Fat Boy Slim

Ben Ehrenreich · Mexico’s Billionaires

Last week, for the second year running, Forbes magazine declared the Mexican telecommunications tycoon Carlos Slim Helú the richest man in the world. In 2010, Slim – who holds a near-monopoly on mobile and landline services in Mexico, and whose family fortune includes department stores, hotels, mining, chemical, oil drilling, tobacco, tyre, construction and financial services companies as well as substantial chunks of both the centre of Mexico City and the New York Times – edged past Bill Gates by $500 million. This year Slim enjoyed a more comfortable lead: in just 12 months, his net worth has swollen by more than 30 per cent to an estimated $74 billion. Gates trails behind with a measly $54 billion.

The son of a wealthy Lebanese immigrant, Slim took advantage of the inflationary crises of the early 1980s to snatch up ailing firms. At the same time, the administration of President Miguel de la Madrid was busy privatising state-owned assets, opening up the markets and slashing social spending. When de la Madrid’s successor, Carlos Salinas de Gortari, privatised Telmex, the national telephone company, in 1990, Slim made a grab for it. Telcel now controls 90 per cent of the Mexican mobile phone market at some of the highest rates on the planet. Its umbrella company, América Móvil, is the largest cellular provider in Latin America.

Slim isn’t the only one who knows how to make the best of a crisis. The latest Forbes list includes more billionaires (1040), more new billionaires and more Mexicans (11) than ever before. Collectively, the Forbes honorees are worth $4.5 trillion, about three times Mexico’s GDP. Their average net worth is up half a billion dollars from last year. It would be easier to celebrate their good fortune – ‘Where their inspiration leads,’ Forbes says, ‘we will follow’ – had it not been such a wretched year for everyone else, not least for Mexicans. Three decades of neoliberal reform have not been so generous to Slim’s countrymen. Industrial jobs have leaked to Asia, the domestic agricultural market was smothered by cheap, heavily subsidised US imports, and millions of Mexicans followed their money across the border to the north, leaving large swathes of the countryside almost abandoned.

Given the dismal job prospects in the US, some have recently been returning to a country where an official unemployment figure of 5.5 per cent hides a reality in which a third of the population works in the informal sector and about 50 million people live in poverty, 19 million of them in what statistician’s call ‘alimentary poverty’. Then there’s the struggle to control the most unregulated market of all: the trade in illegal drugs from Mexico and points south to consumers in the US. Since 2006, when President Felipe Calderón declared ‘war’ on the drug trade – a conflict many Mexicans understand as an effort by the army and the federal police to monopolise, rather than eradicate, profits from the drug sales – 35,000 Mexicans have been killed, about 13,000 in 2010 alone. On the day that Forbes published its list of billionaires, 52 people were murdered across Mexico in incidents of what the newspapers call narcoviolencia. It was, in other words, a fairly uneventful day.

Which brings us to the most notorious of Slim’s companions on the billionaire list and the other great victor in Mexico’s ongoing neoliberal collapse: Joaquín ‘El Chapo’ Guzmán Loera, the elusive chief executive of the Sinaloa Cartel, which according to Forbes controls a quarter of all drugs smuggled out of Mexico. Guzmán first made the list in 2009, when he also made the magazine’s list of the world’s ‘most powerful people’. This year he was placed 60th on the power list, four spots above Oprah Winfrey. (Slim came in at 11, just after Hillary Clinton.) Guzmán’s rank among the billionaires, however, has plummeted. He tied for last. In the current booming crisis economy, a single billion doesn’t get you very far.


  • 16 March 2011 at 1:28pm
    technicalslip says:
    $74bn. Let's leave him a billion to live comfortably on, and continue his supposedly necessary and pioneering activities. Dividing the rest equally among the 47% of Mexico's 113m people who live in asset-based poverty (based on CIA factbook figures) would give them around $1400 each. That's comfortably more than the yearly income of the poorest decile.

    So how about a one-off $73bn windfall tax to celebrate the wondrous achievements of Sr. Slim? With the few thousand dollars left over from my rough and ready calculations, we can surely get a monument to this hero of deregulated neoliberalism erected in Chapultepec park.

  • 16 March 2011 at 2:45pm
    redeho says:
    Although I agree that it is a disgrace for Mexicans to have, in the same place and time, the richest and the poorest, when it comes to the causes behind this, the author got it all wrong. The author claims that "[t]hree decades of neoliberal reform have not been so generous to Slim’s countrymen...", but he seems to forget that income inequality --measured by the Gini coefficient-- is lower now than 20 years ago and, although marginally, poverty is also lower now than 20 years ago ( The high levels of income inequality are explained, to a large extent, by the lack of competition in Mexico (see Levy and Walton (2009) "No growth without equity"). Privatization, trade liberalization and other market-oriented reforms in Mexico could have increase the precarious levels of economic competition in Mexico and this might explain, partly, the decrease in inequality that we observe.

