Mirages of well-being. Dangerous debt that mortgages the future

CARLOS R. MENÉNDEZ LOSA

The combination is risky: the increase in public debt, added to the fall in formal income due to low tax collection, leads to a vicious circle that strengthens clientelism instead of sustainable development. Social programs cease to be instruments of inclusion and social mobility and become mechanisms of political control.

Given the advance of informality – often due to lack of political will – debt is resorted to to support electoral subsidies and clientele, sacrificing investment in productive infrastructure and the generation of formal employment. A greater proportion of public spending is allocated to direct transfers that buy loyalty and generate submission.

The debt grows aimlessly. It is used to finance unproductive social programs, avoiding increasing taxes, always unpopular. Welfare persists for political convenience, not for social effectiveness. Instead of promoting development and citizen autonomy, the government adopts a perverse logic of dependency: “I will help you if you support me.”At the end of Calderón’s six-year term, Mexico’s public debt amounted to 6 trillion pesos. Six years later, López Obrador received a debt of 10 billion, which reached 18 billion in the election year of 2024. The heavy inherited burden now forces Claudia Sheinbaum’s government to go into even more debt, with a projection of 20 billion for 2026 (bit.ly/3JuiLvd

).

According to the Revenue Law approved this month, the federal government will be able to increase the debt next year by 1.78 trillion. Resources are urgently needed to continue financing the inefficiencies in Pemex and cover the commitments made with pharaonic projects such as the Mayan Train and the unproductive Welfare programs. Sustainable development will continue to be sacrificed.This year, Mexico has become the largest borrower among developing countries. It has issued sovereign bonds for more than $41 billion, the majority to cover Pemex’s operating deficit, the cost of its debt — which exceeds $100 billion — and to sustain oil production at its lowest level in the last 40 years (bit.ly/47niKRJ

).

Furthermore, a dangerous economic contraction has deepened in the first eight months. With 20 months of consecutive declines and the largest decline since July 2020—in the midst of the pandemic—industrial activity fell 1.8% compared to the same period in 2024 and the number of people employed in the manufacturing industry decreased 4.04%. The warning signs are obvious.

The Obrador regime needs resources to sustain its control strategy and maintain subsidies. It could combat informality, but it does not suit it. He could increase the collection, but he doesn’t dare. Millions of Mexicans in the informal sector are a political asset. He prefers direct transfers, which do alleviate poverty, but only temporarily.

PRODUCTIVITY

They tell us that the priority is to reduce poverty, but their decisions point in another direction. The countries that have managed to reduce it in a sustained manner did not do so with clientelism and subsidies, but with productivity and solid institutions. In Mexico, without a greater effort against informality, the fight against poverty will continue to be welfare-based, not structural.

To truly eradicate this stigma, it is necessary to increase production, promote labor formalization and, consequently, increase revenue, all in an environment of justice and respect for the law. It is urgent to combat corruption and clientelism, and demand transparency and accountability in the use of public resources, under strong citizen surveillance.

The government barely collects 16.5% of GDP, while the minimum collection recommended by organizations such as the OECD ranges between 25 and 30%. To increase it, it would have to expand the tax base, incorporating more informal workers and companies into the tax system. If not, the trend will be the same: manage poverty, not eradicate it.In his analysis of the first year of Governor Huacho Díaz’s administration, analyst Gabriel Rodríguez Cedillo warned this week that Yucatán faces an uncertain economic future if it does not redefine its productive course (bit.ly/4qtXxOS

). “Without structural measures that expand internal productive capacity,” he noted, the state “will continue to be anchored in a passive and dependent economy.”

Rodríguez Cedillo recalls that the supposed growth of the state economy in recent years was strongly influenced by federal investments, such as the unproductive Mayan Train, which did generate profits—temporarily—but also new commitments. Without that “dynamism,” he warns, Yucatán will return to its “normal dynamic,” of slow development.

EXTREME POVERTY

The Inegi reported this week that 25 Yucatecan municipalities live in extreme poverty, with average incomes below the minimum wage, while many others face great shortages, including the outskirts of Mérida, targeted by Morenoism. It was also reported that the government continues to support the expansion of the Mayan Train as its major “development” project, along with the undefined high-altitude port of Progreso.

