Over the last few decades, research has shown a clear connection between the ideals of neoliberalism and social inequality. According to A Brief History of Neoliberalism, neoliberalism is defined as a theory of political economic practices that proposes that human well-being can best be advanced by liberating individual entrepreneurial freedoms and skills within an institutional framework characterized by strong property rights, free markets, and free trade. Beginning in the 1970s and 1980s as political philosophy rooted in classical liberalism with a focus on free markets and economic growth, the definition of neoliberalism has changed quite a bit over the last few decades. The evolutionary dynamic of neoliberaliztion has been such as to force adaptations that have varied greatly from place to place as well as over time. Any attempt to piece together a picture of what a typical neoliberal state looks like today would prove to be a difficult task. The somewhat chaotic evolution and uneven geographical development of state institutions, powers, and functions over the last thirty years suggests that the neoliberal state may be an unstable contradictory political form. The effects of this economic philosophy are especially obvious in Latin America, where many nations faced debt crises directly related to neoliberalism. The overall result was an awkward mix of low growth and increasing income inequality. In Latin America, where the first wave of forced neoliberalization struck in the early 1980s, the result was for the most part a whole ‘lost decade’ of economic stagnation and political turmoil. It can be concluded that forced neoliberalism in Latin America has led to an obvious increase in social inequality, but more specifically, forced neoliberalism in Mexico has led to a country full of impoverished citizens who lack economic and social stability. In 1984 the World Bank granted its first-ever loan in history. Mexico was hit hard during the global crisis of the 1970s, but the new combination of the IMF, the World Bank, and the US Treasury pulled together to bail the country out of its difficulties. Once Mexico was opened to the global economy, things took a turn for the worse. Due to government problems and the re-orientation of the country’s governing economic model, state expenditure on public goods declined. Food subsidies were restricted to the poorest segments of the population, and the quality of public education and health care stagnated or declined. President De La Madrid noticed the country’s rapid descent into debt and felt the only way out was to sell off and privatize public businesses. Privatization entailed the wholesale restructuring of labor contracts and this provoked conflict. The general outcome of this is lower wages, increasing job insecurity, and in many instances loss of benefits and of job protections. Given the violent assault on all forms of labor organization and labor rights and heavy reliance upon massive but largely disorganized labor reserves in countries such as Mexico, it would seem that labor control and maintenance of a high rate of labor exploitation have been central to neoliberalization all along. The restoration of formation of class power occurs, as always, at the expense of labor.
Mexico has demonstrated a key difference between liberal and neoliberal economic practices. Under a neoliberal state, borrowers are forced by state and international powers to take on board the cost of debt repayment no matter what the consequences for the livelihood and well-being of the local population. Under President Salinas, the attack on organized labor intensified in order to conform to NAFTA. Salinas had to open the peasant sector and agriculture to foreign competition meaning only the most efficient and affluent Mexican farmers could survive and compete. Close to starvation, many peasants were forced off the land, only to augment the pool of underemployed in already overcrowded cities. The wave of privatization in Mexico after 1992 catapulted a few individuals into the elite group of the world’s wealthiest people, proving that the neoliberal turn is in some way and to some degree associated with the restoration or reconstruction of the power of economic elites.
The effect of neoliberalism on Mexico has clearly been negative. Not just economically, but socially as well. The social inequality created by neoliberalism has become a serious issue in Mexico, as well as Latin America as a whole. Privatization of once public businesses has provoked major conflict throughout the country. Citizens who were once employed as laborers, are now close to starvation and forced to compete with other unemployed individuals in already overcrowded cities. It can be safely assumed that neoliberalism in Mexico has definitely led to an increase in social inequality.

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[ 4 ]. Harvey, David. A Brief History of Neoliberalism. Oxford: Oxford University Press, 2005. 88.
[ 5 ]. Harvey, David. A Brief History of Neoliberalism. Oxford: Oxford University Press, 2005. 100.
[ 6 ]. Harvey, David. A Brief History of Neoliberalism. Oxford: Oxford University Press, 2005. 100.
[ 7 ]. Harvey, David. A Brief History of Neoliberalism. Oxford: Oxford University Press, 2005. 76.
[ 8 ]. Harvey, David. A Brief History of Neoliberalism. Oxford: Oxford University Press, 2005. 29.
[ 9 ]. Harvey, David. A Brief History of Neoliberalism. Oxford: Oxford University Press, 2005. 101.
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