Featherbedding

It [Pemex, Mexico's state-owned petroleum company] eventually grew bigger than Gazprom, the Russian state oil company, but it has always had a problem with internal malfeasance and featherbedding. “Corporate governance is poor,” says Duncan Wood, head of the Mexico Institute at the Wilson Center. “It’s disorganized. There are little fiefdoms within it. They strike deals with organized crime and turn a blind eye.”

Two factors made the Ministry untenable; private industry considered the featherbedding of the public sector to be unfair competition. Since the DC depends on private industry for much of its support, continuing the practice would have compromised this support.