Mexico: Year Zero

Fred Rosen

For Felipe Calderón, the second president of Mexico to come from the conservative National Action Party, this is year zero for his governance of Mexico from the hard right. Elected in a disputed, polarizing process with just 35% of the popular vote, unrecognized as Mexico’s legitimate president by his principal opponent, he has chosen, despite his soft-spoken manner, to rule with an iron fist.

He is eager to demonstrate that he will be a tougher and more decisive president than his equally conservative but very indecisive predecessor, Vicente Fox.

The Political Moment

On November 20, about two weeks before Calderón’s inauguration, Andrés Manuel López Obrador (AMLO), the center-left candidate of the Party of the Democratic Revolution (PRD) who lost to Calderón by a disputed half percent of the vote, arranged to be sworn in as the “legitimate president of Mexico.” He presented a parallel cabinet to the public, declared his solidarity with social movements of the poor, and announced that his inauguration was meant to “confront a fraudulent election.”

Calderón’s response to AMLO’s challenge has been his announced determination to govern Mexico with no equivocation or compromise of his conservative principles.

His intentions were first signaled by his cabinet choices: Even his best, most competent choices were meant to contribute to a politics of polarization. While the heavy-handed (or “firm-handed,” take your pick) former governor of the state of Jalisco, Francisco Ramírez Acuña, now the secretary of the interior, drew the most criticism for his repressive past, it is probably more significant that Calderón chose a team of neoliberal technocrats for his “economic cabinet,” especially the neoliberal financial functionary Agustín Carstens, to be secretary of the treasury.

Carstens was a Treasury undersecretary in the early years of the Fox government, and a mid-level officer of the International Monetary Fund (IMF) from 2003 until he left the job to join Calderón’s transition team last October.

His career reflects his undergraduate training at the Technological Institute of Mexico and his graduate training in economics at the University of Chicago, both of which prepared him to see the world as one in which competitive, unregulated markets are always efficient and produce “optimal” outcomes, a world in which private investment is always the key to economic development. His career at the IMF reflects a utopian belief in a single world economy in which the most important actors are sovereign private investors, unregulated by national political actors.

His advocates hope he will attract more foreign investment to Mexico by balancing the budget, reducing regulations and therefore the costs of production, privatizing as much of the energy sector as possible, breaking up the Telmex near-monopoly of the telecommunications sector and further deregulating labor markets—smashing, that is, what’s left of union power and eliminating as many labor protections as possible.

The appointments of Ramírez and Carstens go together. The repressive law enforcement we have already begun to see under Ramírez is a necessary complement to the deregulatory, neoliberal economic policies we are beginning to see from Carstens. The one enforces while the other excludes and divides.

Calderón’s government is determined to present itself as tough enough to crack down on disorder and to balance its fiscal budget by imposing austerity on the public sector (except on that part of the public sector that enforces the government’s toughness). He wants to restore law and order to those areas beset by criminal violence or social protest (two activities he deliberately conflates), and he wants to maintain macroeconomic stability by cutting federal spending, even while raising military and “security” expenditures.

He has begun by launching what has been billed as an all-out war against Mexico’s brutal drug traffickers, vigorously defending the social order by cracking down on the social movements in the state of Oaxaca, and responding quickly to the stunning rise in corn and tortilla prices. As these three components of the political moment play themselves out, things are beginning to look dicey for the new president. Illicit drugs are becoming cheaper and more plentiful on Mexican streets, tortillas are becoming more expensive and less plentiful on the kitchen tables of the poor, and repression and dissent are escalating in Oaxaca.

The Drug War

“We are looking to take back the spaces that organized crime has seized,” announced Interior Secretary Ramírez in early December, after the government sent federal troops and police to the beleaguered state of Michoacán to battle the powerful drug cartels that have carried on a chaotic reign of terror with almost total impunity. Ruthless violence between rival gangs in Michoacán has taken hundreds of lives during the past year.

