SYNOPSIS: Fox's victory is a victory for Democracy and Globalization

When things went wrong for global capitalism in the 20th century -- and they often did -- they tended to go wrong first in Mexico. The Victorian version of globalization -- which depended either on colonialism, or on the support of domestic elites so disconnected from the local population that they might as well have been colonists -- began to fall apart in 1911, when Mexicans rebelled against the rule of the "scientific" dictator Porfirio Díaz. The cocksure optimism of "emerging market" investors in the early 90's got its first serious warning at the end of 1994, when Mexico plunged into financial crisis -- a crisis that proved to be a dress rehearsal for the terrifying Asian crisis that began 30 months later.

So Mexico's triumphantly free election on Sunday was cause for rejoicing, not just for Mexico, but for everyone who hopes that this time around we may be getting globalization right.

It's by no means clear that Vicente Fox Quesada was the better man. In terms of policy positions, he was virtually indistinguishable from Francisco Labastida Ochoa, the candidate of the ruling Institutional Revolutionary Party (what a name!), or PRI. And Mr. Fox will face a sort of reverse version of the Nixon-goes-to-China effect, which may put him at a disadvantage as he tries to continue Mexico's opening to the world. As a former executive of Coca-Cola, he will have to be especially careful not to lay himself open to charges of Coca-colonization, of selling his country to foreign investors. As the candidate of a party originally founded to defend the privileges of the Catholic Church and oppose land reform, he will have to bend over backwards to show that his free-market policies are not just a way to make the rich even richer.

And yet his electoral victory is the best thing that could have happened.

The worst-case scenario was a narrow victory by the PRI -- a victory that would have raised understandable suspicions of fraud. A solid victory by Mr. Labastida might have been acceptable; but Mr. Fox's victory proves that Mexico's reformers meant what they said, that they really have been out to turn their country into a real democracy.

Need one point out that this is, among other things, a vindication for the North American Free Trade Agreement? Sophisticated supporters of Nafta have always acknowledged that the treaty would in itself produce only modest economic gains -- a few percent added to real income in Mexico, a few tenths of a percent added in the U.S. The real justification of the agreement was political: it gave Mexico's reformers an achievement to point to, a promise of better things to come. Some critics of Nafta jeered at this argument, claiming that Mexican reform was a sham, that the reformers themselves were merely well-spoken crooks -- a claim made more plausible as revelations emerged about the dealings of former President Carlos Salinas de Gortari. But now we know that, whatever the sins of Mr. Salinas, the reformers he brought to power were sincere -- and the reform was real.

More broadly, those of us who believe that globalization, while neither a necessary nor a sufficient condition for democracy, tends to promote freedom have another success story to add to the list -- a list that now includes Korea, Taiwan, Chile, Argentina and more. When a nation opens to the world, its businesses become less dependent on government favor, its citizens become more aware of how politics is conducted in advanced countries. The result, repeatedly, has been a peaceful transition to true democracy.

Of course, such transitions are not automatic -- we still need heroes. And the hero of Mexico's transition is the current president, Ernesto Zedillo. Mr. Zedillo was an accidental president, a mild-mannered economist thrust into power when assassins gunned down the PRI's chosen candidate. His elevation raised the obvious questions: Would he become just another machine politician? Or would he simply be weak, allowing the "dinosaurs" to return to business -- including the business of stealing elections -- as usual?

But Mr. Zedillo was neither corrupted by office, nor a patsy for the corrupt officials in which the PRI still abounds. He insisted on a fair election. And he and his party have triumphed in defeat: the finest hour in the PRI's history was surely the moment in which it finally lost power.

Originally published in The New York Times, 7.5.00