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Mexochism: Mexico Is Likely to Disappoint, Again

One Mexican street graffito during the 2012 national election campaign that returned the Institutional Revolutionary Party (PRI) to power read, “Kick out the fools, return the thieves.” This line perhaps best captured the popular sentiment that the PRI, though perhaps cynical, undemocratic, and even criminal, at least had a coherent and predictable identity. Having the PRI government establishment intact with a different party sitting in the presidency simply had not worked for the country.

With the return of the PRI to the presidency in 2012, two broad views emerged as to what awaited this troubled country. The pessimists feared that the twelve-year experiment with a vibrant yet messy democracy under two administrations of the longtime opposition National Action Party (PAN) would be replaced by the “managed democracy”—more managerial than democratic—that was the hallmark of the PRI’s seventy-one-year reign before Vicente Fox led PAN’s successful campaign to defeat it in 2000. Thomas Friedman of the New York Times captured the optimists’ view when he predicted last year that the return of the PRI would create a Mexican renaissance marked by economic growth and increased geopolitical heft. Proponents of this view believe Mexico’s photogenic new president, Enrique Peña Nieto, will finally enact big reforms and that the country’s global competitiveness would increase as costs continue to rise in China. Both views may be right. But historically, Mexico’s political and economic life cycle has always tended to begin with optimism and end in disappointment.

Certainly this was the lesson of Fox’s alleged breakthrough in 2000, which in fact was greatly aided by more than a decade of PRI infighting. The first significant division happened in 1988, when the party’s left wing, under Cuauhtémoc Cárdenas, split to form the Party of the Democratic Revolution (PRD), which then caused a national crisis by charging that the PRI had stolen the 1988 election for its candidate, Carlos Salinas. Six years later, as Salinas’s term was ending, a bloody little war further weakened the party. Salinas claimed that his own party’s “nomenklatura” was derailing his reform program, a dispute that Salinas believes led to at least three casualties in his camp: Luis Donaldo Colosio, his handpicked successor, was assassinated at a campaign rally in Tijuana; José F. Ruiz Massieu, his former brother-in-law and party chairman, was murdered in 1994; and his brother Raúl was imprisoned shortly after Salinas left power. Salinas openly accused Luis Echeverría, who before assuming the presidency in 1970 served as chief of the Interior Secretariat, of being involved, along with the political police he once headed, in these events, and of leading a conspiracy against reform. These divisions inside the PRI paved the way for Fox’s victory. Another schism formed inside the party six years later, when the powerful national teachers’ union abandoned the PRI to support PAN’s teetering campaign, contributing significantly to the narrow win of Fox’s successor, Felipe Calderón.

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Yet despite expectations that they would break with Mexico’s corrupt past and preside over an era of economic reform, both presidents Fox and Calderón failed to boost development or trim the country’s nearly fifty percent poverty rate. Worse still, according to the IMF, Mexico was the bottom performer in Latin America in per capita growth during the PAN years, whereas Peru saw Asia-like growth, Brazil lifted some twenty-five million from poverty, and Colombia reasserted the state’s primacy by significantly diminishing the power of the cartels and other extra-constitutional groups.

Neither of the PAN administrations was able to make Mexico keep pace with these hemispheric developments, as the country plunged into a prolonged period of drug trade–induced violence that has left upwards of one hundred thousand dead or disappeared. Organized crime surged in its power and cruelty and occupied more of the country’s civic space as Calderón declared war on Mexico’s cartels days after assuming office. The situation became so dire that commentators the world over began referring to Mexico as a “failed state.” An estimated third of the country’s territory is not ruled by laws or official institutions, with organized crime and local PRI bosses routinely extorting money from legitimate businesses they have not already plundered or seized.

 

One cannot understand Mexico and its politics and policies without an appreciation for the degree to which the country’s politicized security apparatus influences and often determines policy and events in the country. This “political police,” under various and changing acronyms, is jam-packed with PRI operatives and acts as a virtual extension of their fractious governing elite. The security apparatus and judicial system are so corrupt that former US Ambassador James Jones told journalist Dolia Estévez that he had urged Fox’s predecessor, President Ernesto Zedillo, to “nuke” Mexico’s entire structure of police and justice rather than attempt piecemeal reform.

