Mexico's strong economy has helped and will continue to help El Paso's
economy, the head of the Federal Reserve Bank of Dallas said during a speech in
El Paso on Wednesday.
Dallas Fed Chief Executive Officer Richard Fisher also blamed Congress and the Obama administration for holding back the nation's economic progress by their inability to agree on a budget and tax policies.
"Mexico has a significant impact on the fate of the El Paso economy, and this is fortunate because the Mexican economy is being transformed to a greater degree than people understand" in other parts of the United States, Fisher told two packed rooms in the Undergraduate Learning Center at the University of Texas at El Paso.
Mexico recovered more quickly from the worldwide recession than did the United States, and its economy grew 3.3 percent last year compared with 1.7 percent in the United States, Fisher said.
Mexico, which had hyper-inflation in the past, has seen an inflation rate of less than 3 percent in the past few months, he reported. The peso is holding steady and the Mexico banking system is growing while the United States banking system is contracting, he said.
Mexico's Congress is responsibly managing the country's fiscal affairs while the U.S. Congress "kicks the can down the road," he said.
Mexico's new president, Enrique Pena Nieto, has the nation talking about possible structural reforms in the country's nationalized energy and telecommunications sectors, he said.
If Mexico can reform its "woefully underperforming" oil industry, Mexico's economy will only grow stronger, and again, that will only help El Paso, Fisher said.
While Mexico has taken steps to improve its economy, Texas has been showing the rest of the United States how to create jobs and improve prosperity, with a "highly diversified economy," Fisher said.
In the past 22 years, Texas has outgrown the nation by a factor of 2-to-1 in job creation, Fisher reported.
"Here's what is holding back economic progress for El Paso and Texas" and the rest of the nation, Fisher said. A photo of the U.S. Capitol flashed on the screen behind him.
"Yep, Washington," he said, bringing laughter from the audience.
"The Federal Reserve has provided plenty -- if not too much -- high-octane fuel in the form of cheap money" for loans "to propel the economy forward," Fisher said. "Yet Congress and the executive branch cannot agree on a budget. We have not had one for five years. Nor can they agree on a path forward on taxes" and ways to incentivize businesses so that jobs can be created, he said.
Fisher also told his audience that they are not completely innocent in the nation's fiscal debacle.
"Look in the mirror," he said. "You put these people in office."
(c)2013 the El Paso Times (El Paso, Texas)
Distributed by MCT Information Services
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