Finding a Financial Balance: The Economy of Mexico

Obregón’s successor as president, Plutarco Elías Calles, formed a political party in 1929 that would become known as the Partido Revolucionario Institucional (PRI), or Institutional Revolutionary Party. The PRI was formed to ensure that the agreements made during the Mexican Revolution, such as land reform and political changes, were carried out. Calles focused on economic reforms. He founded the Bank of Mexico as well as the National Bank of Agricultural Credit, which was meant to loan money to poor farmers. In 1934, Lázaro Cárdenas became president. During his administration, the government implemented a major land reform program that distributed millions of acres of farmland to peasants. Under the ejido system , citizens could share ownership of farmland and pastureland. Each family in an ejido community would have a section that they could work independently. The land rights could be passed through generations of families. Cárdenas also allowed the formation of a large workers’ union, the Confederation of Mexican Workers. This union allowed workers to defend their rights and fight for higher wages. Perhaps the most significant change of the Cárdenas government was to nationalize the oil industry in Mexico. In 1938 the Mexican government took over the operations of foreign oil companies and turned them over to a new state-owned company, Petróleos Mexicanos (PEMEX). This gave the Mexican government a monopoly on the exploration, production, refining, and distribution of Mexico’s oil and natural gas resources. The growth of the oil industry, as well as natural gas production and the development of factories led to growth in the middle class of Mexico. Cárdenas also put railroads under national control. During the Second World War, Mexico helped the United States immensely. Mexicans came to the U.S. to work in factories and on farms. New laws allowed


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