A hundred years ago Mexico was a very different place.
Believe it or not, Mexico was once a free-market beacon of rapid economic growth. It had low taxes, encouraged foreign investment and had reformed its laws to become more business-friendly.
And under Porfirio Diaz, Mexico pursued a pro-U.S. policy, invested heavily in education and rejoiced when local and foreign magnates opened new job opportunities for the Mexican people.
Then it was all undone. Diaz was tossed out by a revolution in 1911.
Since then the news from Mexico hasn't been so good.
After more than a decade of unrest, the Institutional Revolution Party (PRI) took over in 1929 and ruled the country with a kind of klepto-socialism for the next 71 years.
In the aftermath, the oil business was later nationalized, and run thereafter as a state-owned monopoly called Pemex with no foreign investment allowed. The education system became dominated by the teachers' unions, a central force of the PRI.
And in 1988, the telecom company was privatized to Carlos Slim, who gave Mexico a monopoly service with some of the world's highest telecom rates, thereby making himself the world's richest man.
In 2000, the PRI did manage to finally lose power. But the PAN governments of 2000-2012 never had a majority in Congress, and did little to improve conditions in energy, education or telecoms.
Investing In Mexico Today
Then last July Mexico changed course.
The PRI was re-elected under Enrique Pena Nieto, who was younger and more reformist than his predecessors. He was also more politically adept. Pena Nieto's first act in office was to do a deal with the opposition parties so he could get legislation through Congress.
Since then he has had the teachers' union head, accused of embezzling $200 million, arrested. He has gotten his party to agree to allow foreign investment in Pemex. And he has introduced legislation to allow foreign investment in telecoms, and if necessary break up Slim's near monopoly.
Of course, Mexicans will scowl if you suggest they're heading back to the days of Porfirio Diaz, because the PRI got to write all the history books and demonized him.
But that's where Mexico seems to be going, which is good news for investors.
In fact, there are examples all over the world where breaking a logjam like Mexico's went on to turbocharge growth.