Mexico’s transnational cartels make their money not so much by producing illegal drugs as by transshipping them from third-country producers to U.S. wholesalers. Since no legitimate agency is in a position to regulate this trade, the industry has become self-regulating by means of selective assassination, cautionary beheadings, bribery of government officials, strategic payments to the needy and so on.

Since the U.S.-promoted Drug War began in the early 1980s, its successes in Mexico (and elsewhere) have been minimal. Indeed, each seemingly successful crackdown has produced what Mexican law enforcement officials call the “cockroach effect,” the movement of illicit production and trade from one heavily policed area to another that is friendlier to the industry.

The production, distribution and transshipment of illicit drugs is a trade in which hundreds of billions of dollars a year changes hands in North America alone. U.S. drug enforcement officials estimate that $142 billion in profits was grossed last year in Mexico. The high stakes have produced a ruthless struggle for control among the drug gangs. The billions in profits (even to the mere contenders for market power) has allowed each cartel to employ the hit men who regularly make otherwise honest citizens an offer they can’t refuse: plomo o plata—lead or money.

In 2002, the Tijuana drug capo Benjamin Arellano Felix was captured by federal police, and his brother Ramón was killed. This led Attorney General Rafael Macedo de la Concha to jubilantly declare, “We have taken the cartel to pieces.” The U.S. and Mexican press celebrated the “body blow” dealt to the Tijuana cartel.

The vacancy at the top, however, had not destroyed the industry; on the contrary, it had unleashed violent struggles for its control. So President Fox unveiled a plan called México Seguro, which aimed to confiscate illicit drugs, destroy productive fields and complexes, arrest traffickers and establish checkpoints on the highways of the half dozen states most affected by the drug trade. The main result was a further flowering of violence and brutality. Another was the “cockroaching” of traffickers into less controlled areas.

Now we are witnessing the dispatch of federal police and military units to the states of Michoacán, Baja California and Guerrero, as Calderón tries to show the cartels and their hit men who’s in charge. Marijuana fields have been burned, drugs have been confiscated, capos and their family members have been arrested and extradited to Texas and California, drug profits have been lost, and professional executioners have been killed, arrested, or forced to flee the states under siege. Calderón says the operation has brought “peace and certainty” to Mexico, and has been lavishly praised (especially for the extraditions) by George W. Bush, U.S. Attorney General Alberto Gonzales and the U.S. ambassador to Mexico, Tony Garza.

But political columnist Raymundo Riva Palacio reports in the daily paper El Universal that aside from the extradition of a half dozen drug barons, the cartels have not taken such a hard hit. “The cost of a joint of marijuana on the street of Mexico City,” reports Riva Palacio, “is 15 pesos [about $1.25], compared to 25 pesos in December, while Ecstasy tabs, whose producers were also supposedly targets of the crackdowns, have fallen to half of the 50 pesos they cost at the end of the year.” If the operations had been a success, reasons Riva Palacio, the logic of supply and demand would have produced a reverse effect.

The new drug war, however, may have broader motives. The administration may simply be signaling that whether it is confronting civil unrest, labor conflicts or criminal activity, it will increasingly rely on police and military force to establish the conditions for law and order, no matter what the disorder is all about. Which brings us to Oaxaca.

Oaxaca

The explosive situation in the state and (especially) the city of Oaxaca began last spring as a simple labor conflict: Section 22 of the National Teachers’ Union (SNTE) versus the Secretariat of Public Education (SEP). On May 1, Section 22 presented a list of contractual and social demands to its official negotiating partner, the SEP, and to Oaxaca’s governor, Ulises Ruíz. The demands, some directed to the SEP, some to the state government, were quickly—as has become traditional in Oaxaca—backed by civil disobedience and a strike. The civil disobedience was answered on June 14 by a ferocious state police attack on a teachers’ sit-in.

The attack upped the ante, widened the conflict and complicated Mexican politics. It gave birth to a community-based social movement called the Popular Assembly of the Peoples of Oaxaca (APPO), formed to back the teachers’ strike and to press for a broader set of political and social demands.