    The author also claims: "... President Felipe Calderón declared ‘war’ on the drug trade – a conflict many Mexicans understand as an effort by the army and the federal police to monopolise, rather than eradicate, profits from the drug sales..." This is a strong statement and as such should have a reference. I never seen any survey showing support for this claim (or conjecture). On the contrary, in Sep 2010, 55% of Mexicans supported the war against drugs ( Even among those of us who are against this war, I never came across anybody thinking of a government's plan to monopolize profits. Those of who differ from President Calderon's strategy think that the right strategy should be one that moves towards a free market for drugs (

    Rafael de Hoyos
    Mexico City

    • 17 March 2011 at 3:03pm
      cigar says: @ redeho
      "On the contrary, in Sep 2010, 55% of Mexicans supported the war against drugs..." Really? I took the trouble to read the DPA wire agency article the link points to, and here's what I found:

      "En septiembre, un 67% opinó que es inaceptable el costo de la guerra contra el narcotráfico, contra un 24% que opina positivamente y un nueve por ciento que dice no saber.

      "En junio, ante la misma pregunta, un 33% consideraba aceptable los costos de la guerra contra el narcotráfico, un 58% estaba en contra y un 9% contestó no saber."

      Summing it up: in September 2010, 67% (up from 58% on june) disapproved of the cost of the drug war, while 24% (*down* from 33%) approved, with 9% undecided. The 55% figure refers to FECAL's approval rating, which, actually, according to that same article, had fallen from 58% in that same period, and from 63% in 2007.

      You should be more careful with the primitve tricks you try to pull on LRB readers Sr. de Hoyos - they are not like the ignorant gringo chauvinists who frequent the WSJ, the NYT or the WP.

    • 17 March 2011 at 10:38pm
      cigar says: @ redeho
      According to the de Hoyos' page in Mexico's University of Anahuac,
      he's a consultat of the WB. How odd then that he should cite the Mexican government's figures, considering that at least according to one respected source in the media,
      they have been caught manipulating them! It may or may not be true that there are less poor Mexicans now than 20 years ago (one has to take de Hoyos' word for it, as he only provides a link to the home page of CONEVAL, the government's agency in charge of assesing "social development policy".) But the WB's latest report containing poverty and inequality figures, released last year, reveals that - at least since FECAL came to power - things have only gotten worse.

      The relevant WB report can be downloaded for free in
      It shows clearly, in page 39, that between 2006 and 2008, the number of Mexicans earning less than 1.26 and 2 dollars a day - respectively - has more than doubled.

      As to inequality, the Bank's historical figures, which can be found here,
      show that Mexico's Gini coefficient has grown 4 points between 2006 and 2008, going from 48 to 52, reflecting a clear and definite rise in income inequality. The UNAM's La Jornada, which, by the way, is financially supported by Slim, goes into more detail regarding the WB's inequality data:
      It shows that the income of the richest 10 % of Mexicans grew by close to 40% between 2004 and 2008, while that of the poorest 10% fell by 0.3 %. As things stood in 2008, the richest decile earned 34 times more than the poorest one.

      And de Hoyos' reasoning on the link between competition and inequality is convoluted to the point of being absolute nonsense. As the original post states, privatization created Slim's Telmex telecom monopoly, and given that FECAL's administration has been openly neo-Liberal in its desire to privatize everything but the air that Mexicans breathe, the WB's figures on inequality don't square with de Hoyo's claim that competition leads to more equality. That is, if, like de Hoyos, one assumes from the start that privatization can only lead to increased competition. Perhaps, thanks to his more extensive and experienced access to the WB's global and historical data, he could come up with better proof that this is the case?

    • 2 April 2011 at 8:26pm
      redeho says: @ cigar
      There are two statements made in the original article of Ben Ehrenreich that are clearly wrong:

      (1) “[t]hree decades of neoliberal reform have not been so generous to Slim’s countrymen…”

      For those who know about poverty and inequality in Mexico it is a well-known fact that poverty and inequality in Mexico decreased between 1992 and 2008 (even when taking into account that, as pointed out by "cigar" poverty increased between 2006 and 2008). Lustig and López-Calva document the reduction in inequality across Latin America during the last decades ( You do not have to take my word on the poverty trend in Mexico during the last 20 years, here is the link (go to pg 6):

      (2) “… President Felipe Calderón declared ‘war’ on the drug trade – a conflict many Mexicans understand as an effort by the army and the federal police to monopolise, rather than eradicate, profits from the drug sales…”

      The author will have to show his data sources, since I never came across those "many Mexicans" that understand the war on drugs in this way.

      As I said before, the link between inequality and competition is explained in Levy and Walton ( Perhaps "cigar" should go and read this book, it might give him/her a bit of clarity of thought.

      First time I´ve seen "Proceso" and "respected source in the media" in the same sentence.

      My original post had the intention of contributing, with another view, based on figures, to the debate, not engaging in an ideological discussion. There are things that are wrong in Ehrenreich´s article whether he or "cigar" or both like it or not.

      Rafa de Hoyos

    • 3 April 2011 at 3:40am
      Thomas, you are right, household surveys are not the right tool to capture incomes at the very top of the distribution. For instance, if Carlos Slim was included in the Mexican household survey (ENIGH) of 2008, the Gini coefficient would increase in 1.2 Gini points! (

      However, the limitations of household surveys to measure income distribution is faced by Mexico and all other countries in the world. Using administrative data from the fiscal system, F. Bourguignon and other economists at the Paris School of Economics are trying to construct a reliable measure of the top part (right tail) of the true distribution of incomes in OECD countries (


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