The pharaonic railway project, which has already consumed 500,000 million pesos—a figure close to the annual education or health budget—has been an investment with a very low return. Conceived with political criteria, it did generate temporary jobs, but it deprived resources from other infrastructure projects capable of truly expanding productive capacity.

How to break this vicious circle that strengthens clientelism and slows down sustainable development? What can be done to prevent welfare from perpetuating structural poverty, as happens in the workshop? Let us monitor and hold those who govern accountable. It is not about eliminating social programs, but about converting them into instruments of autonomy.

When a government increases debt to maintain clientelistic subsidies instead of investing in true development projects, it mortgages the future. Growth without productivity is a simple mirage. Public investment only combats poverty in the long term when it creates capabilities—not dependencies. Let us be very alert.— Mérida, Yucatán

* * * “100 jewels”. In the context of the celebrations for the centenary ofYucatan Diary flagship ofGrupo Megamediawe present today Sunday “100 jewels of sacred art from the Yucatan Peninsula”, a multiplatform project that brings together, for the first time in a single document, one hundred works of sacred art of great value in Yucatán, Campeche and Quintana Roo (bit.ly/4npbivk

).

Selected by a group of experts in the field, these “one hundred jewels”, valuable for their religiosity, devotion, craftsmanship and cultural identity, are presented in text, audio and video formats, in a multimedia compilation that invites the reader to rediscover, in its different sections, the history and artistic and spiritual value of this invaluable regional heritage.

In the special supplement that accompanies this edition, we offer detailed information about the project, its genesis and development, its authors and the research work carried out over the last five years to make it a reality.

A collaborative effort that seeks to preserve, disseminate and contribute to the progress of the region. We invite you to meet him. direcciongeneral@grupomegamedia.mx / Special section on the website of theDiary : yucatan.com.mx(https://bit.ly/4diiiFP
)(* ) General Director of

Grupo Megamedia

What is the message of the text?

The central message of the writing is a warning about the political and dependent use of public spending in Mexico.

In essence, the text maintains that the government has chosen to go into debt to maintain clientelistic subsidies instead of promoting productive projects that generate employment, growth and citizen autonomy. This model—based on welfare and not productivity—creates an illusion of well-being, a “mirage” artificially sustained with debt, while real development stagnates.

The article suggests that without structural reforms that expand the fiscal base, combat informality and direct investment towards productive infrastructure, Mexico will continue trapped in a cycle of managed poverty and political dependence. In short, public debt is being used not to build a future, but to buy loyalties and sustain an unsustainable economic and political model.

Relevant points of the writing:

• GENERAL DIAGNOSIS
• 1) Mexico faces a risky combination: growth in public debt and decline in tax revenue.
• 2) This imbalance feeds political clientelism, instead of promoting sustainable development.
• 3) Social programs have become instruments of political control, not tools of inclusion or social mobility.
• DEBT AND ASSISTANCE POLICY
• 4) The government uses debt to support subsidies and welfare programs, avoiding raising taxes or expanding the tax base.
• 5) Pemex and the Mayan Train concentrate a large part of the spending, with low economic return and high fiscal cost.
• 6) Public debt increases without a productive plan that generates growth or formal employment.

7) Current growth is illusory (“mirage”) because it is not supported by productivity or structural investment.

• ECONOMIC AND SOCIAL IMPACT
• 8) The Mexican economy shows 20 months of consecutive industrial declines and contraction of manufacturing employment.
• 9) Mexico collects only 16.5% of GDP, well below the average recommended by the OECD (25-30%).
• 10) Labor informality continues to be a political basis and an obstacle to development.
• 11) In Yucatán, recent growth depended on temporary federal investment; Without it, the state faces a passive and dependent economy.
• CONSEQUENCES AND FINAL WARNING
• 12) Going into debt to support clientelist subsidies mortgages the future of the country.
• 13) Public investment only reduces poverty if it creates capabilities, not dependencies.
• 14) The text calls for citizen vigilance and accountability to transform social programs into true tools of autonomy.

15) The final message is a call to action: “Let us be very alert.”