiously, on behalf of our southern neighbors.

Mexico – my favorite country except my own – deserves so much better than what it generally gets from its government.[7]

In sum, Negro Modelos for the rest of the week, but I’m not breaking out the high-end tequila yet.

Ps. Rest assured, dear fellow finance obsessives, I don’t expect to re-engage deeply with writing about historical reforms to the Mexican Constitution on Bankers Anonymous.  I just wanted to share my joy with someone (anyone?) that a small, but key, change is happening in Mexico.

Pps.  Also, if you suffer from insomnia, I can help you!  Please see my 1997 papers on historical reforms to the Mexican Constitution, in particular this one about the Mexican Judicial Branch, and this one on the Mexican Legislative Branch.

I’ve got boxes of these reprints still cluttering up my basement storage.  First person to find me a book agent gets an autographed copy of the physical reprints sent to them in the mail.  They make great stocking stuffers!


[1] As in the US, the Mexican Legislature is bicameral, with a Senate and a House of Representatives (Camara de Diputados).

[2] The phrase “Sufragio Efectivo, No Reeleccion,” (“Effective Ballots, No Re-election”) actually dates, ironically, to a campaign slogan by Porfirio Diaz in the 1870s.  But Diaz quickly decided – once firmly in power in the 1880s – that his own frequent re-election served Mexico’s best interests!  He held on to the Presidency through brutal control of everything, including elections, until fleeing the country in 1911, upon the outbreak of the Mexican Revolution.

[3] And Spain, and Portugal, and Italy, and Germany, and Russia, and China, and Indonesia, and several dozens of other countries in Asia and Africa.

[4] I’m simplifying the issue of disrespect for the US Congress.  It turns out people generally like their own representative, but find everyone else’s representative to be extremely loathsome.  I suppose this explains the paradoxical 95% percent incumbency re-election and 10% Congressional approval ratings?  Also, people generally believe the other side’s hard-core party stalwarts are really driving this country over the cliff.  And of course things seem to be getting worse.  This has been the prevailing view of all good Americans about their Congress since about 1793.

[5] Forgive me, writing this post has interrupted my lunch hour.

[6] On the Judicial Branch, one piece of data is all you need to know.  Teaching law at a decent law school in Mexico traditionally accrues more power and prestige to an attorney than serving on the Mexican Supreme Court.  Seriously.  If you have trouble sleeping at night, can I interest you in a paper by yours truly on the Mexican Judicial Branch published in 1997?

[7] Mexicans sum up their historical suffering with a phrase attributed (probably wrongly) to 19th Century dictator Porfirio Diaz :”¡Pobre México! ¡Tan lejos de Dios y tan cerca de los Estados Unidos!” (Poor Mexico, so far from God, so close to the United States!)

Post read (3941) times.