ABSTRACT
In Mexican economic literature and in the main Latin American economic journals, a continuing argument has been waged between what could be called the fiscal conservatives and the fiscal expansionists. Opponents of a sound budgetary strategy who had criticized the government’s policies since the early 1950s took advantage of the Ortiz-Mena document and blamed the strategy it outlined for the 1968 turmoil. Foreign credit had been relied upon, but it had remained a reasonable and basically constant fraction of gross domestic product (GDP) for about nineteen years. An examination of the different components of the Mexican tax structure shows that taxes were low on consumption, with excise plus sales taxes a comparatively low proportion of GDP. The end of stabilizing development coincides with the start of the Echeverria administration. Echeverria actually continued with the policies of stabilizing development in his first year.
