Comparing Mexico to Venezuela vs Argentina
While Mexico cannot be directly compared to Venezuela due to their differing political landscapes, similarities can be drawn between their charismatic and populist leaders. Mexican institutions, though vulnerable, have shown resilience against falling into a crisis similar to Venezuela’s.
A more relevant comparison is with Argentina, a nation that experienced economic growth but has succumbed to the political whims of its class.
Argentina’s Political Rollercoaster
Argentine democracy has led its citizens to swing across the entire political spectrum. This might be acceptable if new regimes didn’t attempt to reinvent the wheel each time.
A mature country should have established development foundations and opened spaces for political interpretation without violating these boundaries. This includes respecting the division of powers, ensuring autonomy for crucial institutions like a central bank, adhering to fiscal discipline and macroeconomic health, and guaranteeing individual rights such as freedom of expression.
Both Argentina and Mexico share these similarities, with Argentina having at least a couple of decades more experience in political rollercoasters.
Movements like Peronism and Lopezobradorism have attempted to dismantle structures, rewrite economic rules, and impose their own versions of governance. In Argentina, when citizens grew weary of Peronist antics, they’d return power to more liberal politicians who would undo all previous work, only for the Peronists to return and start anew.
Mexico’s Political Landscape
Andréi Milei, backed by Donald Trump’s billions, has secured a majority in the Argentine Congress. While his libertarian ideology might be more consistent than Peronism’s outdated approach, it’s just another bounce in Argentina’s unreliable political scene.
Ask any entrepreneur to invest in long-term development in Argentina when they’re unsure if the next public policy will undermine central bank autonomy, devalue the Argentine peso by 200%, or expropriate their investments.
Though investors may feel more comfortable with the Milei-Trump duo now, capital thinks long-term, and this situation could change drastically within four years.
Mexico’s Political Volatility
López Obrador has implemented significant structural changes that have struck at the heart of investor confidence in Mexico. Modern leftist movements typically leverage markets to refocus their governance efforts on improved social services, unlike the 4T.
The obsession with leaving a grandiose, megalomaniac historical mark through radical and authoritarian changes—such as appropriating the judicial branch, undermining autonomy, re-nationalizing energy industries, or seizing electoral control—erodes investor confidence.
Mexico is not immune to future political shifts, deep reinventions, or extreme ideological pivots.
The bedrock supporting Mexico’s economy is its commitment to an open trade model, especially with the United States. The risk lies externally, driven by another self-proclaimed messianic figure in Washington who also aims to reshape things.
