In the aftermath of the Mexican Revolution, bankers thrust the disciplinary power of the state between debtors and creditors. They used their influence to criminalise the act of writing an uncovered cheque as fraud. From 1932 until 1984, debtors who wrote bad cheques to guarantee loans faced serious consequences, from fines to jail time. By examining approximately 115 arrest records, Chapter 4 uncovers the early history of financialisation, as more people began to use new financial instruments. When people wrote uncovered cheques, some of them experienced first-hand the growing pains that came with participating in financial modernity. Cheques represented the new dynamics of economic citizenship at mid-century, as the political elite of the PRI shored up the interests of bankers at the expense of bank account holders. As this chapter shows, the criminalisation of bad cheques facilitated the emergence of financial capitalism by establishing new kinds of property rights and creating a new white-collar crime. In the process, political leaders introduced new forms of coercion into the debtor–creditor relationship that left debtors more vulnerable than ever.

Even more than Chile, Mexico is a case of light taxation. Although its tax burden has increased recently, it remains well below the regional average. Non-tax revenue from PEMEX helps explain this situation, but it is not simply a product of reliance on oil. This chapter develops a political explanation of Mexico’s light taxation, which argues that the causal dynamics behind it are similar to the ones operating in Chile in two crucial respects. First, light taxation reflects a sustained power imbalance favoring anti-statist actors. Second, this imbalance is largely an unintentional, path-dependent consequence of efforts by a left-leaning government to redistribute property in favor of workers. The key reformist episode, which occurred during the mid-1930s, set in motion a reactive sequence whose result, strong business organization and the coming together of economic elites and social conservatives in a relatively cohesive anti-statist bloc, was subsequently reproduced through self-reinforcing mechanisms involving ideas and power. This bloc has held together under both authoritarian and democratic conditions, frustrating efforts to raise taxes and expand the public sector.