Financial Times, 5/24/2012
by Richard Fisher, Chair of the Dallas Federal Reserve
For many Americans, Mexico is seen through the lens of immigration or drug trafficking. This is a mistake: it is outperforming the US in many economic areas and provides several important lessons for Washington policy makers that seem unable to make a start on ever more urgent reforms. Mexico has a sound macroeconomic footing and is addressing the microeconomic problems still holding it back. The same cannot be said for the US.
Mexico recovered rapidly from the global financial crisis. Real gross domestic product grew 5.5 per cent in 2010 and 3.9 per cent in 2011 after plummeting 6.2 per cent in 2009. Economic output was back to its peak pre-recession level after 12 quarters, bettering the US by nearly a year. Moreover, Mexico’s industrial production surpassed its pre-recession high in early 2011. US industrial production remains 3.3 per cent below its December 2007 peak.