Neither of PAN’s leaders heeded the ambassador’s advice. Instead, Fox retained many of the “hard hombres” of the previous regime’s political police, some marked by scandal. For example, he appointed Alejandro Gertz Manero to the top post at the Secretariat of Public Security (SSP). While working in the administration of President Echeverría, Gertz was dispatched to the homes of private collectors to confiscate their pre-
Hispanic artifacts, as Echeverría had a collection of his own. One such collector in San Miguel de Allende refused to hand over his artifacts and “committed suicide” while Gertz was at his home, an event that scandalized Mexico’s by then besieged independent media.

For his part, Fox’s successor, Calderón, chose as head of the SSP a former political-police operative, Genaro García Luna, whose previous employer, Jorge Carrillo Olea, was a notorious former PRI governor of the picturesque state of Morelos, which was transformed into the country’s kidnapping capital during his tenure. When Calderón ignored the multiple pleas from his allies, and reportedly even from the military establishment, to change course on this and other appointments, his seemingly inexplicable refusal prompted speculation that the entrenched elites among the PRI oligarchs and the security forces in what Mexicans call the “deep sewers” of politics were blackmailing him with kompromat—compromising material assembled over the years—to keep him on a short leash.

Both a recent book by Mexican investigative journalist Anabel Hernández and a classified report from the US Embassy in Mexico City (made public courtesy of WikiLeaks) depict Mexico as a Russian-style state captured by its oligarchs, with Hernández detailing their links to the country’s security and judicial bodies. Although they were insufficiently persistent and ultimately unsuccessful, Fox and Calderón did from time to time shyly place PAN allies atop the unreformed police and law-enforcement structure—namely Ramón Martín Huerta (the interim governor who replaced Fox in his home state of Guanajuato), Juan Camilo Mouriño (touted as Calderón’s successor), and Francisco Blake Mora. All three, however, were killed in separate plane and helicopter crashes while serving in their respective posts.

Because of the utter failure to reform key institutions, Mexico under Calderón resembled more an autoimmune disease than a democracy. Several of the local crime bosses hauled in by the army turned out to be also local PRI luminaries, as well as shareholders in predatory companies linked to organized crime. PRI politicos found by the army or marines with heavy weapons and evidence of crimes were routinely released not only by the courts but also by the government. The most notorious case was the son of Carlos Hank González, patron of the PRI branch from which the current president, Enrique Peña Nieto, hails. Only one-fifth of these alleged big-time gangsters captured at great cost are still in custody.

As with the security apparatus, so with the government’s finances. Both PAN presidents appointed PRI “technocrats” to the powerful Finance Secretariat. While serving as Calderón’s finance minister and later central-bank chairman, Agustín Carstens, a PRI loyalist, permitted Mexican states to incur debt largely free from the central government’s oversight. PRI-ruled states took on massive liabilities that later could not even be accounted for. Meanwhile, the PRI machinery was also building a cash tsunami to ride back into the presidency in 2012. Calderón never seemed to connect the dots.

 

With the PRI back in the presidency, the past is prologue. The PRI was founded in 1929 not by the liberal ideologues and colorful figures of the Mexican Revolution of 1910 and subsequent civil war, as is popularly assumed, but by caudillos and strongmen who had amassed property during the social turbulence of this era. Eschewing further violence as counterproductive to their interests, they agreed to share the national wealth through a predictable political process. Predatory yet pragmatic from the start of its seventy-one-year reign, the PRI establishment calculates the costs and benefits of any reform to its own financial and political interests. And while minor economic reforms were implemented over the years—as when President Salinas sold off smallish public enterprises—the party and its elites have retained monopolistic control over the economy, from the energy sector to the privatized telecoms. This type of political economy, which has arguably kept Mexico poor and crisis-ridden over decades, would not likely be recognized by Adam Smith as a “moral” economy.

Now back at the presidential palace in Mexico City, the PRI factions have become unified in a way seldom seen previously. The consolidation under way is designed to ensure that no other opposition force will pose a challenge to their supremacy in the foreseeable future. As a sign of this resolve, the first major arrest by the new Peña administration was the head of the teachers’ union that had left the fold six years earlier to support the PAN candidate.

Looking ahead, the PRI is unlikely to rock its boat for the sake of genuine reform or economic development. Its much-touted “Pacto por México” program, although twenty years late, will likely see the enactment of some basic reforms that could help Mexico’s prospects—though they seem designed more to prevent their statist system from collapsing altogether than to genuinely rethink development. The PRI’s own business networks, the likely main beneficiaries of any new opportunities, dominate the stock exchange. So there may be some growth there, even if, paradoxically, value is destroyed in the overall economy—the way thriving eucalyptus trees devastate their environs to form a “green desert.” Modest reforms will take their course until they hit the inevitable wall of PRI intransigence, the one positive being that at least the PRI will now take the blame for bad policies, whereas before PAN often took the fall for what were usually PRI machinations.