Governor Ruiz is a cacique of the Institutional Revolutionary Party (PRI) who has risen and maintained himself in power through a combination of corruption and thuggery. His departure, by one means or another, has now become the only non-negotiable demand of the striking members of Section 22 of the SNTE, even those who are anxious to go back to work. It is also the APPO’s chief demand.

In late June, the APPO “seized” the center of the city of Oaxaca to support the teachers. This past November, just before Calderón took office, President Fox sent the Federal Preventative Police (PFP) into the city to “retake” the city center and restore order.

Though the intolerable social conditions that reign in most of rural Mexico are just beneath the surface of the conflict, the APPO’s demands have never been very radical: better conditions for teachers and schoolchildren, the removal from office of a repressive governor, the withdrawal of federal police and, now, the release of imprisoned APPO members.

All along, even after the PFP was dispatched to the city, the Fox government indicated it might recognize the validity of the social struggle, which had burst into violence under severe provocation, and begin a serious dialogue with the leadership of the union and the APPO.

Had such a dialogue taken place then, or more to the point, were it to take place now, it would touch on issues of education (the unrest began with the teachers’ strike), health, housing and creating decent work opportunities. It would also deal with the APPO’s demand that Governor Ruiz be removed from office and, now, that Oaxaca’s “political prisoners” be released from jail. (More than 140 oaxaqueños were arrested November 25 during a police attack on an APPO demonstration, and many are still being held in a federal prison in the state of Nayarit.)

On the other hand, the federal government (under both Fox and Calderón) has consistently held out the possibility that it might unambiguously side with the tough law-and-order approach of Governor Ruiz, treat the mobilized members of APPO as common criminals and restore order with the overwhelming use of police power.

In early December, Flavio Sosa, known as the APPO leader most open to dialogue and compromise, and most determined to keep the armed supporters of the movement at bay, was taken into custody along with his brother and two other APPO leaders by agents of the PFP and the Federal Agency of Investigation just after they had gone to Mexico City to begin a “dialogue” with Secretary of the Interior Ramírez. They were charged with various counts of robbery, pillage, assault and arson. The “dialogue” with Ramírez was then postponed.

PRD congressional leader Juan Guerra questioned the Kafkaesque nature of the events. “How can the secretary of the interior say that he wants to build dialogue and accord if what he does after sending for a leadership commission is simply to put them in jail?”

With the arrest of Sosa and his compañeros, the Calderón government has clearly opted for what has been labeled “the criminalization of the social struggle.”

The arrests in early December, before the launch of the Calderón government’s drug war, also signaled its intent to inaugurate the crusade for law and order—not against the drug gangs, but against militant social movements. The gangs and the dissidents were thus lumped together as criminal disrupters of the social order.

On January 20, the Barcelona-based International Civil Commission for Human Rights Observation (ICCHRO) issued a preliminary report on the situation in Oaxaca. Among its findings was this observation: “Repressive actions have been undertaken indiscriminately against the civilian population—men, women, children and old people—using tear gas, pepper gas, water with chemicals, medium- and high-caliber arms, military vehicles and helicopters.

Federal, state and municipal police corps and elite units have participated in these acts, along with the participation of military units in tasks of logistics and coordination. Groups of nonuniformed individuals with high-caliber arms have engaged in kidnappings, illegal detentions, sieges and shootings, in some cases using police vehicles and sometimes with the participation of public functionaries.”

In a column in the daily paper La Jornada, historian Adolfo Gilly commented that the ICCHRO report confirms that the repression does not consist of isolated acts and “excesses,” but rather represents a deliberate government strategy to paralyze dissident social processes and movements through the use of fear.

Tortillas

In mid-January, Mexican markets experienced a sudden corn shortage, leading to an explosive rise in the price of corn and, therefore, of corn tortillas, the Mexican staple. This caught tortilla consumers (97% of Mexicans) and the government by surprise. In some corners of Mexico, the price quickly spiked from five pesos (about $0.45) per kilo to seven or eight pesos and kept rising.

