(Page 22 of 22) - Deconcentration versus Devolution of Water Management in Mexico: Inferences from the Rio Bravo (Rio Grande) Basin authored by Donnell, Howard.

analyses. The data analyzed here suggest that, while Rodríguez (1997) focuses on the
fiscal reforms of the De la Madrid and Salinas de Gortari administrations in developing
her argument that the

PRI

-controlled Mexican government decentralized in order to shore

up its legitimacy and popular support (and meet loan requirements of international
financial institutions) in the face of the Latin American debt crisis (which Mexico
triggered with its default announcement in August 1982), the most significant change in
the revenue structure of subnational governments took place earlier, with the López
Portillo administration’s Ley de Coordinación Fiscal of 1980, i.e., while the lending
boom induced by the two

OPEC

oil price shocks of the 1970s was still in full swing, and

while Mexican fiscal policy was expansive, and monetary policy loose. Hence the
“snapshot” data that Willis, Garman and Haggard (1999, Table 2, 13) cite—finding a
moderate increase between 1982 and 1992 in the share of total government tax revenue
collected by state and local governments, and in the share of total government
expenditures exercised by the same—provide no leverage for evaluating the prospect that
a more significant change in these indices may have taken place prior to 1982.
Nevertheless, the present analysis is consistent with their overall conclusion that “Mexico
is substantially more centralized than the other four countries” in their study (Willis,
Garman and Haggard 1999, 16; Garman, Haggard and Willis 2001, 222).

Meanwhile,

the present study provides quantitative empirical support for Montero’s (2001, 47)
qualitative characterization of the Mexican case as one of “sustained centralization,” such
that López Portillo’s 1980 tax reform “continued a historical trend in which, by 1991,
state tax revenues were just over a third less than what they had been before 1940, and
municipal revenues were a quarter of what they had been prior to the revolution”
(Montero 2001, 47, citing Díaz Cayeros 1995, 81-82). Hence in the Mexican case,
including that of funding for water management in the Río Bravo Basin, the data suggest
that the neoliberal reforms after 1982 are less significant in an even slightly broader
historical perspective than the contentious debates over such reforms would lead one to
expect.

The same authors present an updated table in their more recent article (Garman, Haggard and Willis 2001,

Table 3, 217), which incorporates data for 1980-84 versus 1990-94 to measure the share of total government
expenditure by level of government, while retaining single years—updated to 1982 versus 1994—to measure the
share of total government tax revenue collected by level of government. While the former averages in the pre-
crisis years of 1980-81 together with the crisis years of 1982-84, it still does not consider that a relevant
change—implementation of the Ley de Coordinación Fiscal—took place between 1979 and 1980.