The 1% Connection: Mexico and the United States, Crony Capitalism and the Exploitation of Labor

The Richest Person in the World, Carlos Slim, Lives in Mexico

According to Forbes Magazine, Carlos Slim, 72, is the wealthiest person in the world, accumulating $69 billion in net worth as of March 2012.

Born and raised in Mexico City (of Lebanese Christian descent), Slim was well on his way to becoming a very rich man when he struck pay dirt. Under the Mexican presidency of Carlos Salinas, who served from 1988 to 1994, Slim jumped on the Milton Friedman-inspired south-of-the-border rush to privatization and led a buyout of the state run Telmex phone company.

It was crony capitalism at its finest. Salinas relied on the relatively small group of Mexico's oligarchy to supply him with campaign (and perhaps personal) funds, in return for the sale of state assets at favorable rates and terms. (For example, Slim was essentially able to pay for Telmex out of the future profits of the company.)

So in 1990, Slim obtained (with some other backers) a monopoly on the telephone system in Mexico, guaranteed for years. The profit earned from the acquisition of Telmex was the fuel that allowed Slim to finance his telecommunications empire, still dominating the Mexican telephone landline market as well as the nation's cell phone user business through a spin-off firm, Telcel. In turn, the enormous revenue generated by the original sweetheart deal has helped finance Slim becoming the developer and owner of the largest mobile phone company in Latin America, América Móvil.

http://truth-out.org/news/item/10309-the-1-connection-mexico-and-the-united-states-crony-capitalism-and-the-exploitation-of-labor-through-nafta