For Calderón’s neoliberal economic advisers, the tortilla crisis showed that corn markets had to be allowed to operate more freely, and that Mexico must further open itself to free trade by rapidly abolishing all remaining tariffs on imported corn. Indeed, the initial government response was to authorize the tariff-free import of an additional 450,000 tons of white corn from the United States, and another 200,000 from the rest of the world. Mexico currently imports about 8 million tons of various kinds of corn per year. This comes to over one quarter of all the corn that is consumed in the country.

For much of the opposition, by contrast, the crisis demonstrated that the corn markets must be more tightly regulated to guard against unscrupulous manipulation. “It doesn’t add up,” observed a mid-January editorial in El Universal. “If a kilo of corn costs 2.20 pesos and at the end of the productive chain a kilo of tortillas sells for 10 pesos or more, then most of what the consumer is paying goes to intermediaries, who certainly incur costs and have the right to a profit, but not to take such a disproportionate slice of the pie, much less to speculate with the product to cause an artificial shortage.”

One popular response has been to search for the guilty parties, leading to a great deal of conjecture about who is speculating and who is hoarding. Another response has been talk among owners of small tortilla shops of forming a large trade cooperative that would allow them to collectively purchase corn from abroad and avoid the current set of intermediaries.

On January 18 the government announced a compromise between two contrasting “lessons learned” from Mexico’s sudden corn shortage. The compromise, agreed to by the government and the major corn and tortilla distributors—including Maseca, Pan Bimbo and Wal-Mart—reflected the Calderón government’s acknowledgement that the government had to intervene, and its simultaneous expectation that the global market would resolve Mexico’s corn crisis. The agreement set a price cap of 8.50 pesos per kilo of tortillas while allowing for a significant increase of tariff-free imports of various types of corn, including corn used for animal feed. The agreement will remain in effect until April 2007.

Tortillas are the mainstay of the Mexican diet, especially for the poor. José Cacho, vice president of the National Chamber of Industrialized Corn, estimates that an average poor family of four consumes about three kilos of tortillas a day. At the “controlled” price of 8.50 pesos a kilo, the cost of tortillas comes to 25.50 pesos a day. The minimum wage in Mexico (which varies slightly from location to location) averages about 49 pesos a day. The reader can do the math.

The response to the tortilla crisis illuminates the grim future faced by the Mexican family farmer. Max Correa, secretary general of a campesino group called the Central Campesina Cardenista, estimates that “for every five tons bought from foreign producers, one campesino becomes a candidate for migration.” Importing the proposed 450,000 tons of white corn, he told a press conference in January, will likely eliminate more than 100,000 jobs in the rural sector.

One motivation behind the temporary price controls may have been to keep resigned cynicism from spilling over into angry activism. There is a general feeling that the shortage was, somehow, planned by the wealthy and powerful. “For the poor,” remarked a neighbor of mine in a small tortilla shop, “and for the almost-poor like us, the price increases were purposely planned for January.” After the big spending over the holiday season, “people are accustomed to being sin dinero en enero [penniless in January] and hardly notice when prices rise.”

But within a week of the agreement to limit the price of tortillas to 8.50 pesos a kilo, the average price had risen to 9.50, and according to reporters from El Universal, to 20 pesos in the northern state of Durango.

In fact, the price agreement was never meant to be enforceable. High international corn prices, combined with the lack of any integrated, independent production-distribution chains within the country, and the lack of political will to intervene in the markets, have allowed transnational importers like Cargill, Wal-Mart and Pan Bimbo to raise prices in selected outlets while adhering to the agreement in others.

So this past January, people were not simply feeling sin dinero.... Many not only noticed the dramatic increases in corn prices, but significantly reduced their caloric intake. Which brings us back to the political moment.

For now, the stage belongs to Calderón: This government, he is telling everyone concerned, is prepared to impose its will. But after a month of triumphant success, things may be slipping out of control.


Fred Rosen is an independent journalist based in Mexico. He is a NACLA contributing editor.

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