Any policies aimed at controlling the cartels will answer largely to domestic political calculations, as the US is unlikely to pressure the PRI back into the strategy of confronting the cartels head-on. Besides, despite the occasional flare-up, the PRI throughout its decades in office was more adept at handling Washington on the thorny issue of drugs than the PAN later was. For example, despite the allegations of his ties to drug cartels, the PRI’s presidential candidate in 2000, Francisco Labastida, was tacitly endorsed by the outgoing Clinton administration and by both US presidential candidates, George W. Bush and Al Gore. It would appear then that the PRI can again engineer cooperation with both Washington and the main domestic cartels. Mexico, after all, has the geopolitical and energy trump cards, and here the PRI is smart enough to avoid major dust-ups with Washington and to efficiently play to its strengths, including trade and petroleum.

While the days are gone when the legendary architect of Mexico’s modern political police, Fernando Gutiérrez Barrios, famously picked up a phone and called one of a handful of organized-crime chiefs to give orders, the PRI will aim to regain some control over the cartels and channel their energies for its ends. They will likely continue a strategy pursued by Fox and Calderón (although they deny it) to concentrate firepower on more violent and feral groups such as the Zetas—whose roots are in the armed forces and not the older PRI-linked cartels—while forming a tacit alliance with more amenable and “political” cartels such as Sinaloa, whose renegade leader came up through the ranks after working for President Echeverría’s brother-in-law Rubén Zuno Arce, who served out a life sentence in the US for the 1985 murder of a US agent on behalf
of the Guadalajara cartel.

Through its various branches, however, the PRI system will likely continue to extort individual businesses as well as gradually take over industries without resorting to the official nationalizations of the past. Today, organized-crime operatives stroll leisurely into luxury hotels at beach resorts, as well as the outdoor markets of poor indigenous tradesmen, in broad daylight, heavily armed and impervious to any authority—because they are the authority—able to demand extortion payments or force owners to hand over their choicest businesses. Hundreds of businesses, big and small, have been torched for resisting; even foreign-owned ones are no longer immune. Though much of this extortion was encouraged by local PRI bosses to embarrass PAN, the opportunities for enrichment are so sweet that they will not be easily discontinued. After all, even President Salinas had problems controlling the deep sewers of his PRI, which undid him in the end. The fact that even close relatives of top PRI officials are occasionally kidnapped and killed today indicates that Dr. Frankenstein may now be weaker than his monster.

Even if they could not follow former Ambassador Jones’s advice to “nuke” the county’s police and criminal justice systems, Presidents Fox and Calderón might have learned the lessons of history and seen how their counterparts in post-communist Europe and post-Nazi Germany successfully transformed their countries after years of tyranny. Among others, Vaclav Havel in Czechoslovakia, Mart Laar in Estonia, and Konrad Adenauer in Germany succeeded in ushering in new eras by replacing existing elites with their comrades who, though less experienced, were joined by their shared goal to establish competitive political and economic systems. These PAN presidents might also have noted that where the elites were not ousted in Eastern Europe and the former Soviet Union following communism’s collapse, in places like Romania, Russia, and Ukraine, Mexico-style problems surfaced. Security agents and party hacks from the old regime formed symbiotic networks, enriching themselves through corrupt dealings while political and economic life stagnated. Such political lessons did not penetrate the Mexican political consciousness.

Mexico’s ultimate curse remains its political class and lack of viable alternatives. Only different shades of statism, asistencialismo (nanny state) and clientelismo (partaking in patron-client and vertical-dependency relations), seem to have legitimacy in the political discourse. Fear that Mexicans may not understand anything else is a myth propagated by the elites benefitting from this status quo. Indeed, the PRI-PAN-PRD statist political economy seems breathtakingly cynical in the face of the spectacle of millions of Mexicans flocking across the border to the “wild capitalism” of America, from which their political class claims to protect them back home. Some democratic activists have not given up and are trying to form a new political party, but they face an uphill battle. Any attempt to truly liberate Mexico’s economy would first have to neutralize its formidable parallel government. Perhaps more than a Lady Thatcher, this is a job for a Winston Churchill—or even an Oliver Cromwell.

Fredo Arias-King served as senior adviser to the National Action Party during its presidential campaign in 1999–2000. He is the founder of the Washington-based Demokratizatsiya: The Journal of Post-Soviet Democratization.

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