The Downside and the Upside

Álvaro Vargas Llosa drills Latin America for its lack of preparedness leading up to the American financial crisis:

Despite the warnings, Latin Americans were largely unaware of the implications of the U.S. financial meltdown and the recession until only a few weeks ago. They believed that the times when the U.S. sneezed and the region would catch a cold were gone.

What an illusion. A lot of what has helped Latin America's economies in recent years -- access to capital markets, foreign investments, remittances from emigrants, the price of natural resources -- depends on the health of the global marketplace.

He goes on to rail on countries that didn't tuck away any of the extra revenue from the last few years' high commodity prices, which is most of them, including Mexico with its sky-high oil income. It's all true enough, but you could respond that, at least in Mexico's case, the banks are safe, the peso has survived weeks of wild see-sawing, a massive government intervention in key industries will not likely be needed, and Calderón's counter-cyclical stimulus plan has been hailed by everyone as the right approach. Mexico's long-term economic strategy needs to be upgraded (and under Calderón it has taken some timid steps), but given the pre-existing limitations, it's handled the crisis pretty well. Compared to many of its neighbors, Mexico has been a portrait of responsibility.